Monday 3rd July 2023: Asia-Pacific Markets Rise Despite Manufacturing Slowdown

Global Markets:

●         Asian Stock Markets : Nikkei up 1.62%, Shanghai Composite up 1.28%, Hang Seng up 1.98%, ASX up 0.58%

●        Commodities : Gold at $1922.75 (-0.34%), Silver at $23.035 (+0.04%), Brent Oil at $75.12 (-0.33%), WTI Oil at $70.39 (-0.38%)

●        Rates : US 10-year yield at 3.829, UK 10-year yield at 4.437, Germany 10-year yield at 2.383

News & Data:

●         (CNY) Caixin Manufacturing PMI 50.5% vs 50.0% expected

●        (CAD) GDP m/m 0.0% vs 0.2% expected

●        (USD) Core PCE price Index m/m 0.3% vs 0.3% expected

●        (USD) Revised UoM Consumer Sentiment 64.4% vs 63.9% expected

Markets Update:

 Asia-Pacific markets experienced a positive trend as investors absorbed manufacturing activity reports signaling a slowdown in output across the region. China’s Caixin manufacturing purchasing managers index (PMI) for June exceeded expectations, coming in at 50.5, slightly higher than the projected 50.2 by a Reuters poll. However, China’s official government PMI recorded a third consecutive month of contraction.

Mainland China’s markets showed gains, with the Shanghai Composite rising by 1.28% and the Shenzhen Component increasing by 1.98%. Hong Kong’s Hang Seng index also climbed 1.29%, while the Hang Seng Tech index saw a robust increase of over 2%. Leading the gains in the region, Japan’s Nikkei 225 surged by 1.62%, accompanied by a 1.62% rise in the Topix index. South Korea’s Kospi recorded a 1.39% increase, and the Kosdaq rose by 1.81%. Private surveys for both South Korea and Japan also indicated a slowdown in factory activity.

In Australia, the S&P/ASX 200 displayed a modest gain of 0.58%. Investors eagerly awaited the Reserve Bank of Australia’s rate decision, scheduled for Tuesday. Economists polled by Reuters anticipated a 25-basis-point increase, bringing the cash rate to 1.75%. This decision would shape the country’s economic landscape in the coming months.

In commodities, the prices of gold, silver, and oil witnessed mixed movements. Gold prices experienced a slight decline of 0.34%, reaching $1922.75. On the other hand, silver prices saw a marginal increase of 0.04%, reaching $23.035. In the oil market, Brent Oil prices declined by 0.33%, settling at $75.12, while WTI Oil prices fell by 0.38% to reach $70.39.

Upcoming Events:

●        7:15 AM           GMT  –          EUR    Spanish Manufacturing PMI

●        2:00 PM           GMT  –          USD   ISM Manufacturing PMI

●        2:00 PM           GMT  –          USD   ISM Manufacturing Prices