Economic Data
(SG) SINGAPORE MAY CPI M/M: 0.2% V 0.3%E; Y/Y: 5.0% V 5.1%E
Markets Snapshot (as of 04:30GMT)
Nikkei225 -0.3%
S&P/ASX -0.9%
Kospi -1.4%
Taiwan's Taiex -0.6%
Singapore Straits Times Index -0.2%
Shanghai Composite -0.6%
Hang Seng +0.3%
Sept S&P Futures -0.4% at 1,321
Aug gold +0.4% at $1,573/oz
Aug Crude oil +0.7% at $80.28/brl
Overview/Top Headlines
Asian equity markets are modestly lower, while euro and US futures are under pressure amid fleeting confidence over the upcoming EU summit. Top Greek government officials have been ruled out from attending - new PM Samaras is said to be recovering from eye surgery while Finance Minister Rapanos is in the hospital since Friday due to stomach ailments. As a result, the return of the Troika inspectors is being delayed, giving European leadership some time to pour over the Greek coalition policy letter asking lenders to roll back some of the conditions of austerity. Specifically, the request would see the government renege on plans to cut 150K public sector jobs and raise sales tax on restaurant and farming sectors, while extending jobless benefits to 2 years as part of a 2-year extension to meet fiscal deadlines. Over in Germany, Finance Minister Schaeuble has hardened his rhetoric on Greece, suggesting Athens government needs to stop asking for help and do more than it has. Chancellor Merkel reached a deal with local government officials to ratify the ESM ahead of its expected July 1st launch data, giving her both Bundesbank chambers going into the constitutional court challenge by some of the lawmakers.
Japanese yen has pared some of the gains late in the session, however the focus is still on the push by PM Noda over support for consumption tax hike vote in parliament this week. DPJ breakaway camp led by former leader Ozawa claims that over 50 lawmakers could follow him out of the party, which would likely result in a no-confidence for Noda cabinet. The threshold to keep Noda at the help is said to be 54 lawmakers, just as 53% respondents to a Nikkei News poll are questioning former DPJ leader Ozawa's intention to break up the party.
Speakers/Geopolitical/In The Press
(EG) Egypt Electoral Commission: Muslim Brotherhood candidate Mohammed Morsi wins nearly 51.7% of the vote; Egypt military ruler has congratulated Morsi on presidential victory.
(CN) China air traffic passenger volume more than tripled in 2011 to 300M travelers; may not sustain strong growth. - SCMP
(CN) Beijing may expand the trial of value-added tax (VAT) to more cities this year to boost tax revenues. - SCMP
(CN) China Housing Ministry researcher: Speculative demand being "squeezed out." - Chinese press
(CN) China business leaders and Western economists see some evidence of local China officials falsifying economic data. - NY Times (update)
(DE) Germany Finance Ministry: Collapse of the euro would see German economy contract up to 10%; unemployment would rise from 2.86M to over 5M people. - German press
(EU) Germany Finance Minister Schaeuble: Germans will have to vote on their constitution sooner than expected; Greece needs to stop asking for more help.
Equities
NSANY: China JV to invest CNY5B in new Dalian plant with initial capacity of 150K vehicles; expects capacity to double to 300k units.
Fuji Electric 6504.JP: To partner with Siemens on production of fossil-fuel-burning power plants in Japan. - Nikkei News
TM: To partner with Germany's BMW on fuel-efficient technologies through supply of hybrid and fuel cell systems. - Nikkei News
ABI.BE: Close to a deal with Mexico's Grupo Modelo; may be valued at over $12 B. - US financial press