Asia-Pacific Markets, Central Bank, Rate Hike, RBA

Shares of Asian technology companies saw sharp declines on Wednesday following comments from US Federal Reserve Chairman Jerome Powell.

The Hang Seng Tech index fell 3.7%, JD.com fell 4.7% and Alibaba traded 3.56% lower in the afternoon session.

In South Korea, SK Innovation and SK Hynix fell 3% and 2.47% respectively, while Samsung Electronics traded 0.82% lower.

Shares of Taiwan-listed Taiwan Semiconductor Manufacturing (TSMC) and MediaTek also fell in Taipei.

– Jihye Lee

Stocks have rallied broadly this year from 2022 lows, but veteran investor Nancy Dengler believes “there’s still plenty of room” to find high-quality stocks with rising dividends and reliable earnings growth.

Investors should be careful where they put their money to work, he says — a sentiment echoed by many market pros.

Pro subscribers can read more here.

– Javier Ong

Thailand may hold off on interest rate hikes in May, Citi analysts wrote in a daily note.

It said there was a “split vote” among MPC members on March 29 and “a pause in rate hikes in May is likely”.

of Thailand Headline inflation increased by 3.79% in February According to analysts polled by Reuters, the official data fell short of the 4.18% increase year-on-year.

The Citi expects another 25 basis points policy rate hike at its next meeting.

– Lee Ying Shan

Hong Kong’s Hang Seng index fell more than 2% in the first hour of trading, led by consumer sentiment, health care, basic goods and technology stocks.

Property stocks also saw sharp losses, including Longfour Group Holdings, which fell 4.59%, and Country Garden, which fell 4.56%.

Chinese smartphone maker Xiaomi fell more than 4%, while NetEase fell more than 3%.

– Jihye Lee

Oil prices rose slightly among new export partners after OPEC’s secretary-general said Russia’s oil production remained strong.

“Russian manufacturing is resilient and has been able to find new homes,” he said. “It’s not just China and India, I think it’s Turkey as well,” OPEC Secretary General Haitham Al Qais said during the CERAWEEK conference Conducted by S&P Global.

Brent crude futures were up 0.23% at $83.48 a barrel, while US West Texas Intermediate futures were up 0.06% at $77.63 a barrel.

– Lee Ying Shan

US-listed shares of Singapore-based technology company Seay jumped 21.78% after reporting its first-quarter profit. Latest earnings report On Tuesday.

“Recent cost-cutting measures such as salary freezes and headcount cuts have given Sea’s shares some much-needed respite,” said Jonathan Wu, senior research analyst at Philip Securities.

The ocean has seen billions of losses in previous years.

The company reported positive net income of $422.8 million driven by cost improvements in the fourth quarter of 2022, compared to a negative $616.3 million in the same period a year ago.

“A positive surprise in fourth-quarter 2022 earnings should continue to provide upward momentum — particularly as the path to profitability is somewhat clearer,” Wu said.

China’s economy saw weak imports despite a rapid reopening, Wang Tao, head of China economic research at UBS, said in a note.

“Despite the (consecutive) rapid reopening in the last 2 months, domestic demand growth may still have been relatively soft on a y/y basis,” he said in a note.

He also said import volumes of copper ore and iron ore have improved since December due to growth in construction activities.

“Our channel checks suggest that construction sector activity slowed in the first two weeks post-CNY holiday, but accelerated in the 3rd and 4th weeks,” he said, adding that crude oil import growth also fell along with IT components and auto imports. products.

China’s exports fell 6.8% in February in US dollar terms and imports fell 10.2% on Tuesday.

– Jihye Lee

The US is planning to scrap its Covid testing requirements for travelers from China, a source familiar with the matter said. NBC News.

The requirements, which apply regardless of nationality and vaccination status, began on January 5.

“Since the implementation of the policy, we have evidence that cases, hospitalizations and deaths are decreasing. [People Republic of China] And we’ve gathered better information about the outbreak,” the person told NBC, adding that the U.S. will continue to monitor cases in China and around the world.

The traveler-based genetic surveillance program will still be in place and will continue to monitor flights from China and regional transit hubs, NBC said.

– Lee Ying Shan, NBC News

Japan’s seasonally adjusted current account balance rose to 216.3 billion yen ($1.57 billion) in January, government data showed on Wednesday.

Abundant reserves saw a sharp drop from December’s balance of 1.18 trillion yen and November’s balance of 1.92 trillion yen.

The Japanese yen weakened slightly to 137.46 against the US dollar on Wednesday morning

– Jihye Lee

Reserve Bank of Australia Governor Philip Lowe said in a speech on Wednesday that the central bank was close to reaching a point where it would suspend further interest rate hikes.

“With monetary policy in restrained territory, we are close to the point where it would be appropriate to pause interest rate increases to allow more time to assess the state of the economy,” he said, according to a transcript.

“At what point a pause is appropriate will be determined by our assessment of the data and outlook,” Lowe said.

Commonwealth Bank of Australia senior economist Belinda Allen said in a note that Tuesday’s report had a less hawkish tone.

Allen said the CBA expects the Fed to raise rates once more before pausing to 3.85%. — Or hold rates at the upcoming April monetary policy meeting.

– Jihye Lee

The gap between the 2-year Treasury yield and the 10-year Treasury rate widened to 100 basis points during Tuesday’s trade. The spread has not spread at this level since September 22, 1981.

The 2-year yield rose to its highest level since 2007 after Federal Reserve Chairman Jerome Powell said the central bank should again pick up the pace of interest rate hikes.

A yield curve inversion is a phenomenon that has accurately signaled impending recessions for half a century.

– Yun Li

Federal Reserve Chairman Jerome Powell’s congressional testimony contained two key quotes regarding markets.

“Recent economic data has come in stronger than expected, suggesting that the final level of interest rates will be higher than previously expected,” Powell said in prepared comments.

This means the central bank may continue to hike for longer than the market expects. Many wanted the central bank to stop hiking soon.

“If the totality of the data indicates that faster tightening is needed, we will be prepared to increase the pace of rate hikes,” Powell said.

The Fed’s last hike was a quarter point as it slowed pace. Powell hints here that the Fed may need to pace again, which is a big fear for markets.

– John Melloy

The US-listed ETF invests only in companies led by women, with the belief that the “woman factor” will perform well.

The ETF was created after its fund manager, who has a background in investment banking and private equity, observed that institutional barriers to female candidates for top positions required the winners to perform at a higher level, resulting in better overall performance. performance.

The ETF is based on an index that has outperformed its benchmark by more than 20% over the past five years.

CNBC Pro subscribers can read more here.

– Ganesh Rao

Meta plans another round of layoffs this week that could affect thousands of workers, according to Bloomberg News. Report Released on Monday evening.

The job cuts come after the company laid off 13% of its workforce in November as part of a major cost-cutting plan. CEO Mark Zuckerberg previously told investors that 2023 will be a “performance year” for the company.

Meta shares rose 1.5% in premarket trading on Tuesday following the news.

– Hakyung Kim