Asian equities could trade mixed after a flat day on Wall Street, but with some headwinds from higher US yields amid a renewed global bond sell-off with heavy Gilt selling, with the UK 10 and 30-year bond yields rising above 4.5% and 5%, respectively.
On the macro front, cyclical measures from China could keep pressure on the Yuan as China’s cabinet said it would cut fees for small companies by more than CNY 53bln and provide tax relief for some individual commercial pensions. On the other hand, some minor support from Chinese regulators could bring some support for the currency, as reports noting that regulators asked fund managers and brokers to stabilize the stock market is not factual. Looking ahead, traders will keep an eye on the BoJ July Meeting minutes after a dovish decision that helped the USD against the Yen and triggered an FX intervention. Quarter/Month-end flows will also be key for price action in the coming sessions.
