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Equity indices in the Asia-Pacific region ended the midweek session on a mostly higher note.

Japan’s Nikkei: +1.2%,
Hong Kong’s Hang Seng: -0.3%,
China’s Shanghai Composite: UNCH,
India’s Sensex: +0.5%,
South Korea’s Kospi: UNCH,
Australia’s ASX All Ordinaries: +0.6%.

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China’s June FDI -2.7% YTD (last 0.1%)
China Economic Daily pushed back against speculation that the economy could tip into deflation, pointing to a resilient manufacturing foundation.
Chinese banks are expected to lower their mortgage rates.

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Japan’s July Reuters Tankan Index 3 (last 8)
Bank of Japan Governor Ueda said that the 2.0% inflation target remains “some distance away.”

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New Zealand’s Q2 CPI 1.1% qtr/qtr (expected 1.0%; last 1.2%); 6.0% yr/yr (expected 5.9%; last 6.7%)
ANZ is maintaining its forecast for a 25-bps rate hike from the Reserve Bank of New Zealand in November after the release of hotter than expected CPI for Q2.

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Australia’s June MI Leading Index 0.1% m/m (last -0.3%)

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South Korea’s minimum wage will be increased by 2.5% for 2024.

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Major European indices trade in mixed fashion.

STOXX Europe 600: +0.4%,
Germany’s DAX: -0.1%,
U.K.’s FTSE 100: +1.4%,
France’s CAC 40: +0.2%,
Italy’s FTSE MIB: -0.1%,
Spain’s IBEX 35: UNCH.

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Eurozone’s June CPI 0.3% m/m, as expected (last 0.0%); 5.5% yr/yr, as expected (last 6.1%). June Core CPI 0.4% m/m (expected 0.3%; last 0.2%); 5.5% yr/yr (expected 5.4%; last 5.3%). May Construction Output 0.18% m/m (expected 0.10%; last -0.70%)

Semiconductor equipment manufacturer ASML beat Q2 expectations and raised its guidance for FY23.
The European Central Bank will reportedly request that banks publish weekly liquidity updates.

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The U.K. reported cooler than expected inflation figures for June, causing the market to reduce its expectations for a 50-bps rate hike to essentially a toss-up.

U.K.’s June CPI 0.1% m/m (expected 0.4%; last 0.7%); 7.9% yr/yr (expected 8.2%; last 8.7%). June Core CPI 0.2% m/m (expected 0.4%; last 0.8%); 6.9% yr/yr (expected 7.1%; last 7.1%). June Input PPI -1.3% m/m (expected -0.3%; last -1.2%) and Output PPI -0.3% m/m, as expected (last -0.6%)

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Carvana (CVNA 46.87, +7.02, +17.7%): reports Q2 results; beats on revs; announces agreement with noteholders that will provide the company significant flexibility by reducing total debt, extending maturities and lowering near-term cash interest expense

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Goldman Sachs (GS 335.59, -1.68, -0.5%): misses by $0.08, beats on revs; increases dividend 10%

Elevance Health (ELV 465.50, +21.81, +4.9%): beats by $0.26, beats on revs; guides FY23 EPS above consensus

M&T Bank (MTB 141.00, +6.24, +4.6%): beats by $0.89; Net interest income trending toward low end of the range; Loans up in Q3, down slightly in Q4; Deposits up slightly in H2 of 2023

U.S. Bancorp (USB 35.91, -0.64, -1.8%): beats by $0.07, reports revs in-line; guides Q3 revs below consensus; guides FY23 revs in-line
Brunswick (BC 80.00, -5.21, -6.1%): sees Q2 EPS and revs below consensus; sees FY23 EPS below forecast

Halliburton (HAL 37.15, -0.96, -2.5%): beats by $0.02, misses on revs

Baker Hughes (BKR 33.98, -1.06, -3.0%): beats by $0.06, reports revs in-line; sees Q3 and FY23 revs in line with estimates

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Cisco (CSCO 52.17, +0.93, +1.8%): upgraded to Overweight from Neutral at JPMorgan

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Johnson & Johnson files litigation against the U.S. Dept. of HHS as well as the Centers for Medicare and Medicaid Services to challenge the innovation-damaging drug pricing provisions of the Inflation Reduction Act (IRA)

(JNJ 157.16, -1.90, -1.2%):

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AT&T (T 14.07, +0.62, +4.6%): halted plans to remove lead cables from Lake Tahoe, according to WSJ; believes less than 10% of its network has lead cables, according to Bloomberg

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The weekly MBA Mortgage Applications Index rose 1.1% after a 0.9% increase last week with refinancing applications up 7.0% and purchase applications down 1.0%.

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