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StreetAccount Summary - Asian Market Recap: Nikkei +1.14%, Hang Seng +2.06%, Shanghai Composite +1.15% as of 04:10 ET

Jun 24 ,2025

• Synopsis:

  • Asia equities ended higher almost everywhere Tuesday. Tech-orientated boards saw the best of the gains as the Nikkei and Taiex finished notably higher, Kospi near a four-year high supported by battery stocks on read through to Tesla's gains. Australia and Greater China boards also advanced, India trading at nine-month high as the oil price dips. Southeast Asia also higher. New Zealand the sole Asia benchmark with a loss. US futures indicate a strong open, Europe opened higher. US dollar DXY index continued on from overnight falls to trade close to 98; Asia currencies strong across the board. Treasuries higher across tenors, JGB and other Asia sovereign yields higher. Brent and WTI crude futures down almost 3% Precious metals sharply down. Base metals mixed.

  • Asia equities responded positively to reports of a ceasefire between Israel and Iran, despite some initial hesitation over when it would begin and late reports of a violation by Iran within hours of the ceasefire starting. Technology stocks benefited the most with Nasdaq futures also seeing a strong gain while energy and defense stocks dragged a little. Ceasefire comes after 'choreographed' missile attack on US bases in the Gulf that signaled Tehran's unwillingness to respond in force or to attack shipping in the Straits of Hormuz. Oil prices pared two-week gains, gold and Treasuries prices also fell noticeably, while risk assets such as Asia forex caught a bid amid a weaker US dollar.

  • Few data points or news items to alter the trajectory higher today. South Korea trade minister reiterated Seoul's demand for the removal of all tariffs, India and the US aim for an interim agreement by 9-Jul despite unanswered questions over agriculture market access; China said it was tightening scrutiny over two fentanyl ingredients. In macro news, South Korea consumer sentiment rose to a four-year high after President Lee's election and pledge of consumer support.

  • Hon Hai Precision (2317.TT) gave an upbeat presentation at its investor day, saying its new server rack shipments would grow q/q from H2-25. SK Hynix (000660.KS) is planning to build a new semiconductor back-end process facility in central South Korea to build out its chip-packaging capabilities. China Airlines (2610.TT) is to postpone the retirement of some of its older aircraft because of delays in receiving new Boeing aircraft. Rio Tinto (RIO.AU) and Hancock Prospecting announced they will invest $1.61B into the Hope Downs iron ore project in the Pilbara region of Western Australia. Bain Capital's Virgin Australia (VGN.AU) began trading Tuesday after raising A$685M ($445M) in an IPO; closed more than 11% higher.

• Digest:

  • Israel and Iran agree to ceasefire:

    • Israel prime minister Benjamin Netanyahu said the ceasefire between Israel and Iran was in effect despite some initial confusion over timing (Reuters). The White House earlier said both nations agreed to 12-hour ceasefire and, after 24-hours, war will be considered ended (Bloomberg, Reuters). US strikes against Iranian nuclear facilities on Saturday were expected to trigger a counterattack though Tehran's response underwhelmed after handful of missiles launched towards US base in Qatar were intercepted with no death or injuries. Iran's foreshadowing of its response was also seen as intent to de-escalate (Bloomberg). Oil extended losses following latest developments with WTI crude back to pre-war levels. Geopolitical premium built into crude over past week thought to have reflected risk of disruptions to shipments through Strait of Hormuz. However, there was also longstanding skepticism Iran would carry out such an action given global ramifications, harm to China (which accounts for 90% of Iran's oil exports) and likely blowback on Iran. Unclear whether cessation of hostilities will presage return to negotiations, though CNN sources noted US envoy Steve Witkoff has remained in touch with Iran officials following US strikes on weekend.

  • Japan upper house election confirmed for 20-Jul:

    • Cabinet confirmed upper house election to be held 20-Jul (NHK). Attention heightened in the wake of LDP's surprisingly poor showing in the Tokyo Assembly election over the weekend. While official campaigning is set for 3-Jul, Nikkei coverage of Prime Minister Ishiba's press conference Monday evening was effectively framed as an early preview. Ishiba reaffirmed priority on economic growth and a longer term strategy of achieving JPY1,000T ($6.84T) nominal GDP by 2040, compared with current level of JPY600T, while boosting average income by more than 50%. Article recalled the ruling coalition lost lower house majority after the October election. But was expected to retain an upper house majority until Sunday's Tokyo assembly poll, in which the LDP won the fewest seats on record and coalition partner Komeito also lost seats. List of headwinds are growing -- elevated inflation and sluggish private consumption represent the main domestic economy issues, while diplomatic challenges include Trump tariffs and US demands for Japan to increase defense spending to 5% of GDP against current backdrop of latest Middle East conflict. Main stimulus pledge is a cash handout of JPY20K per person while fending off calls for a consumption tax cut.

  • Japan Finance Ministry proceeds with JGB issuance tweaks, but market concerns linger:

    • Nikkei reported MOF implemented proposed tweaks to FY25 JGB issuance, culling the size of 20-year auctions by JPY200B each along with JPY100B cuts to 30- and 40-year sales. But while the bigger than expected adjustment was generally well-received, immediate impact in the superlong sector has been limited as participants cited longer term concerns surrounding fiscal policy risks. US Pentagon demands for Asian allies to boost defense spending to 5% of GDP has emerged as a new element expected to maintain selling pressure. LDP's major disappointment in the Tokyo Assembly election added to concerns, weakening the party's position in the lead-up to the upper house vote. Cited greater risk of the ruling coalition having to capitulate to opposition calls for a consumption tax cut that would worsen the budget position. While crude oil prices have sold off sharply on news of an Israel-Iran ceasefire, earlier rally during the conflict raised cognizance of a scenario in which higher inflation might prompt calls for additional cost-of-living relief measures. No easy solutions for the superlong sector given life insurers remain reluctant to add positions citing risk management under current volatility. Lifer net selling of superlongs reached a record in March and buying in subsequent months has been limited in comparison. Foreign investors raised as the only viable substitute, though trading is dynamic and cannot be seen as a source of stabilization.

  • China yuan weakness vs currency basket seen reflecting rotation of export markets away from US:

    • Nikkei discussed yuan weakness against the broader currency basket in a sign that Beijing may be trying to boost its export competitiveness with trade partners other than the US. CFETS yuan index has lost 5% since 2024-end with mostly progressive declines over the period. Among notable drivers, yuan has depreciated by almost 10% vs euro, recovering slightly from a near 11-year low 8.44 in late April. Yuan also weaker against baht and other Southeast Asia currencies. Overall, CNY lower against 19 out of 25 currencies in the basket. Dollar the key exception with yuan up about 2% and USD/CNY moving relatively stable in the 7.16-7.20 over the past month. Article cited an academic suggesting China has accepted the decline in exports to US and has pivoted to targeting growth in other markets. Recalled China exports to US tumbled 20% y/y in April after US tariff rates were well above 100%, and shipments fell a further 35% in May even after agreeing on a truce. In contrast, exports to SE Asia grew a strong 21% in April and 15% in May, while shipments to EU also logged solid increases. Goldman Sachs estimated a 10% yuan depreciation on a trade-weighted average basis would lift exports by 5% with a one-quarter lag and raise GDP by 75 bp. Exports are more sensitive to basket than dollar alone.

  • Thailand government teeters on the brink of collapse as new probe into PM launched:

    • Thailand's anti-corruption commission set to investigate PM Paetongtarn Shinawatra ethics over phone call last week with Cambodia president Hun Sen that led to senior party leaving coalition, calls for her resignation (BangkokPost). Commission responded to petition from Senate Speaker who also asked constitutional court to relieve Shinawatra of duties following leaked call, in which she was heard blaming military for border dispute between two countries, appeared to signal readiness to comply with Hun Sen's demands. Turmoil comes at poor time for Thailand economy with large tourism industry struggling with falling visitor numbers, not helped by middle east unrest, social media rumors of potential coup (BangkokPost). Shinawatra defied calls for resignation, pushed ahead with cabinet reshuffle and promised "new way of working" over weekend (Bloomberg). However, border frictions remain elevated as Phenom Penh cut energy imports from Thailand while Bangkok threatened to cut internet connectivity, some electricity supplies (Reuters).

  • Notable Gainers:

    • +15.6% 010120.KS (LS Electric): reportedly may supply power control devices for liquid cooling to Vertiv

    • +9.1% 003490.KS (KOREAN AIR LINES Co.): Airlines trading higher on oil prices drop following Trump's announcement on Iran-Israel ceasefire

    • +6.4% 1378.HK (China Hongqiao Group): guides H1 net income to increase by around 35% y/y

    • +2% 4568.JP (Daiichi Sankyo): FDA approves Datroway for previously-treated EGFR-mutated NSCLC

    • +1.2% 017670.KS (SK Telecom): to resume new subscriptions upon USIM replacement completion

  • Notable Decliners:

    • -6.4% 010950.KS (S-Oil Corp): oil sector move on Trump's announcement of Iran-Israel ceasefire

• Data:

  • Economic:

    • No economic data today

  • Markets:

    • Nikkei: 436.47 or +1.14% to 38790.56

    • Hang Seng: 487.94 or +2.06% to 24177.07

    • Shanghai Composite: 38.98 or +1.15% to 3420.57

    • Shenzhen Composite: 35.63 or +1.79% to 2023.32

    • ASX200: 80.60 or +0.95% to 8555.50

    • KOSPI: 89.17 or +2.96% to 3103.64

    • SENSEX: 427.72 or +0.52% to 82324.51

  • Currencies:

    • $-¥: (1.00) or (0.68%) to 145.1520

    • $-KRW: (9.69) or (0.71%) to 1361.5100

    • A$-$: +0.00 or +0.54% to 0.6494

    • $-INR: (0.17) or (0.19%) to 86.1459

    • $-CNY: (0.00) or (0.04%) to 7.1767