Asian Equities Mixed, Tech Outperforms, Asia FX Surges

Asian markets are trading mixed today, with Japan's stocks falling due to a stronger yen, which pressured technology firms, leading to a decline in the Nikkei 225 and Topix Index. In contrast, Hong Kong's market saw gains, driven by strong earnings from tech giants like Alibaba and JD.com. The broader sentiment in the region is cautious, with investors closely monitoring upcoming comments from Federal Reserve Chair Jerome Powell at the Jackson Hole symposium, which could influence global monetary policy expectations.

• Japanese stocks are slightly lower today, after strong returns since the August 5 sell-off. In June, Japanese machinery orders fell by 6%, but rose 7.4% in the April-June quarter, with private-sector orders slightly up by 2.1% in June but marginally down by 0.1% for the quarter, while a 3.8% decline is forecast for total orders in the July-September quarter. The yen has rallied about 1% which has heavily weigh on tech stocks with the Nikkei falling 0.90% while the TOPIX is 0.65% lower.
• Hong Kong and Chinese markets are trading higher today, led by strong gains in technology stocks following better-than-expected earnings reports. The Hang Seng China Enterprises Index rose as much as 1.8%, with major contributors like Alibaba, JD.com, and Meituan posting significant advances. Investor sentiment is buoyed by speculation around potential fiscal stimulus from Beijing and easing measures, which could support economic growth. The rally is also driven by expectations of a softer U.S. economic landing and possible Fed rate cuts in 2024.
• South Korean equities are a touch lower today, the market has seen gradual recovery since the sharp 8.77% drop on August 5, driven by easing recession fears in the U.S. Technology stocks like Samsung Electronics and SK hynix weighed on the market, while automotive and financial stocks, such as Hyundai Motors and KB Financial have seen gains. The KOSPI is 0.60% lower, while the KOSDAQ is down 0.65%.
• Taiwan equities are higher this morning, following strong inflows into the region to end last week. TSMC is unchanged this morning, while the Taiex is up 0.20%.
• Australian equities are unchanged today with losses in Consumer Staples & Discretionary offset gains in Utilities and Healthcare stocks. New Zealand equities are the worst performing in the region today with the NZX50 down 0.80% after A2 Milk dropped 18% on the back soft guidance.
• Asia EM is mostly higher today with Asian FX rallying, Indonesian's JCI is up 0.10%, India's Nifty 50 is 0.15% higher, Philippines PSEi is 0.90% higher, Malaysia's KLCI is 1.10% higher while Singapore's Strait Times is is unchanged,