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StreetAccount Summary - Asian Market Recap: Nikkei +0.01%, Hang Seng (1.06%), Shanghai Composite (1.25%) as of 04:10 ET

May 27 ,2026

• Synopsis:

  • Asia equities traded mixed Wednesday with further gains for technology names but broader-based sectors struggling for positive momentum. The Kospi and Taiwan's Taiex closed at fresh record highs while the Nikkei was flat. Japan's Topix lower, mainland China lost more ground and Hong Kong fell sharply as the impact of the brokerage crackdown was felt. ASX was slightly higher, New Zealand stocks notably stronger after RBNZ split vote. Singapore, Indonesia, Philippines markets closed for a holiday. US futures higher, Europe seeing modest gains at the open. US dollar flat, NZD higher, AUD lower, other Asia currencies quiet. Treasury yields lower, JGBs mixed, CBG yields at month-long lows. Crude oil consolidating overnight moves with Brent still below $100/bl. Precious metals under pressure, base metals seeing support. No material movement in cryptocurrencies.

  • Asia equities again struggled for a firm direction Wednesday with more strong gains in technology stocks and related clusters but broader-based sectors and country benchmarks underperformed amid the absence of a firm breakthrough in middle east peace talks and still-elevated commodity prices. Brent crude and the US dollar hovered near overnight lows while sovereign bond yields found a little relief but gold neared its conflict-time low. And, in the equity markets, whereas the Kospi, Taiex and Nikkei 225 again touched fresh records, the Hang Seng fell to the trough of its recent trading band as oil & gas and conglomerates dragged; in Japan, materials, construction and banks underperformed; and in South Korea, transport and food stocks again underperformed.

  • Today, New Zealand's central bank kept its policy rate on hold but the board was split between no change and a 25 bps hike, with the accompanying statement leaning hawkish. BOJ Governor Ueda warned over the risk of oil shock feeding through to wage and inflation expectations while markets braced for the Bank of Korea decision tomorrow and the potential for a hawkish tilt. Australia April headline inflation fell by more than expected though core inflation was unchanged and above the RBA's 3% target. China industrial profit growth accelerated in April, led by upstream industrials and AI-related sectors. Taiwan consumer sentiment fell to a three-year low. South Korea business confidence neared a four-year high.

  • The local offices of CCB International (China Construction Bank, 939.HK) and China Securities International (CSC Financial, 6066.HK) were raided by Hong Kong securities regulator as it investigates suspected misconduct over share offerings. TikTok's owner ByteDance (+BYTE.HK) has reached an agreement with Qualcomm to buy millions of AI chips for data centers. Xiaomi (1810.HK) said its Q1 profit had contracted by 57% on higher memory chip costs. TSMC (2330.TT) is to raise price of 3nm chips by 15% in H2 due to strong demand. Samsung Electronics (005930.KS) unionized workers vote to accept wage deal easing concerns over chip supply chains.

• Digest:

  • US-Iran agreement hinges on resolving some sticking points:

    • Nothing particularly incremental in latest US-Iran diplomacy headlines. Iran described Monday's skirmish involving US and Israeli jets as violation of ceasefire, though backchannel talks are continuing (link, FT, Bloomberg, Reuters). Negotiations between Iran and mediators focusing on release of $24B in frozen assets with potential compromise seeing Tehran receive half of that amount early.

    • Despite Monday's exchange of fire there has been a pickup in shipping activity with two more supertankers successfully crossing Persian Gulf over past 24 hours (Bloomberg). MoU reportedly involves deal to reopen Strait of Hormuz 30 days after agreement struck, though presence of mines and Iran's insistence on collecting fees among complications.

    • Mediators say some progress made on enriched uranium stockpiles with Trump the other day appearing to soften demands Iran hand over material to US. Talks over Iran's nuclear program would take place in second round of negotiations with length of moratorium on enrichment having been a major point of contention. Lebanon another sticking point with Israel vowing to continue operations against Hezbollah while Iran insists that agreement with US includes cessation of hostilities in Lebanon.

    • Market's baseline expectation remains for deal to be reached though Secretary of State Rubio said it may take few days to materialize. Media sources described how Iran's negotiating strategy aimed at securing financial relief while denying Trump victory on his nuclear demands. Resistance against diplomacy by regime hardliners and difficulties communicating with Supreme Leader Khamenei among other hurdles to deal.

  • RBNZ on hold, foreshadows rate hikes at upcoming meetings:

    • RBNZ left OCR unchanged at 2.25% as expected. Vote count split with three members dissenting in favor of 25 bp rate hike (chair cast deciding vote to hold). Statement leaned hawkish with MPC saying OCR will most likely need to increase sooner and by more than envisaged in February. Updated rate forecasts modeled OCR of 2.51% by Q3-2026 and 2.84% by year-end, implying two rate hikes this year. Longer-term rate projections also revised up with new peak of 3.27% vs 3.00% in February.

    • Headline seen peaking at 4.3% by Q3 before returning to 2% midpoint in mid-2027, reflecting first- and second-round effects of higher fuel prices. While medium-term inflation expectations remain close to 2%, there are upside risks with oil projected to settle above pre-conflict levels, adding to pressures from cost-push nature of shock and elevated post-pandemic inflation. Near-term economic activity likely to be weaker than assumed in February with household consumption subdued and investment impacted. Spare capacity and elevated employment projected to persist for longer. Material tightening of financial conditions also weighing.

    • RBNZ outlined three scenarios related to Middle East conflict: Scenario 1 (more persistent conflict and disruption to oil supply) envisages inflation peaking at 5.8% and quicker OCR hikes with peak rate of 4.3%. Scenario 2 (more persistent oil supply disruption but restrained cost pass-through) sees OCR peaking at 3.6%. Scenario 3 (larger negative impact on demand) sees inflation returning to target band quicker with OCR remaining at 2.25%.

  • SK Hynix's market cap eclipses $1T as memory rally rolls on:

    • South Korean memory giants drove Kospi to fresh all-time high Wednesday. SK Hynix's (000660.KS) latest rally took its market cap above $1T for first time, joining Samsung Electronics (005930.KS) and Micron (MU). Micron logged its biggest daily gain since 2011 on Tuesday after UBS tripled its price target, believing stock will continue to re-rate higher amid AI-driven structural changes to memory market. Trend towards longer-term supply agreements (LTAs) also seen increasing demand visibility.

    • Korean media also highlighted how SK Hynix is fielding investment offers from big US tech firms for construction of fabs and purchases of EUV lithography equipment(Chosun). Noted SK Hynix has declined such offers amid concerns about being locked into individual contracts for supply of product below market price. Rather, firm viewing big tech's desperation as negotiating leverage in strengthening LTAs such as requiring higher prepayments, ultra-long contracts and price floor guarantees.

    • Strength of Kospi's rally inviting usual discussion about overheating and speculative excess. Asset managers launched single stock leveraged ETFs focused exclusively on two memory giants with SK Hynix ETF up over 20% and Samsung ETF up over 13%. Surge triggered Volatility Interruption (VI) safeguard mechanism. Concerns about extreme concentration with Samsung and SK Hynix comprising over 50% of Kospi benchmark and remaining principal drivers of its rally. Some focus also on elevated demand for downside protection with Kospi Volatility Index up 4% Wednesday.

  • Australian underlying inflation edges up as higher fuel prices filter down:

    • Australia April headline inflation came in at 4.2% against forecast 4.4% and March's 4.6%. Fall driven largely by reduction in fuel prices, reflecting government's excise cut. Lower fuel prices saw tradeables inflation fall to 3.2% from 4.5%. Clothing and footwear and furnishings, household equipment and services categories experienced narrow declines.

    • Inflation pressures were more evident excluding fuel with trimmed mean inflation rising to in-line 3.4% from 3.3%. Non-tradeables inflation rose to 4.7% from 4.6%, driven by electricity and new dwellings. Services inflation eased slightly to 3.5% from 3.6%, reflecting rent moderation.

    • Data elicited dovish market reaction with Australian yields declining along the curve. RBA was already expected to hold in June after Governor Bullock said board now in position to be alert to risks on both sides (growth and inflation) following three consecutive rate hikes.

    • RBA also remains alert to risk of inflation expectations drifting higher with April CPI data showing higher energy prices translating to increases in construction input and logistics costs. Survey-based measures of business and consumer inflation expectations are also elevated. August rate hike considered a possibility if oil-driven cost pressures become more evident in Q2 CPI data. Market almost fully pricing in another rate hike by year-end.

  • BOJ treading cautiously on JGB purchase reduction plan:

    • Nikkei discussed BOJ's upcoming deliberations on the JGB purchase reduction plan slated for the June 15-16 policy meeting. Current circumstances notably affected by the government's sensitivity to bond yields which may affect its stance on rate hikes.

    • Article was largely based on BOJ's meeting with bond market participants on 21-May. Highlighted several views that higher yields are normal as market functioning is being restored, raising concerns that tweaking the purchase reduction pace will reduce predictability, posing the risk of increasing volatility. According to multiple participants, megabanks and most regional banks want purchase reductions to continue from Apr-27. BOJ sources were said to have been surprised at the number of such views.

    • Story recalled reductions began in 2024 at a pace of JPY400B per quarter, though was pared back to JPY200B in Apr-26 to continue through Mar-27 out of sympathy for the market turmoil caused by Trump tariffs. Overall, current schedule would leave monthly purchases at a JPY2.1T pace compared to the starting point of JPY5.7T. At the June MPM, board members will discuss the trajectory through Mar-27 and beyond. With virtually no calls for immediate adjustments through Mar-27, attention has shifted to the outlook for the next fiscal year. Story outlined three main scenarios -- halting reductions and maintaining the monthly buying pace of JPY2.1T, paring reductions to JPY100B per quarter, or maintaining the current reduction pace of JPY200B per quarter.

    • Some thoughts that even without further tapering, a JPY2.1T pace would still lead to a reduction in BOJ's JGB holdings by JPY40-50T per year, and tweaks in the order of hundreds of billions of yen would not significantly affect the trajectory for holdings (implying redemptions will do most of the work). Also, lack of viable buyers to fill the void left by BOJ remains an issue as banking sector capacity has been constrained by the regulatory environment, placing more hopes on individual or foreign investors.

    • Another request from the market participants meeting was for BOJ to indicate what it sees as the appropriate size of balance sheet, which would provide guidance for the level of current account balances required to stabilize money markets.

  • Notable Gainers:

    • +9.3% 000660.KS (SK Hynix): trading higher on positive read-through from strong SOX gains and momentum-driven rally in Micron

    • +4.9% 006280.KS (GC Biopharma): Eli Lilly to acquire Curevo

    • +3.9% 7733.JP (Olympus): to buy medical device manufacturer BioProtect for $270M (¥43.00B)

    • +2.7% 005930.KS (Samsung Electronics): trading higher on positive read-through from strong SOX gains and momentum-driven rally in Micron; union reportedly approves tentative agreement with 73.7% in favor

    • +1.3% 2330.TT (TSMC): reportedly to increase 3nm prices up to 15% in the second half of the year

  • Notable Decliners:

    • -6.2% 9896.HK (MINISO Group Holding): reports Q1 adjusted EPADS CNY1.80 vs year-ago CNY1.88

    • -4.7% 009830.KS (HANWHA SOLUTIONS): downsizes rights offering to KRW1.709T from KRW1.814T

    • -4.6% 1810.HK (Xiaomi): reports Q1 results; revenue CNY99.14B vs FactSet CNY100.06B

    • -1.9% 9618.HK (JD.com): European Commission reportedly plans in-depth foreign subsidies probe in connection with JD.com's proposed acquisition of CECONOMY

    • -1.0% 316140.KS (Woori Financial Group): Korean FSS requests Woori Financial Group to revise securities registration statement for acquisition of TONGYANG Life Insurance

    • -0.6% 5844.JP (Kyoto Financial Group): activist Silchester lowers stake to 5.37% from 6.40%

• Data:

  • Economic:

    • China

      • Jan-Apr 2026 industrial profits +18.2% y/y vs +15.5% in Jan-Mar

        • April industrial profits +24.7% y/y vs +15.8% in prior month

    • Japan April

      • Services PPI +3.0% y/y vs consensus +3.3% and revised +3.3% in prior month

    • Australia

      • April CPI +4.2% y/y vs consensus +4.4% and +4.6% in March

        • Trimmed mean CPI +3.4% y/y vs consensus +3.4% and +3.3% in March

      • Q1 construction work done +3.4% q/q vs consensus +0.8% and (0.1%) in Q4

  • Markets:

    • Nikkei: 3.32 or +0.01% to 64999.41

    • Hang Seng: (271.22) or (1.06%) to 25328.23

    • Shanghai Composite: (51.65) or (1.25%) to 4093.73

    • Shenzhen Composite: (37.47) or (1.30%) to 2834.85

    • ASX200: 59.90 or +0.69% to 8717.70

    • KOSPI: 181.19 or +2.25% to 8228.70

    • SENSEX: (102.34) or (0.13%) to 75907.37

  • Currencies:

    • $-¥: +0.03 or +0.02% to 159.3270

    • $-KRW: (7.56) or (0.50%) to 1499.7600

    • A$-$: (0.00) or (0.43%) to 0.7139

    • $-INR: +0.25 or +0.27% to 95.9431

    • $-CNY: (0.00) or (0.06%) to 6.7822