Global Market Quick Take: Asia – June 29, 2023 Global Market Quick Take: Asia – June 29, 2023 Global Market Quick Take: Asia – June 29, 2023

Global Market Quick Take: Asia – June 29, 2023

Macro 7 minutes to read
Redmond Wong

Chief China Strategist

Summary:  US equity indices had minimal movement, with the S&P 500 index finishing nearly unchanged and the Nasdaq 100 seeing a slight increase. The energy sector performed well, rising 1% driven by a rally in crude oil prices. Nvidia dropped 1.8% as investors assessed the potential impact of an additional export ban on AI chips to China. Cruise line and timber stocks outperformed due to strong consumer confidence and home sales date earlier. Treasury yields decreased. The Federal Reserve's stress test results affirmed that the 23 large US banks have sufficient capital to withstand adverse conditions. Chinese EV maker Nio partners with CNOOC Refining to develop EV charging and battery-swapping infrastructure.

What’s happening in markets?

US equities (US500.I and USNAS100.I): little changed in choppy session; cruise liners advance, Nvidia drops

US stocks concluded a volatile trading session with minimal movement. The S&P 500 index remained nearly flat at 4,376, while the Nasdaq 100 saw a marginal increase of 0.1% to reach 14,964. On the other hand, the Russell 2000 index recorded a gain of 0.5%, closing at 1,858. The energy sector emerged as the top-performing sector within the S&P 500, rising 1% propelled by a rally in crude oil prices.

Nvidia (NVDA:xnas) dropped by 1.8% as investors were weighing the potential impact on the chipmaker’s revenues amid reports suggesting that the Biden Administration might implement an additional ban on the export of AI chips to China. Saxo's Peter Garnry provides a detailed analysis of the subject in his article here.

Tesla, on the other hand, advanced 2.4% ahead of its upcoming announcement of second-quarter deliveries numbers, anticipated over this weekend. The cruise line operations and timber stocks outperformed, driven by strong consumer confidence and favorable home sales data earlier in the week. Carnival (CCL:xnys) soared 8.8% and Norwegian Cruise Line (NCLH:xnys) added 7.6%. Weyerhaeuser (WY:xnys) surged 4.3%.

In extended trading hours, Micron (MU:xnas) gained 3% after reporting FY Q3 revenue that surpassed estimates and providing positive guidance.

Treasuries (TLT:xnas, IEF:xnas, SHY:xnas): yields dropped on strong demand for 5 and 7-year notes

Treasuries were initially weighed by Fed Chair Powell’s higher-for-longer comments but bounced strongly in New York afternoon to finish higher in prices and lower in yields. The rally was driven by large block buying in the 5-year T-note futures (ZFU3) and a strong 7-year auction. The USD25 billion 7-year notes were stopped at 1.1bps richer than the level at the auction deadline and registered a decent 2.65 bid-to-cover ratio with strong participation (75.3%) from indirect bidders. Yields on the 2-year, 5-year, and 10-year notes fell by 5bps to 4.71%, by 6bps to 3.97%, and by 6bps to 3.71% respectively. The market continues to price in one more 25bp rate high and most probably in July.

Hong Kong & Chinese equities (HK50.I & 02846:xhkg): Hang Seng and CSI300 Indices Stall, consumer stocks shine

The Hang Seng Index and CSI300 Index remained stagnant near recent lows, failing to extend the previous rally. However, market reactions to reports regarding potential additional US export bans on microchips were relatively subdued. The Hang Seng Index fluctuated between gains and losses throughout the day, ultimately closing 0.1% higher. Consumer stocks advanced, with sportswear and catering companies outperforming. Among the top winners of the Hang Seng Index were Shenzhou (02313:xhkg), Anta (02020:xhkg), and Haidilao (06862:xhkg).

Meanwhile, the Hang Seng Tech Index gained 0.8%, primarily driven by electric vehicle (EV) stocks. XPeng (09868:xhkg) jumped 11.2%, while Nio (09866:xhkg) surged by 7.2%. XPeng is set to launch its new G6 model today and has plans to commence shipments in July.

In the A-share market, technology, media, and telecommunication sectors weighed on the overall market performance. Conversely, coal mining, electricity utilities, and electric equipment stocks gained amid increased coal consumption in electricity generation, driven by a widespread heatwave. Additionally, the food and beverage sector also saw positive growth.

FX: AUD slid over 1% on soft CPI

The Australian dollar fell around 1.3% after the CPI unexpectedly tumbled to 5.6% in May from 6.8% in April and much below the 6.1% expected. The pessimism toward the Chinese economy also weighed on the sentiment about the AUD.

Crude oil: WTI gained 2% on US inventory drop

WTI crude oil rose by 2% after data from the American Petroleum Institute indicated a larger-than-expected 2.4 million barrel weekly decline.

What to consider?

Federal Reserve stress test: all 23 large U.S. banks deemed well-capitalized to withstand severe economic and market scenarios

The Federal Reserve has announced the results of its annual stress test conducted on the 23 large banks in the U.S The test concluded that each of these banks possesses adequate capital to absorb losses and maintain lending operations even under highly challenging conditions. The hypothetical stress scenarios employed in the test encompassed various adverse factors, including a 10% rise in the unemployment rate, a 38% decline in house prices, a 40% decrease in commercial real estate prices, widened corporate bond spreads, and heightened market volatility.

Under the stress test, the aggregate of the 23 large banks’ common equity tier-1 (CET1) ratio drops to a minimum of 10.1 before bouncing to 10.7 in Q1 2025, the end of the 2-year stress test period. On the individual bank level, the 5-quintile or the bottom five banks ranked by the minimum CET1 are Citizens (6.4), US Bankcorp (6.6), Truist (6.7), M&T (7.0), PNC (7.9). All of them, despite being relatively weaker than the others, have a minimum CET1 ratio comfortably above the required 4.5 under Basel III.

Industrial profits in China show improvement with a smaller decline in May

Industrial profits in China declined by 12.6% Y/Y in May, a smaller contraction than the -18.2% in April. The decline was largely driven by a smaller decline in profits in the manufacturing sector. In particular, profits in the equipment manufacturing industry increased by 15.2% Y/Y.

Nio partners with CNOOC Refining to build EV charging and battery-swapping infrastructure

Nio signed a strategic cooperation framework agreement with China National Offshore Oil Refining Co (CNOOC Refining) to jointly build electric vehicle charging and battery-swapping infrastructures across China. So far the two companies have jointly built three EV charging and battery-swapping operations. The announcement from the two companies des not give details of how many such infrastructures are to be built under the agreement.

Nike earnings report: modest revenue increase expected, focus on FY24 guidance

Nike (NKE:xnys) is set to release its earnings report today after the US market closes. Analysts' consensus estimate projects a modest 2.8% Y/Y increase in revenue, reaching USD 12.57 billion compared to USD 12.23 billion. This reflects slower growth in North American markets, specifically in the North American wholesale channel. Expectations for the EBITDA margin are at 11.8%, down from 13.5% a year ago. This decline is attributed to promotions aimed at clearing excess inventory, higher supply chain costs, and rising wages, which are offsetting lower freight expenses. Adjusted EPS is anticipated to plunge to USD 0.67 from USD 0.90.

Investors will closely monitor Nike's FY24 guidance, the share of direct channel revenue, and signs of improvement in China (where peers have recently shown more positive outlooks). According to Saxo's Peter Garnry, the reaction from investors will be defined by Nike's FY24 guidance on operating and gross margin. Further insights on this topic can be found in Garnry's article.


For a detailed look at what to watch in markets this week – read our Saxo Spotlight.


For a global look at markets – tune into our Podcast.

Quarterly Outlook 2024 Q3

Sandcastle economics

01 / 05

  • Macro: Sandcastle economics

    Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.

    Read article
  • Bonds: What to do until inflation stabilises

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.

    Read article
  • Equities: Are we blowing bubbles again

    Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.

    Read article
  • FX: Risk-on currencies to surge against havens

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.

    Read article
  • Commodities: Energy and grains in focus as metals pause

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.

    Read article


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (
Full disclaimer (

Saxo Bank (Schweiz) AG
The Circle 38

Contact Saxo

Select region


All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) Ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law. 

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.