Asian equity markets are predominantly in the green,Opening the week

Asian equity markets are predominantly in the green, opening the week by shrugging off the caution seen late on Friday with response to some better than expected economic data. With about 90 minutes to go in Tokyo trading, Nikkei225 is in rally-mode coming out of midday break, gaining about 1% to 9,880. Hang Seng and Taiwan are up 2.7% and 1.4% - outperforming on respective macro developments, while S&P/ASX and Kospi are up only 0.5%. Ahead of the US open, front-month S&Ps are lifted by 0.3% above $918, while benchmark yields remain contained below 3.80% ahead of the much-anticipated Fed decision this Wednesday.

Economic docket saw a strong industrial sector update from Japan, housing figures from UK, and 2nd tier data from Australia and New Zealand. Japan's Q2 BSI All Industry index improved on a Q/Q basis to -22.4 V -51.3 prior, and large manufacturers saw its best data since Q3 of 2008 at -13.2 - a sharp gain from the prior -66.0 and testament to the overall industrial/manufacturing sector improvement noted by both the Bank of Japan and Japan's government. April Tertiary Industry Index suggested that recovery may be at least a couple of months in the works, coming in 2.2% - the highest level since January 2006. Housing data from the UK were a disappointment, with June HPI contracting for the first time since January at -0.4% vs +2.4% seen in May. In Australia, May New Vehicle Sales saw its best increase since January 2005 at 5.4% v 1.7% prior, but New Zealand's credit card spending declined 2.4% in May vs 1.6% drop in April - evidence of local currency strength weighing on the overall economy as implied by local Prime Minister and Finance Minister in recent days.


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