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StreetAccount Summary - Asian Market Recap: Nikkei +0.77%, Hang Seng (0.37%), Shanghai Composite +0.85% as of 04:10 ET

Aug 18 ,2025

• Synopsis:

  • Asia equities ended mostly higher Monday. Strong gains posted in Japan, which saw its Nikkei and Topix reach fresh record highs as automakers outperformed again. Greater China led by Shenzhen while Shanghai's Composite index rose to a ten-year high however the Hang Seng fell into the close. Modest gains for Australia and Taiwan, India leading post GST news. Southeast Asia mainly lower, Jakarta closed for a holiday. US futures now lower after being higher all morning, Europe trading lower in the opening hour. US dollar higher, no movement of note in Asia forex. Treasuries mixed. Crude oil futures slightly higher, precious metals supported. Base metals lower. Cryptocurrencies lower.

  • Asia markets propelled largely higher Monday on read through from Wall Street's positive close, while the positive momentum in Japan's benchmarks continued following last week's surprisingly strong GDP number. India stocks boosted by Modi's plan announced over the weekend to cut GST in an array of consumer goods as a way of countering the impact of US tariffs on the country's economy, which jumps to 50% on 27-Aug. Comes as US negotiators canceled a trip to India scheduled for next week. In other tariff-related developments, President Trump said he would hold off on additional China tariffs because of its purchase of Russian oil for at least several weeks as Ukraine negotiations continue.

  • Elsewhere, China's central bank pledged its commitment to thoroughly implement a "moderately lose" monetary policy. Thailand Q2 GDP growth was higher than expected but economists continue to warn over a slowdown in H2. Singapore's volatile non-oil exports fell sharply in July as pharma exports plunged. New Zealand's Services PMI contracted for a sixth consecutive month albeit at a reduce pace of decline.

  • Minenea Mitsumi (6479.JP) latest offer for Shibaura Electronics (6957.JP) is likely to be its final one after it made a ¥6,200 per share offer, matching that made by Yageo Corp (2327.TT). Dongfeng Motor (~489.HK~) is to sell its 50% stake in an engine joint venture with Honda Motors (7267.JP). An Australian court has fined Qantas (QAN.AU) a record A$90M ($58.6M) for firing 1.8K ground staff during the pandemic and criticized it for a lack of contrition. National Australia Bank (NAB.AU) warned its full-year costs would be up to A$130M ($84.7M) higher after it discovered it had underpaid some of its staff dating back to 2019. A2 Milk (ATM.NZ) said strong demand from China helped it to post a 21% jump in FY profit, will acquire manufacturing facility to expand market share in China.

• Digest:

  • India boosts economy with GST cut to offset impact of US tariffs:

    • India government officials say proposed GST changes will boost economy without hurting fiscal deficit (EconomicTimes). Officials said changes will see tax categories reduced from four to two, submitted to GST Council headed by FM Sitharaman in September, implemented this fiscal year; changes amount to complete revamp of direct and indirect tax system (BusinessStandard). Changes had been discussed previously but timing surprised coming just days ahead of Washington's 27-Aug 50% tariff deadline. Economists said lower taxes could add 0.6 pps to nominal economic growth, 0.6-0.8 pps negative impact on inflation, 0.4% of GDP decline in government revenue, with states absorbing disproportionate contraction in revenue (Bloomberg). S&P Rating agency calculated tariffs would have a "manageable" impact on country's economy (Bloomberg), although economists still debating sectoral impact (Mint). Analysts said placing consumer goods into new 5% or 18% GST tax bracket likely to benefit FMCG sector most (Mint), automakers could benefit with lowering of GST on small cars (EconomicTimes). FMCG, automakers and bank sectors outperforming positive start for Nifty and Sensex indexes.

  • Trade talks called off as US hardens rhetoric towards India:

    • Fading prospects for near-term de-escalation of US-India trade tensions after Reuters sources noted planned talks for next week have been called off. US delegation was scheduled to arrive in New Delhi for next round of negotiations, which have now been deferred to another date. Comes as US hardens rhetoric towards India after Trade Adviser Navarro wrote column in FT accusing Delhi of facilitating Russia's war in Ukraine. Navarro said Delhi engaging in opportunistic purchases of Russian crude and profiteering from export of refined fuels to other countries. Also flagged concerns about selling US defense equipment to an India increasingly embracing Russia and China. India's resistance to opening its dairy and agricultural markets has been another source of tension. Meanwhile, India continues to strike defiance stance after PM Modi on weekend repeated vow to protect farmers and urged traders to buy local (Reuters, FT). Chill in US-India relations has also led to Delhi and Beijing to seek common ground over recent weeks (Bloomberg).

  • China bolstering crackdown on taxing offshore investments:

    • FT reported Chinese authorities have strengthened calls on investors to pay taxes on global gains. After tax officials in major economic hubs such as Shanghai, Zhejiang and Shandong called on their websites for investors to declare taxes, in addition to contacting individuals, officials this month escalated the campaign with a big state media push. Article cited warnings issued by PBOC-backed Financial News. Also discussed the contrast between domestic investment income taxes which are exempted until 2027 with increased scrutiny of offshore accounts, which have been more attractive to Chinese investors against the backdrop of underperforming domestic markets. Investors who spend 183 days a year in mainland China face 20% tax on their global income. While well within the global range of 10~30%, Chinese authorities have long lacked the resources and infrastructure to pursue potential tax evasion. However, urgency to find new revenue sources are on the rise amid the collapse of land sales and slowing economic growth. A mobile app based on OECD-based Common Reporting Standard launched in 2018 provided authorities with a channel of information to enable investor screening. However, potential disputes prompting investors to adjust investment and tax strategies. Many considering migrating from Chinese to American brokerages under the assumption the US and China will not share information.

  • Thailand's economy grows by more than expected in Q2:

    • Thailand's economy grew faster than expected in Q2, joining many other Asia nations in posting better-than-expected Q2 growth but also warning of slowdown in H2-25. Country's National Economic and Social Development Council (NESDC) said exports grew favorably, private investment expanded alongside private consumption and government spending. Economy grew 2.8% y/y versus 3.2% in Q1 but above FactSet consensus of 2.5%; slower q/q growth of 0.6% due to tourism-related activities as growth slowed from 4.1% to 3.5%; economists attributed this to to political instability, border clash with Cambodia (Bloomberg). Private final consumption also fell q/q. Industrial sector expanded 0.8% y/y, exports rose 12.2% y/y on tariff frontloading efforts. Council narrowed FY25 GDP growth forecast to 1.8-2.3% from 1.3-2.3%, compares with FY24 2.5% growth rate (Reuters). Also warned lower FY tourist numbers, strong baht, intense price competition could weigh on economy in H2.

  • Street Takeaways: China activity data

    • Economist narrative on the July activity data was broadly bearish, bringing the H2 slowdown theme back to the fore. Key metrics were broadly worse than expected, highlighted by the softest fixed asset investment growth since Mar-20. Cited NBS attribution of bad weather impacts impeding infrastructure and there was no notable pushback on this reasoning. While there was no over-riding catalyst, government anti-involution policies were mentioned as a possible growing cyclical drag against the backdrop of ongoing depressed consumer confidence and property slump. Nomura noted subdued retail catering sales weighed down by new austerity rule prohibiting alcohol consumption at official meals that discourages government officials from dining out. Some evidence of waning support from the consumer goods trade-in program. No discussion of how the latest US-China tariff truce extension impacts the export front-loading window. Overall, GDP forecast implications were limited as current 2025 projections already assumed a slowdown in H2 reflecting diminishing policy support and payback for earlier export front-loading. Latest weakness reinforced calls for fresh stimulus, though nothing specific foreseen in the near term.

  • Notable Gainers:

    • +9.1% 460.HK (Sihuan Pharmaceutical Holdings Group): new drug application for Semaglutide Injection accepted by NMPA

    • +7.0% 011200.KS (HMM): to launch 81.8M-share buyback through tender offer, to run from 18-Aug through 12-Sep

    • +6.1% 8410.JP (Seven Bank): ITOCHU, Seven Bank to commence discussions on potential capital and business alliance

    • +4.4% 601088.CH (China Shenhua Energy): expects to distribute at least 75% of H1 net income attributable as interim dividend; acquires 13 subsidiaries from controlling shareholder CHN Energy

    • +1.8% 7649.JP (Sugi Holdings): reports July Sugi Pharmacy Co. total store sales +17.4% y/y

    • +1.1% 9984.JP (SoftBank Group): current and past OpenAI employees reportedly considering sale of company shares to investor group including SoftBank Group, Thrive Capital and Dragoneer Investment Group

  • Notable Decliners:

    • -11.2% 042670.KS (HD Hyundai Infracore): US reportedly expanding steel tariffs to construction machinery; Trump and Putin leave Alaska summit without breakthrough on Ukraine

    • -7.2% 1083.HK (Towngas Smart Energy): reports H1 results with revenue HK$10.44B vs year-ago HK$10.50B

    • -6.2% 1347.HK (Hua Hong Semiconductor): A-share to suspend trading starting 18-Aug pending share placement plan

    • -0.2% 3382.JP (Seven & I Holdings): reportedly remains committed to stock market listing for 7-Eleven Inc. and will channel some proceeds into growth

• Data:

  • Economic:

    • Singapore July

      • Non-oil domestic export y/y (4.6%) versus +12.9% in prior month

  • Markets:

    • Nikkei: 336.00 or +0.77% to 43714.31

    • Hang Seng: (93.22) or (0.37%) to 25176.85

    • Shanghai Composite: 31.26 or +0.85% to 3728.03

    • Shenzhen Composite: 40.40 or +1.76% to 2341.17

    • ASX200: 20.70 or +0.23% to 8959.30

    • KOSPI: (48.38) or (1.50%) to 3177.28

    • SENSEX: 859.32 or +1.07% to 81456.98

  • Currencies:

    • $-¥: +0.28 or +0.19% to 147.4460

    • $-KRW: (4.01) or (0.29%) to 1384.9700

    • A$-$: +0.00 or +0.05% to 0.6509

    • $-INR: (0.13) or (0.15%) to 87.3806

    • $-CNY: (0.00) or (0.03%) to 7.1799