Asia Pacific markets, Fed, rate hikes, RBA

Stocks have generally recovered this year from their 2022 lows, but veteran investor Nancy Tengler believes “there are still plenty of places” to find high-quality stocks with rising dividends and reliable earnings growth.

She says investors should be careful about where they put their money to work – a view echoed by several market professionals.

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— Zavier Ong

Thailand may hold back rate hikes in May, Citi analysts wrote in a daily note.

It added that there is a possibility of “a split vote” among the members of the monetary policy committee on March 29, and “a possible pause in the rate hike in May”.

Headline inflation in Thailand for February rose 3.79% year on year, official data showed, down from a 4.18% increase according to analysts polled by Reuters.

Citi expects there will still be a 25 basis point policy rate hike at the next meeting.

— Lee Ying Shan

from Hong Kong Hang Seng index lost more than 2% in the first hour of trading, led by consumer discretionary, healthcare, basic materials and technology stocks.

Real estate stocks also experienced significant losses, including Holdings of the Longfor Group that fell by 4.59%, Rural garden that lost 4.56%.

Chinese smartphone maker Xiaomi fell more than 4% and NetEase lost more than 3%.

— Jihy Lee

Oil prices moved slightly higher following OPEC Secretary General’s claim that Russian oil production remained strong, with new export partners in the middle.

“Russian manufacturing has been resilient and has found new homes,” he said. “It’s not just China and India, I think it’s Turkey as well,” OPEC Secretary General Haitham Al Ghais said at a CERAWEEK conference held by S&P Global.

Brent crude oil futures last traded 0.23% higher to $83.48 a barrel, while US West Texas Intermediate futures rose 0.06% to $77.63 a barrel.

— Lee Ying Shan

US-listed shares of the Singapore-based technology giant Sea jumped 21.78% after reporting its first-ever quarterly profit in its latest earnings report on Tuesday.

“Recent cost-cutting measures, such as salary and workforce freezes, have given Sea’s stock some much-needed respite,” said Jonathan Woo, senior research analyst at Phillip Securities.

Sea had lost billions in recent years.

The company posted positive net income of $422.8 million in the fourth quarter of 2022 from cost improvements, up from a negative $616.3 million in the same period a year ago.

“The positive surprise in Q4 2022 results should give Sea continued upward momentum, especially as the path to profitability is a little clearer,” said Woo.

China’s economy saw weaker imports despite the speedy reopening, Wang Tao, UBS China’s head of economic research, said in a note.

“Despite a rapid reopening (sequentially) over the past 2 months, year-over-year growth in domestic demand may still have been relatively weak,” she said in a note.

She added that copper ore and iron ore import volumes both improved from December, likely due to a pick-up in construction activity.

“Our channel checks suggest that the resumption of work in the construction sector was slow in the first two weeks after the CNY holiday, but accelerated in the 3rd and 4th weeks,” she said, noting that crude oil import growth also declined, along with imports of IT components and cars. Products.

On Tuesday, China saw exports fall 6.8% in US dollars in February and imports also fell 10.2%.

— Jihy Lee

The US plans to scrap Covid testing requirements for travelers from China, a source familiar with the matter told NBC News.

The requirements, which applied regardless of nationality and vaccination status, took effect on January 5.

“Since the implementation of the policy, we have evidence that the number of cases, hospitalizations and deaths in the world is declining. [People Republic of China] and we’ve gathered better information on the rise,” the person told NBC, adding that the US will continue to monitor cases in China and around the world.

The traveler-based genomic surveillance program remains in effect and will continue to monitor flights from China and regional transportation hubs, NBC reported.

— NBC News, Lee Ying Shan

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

The balance sheet surplus saw a sharp decline from the December balance of 1.18 trillion yen and the November balance of 1.92 trillion yen.

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

— Jihy Lee

Reserve Bank of Australia Governor Philip Lowe said in a speech on Wednesday that the central bank is closer to pausing further rate hikes.

“With monetary policy now in restrictive territory, we are closer to the point where it is appropriate to pause rate hikes to allow more time to assess the state of the economy,” he said, according to a transcript.

“When it is appropriate to pause will be determined by the data and our assessment of the outlook,” Lowe said.

Commonwealth Bank of Australia senior economist Belinda Allen said in a note that the speech did not reverse Tuesday’s statement, which carried less aggressive tones.

Allen added that CBA expects the central bank to rise one more time before pausing to 3.85% — or to hold rates at the upcoming April monetary policy meeting.

— Jihy Lee

The spread between 2-year Treasury yields and 10-year Treasury yields widened to 100 basis points during Tuesday’s trading. This spread has not been this wide since September 22, 1981.

Two-year yields rose to their highest level since 2007 after Federal Reserve Chairman Jerome Powell said the central bank may need to ramp up the pace of rate hikes again.

The inversion of the yield curve is a phenomenon that has been an accurate indicator of coming recessions for half a century.

— Yun Li

There were two key quotes in Congressional testimony from Federal Reserve Chairman Jerome Powell as far as markets were concerned.

“The latest economic data is stronger than expected, suggesting that the eventual interest rate level will likely be higher than previously expected,” Powell said in prepared remarks.

This means that the Fed may continue to raise for longer than the market expected. Many wanted the Fed to stop hiking quickly.

“If the totality of the data indicated that faster tightening is warranted, we would be willing to step up the pace of rate hikes,” Powell also said.

The last rate hike by the Fed was only a quarter of a point as it slowed the pace. Powell is hinting here that the Fed may need to speed up, which is a big fear for the markets.

—John Melloy

A US-listed ETF invests only in companies led by women, believing that the ‘feminine factor’ outperforms.

The ETF was created after the fund manager, who has a background in investment banking and private equity, noticed that institutional barriers to female candidates for top positions meant that those who did succeed had to perform at a higher level, resulting in better overall results. performance.

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

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— Ganesha Rao

meta is planning another round of layoffs that could affect thousands of workers as early as this week, according to a Bloomberg News report released Monday night.

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 would be the “year of efficiency” for the company.

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

— Hakyung Kim