Morning Bid Asia: Asian markets face tough act to follow

Host Hotels & Resorts

30/07/2023 22:45

NEW YORK, July 31 (Reuters) - A look at the day ahead in
Asian markets from Stephen Culp, financial markets columnist.
    
    Goodbye, July.
    Asian stocks could be in for a bumpy start to the week if
they expect to outdo robust gains enjoyed the week prior, under
the power of potential stimulus in China, Japan's biggest-ever
minimum wage hike and the flickering optimism that the global
economy might avoid recession.
    Chinese stocks face the challenge of topping last week's
4.5% gain in the CSI 300  .CSI300 , the index's biggest weekly
jump since November. 
    The week also saw the Hang Seng  .HSI  and the Nikkei 225
 .N225  gaining 4.4% and 1.4%, respectively, while MSCI's index
of Asia Pacific shares outside of Japan  .MIAPJ0000PUS  advanced
2.5%.
    Markets were rocked at the tail-end of the week when the
Bank of Japan took its first step away from its decades-long
monetary stimulus policy, allowing interest rates more freedom
to move in harmony with inflation and economic growth.
    The move coincided with a decision to implement Japan's
biggest minimum wage hike in history in an effort to jolt the
world's third largest economy out of the doldrums.
    Market participants are also scrutinizing the other side of
the Sea of Japan for signs of life in the Chinese economy.
    On July 24, Beijing pledged to adjust its policies to
jump-start the nation's lackluster post-COVID recovery, a move
which helped solidify the yuan's near two-week high against the
dollar, sent the CSI 300 leaping nearly 3% and the HSI surging
4.1%.  
    In the coming week in the United States, second-quarter
earnings season gallops along, and a spate of high profile
results in the coming days are expected to shed additional light
on the global demand picture, particularly as it relates to
China.
    Megacaps Apple Inc  AAPL.O  and Amazon.com  AMZN.O , along
with chipmaker Western Digital Corp  WDC.O , construction and
mining equipment manufacturer Caterpillar Inc  CAT.N , globally
ubiquitous coffee chain Starbucks Corp  SBUX.O , and wireless
tech firm Qualcomm Inc  QCOM.O  are all on deck.
    Earnings from Marriott International  MAR.O , MGM Resorts
International  MGM.N  and Host Hotels & Resorts  HST.O  will
help illuminate the state of global travel and tourism demand. 
    Potentially market-moving U.S. indicators next week include
manufacturing and services PMI. Beyond that, job openings,
private payrolls, jobless claims and planned layoffs will set
the stage for the closely watched July employment report on
Friday.    
    
    Here are key developments that could provide more direction
to markets on Monday:
    - China's Caixin manufacturing PMI expected
    - Japan to unveil consumer confidence, housing starts and
unemployment data for June
    - Australia due to release July manufacturing PMI, June
building approvals
    - South Korea on deck with July import/export growth report

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
The race to raise rates    https://tmsnrt.rs/3Oaq21N
Asian stock market performance    https://tmsnrt.rs/3YdZxNh
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 (Reporting by Stephen Culp; editing by Diane Craft)
 ((stephen.culp@thomsonreuters.com; 646-223-6076;))