Global Market Quick Take: Asia – August 14, 2023 Global Market Quick Take: Asia – August 14, 2023 Global Market Quick Take: Asia – August 14, 2023

Global Market Quick Take: Asia – August 14, 2023

Macro 7 minutes to read
APAC Research

Summary:  Uptick in US PPI for July underpinned a bond rout and US equities extended their slide. China’s credit data showed a huge slump and may evoke a cautious start today, with focus also on Country Garden restructuring talks. That led to a slump in industrial metals with Copper at over one-month lows. USDJPY broke above 145 and Japan’s Q2 GDP could be in focus tomorrow.

What’s happening in markets?

US equities (US500.I and USNAS100.I): Semiconductor stocks declined

Stocks continued to slide on Friday. The S&P500 shed 0.1% while the Nasdaq 100 declined by 0.7%. While Information technology, communication services, and consumer discretionary were the worst-performing sectors, the energy, healthcare, and utilities sectors were the top gainers. Nvdia (NVDA:xhas) dropped by 3.6%, losing for four days in a row. Lam Research, (LRCX:xnas) plunged by 5%. The Philadelphia Semiconductor Index declined by 2.3%. Meanwhile, News Corp (NWS:xnas) advanced 4.5% on earnings beat.

Treasuries (TLT:xnas, IEF:xnas, SHY:xnas): Yields rise on firmer PPI

Treasuries sold off, yields surging, after the PPI prints surprised to the upside. Yields rose the most in the belly of the curve as the 5-year yield climbed 7bps to 4.25%. Meanwhile, the 2-year and 10-year yields ended the session around 5bps higher at 4.89% and 4.15% respectively.

Hong Kong & Chinese equities (HK50.I & 02846:xhkg): CSI300 plunges 2.3% on wealth management products and local government debt concerns

The Hang Seng Index declined 0.9% while the Hang Seng TECH Index plunged 2.4% last Friday. Chinese property developer Country Garden (02007:xhkg) continued to decline, falling 5.8% after preannouncing a USD7.6 billion loss estimate for the first six months of the year. China’s securities regulator met with some property developers and banks but Country Garden was not invited to the meeting. President Biden’s remarks about China as a “ticking time bomb” and “bad folks” also added to the worry about the Sino-American relationship. Alibaba (09988:xhgk) gained 1.1% and Li Ning (02331:xhkg) added 0.8%, both on earnings beat.

The CSI300 tumbled 2.3%. Non-bank financial led the market decline as online stories said Zhongrong Trust and three other trust companies defaulted on wealth management products.  Concerns about local government debts also mounted. Northbound Stock Connect has a new sale of RMB12.3 billion, the largest outflow from the A-share market since October last year.

FX: USDJPY breaks above the 145 handle

USDJPY has touched the 145 barrier on Friday and this morning in Asia with the surge higher in Treasury yields continuing. This week’s GDP and CPI data in Japan could be key, as will be the US data such as retail sales which if firmer could continue to push yields higher. Traders are also continuing to watch whether Japanese authorities could intervene but lack of verbal intervention so far suggests potential patience from them. EURUSD slid further below 1.10 to touch lows of 1.0940 with fears of surge in European gas prices cooling. GBPUSD supported by strong GDP data last week but labor market and inflation data this week will be in focus.

Crude oil: a small gain for the seventh week in the row

Crude oil recorded its seventh consecutive weekly gain as signs of stronger demand comes amid tightening supplies. The International Energy Agency said on Friday that oil demand surged to a record high in June and may even soar higher due to Chinese consumption. But prices were lower at the start of the new week with reports suggesting that Iran is pumping exports at an increasing pace, which helped to offset concerns about Saudi Arabia extending its production cuts. Still, escalating tensions over the Black Sea further threaten disruption of the crude oil exports from Russia. This week, oil traders will also focus on a lot of macro data from US retail sales to China’s activity indicators.

Copper: under pressure on China woes

Copper prices dropped to over one-month lows amid signs of stress in China’s property market. Concerns over liquidity of one of the country’s biggest property developers, Country Garden Holdings Co, brought back into the focus the troubled property sector. Meanwhile, China’s loan growth increase in July was also the smallest since the financial crisis. Copper prices are now threatening a break below $3.70 which could threaten the June low of $3.65.


What to consider?

US PPI comes in firmer-than-expected

Headline PPI rose 0.3% MoM (exp 0.2%) and accelerated from the prior 0.0%, which was revised down from 0.1%. The Y/Y rose 0.8%, up from the prior 0.2% (revised up from 0.1%) and above the 0.7% forecast. Core and super core measures were also higher than expected and steady at last month’s pace with core at 2.4% YoY and super-core at 2.7% YoY. The higher core measures suggest that the uptick is not just coming from the energy prices but a broader uptick in services inflation and could alert the Fed. Meanwhile, prelim University of Michigan saw the headline fall to 71.2 (prev. 71.6), but above the expected 71.0. Current conditions printed 77.4 rising from the prior 76.6 and topping the consensus of 76.9, but forward-looking expectations declined more-than-anticipated to 67.3 (exp. 68.1, prev. 68.3).

China’s credit growth falls more than expected in July

New aggregate financing plunged to RMB528 billion in July from RMB4,224 billion in June. While seasonally July was a slow month in credit, the number came in less than half of the RMB1,100 billion anticipated by economists. The growth rate of outstanding aggregate financial slowed to 8.9% Y/Y in July from 9.0% in June. New RMB loans were RMB346 billion in July, down from RMB3,050 billion in June, and were also less than half of the RMB780 billion expected. The growth of outstanding RMB loans fell to 11.1% Y/Y from 11.3% Y/Y. New loans to both the corporate sector and the household were weak. New loans to corporate dropped to RMB238 billion in July from RMB2,280 billion in June and RMB288 billion in July last year. New loans to households fell to net repayment of RMB201 billion in July, from new lending of RMB964 billion in July and RMB122 billion in July last year. The growth in M2 declined to 10.7% Y/Y in July from 11.3% in June.

Japan Q2 GDP on the radar tomorrow

Japan’s preliminary Q2 GDP will be released tomorrow morning in Asian hours, and estimates are suggesting we could see a strong uptick. Annualized GSP is seen coming in higher at 2.9% QoQ from 2.7% in Q1 as per Bloomberg forecast. While this could rattle the JGB markets and the Japanese yen as further tightening expectations build in, most of the GDP gains will likely come from net exports and consumer spending could remain weak. This could keep the BOJ’s focus on wage growth and give them room to argue need for continued stimulus.

Tesla cuts prices in China

After several rounds of price cuts earlier both in US and China, Tesla has now cut prices in China for some models. Price was Model Y Long-range and Model Y Performance has each been cut by RMB 14,000 ($1900). The Model Y forms part of the stable of vehicles, along with the Model 3, which are the best-sellers for Elon Musk’s company. The push for local EV makers in China has made the landscape for Tesla relatively tougher and Tesla’s China deliveries slumped 31% in July to lowest levels this year.

Country Garden suspends trading in 11 onshore bonds

Country Garden has suspended the trading of 11 onshore bonds at the exchange. Investors are expecting that the Chinese developer which failed to pay coupons of two offshore bonds and preannounced a huge loss for the first half of the year is set to start restructuring talks with creditors.



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

For thematic discussions on developments affecting your portfolio – watch our The Curious Investor videos.


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 is not intended to and does not change or expand on this. 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 (

Business Hills Park – Building 4,
4th Floor, office 401, Dubai Hills Estate, P.O. Box 33641, Dubai, UAE

Contact Saxo

Select region


Trade responsibly
All trading carries risk. Read more. To help you understand the risks involved we have put together a series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. Read more

Saxo Bank A/S is licensed by the Danish Financial Supervisory Authority and operates in the UAE under a representative office license issued by the Central bank of the UAE.

The content and material made available on this website and the linked sites are provided by Saxo Bank A/S. It is the sole responsibility of the recipient to ascertain the terms of and comply with any local laws or regulation to which they are subject.

The UAE Representative Office of Saxo Bank A/S markets the Saxo Bank A/S trading platform and the products offered by Saxo Bank A/S.