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StreetAccount Summary - Asian Market Recap: Nikkei (0.45%), Hang Seng (0.48%), Shanghai Composite 0.00% as of 04:10 ET

Oct 08 ,2025

• Synopsis:

  • Asia equities ended with a negative tilt Wednesday. The Hang Seng was led lower by its internet & IT stocks with banks also on the retreat. Losses for Taiwan, Australia, Singapore and India, modest gains in New Zealand and Southeast Asia. Japan's Topix gained a few points while the Nikkei lost ground. Mainland China and South Korea remain closed for a holiday. US futures unchanged, Europe stronger at the open. US dollar higher, NZD substantially lower and dragging AUD down with it on sentiment, yen also weaker again and past 152 per dollar. Treasury yields mixed, JGB 10Y yields at fresh 17-year high. Crude oil futures higher, gold surging again, base metals mixed. Cryptocurrencies off recent highs.

  • Asia equities drifted lower Wednesday in a rather directionless session. Japan's equity markets still digesting the LDP's election of Senae Takaichi and the implications for monetary policy, with OIS now pricing in just a 25% chance of an October hike versus around 80% last week. The yen weakened again today with long-dated JGB yields edging higher too on the expectation of fiscal support by the government ahead of probable elections next year. Adding to the BOJ's dilemma, Japan nominal wage growth slowed and the Reuters Tankan survey revealed manufacturer sentiment had fallen for the first time in four months, dragged lower by weak auto sector confidence post US tariffs.

  • In other developments, the Bank of Thailand held its policy rate steady against expectations for a cut as economists noted a fiscal stimulus was probable ahead of elections next year in a turn of events similar to Japan. Separate data Wednesday showed Thailand consumer sentiment improved in September following rollout of the new PM's support measures. The RBNZ cut its OCR by 50 bp to 2.50% against a slim majority of economists who expected a 25 bps cut. The World Bank raised its FY 2005 China growth forecast but warned of a slower 2026. Separately, state media published early spending data from China's Golden Week holiday that appeared to indicate retail sales growth was below travel expenditure.

  • Asahi Group (2502.JP) was cyberattacked by Qilin, a renowned ransomware group with a history of attacks on major groups around the globe, according to reports. Softbank Group (9984.JP) is to buy ABB industrial robotics arm for $5.4B to build on group's AI and data center operations. LG Electronics (066570.KS) India IPO said to be fully subscribed on its first day of marketing; Tata Capital's $1.7B IPO - India's biggest this year - fully subscribed on its final day.

• Digest:

  • RBNZ cuts interest rate by 50 bp, open to further reductions:

    • RBNZ cut OCR by 50 bp to 2.50%. While central bank was tentatively expected to cut by 25 bp, multiple economists predicted 50 bp reduction. Committee debated 25 bp and 50 bp cuts, ultimately settling on the more aggressive move given prolonged spare capacity and downside risks to medium-term activity and inflation. Forward guidance dovish with RBNZ open to further OCR cuts. Acknowledged contraction in New Zealand Q2 GDP was considerably larger than it expected, and while more timely indicators suggest moderate recovery in Q3 significant spare capacity remains. Still anticipates inflation converging to 2% midpoint in H1 2026 following near-term rise to 3% upper band in Q3 2025. Noted downside inflation risk if excess household and business caution dampens consumption and investment by more than currently assumed. Comes on back of Tuesday's closely-watched NZIER Quarterly Survey of Business Opinion (QSBO) that showed deterioration in business confidence. Conversely, higher near-term inflation could prove more persistent given constraints to potential output growth. Lower New Zealand dollar could also have inflationary implications.

  • Bank of Thailand keeps policy rate unchanged against expectations for a cut:

    • Bank of Thailand kept policy rate unchanged in surprise move amid strong baht, persistent deflation, dip in exports and political instability. Decision against most economist expectations and swaps markets that were pricing in a 25 bps cut; MPC vote 5-2 in favor of no change, dissenters voted for 25 bps trim. New Governor Vitai Ratanakorn seen as dovish also fueled expectations for a cut. Economists said unchanged decision could reflect recent political flux that saw appointment of new PM who will likely focus on fiscal economic support ahead of elections next year. Bank said economy not materially changed since last update while there was no broad-based decline in inflation; expects economy to expand 2.2% y/y in 2025, 1.6% in 2026, FY25 inflation at 0.0%. Noted credit quality of vulnerable groups deteriorated, added timing of future rate cut would be important given 'limited policy space'.

  • Japan wage growth slows, Reuters Tankan manufacturer sentiment weighed down by tariff effects:

    • Nominal average wages rose 1.5% y/y in August, markedly below consensus 2.7% (recent forecasts have tracked at roughly 3%). Follows revised 3.4% in the previous month. July revision drew some attention when data was published on 26-Sep because it swung real earnings to a 0.2% decline from an initial 0.5% rise. August real wages fell a weaker 1.4% for the eighth straight decline. Volatility stemmed mainly from special payments, which dropped a sharp 10.5%, though signal value limited given this is outside the semi-annual bonus period. Overtime payments also slowed to 1.3% from prior month's elevated 3.0%. Core base pay (scheduled earnings) has tracked a stable ~2% pace since the start of FY25 in April. Total hours worked reverted to declines after briefly edging up in July. Broader trend has been consistently negative reflecting lower scheduled shifts and overtime hours. Reuters Tankan manufacturer sentiment index fell to +8 in October from +13 in the prior month, marking the lowest since July. Outlook index also points to further softening to +4. Highlight was the auto & transportation machinery sector which tumbled to +9 from +33 reflecting US tariff impacts. Rising input costs also said to be a recurring theme across many sectors. Five out of nine subsectors logged declines. In contrast, non-manufacturing index held steady at +27 with outlook index little changed at +26.

  • Early data shows subdued consumer spending in China during Golden Week:

    • FT reported early data from China during its extended Golden Week holiday hinted at consumer caution despite surge in travel. Cited China state media posting retail sales growth of 3.3% y/y in first four days of holiday versus 3.4% growth in August. Quoted Goldman Sachs economist saying there was plenty of people traveling, but 'not a ton of spending'; Nomura economist noted signs of relative soft mobility and consumption activities halfway through holiday. SCMP noted transport ministry had forecast 19.2M domestic and international flights over holiday, 3.6% y/y increase, while state media cited 5.7% increase in cross-regional passenger trips despite southern China disrupted by typhoon landfall over weekend. Increased travel, subdued spending will disappoint China retailers and policy makers that were keen on consumer uptick given ongoing deflationary pressures, recent policy support which has targeted consumers (Bloomberg).

  • Gold surpasses $4,000 an ounce for first time to continue record rally:

    • Spot gold price topped $4,000 an ounce for first time on Wednesday (Bloomberg, Reuters), less than a day after gold futures broke above the level (CNBC), driven by continuous haven demand from growing economic, fiscal and geopolitical uncertainty. Gold has delivered more than 50% YTD returns while concerns over potential market shocks following US government shutdown and expectations of further Fed monetary easing are adding fuel to rally. Bullion-backed ETFs saw biggest monthly inflow in more than three years in September. Ray Dalio said investors should allocate as much as 15% to gold as a portfolio diversifier (CNBC). Global central banks have been another key driver with pace of buying having doubled after Russia's war on Ukraine which saw Moscow's foreign-exchange reserves frozen by west. Latest PBOC data showed China's central bank increased gold reserves for 11th consecutive month, adding 40,000 ounces to 74.06 million troy ounces by end-September, as it is keen to de-dollarize. BusinessTimes also noted surge in physical gold ownership in APAC with region accounting for 69% of global demand in 2025, compared with average of 63% during 2010-2019 and 39% in 2020.

  • Notable Gainers:

    • +161% 2652.HK (CF PharmTech): opens +218.6% at HK$47/share on HKEx vs offer price HK$14.75/share

    • +2.0% 2502.JP (Asahi Group Holdings): Qilin, a ransomware group with a track record of cyberattacks on major entities around the world, claimed responsibility for a hack on Asahi Group Holdings that disrupted its production

    • +1.5% 2303.TT (United Microelectronics): reports September revenue NT$19.93B, +5.2% y/y

    • +0.5% 2379.TT (Realtek Semiconductor): reports September revenue NT$10.03B, +2.1% y/y

  • Notable Decliners:

    • -2.0% 9984.JP (SoftBank Group): ABB Limited agrees to divest its Robotics division to SoftBank Group for an enterprise value of $5.375B

    • -0.9% 4684.JP (OBIC Co.): on report of 9M revenue +10% y/y to just more than ¥65.0B

• Data:

  • Economic:

    • Japan

      • August average nominal wages +1.5% y/y vs consensus +2.7% and revised +3.4% in prior month

        • Real wages (1.4%) y/y vs consensus (0.5%) revised (0.2%) in prior month

      • October Reuters Tankan manufacturers sentiment index +8 vs +13 in prior month

      • August current account balance ¥3,775.8B vs consensus ¥3,506B and ¥2,684.3B in prior month

  • Markets:

    • Nikkei: (215.89) or (0.45%) to 47734.99

    • Hang Seng: (128.31) or (0.48%) to 26829.46

    • Shanghai Composite: Closed

    • Shenzhen Composite: Closed

    • ASX200: (9.20) or (0.10%) to 8947.60

    • KOSPI: Closed

    • SENSEX: 26.29 or +0.03% to 81953.04

  • Currencies:

    • $-¥: +0.50 or +0.33% to 152.4020

    • $-KRW: +6.72 or +0.47% to 1422.7900

    • A$-$: (0.00) or (0.19%) to 0.6569

    • $-INR: +0.02 or +0.03% to 88.7605

    • $-CNY: (0.00) or (0.01%) to 7.1186