Back to Daily DR Market Summary

StreetAccount Summary - Asian Market Recap: Nikkei +0.05%, Hang Seng +0.93%, Shanghai Composite +1.45% as of 04:10 ET

Aug 22 ,2025

• Synopsis:

  • Asia equities traded mixed Friday. Greater China benchmarks continued their recent grind higher as Shenzhen outperformed again and the Hang Seng rallyied into the close. South Korea's Kospi traded higher but the Taiex was down. Losses for Australia and India. Japan mixed as the Nikkei traded unchanged but the Topix rose again. For the week, markets traded mostly lower but China's mainland benchmarks outperformed to end on fresh multi-year highs S&P futures higher, but Nasdaq down again, Europe paring opening losses. US dollar higher, Asia currencies led lower by the yen. Treasury yields lower but JGB yields surged again. Crude contracts a smidge higher, precious metals lower, base metals under pressure.

  • Asia equities traded in a tight band ahead of Fed Chair Powell speech later Friday ex China's benchmarks that continued their slow march higher to fresh ten-year highs. Powell is expected to give major clues as to whether the Fed will cut rates next month amid intense political pressure and softening economic data, set against accelerating inflation. Fed Fund Futures show a 73% chance of this but this is down from near 98% several weeks ago. US dollar advancing for almost five straight days, weighing on Asia currencies and creating fresh headwinds for stocks, and joining this week's tech selloff to produce a poor week for the region's equity market away from mainland China.

  • In regional developments, Japan's consumer inflation declined to an eight-month low 3.1% although this was still above the BOJ's target and above economists' expectations. JGB yields continued their ride higher with the 10Y holding near a multi-year high and the 30Y reaching fresh record highs. The Japan ministry of finance responded to the rise in yields by assuming a bond interest rate of 2.6% in its fiscal 2026/27 budget, its highest level in 17 years. Thailand's criminal court dismissed a lese majeste case taken out against former PM Thaksin Shinawatra but he and his daughter Paetongtarn still face two further court verdicts that could yet throw the country into another political crisis.

  • Asahi Kasei (3407.JP) is set to double its chip material production to tap into the AI boom. Fonterra (FCG.NZ) agreed to sell its $2.2B consumer unit to France's Lactalis. Guzman y Gomez (GYG.AU) declared its inaugural dividend but shares slide after soft outlook statement, higher US expansion costs, miss on earnings. Nvidia CEO arrived in Taipei to visit chip foundry partner TSMC (2317.TT) and said he was in talks with the US administration over a new China chip with reports saying it had stopped H20 chip production.

• Digest:

  • Nvidia chip supplies to China remain in the headlines:

    • Some attention Friday on a report by The Information citing unnamed sources saying Nvidia (NVDA) has instructed component suppliers including Samsung Electronics (005930.KS) and Amkor Technology (AMKR) to halt production related to H20 AI chips (Bloomberg). Said to be a response to Chinese authorities urging local companies to avoid using H20. Bloomberg noted a suspension would raise questions about H20 demand, offering a boon for local peers such as Huawei Technologies and Cambricon Technologies (668256.CH). Nvidia and Advanced Micro Devices (AMD) were recently granted approval from Washington to resume sales of lower end AI chips to China, though Beijing now concerned about security risks after US officials said they were considering ways to equip chips with better location-tracking capabilities. Nvidia CEO Huang on Friday reiterated denials that any such backdoor exists. Currently on a Taiwan visit to TSMC (2330.TT) to discuss next-gen Rubin chips, Huang indicated they are in talks with Washington about a potential successor to the H20 for China, which Reuters previously reported is based on Blackwell architecture and tentatively named B30A, though clarified that depends on US approval.

  • South Korea government slashes growth outlook:

    • South Korea's government Friday lowered FY25 economic growth forecast to 0.9% from 1.8% made in January as US tariffs slow exports. Government said overseas shipments remained resilient in H1 on front-loading but these many now weaken in H2 offset by improved private consumption triggered by fiscal support measures (Yonhap). Cited rising uncertainties at home and overseas for lower growth forecast. Warned projection does not include potential impact of secondary US chip tariffs that will add to base 15% rate. Government said construction investment to decline 8.2% y/y in FY25, exports to increase only 0.2% y/y. In July, government approved KRW31.8T ($23.3B) extra budget, announced this week additional support package for supply chains worth KRW45.8T. Economists split on whether central bank will lower rates next week with MPC members seemingly open to one but bank known to be cognizant of high household debt, surge in Seoul house prices (Bloomberg).

  • Japan core inflation eases on energy subsidies, food pressures still building:

    • Nationwide core CPI rose 3.1% y/y in July, slightly above consensus 3.0%, though still moderating from 3.3% in the previous month. Ex-fresh food & energy inflation was steady at 3.4%, matching expectations. Main factor was lower energy contributions as electricity and gas prices turned negative reflecting base effects from a termination of government subsidies a year earlier. Other notable drivers were mixed. Attention remains largely on non-fresh food prices, which continued to grind higher to +8.3% y/y from +8.2%. Rice prices eased to +89.9% from +99.2% though still added 0.36 ppt to the headline. Coffee and chocolate remain elevated reflecting international markets, though more of the attention going to permeation from rice into rice-based products, as well as dining. Recall that BOJ still sees this phase as temporary, though has acknowledged flow-on effects and the possibility of prolonged strength eventually adding to inflation expectations. Elevated core inflation (now above 3% for the eighth straight month) underpinning BOJ rate hike expectations though marginal impacts from official data limited by lack of clarity surrounding underlying trend inflation cited by BOJ as the true policy benchmark. Officials have consistently noted underlying inflation remains below the 2% target, warranting policy to remain accommodative though does not preclude rate hikes that have yet to reach neutral levels (where guidance has also been murky).

  • Thailand's former PM Thaksin Shinawatra cleared of breaking lèse-majesté laws:

    • Thailand's criminal court Friday dismissed lèse-majesté case against Thaksin Shinawatra, former premier and father of recently ousted PM Paetongtarn Shinawatra (CNA). Military accused Thaksin of insulting royal family during 2015 media interview using Thailand's strict lèse-majesté law, court said case dismissed over insufficient evidence (TheNation). Decision does not end legal difficulties for family as Thaksin faces second court decision in two weeks over whether his 2023 detention in VIP hospital wing instead of jail meant his prison sentence for abuse of power was not fully served. Further, Paetongtarn Shinawatra faces constitutional court decision on 29-Aug over alleged ethics violation following leaked telephone call with Cambodian leader Hun Sen amid border military clashes (BangkokPost). Political analysts cited by Reuters said collective court decisions likely to lead to fresh elections by mid-2026 or sooner given political instability in government but Paetongtarn's Pheu Thai unlikely to win popular vote as it stands.

  • Record-high Japan stocks fueled by foreign inflows, reinforcing BOJ rate hike expectations:

    • Nikkei reviewed latest equity flows in the context of recent price action. TSE data showed foreign investors bought net JPY573.7B in Japan cash equities in the second week of August and JPY1.1T in futures. Latter marked the highest in about six years, standing out as the main driver propelling the Nikkei 225 to all-time highs. Cash purchases were also the largest in three weeks. Article rationalized market activity during that week, when foreigners dominated with many domestic participants away during the obon holidays. Inflows were consistent with outperformance in preferred highly liquid blue chips -- Topix Core 30 gained 4% that week, surpassing 3% gains in the broader Topix index. Also fits with the rally in internationally popular names such as SoftBank (9984.JP) which posted successive record highs on the back of US tech strength. Megabanks were buoyed by stronger than expected GDP data. Separately, Nikkei also discussed how bullish sentiment leading to equity countertrades in JGBs, leading 10y yields higher in a reinforcement of BOJ rate hike expectations. Noted BOJ plays evidently the main driver while swap spreads have not changed much despite recent talk of trickle-down from superlong weakness.

  • Notable Gainers:

    • +20.6% 9896.HK (MINISO Group Holding): reports Q2 adjusted EPADS CNY2.24 vs FactSet CNY1.71

    • +13.6% 9868.HK (XPeng, Inc.): CEO Xiaopeng He purchases 3.1M Class A ordinary shares

    • +8.8% 2331.HK (Li Ning): reports H1 net income attributable CNY1.74B vs FactSet CNY1.68B

    • +6.5% 336260.KS (Doosan Fuel Cell): enters KRW55.40B supply contract with Samchully ES

    • +4.4% 1024.HK (Kuaishou Technology): reports Q2 earnings; revenue CNY14.82B vs FactSet CNY14.56B, adjusted net income CNY5.62B vs FactSet CNY5.04B

  • Notable Decliners:

    • -6.5% 1836.HK (Stella International Holdings): reports H1 net income attributable $78.6M vs year-ago $91.9M

    • -6.1% 9626.HK (Bilibili): Bilibili reports Q2 adjusted earnings; mobile games CNY1.61B vs FactSet CNY1.63B

    • -1.8% 386.HK (Sinopec (China Petroleum & Chemical)): reports H1 IFRS net income attributable CNY23.75B vs year-ago CNY37.08B

    • -0.1% 507685.IN (Wipro): to purchase Harman Connected Services et al from Harman International Industries for up to $375M (INR32.71B) in cash

• Data:

  • Economic:

    • Japan July

      • Nationwide core CPI +3.1% y/y vs consensus +3.0% and +3.3% in prior month

        • CPI excl. fresh food & energy +3.4% y/y vs consensus +3.4% and +3.4% in prior month

        • Overall CPI +3.1% y/y vs consensus +3.1% and +3.3% in prior month

  • Markets:

    • Nikkei: 23.12 or +0.05% to 42633.29

    • Hang Seng: 234.53 or +0.93% to 25339.14

    • Shanghai Composite: 54.66 or +1.45% to 3825.76

    • Shenzhen Composite: 35.14 or +1.49% to 2393.21

    • ASX200: (51.70) or (0.57%) to 8967.40

    • KOSPI: 26.99 or +0.86% to 3168.73

    • SENSEX: (490.72) or (0.60%) to 81509.99

  • Currencies:

    • $-¥: +0.22 or +0.15% to 148.5920

    • $-KRW: (8.48) or (0.61%) to 1392.7100

    • A$-$: +0.00 or +0.06% to 0.6425

    • $-INR: +0.22 or +0.26% to 87.5011

    • $-CNY: +0.00 or +0.00% to 7.1807