Asia Market Quick Take – September 2, 2025

Key points:

• Macro: China’s private PMI rises to 50.5, exceeding forecasts
• Equities: Alibaba surges 18.5% on strong cloud growth
• FX: EURUSD climbed past 1.1700, USDJPY remained near 147.30
• Commodities: Gold near $3,500 record; silver above $40 for the first time since 2011
• Fixed income: Gilts fell; 30-year yield at 5.64%, near its 1998 peak

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Disclaimer: Past performance does not indicate future performance.

Macro:

• The RatingDog China General Manufacturing PMI climbed to 50.5, exceeding July's figure and the market forecast of 49.5, marking a high since March. Output grew with increased new orders and purchasing, while foreign demand declined less sharply. Despite rising backlogged work, firms cut staffing for the fifth consecutive month.
• The Euro Area unemployment rate reached a record low of 6.2%, down from 6.3% in June, with 170,000 fewer unemployed, totaling 10.805 million. Youth unemployment dropped to an all-time low of 13.9%. Germany and the Netherlands had the lowest rates at 3.7% and 3.8%, respectively, with Italy at 6.0%, France at 7.6%, and Spain at 10.4%.
• UK net mortgage approvals rose to 65,352, exceeding June's revised 64,571 and market expectations of 64,400, reaching the highest level since January. This indicates housing market recovery following the April expiration of a tax break and amid falling interest rates. Meanwhile, remortgage approvals dropped by 2,700 to 38,900 in July.

Equities: 

• US - closed
• EU - European stocks edged higher on September’s first trading day as investors weighed global rate outlook and geopolitical risks. The Eurozone STOXX rose 0.3% to 5,365, while STOXX 600 added 0.2% to 551. Defense stocks led gains after EU chief Ursula von der Leyen signaled plans for potential military deployments to Ukraine, boosting Rheinmetall (+3.2%), BAE, Airbus, Rolls Royce, and Leonardo (up 1–4.5%). Novo Nordisk climbed 1.8% on positive Wegovy heart-risk data. Banks also advanced amid bond market volatility ahead of France’s budget confidence vote.
• HK - Hang Seng jumped 2.2% to 25,617 on Monday, its biggest gain since Aug 13 and second straight rise, driven by broad-based buying. Consumer stocks rose 3%, with tech and property also strong, after upbeat China PMI data signaled renewed growth. Mainland shares climbed for a third day on ample liquidity, while gains were capped by mixed U.S. futures after a court upheld Trump tariffs for now. Alibaba soared 18.5% on cloud optimism, and pharma names rallied—Innovent (+8.2%), Wuxi (+7.2%), Sino Biopharma (+6.2%)—on faster drug approvals and AI-driven biotech prospects.
• SG - The Straits Times Index (STI) rose 0.2% to 4,276.07, with Yangzijiang Shipbuilding gaining 6.5% after announcing new orders worth US$920M while Venture Corp fell 2.4%. Regional markets are quiet ahead of the key NFP report this Friday.

Earnings this week:

• Tuesday - NIO, Academy Sports + Outdoors, Signet Jewelers, Zscaler, HealthEquity
• Wednesday - Salesforce, Hewlett Packard Enterprise, GitLab, Dollar Tree, Asana, American Eagle Outfitters, Macy's, Campbell's, ChargePoint, C3.ai
• Thursday - Broadcom, Lululemon, DocuSign

FX:

• With US markets closed for Labor Day, the Dollar Index (DXY) softened to 97.70 amid trade uncertainty after a court ruled most Trump tariffs illegal but maintained them pending Supreme Court action. Fed uncertainty continued, with Governor Cook's dismissal unresolved and Fed's Daly hinting at upcoming policy adjustments.
• EURUSD rose above 1.1700 following last week's momentum, despite ECB's Rehn noting inflation cooling risks and economic uncertainty necessitating flexible responses.
• GBPUSD saw modest gains, stabilizing above 1.3500, though lacking UK-specific drivers to propel upward movement.
• USDJPY exhibited indecision as Japanese stocks underperformed and trade tensions lingered, with Japan's negotiator postponing a US visit over rice purchase disputes. USDJPY traded around 147.30.
• AUD and NZD currencies held steady amid mixed Chinese PMI data and cautious market sentiment.
• Economic Calendar - BoJ Himino speech, EU Inflation Rate Flash, Canada S&P Global Manufacturing PMI, US ISM Manufacturing PMI, US ISM Manufacturing Employment

Commodities:

• Gold hovered just below April’s record above $3,500 as silver held above $40 for the first time since 2011, with Fed rate‑cut expectations and policy uncertainty fuelling the rally. Spot gold rose 0.1% to about $3,479, while silver steadied after Monday’s 2.7% surge.
• Oil rose and drifted in a narrow range ahead of this weekend’s OPEC+ output meeting and US moves on Russian supplies. WTI hovered near $65, about 1% above Friday’s close after the US holiday, while Brent held above $68.

Fixed income:

• The French–German 10-year yield spread held at 79 bps as France’s prime minister sought support ahead of next week’s confidence vote. German 10-year yields rose as much as 4 bps to 2.76% before easing into the close, with the US bond market closed for a public holiday; it reopens today. Gilts also sold off, with the 30-year yield up 4 bps to 5.64%, approaching its 1998 peak. Investors will be watching Japan’s 10-year government bond auction today.

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