Morning Report APAC: Asia muted following China's 'Black Monday'

• Asian markets were lower in early trade after yesterday's Chinese mini-crash
  
• Eurozone CPI numbers were in line with expectations 
  
• The Kiwi dollar traded lower after weaker-than-expected New Zealand CPI data
  
• Mining shares were boosted by the strong economic data from China

By Saxo APAC Sales Trading

Economic data of the day (Singapore Time)

Speeches

0900 – AU – Reserve Bank of Australia July rate meeting minutes

2130 – UK – Bank of England Governor Mark Carney introduces new £10 note in Winchester

Overnight news

US: Very quiet US session as summer markets are in full swing. US Treasury yields traded softer on the continued theme from weaker inflation data last week.

Netflix reported earnings after the close with significant beats in subscription numbers both domestically and internationally. 

Europe:  Eurozone CPI numbers were in line with expectations at 1.1% core and 1.3% headline. 

Very little new news as summer markets dominate.

Foreign exchange

USD: A mixed day of performance; Scandinavian currencies perform while other commodity currencies give back some gains.

NZD: Deputy RBNZ governor Geoff Bascand noted that a weaker NZD would balance growth. CPI data this morning came in weaker than expected, which saw NZD trade 40 pips lower instantly.

CAD: After a very good run, over 8% from earlier-year lows, CAD gave up some ground overnight on profit taking.

Emerging Markets: A mixed bag, with the ZAR continuing its recently good run. RUB fell again as oil traded lower. 

Foreign exchange movement

Rates

Commodities  

Equities

US stocks were generally muted on Monday as investors looked towards quarterly results of heavyweights to be released this week, including Bank of America Corp, Goldman Sachs Group, Microsoft and General Electric.

Blackrock dropped 3.08%, having posted adjusted quarterly profit of $5.24/share, 14cps below Bloomberg consensus estimates, and revenue was also below forecasts. CEO Larry Fink said significant cash remains on the sidelines but that investors are increasingly putting that money back to work.

Recent IPO Blue Apron Holdings tumbled more than 10%, hitting an all-time low, after Amazon.com Inc (up 0.17%) filed a trademark for a meal-kit service, suggesting the company could face competition since Amazon’s proposed acquisition of Whole Foods Market Inc (down 0.50%).

European stocks broadly gained, boosted by mining shares after China’s quarterly growth figures topped expectations. Rio Tinto rose 0.71%, BHP Billiton added 1.34%, South32 rallied 4.04% , Anglo American rose 1.21% , Glencore was up 1.49% .

Carillion PLC shares surged 19% as the infrastructure services company’s joint venture partnership won two UK government contracts worth £1.4 bn ($1.80 bn) to help build Britain’s planned High Speed 2 railway. This came after losing 70% of their value due to a profit warning and its chief executive, Richard Howson, stepping down.

ITV PLC shares climbed 3.2% after the UK broadcaster said the boss of EasyJet PLC (up 0.3%) Carolyn McCall will become its new chief executive on January 8. EasyJet said it’s already started looking for McCall’s successor.

Asia Pacific Stocks

Hong Kong 

Analyst Ratings: 

•  Best Pacific (2111 HK): Cut to Hold at Hua Tai Securities 
  
• Brilliance China (1114 HK): Raised to Outperform at Credit Suisse, PT HK$20 
  
•  Champion REIT (2778 HK): Raised to Add at CIMB, PT HK$6.70 
  
•  China Mer Port (144 HK): Cut to Hold at Morningstar 
  
•  Chow Sang Sang (116 HK): Cut to Hold at Guangfa Securities, PT HK$18 
  
•  Sinopec (386 HK): H Shares New Buy at DBS Vickers, PT HK$7.90 
  
•  Tsingtao Brewery (168 HK): H Shares Raised to Hold at Morningstar 
  
•  Xinyu Iron & Steel (600782 CH): Raised to Buy at Chang Jiang 
  

Preview: 

•  Belle International (1880 HK): Says Independent Shareholders Approve Privatization Offer 
  
•  China Railway (390 HK): 1H Value of New Contracts Rises 34.5% y/y 
  
•  China Shenhua Energy (1088 HK): Says June Coal Sales Rose 0.8% y/y 
  
•  China Vanke (000002 CH): A-Shares to Resume Trading After GLP Buyout Deal 
  
•  Citic Resources (1205 HK): Sees ‘Significant’ Rise in 1H Net vs Year Ago 
  
•  Country Garden (2007 HK): Plans to Invest 926.3M Yuan in CIMC Unit 
  
•  Glencore (805 HK): Is Said To Spin Off Mining Royalties To New Co: FT 
  
•  Grand Baoxin Auto (1293 HK): Expects 1H Net to Rise at Least 500% on Year 
  
•  Great Wall Motor (2333 HK): Markets $350m-Equivalent 3Y Loan 
  
•  Huaneng Power (902 HK): 1H Power Output Rises 27.8% y/y to 186.7bn kwh 
  
•  Kunwu Jiuding Investment (600053 CH): Denies Report on China Reform’s Investment Plan 
  
•  Leshi (300104 CH): Wanda May Cooperate in Movie Business, Major Backer Says 
  
•  Leshi (300104 CH): Shareholders Approve Sunac’s Sun to Be Director 
  
•  Macau Rev. May Be Hurt as Players Try to Avoid Scrutiny: Goldman 
  
•  Sa Sa Int’l (178 HK): 3-Month HK, Macau Same-Store Sales Fall 2.5% y/y 
  
•  Sunny Optical (2382 HK): Expects 6-Month Net Income to Jump Over 120% y/y 
  
•  Zoomlion (000157 CH): JPM Is Underweight Zoomlion Bonds Despite Positive Profit Alert 
  

Japan

Analyst Ratings: 

•  Alps Electric (677): Cut to neutral from outperform at Credit Suisse 
  
• Dai-ichi Seiko (6640): Rated new buy at MUFJ-MS 
  
•  Ichigo Office Reit (8975): Raised to buy from neutral at Mizuho 
  
•  Sekisui House Reit (3309): Cut to neutral from buy at Mizuho 
  
•  Taiyo Yuden (6976): Raised to outperform from neutral at Credit Suisse 
  

Preview:

•  Doutor Nichires Holdings (3087): 1Q operating profit up 10% to 3.2bn yen 
  
•  Gunosy (6047): Forecasts operating profit up 45% to 2.21bn yen for current fiscal year; forms business tie up with KDDI for smartphone media service 
  
•  Hioki (6866): 1H operating profit up 13% to 1.2bn yen, beats company forecast by 13% 
  
•  Hito (3654): 9-month group operating profit fell 8% to 2.1bn yen 
  
•  Japan Food & Liquor (2538): To sell 2bn yen of shares in private sale; to sell about 42.5m shares for 47 yen each 
  
•  JINS (3046): 9-month group operating profit up 80% to 3.9bn yen 
  
•  Japan Tobacco (2914): June domestic cigarette sales volume down 10.1% y/y 
  
•  Like (2462): Forecasts operating profit up 17% to 1.78bn yen for current fiscal year 
  
•  NOK (7240): Lifts 1H operating profit forecast 29% to 20bn yen; boosts FY target 11% 
  
•  Park24 (4666): To buy 51% of UK’s National Car Parks for GBP158.95m 
  
•  Pasona Group (2168): Forecasts operating profit up 26% to 5.65bn yen for current fiscal year 
  
•  Retailers: June Japan department store sales; Isetan Mitsukoshi (3099) down 1.3% y/y; J Front Retailing (3086) up 4.8% y/y; Takashimaya (8233) 13 store sales up 4.9% y/y 
  
•  SoftBank (9984): Uber shareholders and board said to have have discussed selling some shares to co. and other potential investors 
  
•  Sojitz (2768): Forms 200bn yen Turkish hospital JV with local company, people familiar with matter say 
  
•  Suminoe Textile (3501): Forecasts operating profit to more than double to 2.8bn yen for current fiscal year 
  

Australia

Analyst Ratings: 

•  GPT Group (GPT AU): GPT Group Raised to Buy at UBS, PT A$5.30 
  
•  JB Hi-Fi (JBH AU): JB Hi-Fi Cut to Neutral at UBS, PT A$25.80 
  
•  Santos (STO AU): Santos Raised to Overweight at JPMorgan, PT A$3.80 
  
•  Scentre Group (SCG AU): Scentre Group Raised to Buy at UBS, PT A$4.42 
  
•  Sky Network TV (SKT NZ): Sky Network TV Cut to Hold at Morningstar 
  
•  Vicinity (VCX AU): Vicinity Raised to Buy at UBS, PT A$2.92 
  
•  Woodside (WPL AU): Woodside Cut to Neutral at JPMorgan, PT A$30 
  

Preview:

•  Rio Tinto (RIO AU) 2Q production 
  
•  Saracen Mineral (SAR AU) 4Q production 
  
•  Oil Search (OSH AU) 2Q production 
  
•  CIMIC Group (CIM AU) 1H earnings 
  
•  Z Energy (ZEL NZ) reports higher volumes in 1Q on prior year 
  
•  Kingsgate (KCN AU) files request to start gold and silver mine in Chile
  

New Zealand's CPI came in weaker than expected, and NZD traded 40 pips lower instantly. Photo: Shutterstock

 

– Edited by Susan McDonald

This report was compiled by the Saxo APAC Sales trading team in Singapore – the home of social trading. Follow the team on @SaxoStrats or post your comment below to engage with Saxo Bank's social trading platform. Follow us on @SaxoStrats on Twitter

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