Chinese Equities Bounce, E-Minis Marginally Lower

A heavy start for Chinese equities (in the wake of Chinese Premier Li’s Wednesday warning re: the health of the Chinese economy) weighed on wider risk appetite in early Asia trade, with e-minis and the likes of the Nikkei 225 unwinding their opening bid.

• The unveiling of the latest round of fiscal and credit support measures in China, coupled with the partial re-opening of schools in Shanghai from early June & an uptick in throughput at the Shanghai Port (to ~95% of capacity) then facilitated a rebound for Chinese equities, with the CSI 300 now ~0.6% firmer on the day, although wider equity indices were a little more reticent to go bid. The Nikkei 225 is little changed on the day.
• E-Minis sit 0.2-0.5% below settlement after pulling lower alongside the early move in Chinese equities. Some suggested the underperformance in the NASDAQ contract could be attributed to tech giant Apple outlining a round of wage hikes given the current inflationary burden felt by households.
• Note that some pointed to the minutes covering the latest U.S. Federal reserve meeting as a source of support for e-minis in late NY/early Asia trade, with suggestions that the Fed may pause for breath around the end of the year after the current, expeditious round of tightening ends (based on a reference in the text of the minutes).