Asia markets mixed as rising U.S. bond yields pressure equities

Singapore's retail sales rose 1.1% year on year in June, marking the fourth straight month of slowing growth.

Excluding motor vehicles, retail sales increased 2.5%, compared with 1.7% rise in May.

Singapore's statistics department said most industries recorded year-on-year growth in sales in June 2023, with the largest change coming from the food and alcohol industry.

The sector recorded a 30.7% year-on-year growth due mainly to higher demand for alcoholic products, including those sold in duty free shops.

— Lim Hui Jie

China announced on Friday it will lift tariffs on Australian barley imports starting Aug. 5, a move that points to improving bilateral relations and would alleviate supply concerns after Russia suspended a humanitarian corridor to deliver key Ukrainian grains to global markets.

The Chinese Ministry of Commerce "has ruled that it is no longer necessary to continue to impose anti-dumping duties and countervailing duties on imports of barley originating in Australia in view of changes in the Chinese barley market," it said in a statement Friday. No further details on these changes were provided.

Australia's trade, foreign and agriculture ministers said they "welcome this outcome" and expect a similar process to follow for the removal of duties on Australian wine. In March 2021, China introduced a crushing five-year tariff of up to 218% on Australian wine.

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— Clement Tan

Investors should "buy on dip" to trade Chinese equities in the next 2-3 weeks, Bank of America's chief China equities strategist, Winnie Wu told CNBC on Friday.

She added investors need to look beyond big caps for future winners. Wu identified some sectors — without naming specific companies — in two thematic clusters.

For green economy, Wu picked electric vehicles, battery supply chain, renewable energy and new material.

She also highlighted import substitutes like semi-conductors, artificial intelligence, industrial robotics.

Many of these counters are currently small and mid-cap names trading in the mainland A-share market, Wu noted.

— Clement Tan

Australia's central bank has cut the growth outlook for the country to 1% for 2023, down from its previous estimate of 1.25%.

The Reserve Bank of Australia said in its quarterly monetary policy statement that "growth in economic activity in Australia is forecast to remain subdued over the rest of the year, as cost-of-living pressures and the rise in interest rates continue to weigh on domestic demand."

Still, the RBA noted inflation was "heading in the right direction," cutting its inflation rate forecasts to 4.25% from 4.5%. The bank noted that inflation has been declining in the June quarter, but says it still remains "too high."

It expects inflation to continue to decline, hitting 3.75% at the end of 2024 and back within the 2–3% target range in late 2025.

— Lim Hui Jie

Hong Kong's Hang Seng Index led gains in Asia on Friday, powered mainly by property and basic materials stocks.

The index climbed 1.61%, with top gainers on the HSI being property stocks like Longfor Group, which saw a 6.88% rise in its shares.

This was followed by Country Garden Holdings, which rose 4.14% and China Resources Land, which climbed 3.84%.

— Lim Hui Jie

The Philippines' headline inflation rate slowed to 4.7 % in July, down from the 5.4% seen in June.

This is the sixth straight month of decline in the headline inflation and the lowest since March 2022, which was at 4%.

The country's statistics authority elaborated that the "continued downtrend" was mainly due to a slower increase in prices of housing, water, electricity, gas and other fuels.

Prices of food and non-alcoholic beverages also increased at a slower pace in July, while the transport sector saw a faster drop in prices.

— Lim Hui Jie

Morgan Stanley upgraded Indian stocks to "overweight," citing a strong profit outlook and the country's attractiveness to investors in a "multipolar world."

India's situation is in "stark contrast to that in China," the bank said in its Aug. 2 note.

Morgan Stanley also named its top India picks.

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— Weizhen Tan

Investment banks are bearish about European stocks because of a rapid deterioration in economic data.

UBS and Bank of America have predicted a bigger tumble for European stocks than a mere correction or pullback.

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— Ganesh Rao

Natural Gas rose 3.2% Thursday, putting the commodity on pace for its first positive day in four days. Prices hit a high of 2.586, the highest level since Aug. 1, when natural gas traded as high as 2.675.

To be sure, Natural gas is still down more than 2.5% week to date, on track for its second straight week of losses and its fourth negative week out of five.

The First Trust Natural Gas ETF is up 2.7% on pace for the best day since July 18, when it gained 3.02%.

The ETF's leaders Thursday include Silverbow, Northern Oil & Gas, APA Corp., Antero and SM Energy, which are all up 5% or greater for the day.

— Hakyung Kim

Investor Bill Ackman said he is betting against 30-year Treasurys as a hedge against the impact of long-term rates on stocks.

Ackman, the founder of Pershing Square Capital Management, said he is "short in size" on the 30-year Treasurys because it's also "a high probability standalone bet." He said he would be very surprised if we don't find ourselves in a world with persistent 3% inflation.

He added that he's implementing the short position through put options.

— Yun Li

The utilities and real estate sectors are Thursday's biggest S&P 500 laggards.

The Utilities Select Sector SDPR Fund and the Real Estate Select Sector SPDR Fund declined 1.8% and 1.7%, respectively, as of midday Thursday.

FirstEnergy and Pinnacle West Capital saw the biggest declines within the utilities sector, with shares down by more than 3% Thursday.

— Hakyung Kim

A July purchasing managers index reading came in slightly below economists' expectations.

The seasonally adjusted S&P Global U.S. Services PMI Business Activity Index came in at 52.3. That's a hair below the 52.4 reading forecasted by economists polled by Dow Jones.

This number is based off a survey of companies across economies around the world with the goal of capturing the health of the service sector.

"The service sector remains the main engine of growth in the [U.S.] economy, though there are signs of the motor spluttering amid rising headwinds," said Chris Williamson, chief business economist at S&P Global Market Intelligence.

— Alex Harring