EM ASIA CREDIT: TSMC: Rejects 50:50 supply goals

The Ministry of Commerce on Saturday voiced opposition to the U.S. choice to withdraw Validated End-User authorization for three semiconductor businesses running in China. China urged the U.S. to rethink the move, adding it would take necessary measures to safeguard the legitimate rights and interests of enterprises, the Ministry said, after the U.S. removed Intel Semiconductor (Dalian) Co., Ltd., Samsung China Semiconductor Co., Ltd. and SK Hynix Semiconductor (China) Ltd. from the VEU list. VEU permission allows U.S. exporters to ship certain high-technology civilian items to pre-approved entities without requiring private export licenses for each shipment.

Aussie bond futures maintain a negative bias, despite softer Q2 GDP partials and monthly building approvals data. The back end remains softer, with XM (10yr) futures down 3.5bps to 95.665. 3yr futures (YM) are off by 1.5bps to 96.575. Still, both contracts remain up from late August lows. US Tsy futures are mostly lower as well, providing a negative bias for the Aussie market. 

• In the cash ACGB yield space we are around 1-5bps higher, with the 10-30yr tenors leading from a yield standpoint. The benchmark 3yr is up around 1.5%bps to 3.41%, while the 10yr is up 3bps to be back above 4.3%.
• The data showed Q2 company profits down 2.4%q/q, against a +1.1% forecast rise, while Q1 printed at -1.0%. Inventories were +0.1% in Q2, against a 0.2% forecast rise. Building approvals fell 8.2%m/m in July, after a 12.2% gain prion. August ANZ job ads were +0.1%m/m, after a -0.6% decline in July. 

Chinese insurers are set to continue boosting equity investment to counter persistently low interest rates and to meet policy requirements for channeling more medium- and long-term funds into the stock market, Yicai.com reported. The combined stock investment balance of the five major A-share listed insurance companies rose by CNY411.86 billion in H1 2025 from end-2024, a 28.7% increase, according to their semi-annual reports cited by Yicai. Net investment returns at the insurers generally declined by 0.1–0.25 percentage points, partly reflecting weaker bond interest income, the report said.