Gov’t bond FUTS extend drop after US jobs data

Asia market update: Quiet equity session seen amid multiple holidays in Asia; European assets decline; EU elections in focus; Gov’t bond FUTS extend drop after US jobs data.

General trend

– Japanese equities supported by recent yen weakness; Banks supported by higher bond yields.

– Weak bounce for Silver FUTS?

– Busy macro week ahead.

– Reminder: Apple said to unveil ‘Apple Intelligence,’ its plan to push into AI and deeply integrate AI features into its major apps and devices at WWDC event which starts on Mon, June 10th.

– Nvidia’s 1-to-10 stock split becomes effective on Mon, June 10th (US time).

Looking ahead (Asian time zone)

Tue Jun 11th AU NAB May Biz Confidence, Apple WWDC re AI (all week), (Tue eve UK Apr unemployment).

Wed Jun 12th CN May CPI/PPI, (Wed eve UK Apr GDP, DE May CPI, Wed night US May CPI, US Fed rate decision).

Thu Jun 13th AU Westpac Consumer Conf, AU Employment, CN New Yuan Loans, (Thu night US May PPI).

Fri Jun 14th NZ May PMI, JP BOJ rate decision, (Fri night US Michigan June Consumer Sentiment).

Weekend: CN May FDI YTD.

Holidays in Asia this week

Monday June 10th Australia, China, Hong Kong, Taiwan.

Wednesday June 12th Philippines.

Headlines/economic data

Australia/New Zealand

– ASX 200 closed for holiday.

– Follow up on Australian bird flu: WHO was notified of laboratory-confirmed case of human infection with avian influenza (H5N1) virus – press.

-New Zealand to end oil and gas exploration ban H2, 2024.

-New Zealand PM: China Premier Li Qiang to visit New Zealand later this week.

China/Hong Kong

– Shanghai Composite closed for holiday.

– Hang Seng closed for holiday.

– China May Foreign reserves: $3.232T V $3.221TE; Essentially halts gold buying for reservesfor the 1st time in 19 months.

– China reportedly asks banks to accelerate lending to developers – press.

– China Premier Li: Will continue to study and prepare new measures for reducing home inventory and stabilizing the market – State TV.

– Reportedly US closer to tariffs on Asia solar panels with agency vote – press.

– Chinese companies reportedly plan to ask authorities to open an anti-subsidy investigation into imports of some dairy products from the EU – Global Times.

– CATL [300750.CN]: Co says US allegations of Co supply chains using forced labor “groundless and completely false” – statement.

-Three US lawmakers call for additional scrutiny of the ‘NewsBreak’ news app, cite China origins – Press.

Japan

– Nikkei 225 opens flat at 38,689.

-BOJ may drop clues on bond tapering plan next week [inline] – financial press.

– Japan Q1 final GDP Q/Q: -0.5% V -0.5%E; annualized GDP Q/Q: -1.8% V -2.0%E; Business Spending Q/Q: -0.4% v -0.7%e.

– Japan Apr Current Account: ¥2.1T v ¥1.738Te.

– Japan May Bank Lending Y/Y: 3.0% v 3.1% prior.

– Japan May Eco Watchers Current Survey: 45.7 v 48.6e; Outlook Survey: 46.3 v 49.0e.

– Japan will extend gasoline subsidies beyond the summer – Kyodo.

-Japan Government Draft Economic Blueprint: Reiterates to work closely with the BOJ – financial press.

-Hitachi [6501.JP]: Hitachi Energy to invest additional $4.5B by 2027 to accelerate the clean energy transition.

Korea

-Kospi opens -0.9%.

Other Asia

-Taiwan Semi: Reports May (NT$) Rev 229.6B, +30.1% y/y (v 236.0B m/m); YTD Rev 1.06T +27.2% y/y v +26.2% prior [Jun 7th].

North America

– (US) May change in Nonfarm Payrolls: +272K V +180KE (above all estimates).

– (US) May average hourly earnings M/M: 0.4% V 0.3%E; Y/Y: 4.1% V 3.9%E [Jun 7th].

– (US) May unemployment rate: 4.0% V 3.9%E (highest since Jan 2022).

– Southwest Airlines [LUV]: Elliott said to take big stake in the co. worth ~$2.0B – WSJ.

– CRWD, GDDY, and KKR to be added to S&P500 Index, replacing RHI, ILMN and CMA; Several changes also made to S&P400 and 600 indexes.

Europe

– FTSE FUTS decline by >0.5%; DAX FUTS -0.2%; Stoxx 50 FUTs -0.5%; France Oat BOND FUTS -0.2%.

–   President Macron calls snap election after his party was defeated by the far right in the European Parliament elections – Press.

– Ireland May Construction PMI: 49.8 v 53.2 prior [first contraction since Feb].

– Israeli war cabinet minister Benny Gantz said to make statement later today, June 9th; Potentially related to his resignation from the govt – press.

Levels as of 01:20 ET

– Nikkei 225, +1%, ASX 200 closed , Hang Seng closed; Shanghai Composite closed ; Kospi -0.2%.

– Equity S&P500 Futures: flat; Nasdaq100 flat, Dax -0.1%; FTSE100 -0.2%.

– EUR 1.0801-1.0748 ; JPY 157.18-156.69 ; AUD 0.6592-0.6576 ;NZD 0.6109-0.6099.

– Gold -0.6% at $2,312/oz; Crude Oil +0.3% at $75.73/brl; Copper +0.6% at $4.4718/lb.