ASIA-PACIFIC MID-SESSION UPDATE

marketsforu

Asian equity markets trade mostly lower tracking the losses seen in US stock futures, while Chinese industrial profits declined by the most on record

Asian equity markets trade mostly lower tracking the losses seen in US stock futures following Friday’s late weakness on Wall Street. Shanghai Comp. (-0.84%) was pressured after Chinese industrial profits (-8.8% vs. Prev. -2.9%) declined by the most on record, while Nikkei 225 (-1.14%) is weighed on by a firmer JPY coupled with weakness in health care and energy sectors as oil prices continued its downward trajectory. The ASX 200 (+0.81%) bucks the trend as gains in large banks and M&A newsflow support the index, after M2 Group (+13.42%) and Vocus (-6.16%) agreed to merge. Elsewhere, markets in Hong Kong, South Korea and Taiwan are closed for public holidays.

In FX markets, JPY and EUR initially strengthened on the back of safe haven bids amid dampened risk appetite in Asia, which saw EUR/USD test the 1.1200 level before it met resistance and pared all its gains, while JPY remained firm with the USD/JPY in proximity to the 120.20 level.

Finally, 10yr JGBs traded mildly lower with price action relatively subdued ahead of fiscal half-yr end and tomorrow’s 2yr auction, while the BoJ entered the market to purchase JPY 1.2trl in government debt as expected.