In today’s Asian market update, a mixed sentiment prevails as equities react to various global events, with a focus on upcoming EU CPI and US jobs data later in the day. While markets remain relatively quiet, several key developments are influencing trends across the region.
Treasury yields experienced an overnight increase of 8-12bps in the US and EU, but in Japan, China, and Hong Kong, yields slightly declined. The Yen/USD fell back to mid-December levels, hovering around ~145.00.
The Nikkei 225 led the Asian market after an earthquake, gaining momentum throughout the day. In contrast, the Hang Seng lost 1% in early trading, marking a sharp decline this week and approaching all-time lows from September 2022. However, prices recovered most of their losses as the day progressed.
Japan reported weaker-than-expected Services & Composite PMI, but both indicators remained in expansion for the 15th consecutive month. On a positive note, Singapore recorded strongly positive Retail Sales in November, surpassing negative expectations.
The Australia Debt Agency (AOFM) announced upcoming issuance plans for the remainder of 2023-24.
Despite a ‘final warning’ from the US and its allies, Houthi rebels launched a sea drone attack in the Red Sea just hours after the warning.
China’s People’s Bank of China (PBOC) reported a total net drain of CNY2.423 trillion this week, marking a record high. This comes as a counterbalance to year-end injections, and the PBOC continues to allow 14-day reverse repos to mature.
In the US, equity futures showed a slight uptick during Asian trading, indicating a cautious optimism in the market. Investors are closely watching global developments and economic indicators for potential impacts on market dynamics.
