China Weakness Offsets Positive US Futures

Ongoing China/Hong Kong equity market weakness has cast a shadow over regional bourses today. There are still some pockets of strength but major indices are down. US equity futures have weakened a touch in response to the China moves, but remain in positive territory as US markets re-open from the long weekend later. Eminis were last around 4223/24, still +0.25%. Nasdaq futures were slightly better, last holding +0.40% higher.

• As we noted earlier on-going China related equity market weakness remains a theme. The HSI is off by 1% at the break, while the HS China Enterprise index is down nearly 1%, more than 20% off late Jan highs and hence in bear market territory.
• On-going US/China tensions particularly in the tech space, coupled with economic slowdown fears continue to weigh on broader China sentiment. The CSI 300 is down 0.80% at the break, sitting at fresh YTD lows near 3800. Sentiment may stabilize somewhat after the break.
• The Kospi is tracking higher, last near 2575, +0.65% as markets return from yesterday's holiday, which has seen some catch up. The Taiex is down slightly, -0.25%, along with the Topic, -0.35%, with both indices giving back some of the recent gains.
• In SEA sentiment is mixed, but gains and losses are within the +/-0.50% range.