Morning Bid: Asia’s economic spotlight shines on Chinese and Japanese giants

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A man wearing a protective mask, amid the coronavirus disease (COVID-19) outbreak, walks past an electronic board displaying stock market data outside a brokerage in Tokyo, Japan, on 25 February 2022. REUTERS/Kim Kyung-Hoon/File Photo

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Aug 15 (Reuters) – A preview of the day ahead in Asian markets from Jamie McGeever

Economic data from Asia’s two economic powerhouses kicks off the global trading day on Monday – a batch of July indicators from failed China and Japan’s second-quarter GDP report.

We get a first look at how China’s COVID-hit economy started the third quarter, with July readings of industrial production, retail sales, house prices and urban investment. . Economists generally look for a recovery, albeit a gradual one.

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Chinese stocks snapped a five-week losing streak on Friday to end the week up 0.8% (.CSI300), buoyed by the feel-good factor on Wall Street and an easing in Sino-US tensions about Taiwan.

Also on Friday, however, five U.S.-listed Chinese state-owned companies whose audits are being reviewed by the U.S. securities regulator said they would voluntarily delist from the New York Stock Exchange. Read more

Meanwhile, the Japanese economy is expected to have rebounded strongly in the second quarter after contracting in the first, with economists forecasting quarterly growth of 0.6% and an annualized expansion of 2.5%.

The Japanese yen rose about 1% against the dollar last week – its third weekly rise in four. Could it convincingly break through the $130 per dollar barrier this week?

The tone across Asia on Monday will also be set by growing hopes that US inflation has peaked. This could further fuel the rally in risk assets, steepen the US yield curve and weigh on the dollar.

Later Monday, the US Treasury releases its “TIC” data for June, which measures the inflows and outflows of US sovereign debt. In light of recent political tensions, demand from China will be closely watched.

Key developments that should further guide markets on Monday:

Japan GDP estimate in Q2

Data on industrial production, retail sales, housing prices and urban investment in China (July)

New York Fed Manufacturing Index (August)

The Fed’s Christopher Waller talks about banking and finance

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Reporting by Jamie McGeever in Orlando, Florida. Editing by Matthew Lewis and Lisa Shumaker

Our standards: The Thomson Reuters Trust Principles.

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