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StreetAccount Summary - Asian Market Recap: Nikkei +0.57%, Hang Seng +0.51%, Shanghai Composite (0.23%) as of 04:10 ET

Apr 30 ,2025

• Synopsis:

  • Asian equities ended mostly higher Wednesday in a quiet session. There were small gains for Japan, Australia and Singapore; Taiwan and India traded flat. The Hang Seng pared early losses to end higher, Shanghai was lower. Southeast Asia all higher. US futures turning mixed from being down earlier, Europe open with more small gains. US dollar flat, yen weakening. Treasuries largely unchanged. Crude oil futures down sharply, precious metals lower again as tariff rhetoric cools further. Base metals lower.

  • Sentiment continued to inch higher in Asia trading after hints from US commerce secretary Lutnick that the first trade deal was close, without revealing which nation it was with. Speculation remains it is likely to be India following other hints by Trump while South Korea and Japan remain possibilities. Asia equities ending a volatile month with positive momentum with many main benchmarks including the MSCI Asia Pac ex Japan indexes scoring small gains, Hong Kong and mainland China lost ground but Japan's main boards added around 5% each.

  • In regional developments, China's April official manufacturing PMI contracted by more than expected as tariffs began to bite. Domestic new orders declined while new export orders fell sharply. The private Caixin PMI showed manufacturing slowed but remained in expansion. The Bank of Thailand lowered its base interest rate 25 bps to 1.75%, as widely expected, and warned tariffs could negatively impact FY GDP growth. Australia Q1 CPI inflation came in higher than expected though trimmed mean inflation fell inside RBA's 2-3% target band for the first time since late 2021. Japan March industrial production contracted but retail sales growth accelerated. South Korea March industrial production unexpectedly rebounded with chip output rising by most since Aug-2023.

  • Toyota Motor (7203.JP) is to partner with Alphabet's Waymo on autonomous-driving technology as it seeks to catch up with rivals. CATL (300750.CH) is to launch its Hong Kong listing in the second week of May, Reuters reports. Hong Kong Exchange & Clearing (388.HK) posted a record quarterly profit on a trading and listings surge. Xiaomi (1810.HK) unveiled its own open-sourced AI model called the MiMo reasoning model. Samsung Electronics (005930.KS) Q1 headline operating profit and revenues were slightly ahead of earlier guidance and consensus estimates but offset by poor performance in its memory unit.

• Digest:

  • US Commerce Secretary Lutnick says first trade deal done, but doesn't reveal which country:

    • In a CNBC interview, Commerce Secretary Lutnick teased the first trade deal was reached, but said it was not fully finalized and declined to name the country involved. Added he is waiting for approval from the country's prime minister and parliament. Also said he was not dealing directly with China, noting those negotiations were in the portfolio of Treasury Secretary Bessent. Bessent in his Monday interview with CNBC 'guessed' India would be one of the first deals signed, though on Fox Business later Tuesday, declined to confirm any deals had been reached. President Trump voiced optimism about a deal with India while Bessent noted the administration held "substantial talks" with Japan and "contours of a deal" with South Korea could be coming together (CNBC). South Korea vice minister for trade told reporters Monday that a trade deal is "theoretically impossible" before a snap election is held on 3-Jun (Reuters). Japan still mulling bargaining chips ahead of the next round of talks in Washington this week (Nikkei). Remains unclear how far US is willing to go on tariff concessions (with Tokyo aiming for complete exemptions) and talks could drag on if they can't find common ground.

  • China circulating list of US-made goods eligible for tariff exemption:

    • Reuters sources revealed China quietly circulating to companies a 'whitelist' of US-made goods eligible for exemption from 125% tariffs. Reuters sources had earlier noted China waived 125% tariffs on US ethane imports. Comes after press reports last Friday noted China had exempted select US goods from tariffs, on the basis of protecting vulnerable industries (Bloomberg). However, Reuters noted existence of 'whitelist' has not been previously revealed. Unclear how many items included in this list though number of exempted goods appears to be growing. Sources added China surveying firms to assess impact of tariffs, including those in textile and semiconductor space. For its part, White House maintaining its view Beijing will return to negotiating table given tariffs unsustainable. Treasury Secretary Bessent couched this view on belief China could lose up to 10M jobs if tariffs drag on (Fox Business). Developments come as markets pin hope on signs of de-escalation with White House reportedly considering reducing China tariffs by more than 50%. Publicly, however, both US and China disputing the other's characterization of negotiations and China continues to voice message of defiance against US tariffs (Reuters). White House also prioritizing negotiations with other Asian nations, leaving China on backburner for now.

  • China official manufacturing PMI logs deeper than expected contraction:

    • Official manufacturing PMI was 49.0 in April, below consensus 49.7. Follows 50.5 in the previous month, marking the first contraction in three months. Production and new orders swung to declines amid a sharper contraction in exports. Outstanding orders also fell at a notably stronger pace while finished goods inventories and employment extended downtrends. Input and output prices logged sharper declines, reinforcing concerns about deflation risk. NBS attributed weakening to payback for elevated activity in the prior month as well as "drastic" changes in in the external environment. Cited PMI contractions in other major economies including US to support the official "there are no winners in a trade/tariff war" slogan. Tech outperformance provided one of the few bright spots, though consumer goods sectors were under par. Non-manufacturing PMI was 50.4, also below consensus 50.6, following 50.8 in March. Both construction and service sectors logged slower expansion. NBS highlighted civil engineering construction as the key support factor with the sub-index up 6.4 points to 60.9 though did not mention residential housing. More dispersion among other sectors with internet software and IT services among those above 55, while capital markets were in contraction. Inflation metrics showed marginally stronger declines. Deterioration in the employment index pointed to broad-based softening in the labor market. Some consolation from Caixin manufacturing PMI at 50.4, above consensus 49.8, following 51.2 in March and maintaining expansion since September.

  • Samsung Q1 earnings beat, but optimism curbed by outlook uncertainty:

    • Samsung (005930.KS) headline Q1 operating profit and revenue were slightly above guidance while key metrics beat StreetAccount consensus by a wide margin, particularly on net income. However, positive headline effects were negated by underwhelming memory performance with DS segment OP falling to KRW1.1T ($770M) from KRW1.9T a year earlier. Presentation cited erosion in average selling price (ASP) as well as a decline in HBM sales due to factors such as AI chip export controls. Some clients said to have deferred orders in anticipation of upcoming HBM3E products (Bloomberg), projected to ramp from Q2. There was also broader disappointment at growth rates considering the boost from tariff front-loading. Samsung sounded caution on the outlook in an earnings call, acknowledging growing uncertainties in H2 due to tariff policies and strengthening AI chip export controls (Reuters). Company considering relocating production of TVs and home appliances in response to tariffs. Mobile division was a bright spot on the back of the Galazy S25 launch. Guidance flagged strengthening in its foldable lineup optimizing AI functionality. AI was a particular focus across the product range including tablets and wearables.

  • Bank of Thailand cuts its policy rate to 1.75%:

    • Bank of Thailand Wednesday cut its policy interest rate 25 bps to 1.75% as widely expected by economists. Bank's MPC voted five to two in favor of cut, dissenters voted to keep rate unchanged. Growth risks for Thailand mounted over past month just as country had emerged from prolonged period of poor growth, deflation with exporters potentially facing 36% tariff on US shipments trade deal not agreed before 90-day reprieve period ends. BoT said US trade policy, subsequent retaliatory measures will lead to 'significant changes' to global economic landscape with outcome highly uncertain. Expected Thai economy to expand at slower pace this year, inflation likely to fall below target. Scenario analysis showed economy expanding between 1.3% and 2.0% in FY 2025 depending on how severe, how long US tariffs would last. Bank also noted financial conditions remained tight, loan quality deteriorated.

  • Notable Gainers:

    • +16.1% 9684.JP (Square Enix Holdings): activist 3D Investment Partners discloses 5.47% stake

    • +8.9% 128940.KS (Hanmi Pharmaceutical Co.): reports Q1 earnings with operating profit ahead of StreetAccount estimates

    • +7.1% 6758.JP (Sony): reportedly considering spinoff of its semiconductor business

    • +5.5% 352820.KS (HYBE Co.): reports Q1 earnings with revenue ahead of StreetAccount estimates

    • +5% 2882.TT (Cathay Financial Holdings): declares FY cash dividend NT$3.50/share; StreetAccount notes the year-ago dividend was NT$2.00/share

    • +1.8% 603833.CH (Oppein Home Group): Oppein Home Group reports Q1 results with EBIT CNY369.0M, +41% vs year-ago CNY260.9M, +41% vs year-ago CNY217.9M; also posts FY and Q1 operating data

  • Notable Decliners:

    • -9.6% 2801.JP (Kikkoman): reports FY results with operating profit below FactSet estimates; discloses mid-term plan

    • -6.1% 6501.JP (Hitachi): reports Q4 earning with net income attributable below FactSet estimates; provides mid-term plan

    • -4.7% 3968.HK (China Merchants Bank): reports Q1 earnings net interest income CNY53.00B, +2% vs year-ago CNY52.00B

    • -3.6% 4661.JP (Oriental Land): reports FY results with revenue below guidance and FactSet estimates; issues 2035 long-term management strategy

    • -2.7% 1398.HK (Industrial & Commercial Bank of China): reports Q1 earnings with net interest income CNY156.78B, (3%) vs year-ago CNY161.40B

    • -0.5% 005930.KS (Samsung Electronics): reports full Q1 results; shares fall despite earnings beat

• Data:

  • Economic:

    • China April

      • Official manufacturing PMI 49.0 vs consensus 49.7 and 50.5 in prior month

        • Non-manufacturing PMI 50.4 vs consensus 50.6 and 50.8 in prior month

        • Composite PMI 50.2 vs 51.4 in prior month

      • Caixin manufacturing PMI 50.4 vs consensus 49.8 and 51.2 in prior month

    • Japan March

      • Industrial production (1.1%) m/m vs consensus (0.4%) and +2.3% in prior month

        • METI survey projections +1.3% in April, +3.9% in May

      • Retail sales +3.1% y/y vs consensus +3.5% and revised +1.3% in prior month

    • Australia

      • Q1 headline CPI +0.9% q/q vs consensus +0.8% and +0.2% in Q4

        • Headline CPI +2.4% y/y vs consensus +2.3% and +2.4% in Q4

        • Trimmed mean CPI +0.7% q/q vs consensus +0.6% and +0.5% in Q4

          • Trimmed mean +2.9% y/y vs consensus +2.8% and revised +3.3% in Q4

      • March CPI +2.4% y/y vs consensus +2.2% and +2.4% in February

        • Trimmed mean CPI +2.7% y/y vs +2.7% in February

      • March private sector credit +0.5% m/m vs consensus +0.5% and +0.5% in February

    • South Korea March

      • Industrial production +2.9% m/m vs FactSet consensus +0.8% and revised +1.4% in prior month

        • Industrial production +5.3% y/y vs FactSet consensus +3.8% and revised +7.1% in prior month

    • New Zealand April

      • ANZ Business Confidence +49.3% versus +57.5% in prior month

  • Markets:

    • Nikkei: 205.39 or +0.57% to 36045.38

    • Hang Seng: 111.30 or +0.51% to 22119.41

    • Shanghai Composite: (7.62) or (0.23%) to 3279.03

    • Shenzhen Composite: 13.35 or +0.70% to 1915.62

    • ASX200: 55.60 or +0.69% to 8126.20

    • KOSPI: (8.81) or (0.34%) to 2556.61

    • SENSEX: 24.51 or +0.03% to 80312.89

  • Currencies:

    • $-¥: +0.41 or +0.29% to 142.7590

    • $-KRW: (13.11) or (0.92%) to 1419.0300

    • A$-$: +0.00 or +0.19% to 0.6396

    • $-INR: (0.49) or (0.58%) to 84.7273

    • $-CNY: (0.01) or (0.10%) to 7.2622