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Japan Shares Outperform, Volatile Start For HK/China Shares

EQUITIES

Regional equities are mixed as the US NFP comes into view. Japan markets are among the best performers, while Hong Kong and China markets have been volatile through the first part of trade. US equity futures tried to go higher in the first part of trade, but there was no follow through. Eminis last tracked at 4734, +0.10%, while Nasdaq futures are around 0.06% higher.

  • Japan indices are seeing broad based gains, the Topix +0.80% and the Nikkei 225 up by nearly the same. The yen trend remains weaker, while BBG noted sell-side analysts are reducing the likelihood of an end to negative rates.
  • Hong Kong and China bourses opened lower before recovering sharply. At the break, the HSI is off -0.14% (we were down by 1% at the lows), while the CSI 300 is marginally firmer (+0.17%).
  • BBG noted this morning the attractive valuation of local equities relative to local bond yields, so this may have helped at the margin. Data related stocks have risen in China after the government encouraged investment and IPOs in the sector (BBG).
  • South Korea's Kospi is weaker but up from session lows, the index last -0.30%. Headlines crossed earlier that the South Korean military ordered the evacuation of the island of Yeonpyeong, which is near the broader with North Korea (RTRS).
  • In SEA, outside of weaker Thailand stocks (-0.35%), markets are firmer.

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