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StreetAccount Summary - Asian Market Recap: Nikkei +0.86%, Hang Seng (0.63%), Shanghai Composite +0.50% as of 04:10 ET

Jun 30 ,2026

• Synopsis:

  • Asia equites finished mixed Tuesday. Strong gains for the tech-orientated boards in Japan, South Korea, Taiwan and China's Shenzhen. The Topix and Shanghai Composite were also higher; India flat. Some losses for Australia, Singapore, Indonesia while the Hang Seng fell again. US futures slightly higher, Europe opened with small gains. US dollar strengthening, Asia currencies under renewed pressure with the yen and won notably lower. Crude futures lower, precious metals pared early losses, base metals mixed. Cryptocurrencies lower.

  • Asia technology stocks back on the front foot Tuesday on read through from overnight gains on the Nasdaq and the SOX semiconductor index. This supported the Kospi, Taiex and Nikkei 225 indexes with strong gains in Shenzhen once again. But again, the Hang Seng lagged and finished the month and quarter as a significant underperformer against regional peers as its internet-consumer names continue to grapple with high capex bills and weak consumption. For Tuesday, currency traders on alert for yen intervention after it reached a 40-year low against the US dollar while there were more losses for the won today, and the New Zealand dollar is approaching a multi-year low point.

  • In other developments, China June official manufacturing PMIs rose by more than expected with new orders, export orders and production expanding, while inflation metrics eased notably. The non-manufacturing PMI unexpectedly swung to growth as declines in new orders slowed. RBA minutes discussed softer economic momentum but upside inflation risks remain key consideration. New Zealand business confidence rebounded to pre-war high. Japan industrial production growth below expectations. South Korea industrial output weighed down by fall in chip production.

  • The Japan government said it would provide ¥150B in subsidies to Rakuten (4755.JP) to develop a low-earth orbit satellite network. Bloomberg reported Washington lobbying firms have cut ties with Alibaba (9988.HK) and Tencent (700.HK) due to new US restrictions. Honda Motor (7267.JP) reported May global vehicle production had fallen almost 5% in May. Samsung Electro-Mechanics (009150.KS) said it had signed a KRW454B component supply deal with a major US tech firm.

• Digest:

  • China official PMIs edge higher:

    • Official manufacturing PMI was 50.3 in June vs consensus 50.1. Follows 50.0 in the previous month and marks the third mild expansion in the past four months. Sector developments little changed with growth in tech and downstream sectors offset by contraction in upstream segments. New orders meaningfully rebounded from a marginal contraction as exports moved out of contraction. Production expanded at a slightly faster pace. Inflation metrics saw the biggest changes, easing back to late-2025 levels as input prices slowed notably while output prices swung to declines for the first time since December. Nonmanufacturing PMI was 50.2 vs consensus 49.9 and 50.1 in the prior month. New orders fell at the slowest pace in at least a year. Relatively better implications for profitability as input prices turned negative for the first time since October while output prices fell at a faster pace. Sector breadth seemingly largely positive while real estate remained the secular laggard and joined by air transportation. Service sector edged higher while construction declines moderated. Overall composite PMI ticked up to 50.6 from 50.5.

  • Yen sinks to lowest since Plaza Accord, MOF rhetoric unchanged:

    • Yen stimulating headlines after breaking well into the 162 level vs dollar Tuesday morning, breaching the 161.96 trough in Jul-24 and marking the weakest since December 1986 -- at the time undergoing a dramatic positive repricing in the wake of the 1985 Plaza Accord (Nikkei).

    • However, meaningful implications so far remain limited with nothing in the narrative that would indicate heightened expectations of FX intervention. Additional push lower during the Tokyo session was seen reflecting stop-losses on the break of 162, combined with active importer dollar purchases (corporate flows have shown this bias for some time).

    • Finance Minister Katayama repeated warnings that authorities stand ready to respond whenever as required while reaffirming consensus with US counterparts inclusive of their stance that bold measures may be warranted (Nikkei).

    • Core driver still seen to be the pivot in Fed policy expectations to rate hikes. Latest incremental momentum attributed to fiscal policy concerns after press reports highlighted draft versions of the Takaichi administration's economic blueprint due for release in July that stressed the utmost importance for BOJ policy to remain supportive for growth, encouraging speculation this will pose a barrier against further rate hikes. In turn, this is compounding behind-the-curve risks.

    • US-Japan rate expectations augur for a widening in differentials. Recent NQN discussion estimated the implied year-end policy rate gap which has generally defined the trend in USD/JPY. As of 25-Jun, the projected weighted average Fed midpoint rate was 3.95% (vs current 3.50-3.75%) and a BOJ rate of about 1.20% (vs current 1.00%). Notable was that, assuming increments of 25 bp, markets already pricing in more than one move for Fed and less than one for BOJ.

    • While markets saw clear signals the BOJ will accelerate the pace of hikes as the main requirement to quell behind-the-curve risks, the policy statement and Deputy Governor Uchida's press conference largely reaffirmed the status quo, though specific recognition of the risk of overshooting the inflation target was meaningful. Yet, the Summary of Opinions revealed calls for caution from the Cabinet Office representative -- Economic Security Minister Kiuchi -- which was enough to affirm longstanding market speculation the Takaichi administration would demonstrate opposition after having been largely quiet in the lead-up to the June MPM.

  • China advancing efforts on domestic AI, but hyperscalers lagging:

    • China advancing efforts on developing a domestic chip ecosystem. SCMP sources noted ByteDance targeting mass production and release of next-gen in-house CPU in H2 2027 and aiming to finalize design early next year at latest. Group collaborating with Qualcomm (QCOM) on securing manufacturing capacity, helping it to work around supply chain bottlenecks in wafer fabrication to advanced packaging. Last week QCOM revealed it was manufacturing custom chips for two unnamed hyperscalers, one of which was based in China.

    • Efficiency breakthroughs by China LLM developers seen reducing their reliance on expensive chip infrastructure. DeepSeek upgrade to V4 claimed to have increased user response speeds up to 85%, meaning one GPU coud now handle 185 user queries instead of 100 (SCMP). Performance metrics by China's lower cost, open-source AI models have ranked highly on some indexes.

    • Hype surrounding China's chipmakers has not extended to hyperscalers with Tencent (700.HK) and Alibaba (9988.HK) down 30% and 35% respectively ytd. Weakness has led MSCI China to underperform MSCI World Index this year by most since Sep-2021 (Bloomberg). Capex plans by both companies have drawn doubts about monetization potential amid a highly competitive landscape in China, driving investor preference for hardware manufacturers and pure play AI stocks.

  • RBA minutes note softening in economic momentum, but board alert to inflation risks:

    • RBA June minutes featured discussion of Q1 GDP data, which included softening in consumption, weaker public demand, stronger private investment and weak productivity growth keeping unit labor costs elevated. Timely indicators broadly consistent with RBA's May forecasts, household spending growth had not softened materially, and business investment intensions revised up.

    • Acknowledged April's weaker-than-market consensus headline inflation, though noted rise in short-term inflation expectations and signs of firms passing on costs. Labor conditions little weaker than expected in May but board cautioned against overinterpreting monthly data.

    • Based decision to leave cash rate unchanged on financial conditions turning somewhat restrictive with rate hikes being transmitted through economy, softening in housing demand and emergence of US-Iran agreement. Also cautioned inflation remains materially above target and policy needs to remain restrictive. Recent data offered mixed on how quickly economic momentum was slowing.

    • Discussed risks that could influence future decisions; potential for sustained higher oil (due to countries rebuilding inventories) to feed through to inflation expectations even if fuel prices fall. Second risk related to persistently weaker-than-expected productivity growth slowing return of inflation to target, as well as material weakness in housing market that could impact consumption.

  • Japan industrial production misses, labor market data little changed:

    • Industrial production rose 0.5% m/m in May, below consensus 1.1%, following 0.5% in the previous month. Sectors were mostly softer. Petroleum & coal products among the main drivers. Semiconductors & tech devices were moderately positive, autos edged higher. Among the drags, electric and IT equipment fell notably.

    • Shipments logged a similar increase, though inventories still fell for the third straight month, on pace for a third consecutive quarterly decline. Core capital goods shipments fell back sharply from the previous month's strength.

    • METI output survey projections point to a 3.7% increase in June, followed by no change in July. This points to slower growth in Q2 from the 2.5% q/q pace in Q1, while carry-over effects alone providing a headstart for Q3. Adjusted METI June projection of 2.6% relatively little changed from the raw estimate, though still suggestive of some downside risk.

    • Unemployment rate was steady at 2.5% in May, below consensus 2.7%. Sequential developments were incremental with mild growth in total employment (entirely coming from non-regular jobs) exceeding a marginal increase in labor force. Job offers to applicants ratio was 1.17 vs consensus and prior month's 1.18. Back-to-back sequential growth in job offers was enough to negate somewhat sharper increase in applications.

  • Notable Gainers:

    • +7.2% 009150.KS (Samsung Electro-Mechanics Co.): signs KRW453.99B MLCC supply contract with global major corporation

    • +5.4% 4755.JP (Rakuten Group): Japanese government reportedly to provide ¥150B in subsidies to Rakuten Group-led group to develop domestic low-earth orbit satellite network

    • +3.4% 005930.KS (Samsung Electronics): officially announces plans for KRW2,450T investment through 2040 for semiconductor mastery

    • +3.4% 9896.HK (MINISO Group Holding): approves new HK$2B buyback program

    • +0.8% 000660.KS (SK Hynix): officially unveils KRW1,100T mid-to-long-term investment strategy

    • +0.3% 7267.JP (Honda Motor): reports May global vehicle production (4.9%) y/y to 273,307 units

    • +0.0% 088350.KS (HANWHA LIFE INSURANCE): EQT Partners reportedly selects Hanwha Life as preferred bidder for 96.1% stake in Acuon Capital

  • Notable Decliners:

    • -12.9% 151.HK (Want Want China Holdings): reports FY results

    • -7.0% 7965.JP (Zojirushi): reports H1 results

    • -4.4% 780.HK (Tongcheng Travel Holdings): offers to acquire Dida at HK$1.3875/share cash, secures 53.7% shareholder support

    • -2.1% 2678.JP (ASKUL Corp): reports June non-consolidated net sales ¥30.82B, (13.8%) y/y

• Data:

  • Economic:

    • China June

      • Official manufacturing PMI 50.3 vs consensus 50.1 and 50.0 in prior month

        • Non-manufacturing PMI 50.2 vs consensus 49.9 and 50.1 in prior month

        • Composite PMI 50.6 vs 50.5 in prior month

    • Japan May

      • Unemployment rate 2.5% vs consensus 2.7% and 2.5% in prior month

        • Job offers to applicants ratio 1.17 vs consensus 1.18 vs revised 1.18 in prior month

      • Industrial production +0.5% m/m vs consensus +1.1% and +0.5% in prior month

        • METI survey projections +3.7% in June, 0.0% in July

    • Australia May

      • Private sector credit +0.7% m/m vs consensus +0.6% and +0.7% in April

    • South Korea May

      • Industrial production (3.0%) m/m vs (0.7%) in prior month

        • Industrial production (0.9%) y/y vs +1.5% in prior month

    • New Zealand June

      • ANZ Business Confidence +36.6 vs +10.0 May

  • Markets:

    • Nikkei: 594.21 or +0.86% to 70062.32

    • Hang Seng: (145.66) or (0.63%) to 22881.02

    • Shanghai Composite: 20.50 or +0.50% to 4094.40

    • Shenzhen Composite: 57.87 or +2.08% to 2840.67

    • ASX200: (44.70) or (0.51%) to 8778.70

    • KOSPI: 81.83 or +0.97% to 8476.48

    • SENSEX: (119.32) or (0.16%) to 76609.05

  • Currencies:

    • $-¥: +0.34 or +0.21% to 162.2820

    • $-KRW: +11.98 or +0.78% to 1552.7000

    • A$-$: (0.00) or (0.17%) to 0.6876

    • $-INR: +0.05 or +0.05% to 94.6801

    • $-CNY: (0.01) or (0.11%) to 6.7870