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StreetAccount Summary - Asian Market Recap: Nikkei +0.38%, Hang Seng (1.85%), Shanghai Composite (0.19%) as of 04:10 ET

Mar 10 ,2025

• Synopsis:

  • Asia equities ended mixed Monday. Hang Seng and mainland China markets fell post poor monthly inflation data. Taiwan, Southeast Asia and Japan's Topix fell while the Nikkei rose. Some modest gains for Australia, South Korea and India. US futures lower, Europe opened with some gains. US dollar flat after a weak opening, yen stronger after wage data, yuan weaker along with other emerging Asia currencies. Treasuries mixed, JGB 10Y yield at fresh 17-year high. Crude futures now flat with Brent back above $70/bl. Precious metals unchanged, industrial metals lower. Cryptocurrencies reversing early weakness, bitcoin now higher.

  • Expanding global tariff conflict again weighed on Asia equities. China' s tariffs on US food exports set to take effect Monday while over the weekend, Beijing announced reciprocal tariffs on Canadian products following moves last October to impose tariffs on several China-made goods. Also weighing on markets were Trump comments over the weekend in which he said the US economy faces a 'transition' period while avoiding a question over a potential recession; also today, several brokers downgraded US FY growth forecasts.

  • In other developments, China inflation showed the sharpest fall in consumer prices in more than a year and producer price deflation continuing. Japan's real wages sank for the first time in three months and the country recorded its first current account deficit in two years. A leading South Korea think tank said the country faces growing downside economic risks as the trade war escalates while Thailand's finance ministry announced details of the second phase in its digital wallet scheme.

  • JGC Holdings (1963.JP) is to enter a capital and business alliance with Takada Corp (1966.JP) via a share acquisition. A South Korea court has nullified decisions made at Korea Zinc's (010130.KS) January investor meeting, including board appointments, and reigniting battle for control of the company. Sun Pharma (524715.IN) is to acquire Checkpoint Therapeutics for $4.10 per share. Fitch ratings cut the outlook in Adani Energy Solutions (539254.IN) to negative on concerns US investigations could reveal weak corporate governance practices. Star Entertainment (SGR.AU) confirmed it had received an offer from Bally's for A$250M in return for convertible notes as an alternative to bridge facility from King Street Capital Management.

• Digest:

  • China announces tariffs on Canada with an eye on US:

    • China Finance Ministry announced new tariffs on Canada of 100% on rapeseed oil, rapeseed meal and pea products, and a 25% on pork and some seafood imports, effective 20-Mar. Cited Canada's tariffs of 100% on Chinese EVs and 25% on steel and aluminum launched in October last year. Reuters noted China levies cover over $2.6B of Canadian products. Exclusion of canola (rapeseed) may keep the door open for trade talks. Bloomberg said almost all of China's rapeseed imports come from Canada. USDA forecasts about 1.75M tons of rapeseed oil imports this season though raw oilseed volumes are larger. Analysts said Beijing's action constitute a warning shot after the Trump administration signaled potential relief on the 25% tariffs on Canada and Mexico if they adopt the same 20% the US imposed on China over fentanyl flows. Tariff escalation continues wit China's duties on US agriculture products due to come into effect Monday in retaliation for the Trump administration's doubling of tariffs on China to 20%. Beijing protests intensifying after foreign minister Wang Yi on Friday vowed "resolute" countermeasures (Reuters). When asked how China would engage with the Trump administration going forward, warned that no country can suppress China on the one hand and develop good relations with China on the other. Article cited thoughts that Wang exercised restraint by not naming Trump specifically in order to keep the door open for talks.

  • China CPI inflation falls back as LNY effects reverse:

    • CPI fell 0.7% y/y in February, softer than expectations of a 0.5% decline, following a one-year high 0.7% in the previous month. Core CPI fell 0.1% after a prior 0.6% rise, marking the first slide since Jan-21. NBS noted volatility in the first two months of the year were caused by shifting timing of LNY holidays. Base effects were a drag of 1.2 ppt and CPI excluding LNY effects rose 0.1%. Official assessment of a mild rebound in prices remained unchanged. Food prices accounted for more than 80% of the headline decline as fresh vegetables, beef fell by double digits. Better weather conditions vs the year-ago period alleviated supply pressures. Auto prices also fell reflecting discounting. PPI fell 2.2% vs consensus 2.1%. Follows 2.3% decline in the prior month and marks the smallest drop since Aug-24. Declines in upstream and downstream prices remained largely steady. Industrial off-season over LNY continued and most construction work remained suspended, depressing demand for building materials. Sharp drop in coal prices still attributed to ample stockpiles in power plants and ports. Lower oil prices reflected international market conditions.

  • Japan wage growth eases but base pay continues to improve:

    • Nominal average wages rose 2.8% y/y in January, slightly below consensus 3.0%. Follows revised 4.4% in the previous month and marks the softest growth in three months. Consequently, real wages fell for the first time in three months, down 1.8% vs consensus 1.6%, following revised 0.3% increase in December. Slower nominal growth and higher deflator both contributed. Main factor was a roll-off in semi-annual bonuses. However, contracted earnings picked up notably as growth in scheduled payments (base wages) reached 3.1%, highest in 32-years, supplemented by notably firmer overtime awards. Total hours worked still fell marginally, though was the smallest in six months, as overtime hours logged the narrowest decline since Jun-23. Attention on shunto results ramping up with Rengo expected to release first wage hike tallies on Friday. Employers have continued last year's practice of faster than usual conclusions to wage talks and many of them fully meeting labor union targets. Rengo survey covering 2,939 unions, showed average wage hike demands of 6.09%, up from 5.85% last year, marking the first figure above 6% in 32 years. Base pay increases averaged 4.51% among 2,454 unions that specified this component. Small firms called for 6.57% in total increases, stronger than 5.97% last year. Demands are so far above Rengo's mission for at least 5% growth in total wages and at least 6% for small firms.

  • Influential South Korea think tank says country facing 'increasing' downside risks:

    • South Korea's economy faces growing downside risks because of prolonged slump in construction sector, weak employment, worsening export conditions amid global trade war, according to state-owned think tank Korea Development Institute (KDI). Institute said improvement in leading indicators seen in 2024's later months weakened while semiconductor export prices declining. Said 'impact of rising external uncertainties gradually spreading' while low export growth rate in other non-tech sectors keeping overall export growth subdued. Added these weak points partially offset by semiconductor volume growth, higher capacity utilization rates. Noted household and business sentiment indicators gradually recovering from December's martial law attempt, but concerns over global trade slowdown growing. Monday, acting President Choi ordered authorities to activity communicate with Washington to resolve any misunderstanding over tariffs after Trump singled out South Korea for applying high tariffs, threated reciprocal measures (Reuters).

  • India markets struggle to regain confidence after $1.3T contraction:

    • Bloomberg discussed reasons behind India's six-month equity market plunge and reasons why investors continue to stay away. Sensex index 17.0%, Nifty 50 17.6% below September's peak with notable underperformance in media, realty and energy sectors wiping out $1.3T from market value, despite rally last week. Post declines, Nifty 50 trades on 18x PE versus 21x at market peak but article noted still higher than emerging Asia peers. Said investors grappling with economic slowdown, profit downgrades, threat of US tariffs; rotation into China equities continues to hurt. Cited analysts who said investors need to see sustained evidence of economic recovery, earnings growth; improvement in urban, rural consumer spending, positive corporate commentary. However, as valuations now less demanding, correction may be in 'final stages' according to one fund manager. Reuters noted last week Nifty 50 and Sensex benchmarks scored best weekly return in three months last week on China's moves to boost stimulus, cut steel output.

  • Notable Gainers:

    • +14.2% 010130.KS (Korea Zinc Co.): management dispute with Young Poong intensifies ahead of the shareholder meeting

    • +8.9% 000670.KS (Young Poong): Young Poong to cancel treasury shares, conduct 10-for-1 stock split

    • +6.8% 308.HK (China Travel International Investment Hong Kong): included in Shenzhen-Hong Kong Stock Connect

    • +6.8% 6135.JP (Makino Milling Machine Co.): multiple companies reportedly circling Makino Milling Machine

    • +4.1% 2344.TT (Winbond Electronics): reports February revenue NT$6.35B, +2.4% y/y

    • +1.3% 3382.JP (Seven & i): Artisan Partners sends letter to the board of Seven & i; intends to vote against Stephen Dacus and other members of the nomination committee at the upcoming AGM

    • +0.4% 3035.TT (Faraday Technology): reports February revenue NT$2.84B, +244.6% y/y

  • Notable Decliners:

    • -15.2% 9959.HK (Linklogis): excluded from Shenzhen-Hong Kong Stock Connect

    • -4.9% 489.HK (Dongfeng Motor Group): reports February vehicle production 94,287 units vs year-ago 108,801 units

    • -0.6% 9104.JP (Mitsui O.S.K. Lines): to acquire membership rights of LBC Tank Terminals Group Holding Netherlands for $1.72B (¥260.5B)

    • -0.5% 960.HK (Longfor Group Holdings): reports February contracted sales attributable CNY3.73B; StreetAccount notes year-ago figure was CNY3.75B

• Data:

  • Economic:

    • China

      • February CPI (0.7%) y/y vs consensus (0.5%) and +0.5% in prior month

        • PPI (2.2%) y/y vs consensus (2.1%) and (2.3%) in prior month

    • Japan

      • January average nominal wages +2.8% y/y vs consensus +3.0% and revised +4.4% in prior month

        • Real wages (1.8%) y/y vs consensus (1.6%) and revised +0.3% in prior month

      • February bank lending +3.1% y/y vs revised +2.9% in prior month

      • January current account balance (¥257.6B) vs consensus (¥230.5B) and ¥1,077.3B in prior month

  • Markets:

    • Nikkei: 141.10 or +0.38% to 37028.27

    • Hang Seng: (447.81) or (1.85%) to 23783.49

    • Shanghai Composite: (6.38) or (0.19%) to 3366.16

    • Shenzhen Composite: 0.30 or +0.01% to 2080.57

    • ASX200: 14.10 or +0.18% to 7962.30

    • KOSPI: 6.91 or +0.27% to 2570.39

    • SENSEX: 184.09 or +0.25% to 74516.67

  • Currencies:

    • $-¥: (0.56) or (0.38%) to 147.4770

    • $-KRW: +6.56 or +0.45% to 1454.2300

    • A$-$: +0.00 or +0.20% to 0.6319

    • $-INR: +0.15 or +0.17% to 87.2529

    • $-CNY: +0.03 or +0.39% to 7.2623