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Reports Asia

Asian stock market, economy and companies update (May 26, 2014)

May 26, 2014, Monday, 05:40 GMT | 00:40 EST | 09:10 IST | 11:40 SGT
Contributed by Trade The News


***Highlights/Observations/Insights***
With the US market ending last week on a strong note and a decisive result in the Ukrainian presidential elections, the Asian markets remained in positive territory. Asian equities were higher taking cues from the US housing data, raising investor confidence in the US. The USD traded in the upper ¥101 range early in the session, little changed from levels ended last week. After the BOJ released its minutes from April 30 meeting, the yen weakened slightly against the dollar around the 102 level, while the AUD/USD was little changed. The minutes indicated continued minority dissent regarding views on growth and inflation with three members wanted to revise outlooks to growth and inflation.

Investors expressed optimism that geopolitical tensions would ease after a couple of exit polls in Ukraine showed presidential candidate Poroshenko gained over 55 per cent of the vote. He later declared victory, stating that the election was over after the first round. The candidate is seeking stronger ties with the EU and improved relations with Russia while committed to peace in the region. Former Prime Minister Tymoshenko who came in at second with less than 15% of the votes said she would concede avoiding a subsequent runoff round.

***Fixed Income/Commodities/Currencies***
- (KR) South Korea sells KRW900B in 20-yr govt bonds; avg yield: 3.570%; bid-to-cover: 4.41x
- (CN) PBoC gauges demand for 7-day and 14-day reverse repos, 14-day and 28-day repos as well as 91-day bill sales
- USD/CNY: (CN) PBoC sets yuan mid-point at 6.1699 v 6.1681 prior (weakest setting since Sept 6th; 4th consecutive weaker setting)
- (JP) BOJ offers to buy 400B in 5-10yr JGB and ¥20B in inflation-linked debt

***Speakers/Political/In the Papers***
- (CN) Shanghai new home sales -1% w/w; Avg new home prices +12.94% w/w - Uwin
- (CN) Moody's: Sees China real GDP growth to edge into 6.5-7.5% range in 2014 and 2015
- (CN) SOHO China Chairman Pan Shiyi: Not confident with China's housing market; China's housing market is Titanic, will soon 'hit the iceberg' - Chinese press
- (CN) China regulator has asked investment banks to submit additional IPO materials - Chinese press
- (CN) China Securities Regulatory Commission (CSRC) announces additional 8 applicants for IPO; Total pre-IPO disclosure filings at 380 since Apr 19th - Chinese press
- (CN) China Ministry of Fin researcher Jia Kang: China should accelerate legislation of property tax, to help squeeze the bubble in the housing market - Chinese press
- (CN) China to allow banks to issue certificate of deposit to ease domestic interest rates regulations - financial press
- (CN) China Pres Xi Jinping visited SAIC Motor Corp; Supports development new-energy vehicles in China - Chinese press
- (CN) Shanghai Apr FDI rose 8.3% y/y to $1.74B vs 14.2% y/y rise in Mar - Shanghai Daily
- (CN) China says it scrambled fighter jets after Japanese military aircraft entered China's unilaterally designated air defense identification zone on Saturday
- (IN) India PM-Designate Modi: To have smaller cabinet - financial press
- (TH) Thailand former PM Yingluck said to have been released from military detention, placed under house arrest - financial press
- (JP) Survey finds Japan Abe Cabinet support for May rises by 1% to 49% - Asahi News
- (JP) Survey finds Japan Abe cabinet support for May declines 3% to 53% - Nikkei News
- (JP) BOJ Gov Kuroda: Confident about achieving BOJ's 2% inflation target next FY - Nikkei interview
- (EU) European Elections: EU-wide turnout in European Elections at 43%, similar to 2009 levels - financial press
- (UR) Initial exit polls indicate Ukraine candidate Poroshenko wins first round of presidential elections - financial press
- (UR) French Govt: In a phone conversation between the leaders of France, Germany, and Russia on Saturday, Pres Putin reiterated he would respect the outcome of the Ukraine elections on Sunday

***Equities***
US markets:
- GM: NHTSA reportedly says it's likely that there are more than the 13 deaths that GM has acknowledged that are attributable to the ignition switch defect - press
- AZN: Pfizer said to be near abandoning bid for AstraZeneca - financial press
- AAPL: Apple said to have requested ban on several Samsung devices following patent lawsuit - financial press

Notable movers by sector:
- Consumer Discretionary: BYD Corp 002594.CN +7.9% 1211.HK -3.0% (private placement plan); Beijing Utour International Travel Service 002707.CN +4.4%, China CYTS Tours Holding 600138.CN +2.9% (Tuniu traded up by over 35% in US on Friday)
- Energy: Sundance Energy Australia SEA.AU +3.0% (acquisition)
- Industrials: Qingdao Haier 600690.CN +0.4%, Midea Group 000333.CN +1.1% (on track to post strong earnings)
- Technology: Sony Corp 6758.JP +3.7%, Shanghai Oriental Pearl 600832.CN -0.6% (JV agreements)
- Healthcare: Sino Pharmaceutical 1177.HK +5.9% (Q1 results)
- Utilities: TEPCO 9501.JP +1.6% (announces LNG delivery)


***Economic Data***
- (NZ) NEW ZEALAND APR TRADE BALANCE (NZ$): 534M V 634ME
- (HU) HUNGARY MAY GKI BUSINESS CONFIDENCE: 4.8 V 7.7 PRIOR, CONSUMER CONFIDENCE: -18.4 V -15.3 PRIOR, ECONOMIC SENTIMENT: -1.2 V +1.7 PRIOR
- (JP) BANK OF JAPAN (BOJ) RELEASES MINUTES FROM APR 30 MEETING

Market Snapshot (as of 03:30 GMT):
- Nikkei225 +0.7%, S&P/ASX +0.2%, Kospi -0.2%, Shanghai Composite +0.2%, Hang Seng +0.3%, Jun S&P500 +0.1% at 1,898, Jun gold -0.1% at $1,294, Jun crude oil +0.3% at $104.08/brl

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