Morning wrap (30.04.2025)

In the first part of the day in the Asia-Pacific region, we observe modest movements in stock indices. On the Chinese market, index changes are limited to the -0.60% to 0.00% range. The Japanese JP225 index is down 0.20%, AU200.cash is trading flat, and Singapore’s SG20cash is down 0.25%. US CFD index futures are posting declines in the range of 0.45–0.55%.

SMCI, a semiconductor manufacturer, released preliminary financial data for the completed quarter. The company lowered its revenue and earnings-per-share forecasts, citing delays in customer decisions and inventory issues. It also reported lower gross margins. The company’s stock dropped 15% in after-hours trading and contributed to a sell-off in Nvidia and other sector peers.

US Treasury Secretary Bessent confirmed that Trump still needs to personally approve 18 major trade agreements. He emphasized that none of them have been finalized yet. His comments suggest that Trump’s involvement is slowing progress, and markets may be prematurely pricing in the completion of these deals.

President Trump congratulated Canadian Prime Minister Mark Carney on his election victory. Both leaders emphasized their willingness to cooperate as sovereign nations. They plan to meet in person soon.

Inflation in Australia for Q1 2025 came in slightly above expectations — the CPI index was 2.4% y/y. Despite this, the data supports expectations for a rate cut at the Reserve Bank of Australia's meeting on May 19–20. However, the RBA may avoid strongly dovish messaging due to global economic uncertainty. The AUD rose slightly following the data release.

China’s official manufacturing PMI fell to 49.0 in April (forecast 49.8, previous 50.5). Meanwhile, the Caixin PMI, which focuses on smaller private exporters, remained in expansion territory at 50.4. This discrepancy highlights the resilience of small exporters despite rising tariff pressure. Export orders fell at the fastest pace since July 2023.

Goldman Sachs’ chief economist expects a continued 5% decline in the value of the dollar, which would deepen inflation but support exports. Economic slowdown in the U.S. may further weaken the USD.

Industrial production in Japan in March 2025 fell by 1.1% m/m (forecast -0.5% m/m, previous 2.3% m/m). Retail sales rose 3.1% y/y but also missed expectations. Officials pointed to weak vehicle production and concerns over U.S. tariffs. Nevertheless, the Bank of Japan is expected to leave monetary policy unchanged at its April 30–May 1 meeting.