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StreetAccount Summary - Asian Market Recap: Nikkei (1.89%), Hang Seng (0.64%), Shanghai Composite (0.42%) as of 04:10 ET

Jun 10 ,2026

• Synopsis:

  • Asia equities traded mostly lower Wednesday. Steepest losses in South Korea as its volatility continues; Taiwan and the Nikkei 225 also slid. Greater China saw modest losses, Japan's Topix and Singapore also down. Australia higher but volatile, India and Indonesia higher as authorities move to support currencies, stem investor exodus. US futures lower, Europe mixed at the open. US dollar flat, DXY hovering just below 100; AUD and NZD lower but relatively quiet elsewhere. Treasury yields higher across tenors, JGBs mixed, CGB yields higher post inflation data, IGB yields down as investors respond to investor incentives. Crude futures marginally higher, Brent at around $92/bl. Precious metals under pressure, gold at six-month low. Base metals mixed. Cryptocurrencies lower.

  • Asia continued its volatile week Wednesday as South Korea's Kospi saw yesterday's gains more than erased to send the benchmark back to near May's lows. Other technology leaning benchmarks in Taiwan and Japan also fell as the Nasdaq lost ground overnight and futures indicate another weak opening ahead today. Markets grappling with an increasing set of risks events both current and ahead: today, another set of missile strikes by and on Iran although crude prices pared early gains and the dollar was unchanged as commodity markets increasingly price in tit-for-tat attacks by both sides.

  • But other assets signal broader investor concerns with US CPI tonight expected to show higher inflation that could pave the way for a Fed rate hike; this led to another tick higher in Treasury yields in Asia trading today and gold selling off sharply. Finally, Bloomberg reported Softbank's (9984.JP) attempt to secure a margin loan using OpenAI as collateral has hit a snag, refocusing investor attention on technology valuations, and adding to angst felt among tech investors in Seoul, Taipei and Tokyo over the past week.

  • In regional macro developments today, China inflation figures for May showed consumer inflation stagnating at around 1.2% as food prices declined however producer prices spiked on a surge in fuel and commodity prices. Japan producer prices rose 6.3% y/y to easily beat consensus on higher energy costs and supply chain disruptions.

  • SoftBank's (9984.JP) attempts to get a $6B margin loan using its OpenAI as collateral has stalled just weeks after it cut its initial target from $10B, according to a Bloomberg report. ASICS (7036.JP) is considering the sale of its Onitsuka Tiger brand into a separate company but retain full ownership as a subsidiary. China is preparing a five-year $295B investment in data centers, according to Bloomberg, with China Mobile (941.HK) and China Telecom (728.HK) set to operate them using Huawei (+HUAWEI) chips. Kolon Industries (120110.KS) said it is reviewing strategic options regarding the sale of its display coating and semiconductor package materials businesses but nothing has been finalized.

• Digest:

  • US launches strikes against Iran following downing of Apache helicopter:

    • US launched multiple strikes against Iran in response to downing of Apache helicopter in Strait of Hormuz (Axios, Bloomberg, Reuters). Strikes targeted Iranian air defence and radar systems around Strait of Hormuz in Qeshm Island and Bandar Abbas. IRGC retaliated with drones targeting US assets in region though US officials said most were intercepted. Wording from both sides signaled de-escalation with CENTCOM describing strikes as a proportional response that was now complete and IRGC saying further strikes would be in response to future US attacks.

    • Latest development seen further clouding timeline for an agreement after Israel and Iran traded fire on weekend and Tehran recently launched missiles at Gulf states in response to US strikes in Strait of Hormuz. US and Iran continue to give conflicting assessments on state of talks with Tehran disputing Trump's claims an agreement is near. Negotiations have reportedly stalled over Iran's demands for access to frozen funds, while scope of nuclear concessions and future control of Strait of Hormuz among other discussion points.

    • Market fallout has been relatively contained with crude giving back earlier gains. Baseline assumption remains for a negotiated outcome with Trump downplaying latest incidents and no statements from Iran that it is abandoning talks. Energy flows said to be picking up with US Energy Secretary Wright saying traffic through Strait of Hormuz has risen "very meaningfully" from 1-2 weeks ago (Reuters). Gulf states also ramping up use of alterative routes with Saudi Arabian jet fuel exports to Europe via Red Sea pipeline tracking for highest monthly total since before war (Reuters).

  • China inflation largely in line, PPI inflation continues to build, CPI momentum steady:

    • PPI rose 3.9% y/y in May, matching expectations. Follows 2.8% in the previous month, marking the highest since Jul-22. This came despite a moderation in sequential momentum to 0.5% from 1.7%. Largely mirrors developments in upstream sectors with oil & gas and nonferrous metals the standouts. Petroleum, coal & other fuel processing sectors also up double digits on the year. Downstream prices also contributed via gradual narrowing year-on-year declines, remaining little changed sequentially. CPI rose a steady 1.2% y/y, slightly lower than consensus 1.3%. Core inflation edged back lower to 1.1% from 1.2%. Sharp increase in energy was basically negated by weakness in food prices largely driven by sharply lower pork prices. Incremental developments in sequential changes saw gasoline prices swinging to a 0.3% m/m decline from a 12.6% increase as a reflection of the international crude oil market. AI-related demand provided moderate support for mobile phones and tablets. Notable contrast with generally softer underlying momentum in services in a seasonal normalization from elevated activity during the May Day holiday.

  • Korea stocks in grip of extreme volatility:

    • South Korea's Kospi logged fourth consecutive daily move of more than 4%. Selloff again driven predominantly by SK Hynix (000660.KS) and Samsung Electronics (005930.KS), underlining concentration risks overhanging Kospi with two memory majors comprising 50% of index. Nothing specific behind latest drawdown, which has been attributed largely to an unwinding of crowded longs amid overbought conditions.

    • Sharp swings in Korea equities strengthening demand for downside protection as Kospi VIX hits record high with 20% mtd gain. That has widened Kospi put-call ratio to 2.5x, a five-year high (Bloomberg). Previous two times ratio topped 2.5 was followed by Kospi drawdowns of almost 17% in 2007 and more than 5% in 2021.

    • Volatility has magnified spotlight on record retail debt. Yonhap highlighted how retail traders assuming more leverage to fund dip buying with overdraft balances at major banks rising by more than KRW600B to KRW42.96T over Friday and Monday where Kospi underwent sharp correction. Underlines influence of individual investors in driving Kospi's direction via ETFs, putting their influence on par with foreign investors (Yonhap).

  • BOJ rate hike now thought to be a done deal, attention looks ahead to next step:

    • Bloomberg joined the chorus of polls indicating strong expectations for a BOJ rate hike next week. Governor Ueda's recent speech was viewed as the key signal, prompting 94% to say those remarks made a June hike either certain or highly likely. With a near unanimous 49 out of 51 economists looking for a move next week, about 71% foresee a return to a roughly six-month interval between policy changes. While this survey did not get into details, recall the Nikkei QUICK BOJ Watcher survey indicated projections for a follow-up were split between October and December. Bloomberg added that some 75% said another deferral of a rate hike this month would deepen market perceptions Prime Minister Takaichi is raising the bar for a move.

    • A Nikkei discussion took a cautious view on the implications of a situation where one rate hike may not do much to curb yen depreciation and rising bond yields. Echoed recent talk that silence from the Takaichi administration reflects acquiescence to BOJ independence under the recognition that market concerns about fiscal expansion are being compounded by growing perceptions BOJ is falling behind the curve. External pressure also coming from US Treasury Secretary Bessent's endorsement of monetary policy under Governor Ueda. Yet, lack of impact from a rate hike may lead Takaichi to question whether this is the solution, posing some uncertainty for a follow-up later this year. Recall that Ueda's pivotal speech had limited impact on the yen market, which is looking for clear signals BOJ intends to accelerate the pace of policy adjustments. Market pricing points to a more than 90% probability of a hike next week. However, expectations for two moves this year have fallen behind after tracking as high as 100% last month.

    • This makes BOJ's JGB purchase plan a related issue. Nikkei expanded on the historical context of purchases and the rationale behind an earlier report indicating board members are set to halt further purchase reductions in FY27. While this has been subject to more debate than a rate hike, such a decision is seen as a concession to the JGB market to balance out rate hike effects, while also likely to offer some relief for the Takaichi administration.

  • Japan CGPI inflation strengthening rapidly:

    • CGPI rose 6.3% y/y in May, above consensus 5.6%, marking the highest since Mar-23. Prior month was revised to 5.3% from 4.9%. Sequential momentum moderated to 0.9% m/m, more in line with expectations of 0.8%, following revised 2.8% in the previous month. Fairly broadly based pickup led by topical segments -- petroleum & coal products, utilities, chemicals and nonferrous metals. Closely watched import prices surged 25.5% y/y in yen terms, following revised 21.0% in the prior month, marking back-to-back readings above 20% in the wake of the Middle East conflict. FX was not a factor as USD/JPY declined 0.6% y/y. Instead, contract currency prices are accelerating rapidly and logged the second straight month in double digits, largely driven by crude oil prices. Similar strengthening in export prices, though at a somewhat lesser pace, continuing to point to some deterioration in terms of trade. Developments broadly playing out according to the case for a BOJ rate hike next week, boiling down to a working conclusion that inflation risks are becoming more pertinent than growth risks in light of the Middle East situation. Transmission of higher crude oil prices has been incorporated into the main outlook scenario while spillover from supply chain disruptions skew the risks to the upside. Also a lot of attention on the propensity for inflation expectations to be lifted by the combination of Middle East effects and existing domestic inflationary dynamics, leading to concerns that underlying inflation will overshoot the 2% target.

  • Notable Gainers:

    • +7.6% 120110.KS (Kolon Industries): Responds to media report regarding sale of display coating and semiconductor package materials business units

    • +1.9% 4502.JP (Takeda Pharmaceutical): FDA accepts Takeda's sBLA for Intravenous ENTYVIO (vedolizumab) in pediatric Ulcerative Colitis and Crohn's Disease

    • +0.6% 8795.JP (T&D Holdings): Apollo seeking to acquire Japanese life insurer; has looked at subsidiaries of T&D and Orix - FT

  • Notable Decliners:

    • -9.9% 6770.TT (Powerchip Semiconductor Manufacturing): Issues 26.3M units at price of $31.65/unit (equivalent to NT$66.68/unit)

    • -6.8% 7974.JP (Nintendo): Nintendo Direct 2026 seen as lackluster

    • -0.7% 7936.JP (ASICS Corp): Responds to media reports; confirms consideration of Onitsuka Tiger spin-off

• Data:

  • Economic:

    • China May

      • CPI +1.2% y/y vs consensus +1.3% and +1.2% in prior month

        • PPI +3.9% y/y vs consensus +3.9% and +2.8% in prior month

    • Japan May

      • CGPI +6.3% y/y vs consensus +5.6% and revised +5.3% in prior month

  • Markets:

    • Nikkei: (1,237.36) or (1.89%) to 64179.27

    • Hang Seng: (157.94) or (0.64%) to 24407.96

    • Shanghai Composite: (16.80) or (0.42%) to 3993.23

    • Shenzhen Composite: (54.16) or (1.97%) to 2688.46

    • ASX200: 49.10 or +0.57% to 8653.30

    • KOSPI: (366.11) or (4.52%) to 7730.82

    • SENSEX: 526.75 or +0.71% to 74445.51

  • Currencies:

    • $-¥: +0.04 or +0.03% to 160.4040

    • $-KRW: +3.63 or +0.24% to 1526.5500

    • A$-$: (0.00) or (0.24%) to 0.7012

    • $-INR: (0.15) or (0.16%) to 95.2645

    • $-CNY: +0.00 or +0.04% to 6.7755