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ASIA STOCKS: China Aided By Tariff Headlines/Month End, Rest of Asia Weaker. 

ASIA STOCKS
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  • As month end approaches for markets, most of Asia is experiencing a weak finish with China the exception where all major indices are up on a combination of month end rebalancing, news that Beijing may be less willing to take a hard line on US trade tensions than first thought and expectations for tomorrow’s PMI release.
  • Notably headlines crossed earlier from BBG which quoted the MoF. They stated tariff waivers on some goods would be extended to Feb 28 next year (see this link).
  • Indonesia’s Jakarta composite is finishing the month with a whimper, down -1.10% to finish around 6% lower in a month where the Central Bank were on hold, 10-year government bond yields were significantly higher and the currency -0.55% weaker.
  • Malaysia’s FTSE Bursa KLCI index is slowly moving into month end, down -0.10% for the day and is on track to finish -0.35% down in a month where economic data was generally good, bond yields lower and the currency weaker by -1.4%.
  • South Korea’s KOSPI is the poster child for the equity market weakness today following the BOK’s surprise rate cut yesterday.  The reality of the weakening growth dynamic in the country could not be offset by this morning’s stronger than expected y/y industrial production as the MoM figure was flat.  The KOSPI is on track to finish -3.5% lower, the worst performance of its regional peers.
  • The daily volatility for China equities continues to be a key theme into month end, despite efforts made by authorities.  The CSI 300 is leading the way today up +2% and on track to finish the month up +0.85%; the Hang Seng is telling a different story whilst +1% today, is on track to finish the month down -2.8%; Shanghai is up +1.5% today and on track to finish +1.4% for the month and Shenzhen is up +2.10%, looking to finish +1.00 for November.   
  • In India, the NIFTY 50 has opened this morning very weak and in early trade is down -1.50%. Despite India’s growth profile remaining robust, recent days have seen some significant outflows across equities and bonds.  The NIFTY 50 is on track to post a -1.15% decline. 
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  • As month end approaches for markets, most of Asia is experiencing a weak finish with China the exception where all major indices are up on a combination of month end rebalancing, news that Beijing may be less willing to take a hard line on US trade tensions than first thought and expectations for tomorrow’s PMI release.
  • Notably headlines crossed earlier from BBG which quoted the MoF. They stated tariff waivers on some goods would be extended to Feb 28 next year (see this link).
  • Indonesia’s Jakarta composite is finishing the month with a whimper, down -1.10% to finish around 6% lower in a month where the Central Bank were on hold, 10-year government bond yields were significantly higher and the currency -0.55% weaker.
  • Malaysia’s FTSE Bursa KLCI index is slowly moving into month end, down -0.10% for the day and is on track to finish -0.35% down in a month where economic data was generally good, bond yields lower and the currency weaker by -1.4%.
  • South Korea’s KOSPI is the poster child for the equity market weakness today following the BOK’s surprise rate cut yesterday.  The reality of the weakening growth dynamic in the country could not be offset by this morning’s stronger than expected y/y industrial production as the MoM figure was flat.  The KOSPI is on track to finish -3.5% lower, the worst performance of its regional peers.
  • The daily volatility for China equities continues to be a key theme into month end, despite efforts made by authorities.  The CSI 300 is leading the way today up +2% and on track to finish the month up +0.85%; the Hang Seng is telling a different story whilst +1% today, is on track to finish the month down -2.8%; Shanghai is up +1.5% today and on track to finish +1.4% for the month and Shenzhen is up +2.10%, looking to finish +1.00 for November.   
  • In India, the NIFTY 50 has opened this morning very weak and in early trade is down -1.50%. Despite India’s growth profile remaining robust, recent days have seen some significant outflows across equities and bonds.  The NIFTY 50 is on track to post a -1.15% decline.