New Zealand interest rate hike, inflation data

UBS expects China to fully reopen by Q3 2023

UBS Wealth Management expects a full reopening for China by the third quarter of next year due to a number of factors.

“We think it takes some time for the government to want to check public messages because [some] the concerns of the Chinese public are very real,” UBS Global Wealth Management’s Min Lan Tan told CNBC’s “Squawk Box Asia.”

He added that the country should work to increase the vaccination rate of its elderly population and ensure an adequate medical system before a full reopening.

On the latest measures to ease quarantine for international travellers, Tan described them as “two steps forward and one step back”.

Reopening the country “will be a process, not an event,” he said.

– Jihye Lee

Singapore’s inflation rate eases thanks to small increases in gas and electricity prices

Singapore’s core inflation rate fell from 0.2% to 5.1% in October year-on-year, the Ministry of Trade and Industry (MTI) said, after seeing the same index at 5.3% in September.

The latest consumer price index for October is lower than a Reuters poll which forecast 5.3% for October.

The inflation rate for all items also fell to 6.7% in October on an annual basis after seeing a 7.5% rate in September.

MTI said the easing was due to smaller increases in goods and services as well as gas and electricity prices.

“Prices of energy and food commodities have eased from their peaks at the start of the year but remain elevated given continued supply constraints,” the ministry said in a statement.

—Lee Ying Shan

Malaysia’s shares have changed little as the nation waits for a new prime minister

Shares listed in Malaysia have changed little as the country’s political deadlock continues and local media have reported that Malaysia’s king, Yang di-Pertuan Agong, will make a decision, without providing a timeline.

The benchmark index KLCI fell 0.09% after two negative sessions.

Among the index heavyweights, Genting Malaysia fell 2.33% after reporting third-quarter earnings, and Top Glove also lost 1.1%, while Nestle gained 0.28% and CIMB rose 0.18%.

The Malaysian ringgit it rallied slightly against the US dollar in the morning session and was last seen at 4.5690.

—Jihye Lee

Shares of Chinese online games are higher as the crackdown on the sector appears to ease

The New Zealand central bank hints at further hikes

Reserve Bank of New Zealand (RBNZ) governor Adrian Orr said the bank’s only goal is to bring the official exchange rate to a point where inflation can be reduced.

Orr’s comments come after the central bank made its largest rate hike by 75 basis points.

“Our core inflation rate is too high,” Orr said at a news conference, adding that the central bank is “well on the trajectory of the tightening cycle.”

In a separate press release shortly after the decision, the RBNZ said: “Committee members agreed that monetary conditions needed to continue to tighten further

—Lee Ying Shan

BYD shares fall after Berkshire Hathaway cuts stake

Shares of BYD Hong Kong-listed fell 2.64% after Warren Buffett’s Berkshire Hathaway announced it was cutting its stake in the Chinese electric vehicle maker.

According to an HKEX filing, the company sold 3.2 million shares worth about 630 million Hong Kong dollars ($80.6 million), reducing its holdings of the company to 15.99% from 16.28 %, showed the deposit.

Separately, the company also announced it would raise prices for some of its electric vehicle models, according to Reuters.

– Jihye Lee

Kuaishou, Baidu shares soar after reporting gains

Xiaomi expects to report a decline in revenue for the third quarter

Xiaomi it should see a decline in revenue for the third quarter of 2022, according to an average of estimates from a Refinitiv survey.

The company is expected to see a 9.66% decline in revenue to 70.52 billion yuan ($9.87 billion) for the July-to-September quarter, compared with 78.06 billion yuan in the same period last year. year.

The expected drop is likely due to “tepid smartphone sales” as well as a weak macro backdrop and consumer sentiment, Daiwa Capital Markets wrote in a note.

Shares of Xiaomi fell as much as 1.72% in morning trade ahead of the release, and were down about 1% last time around.

– Lee Ying Shan

New Zealand dollar strengthens after major rate hike

The New Zealand dollar strengthened to 0.6192 against the dollar after the central bank hiked rates by 75 basis points, its biggest hike on record.

The NZD last traded at 0.6170 against the dollar as the NZX 50 index in New Zealand fell 0.8%.

The NZ 10-year Treasury yield briefly touched 4.305% shortly after the decision and last traded at 4.235%. Yields move inversely with prices and one basis point is equal to 0.01%.

– Lee Ying Shan

CNBC Pro: Goldman Says EV Batteries Are Going “Critical” & Names 2 Stock Picks

Electric vehicle batteries are gaining “critical importance” during the energy transition, according to Goldman Sachs.

The investment bank names two top stocks to play in the electric vehicle battery sector, up nearly 70%.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Singapore releases reduced GDP estimates for 2022

Singapore’s economy is expected to grow by about 3.5% in 2022, according to forecasts from the Ministry of Trade and Industry, citing a weakening in external demand prospects following Europe’s energy crisis and continued Chinese restrictions related to Covid.

The figure is a low estimate from the previously expected range of 3% to 4% and reflects third quarter annualized growth of 4.1% and growth of 1.1% over the prior quarter.

The ministry also said it expects the nation’s GDP growth in 2023 to be between 0.5% and 2.5%.

—Jihye Lee

CNBC Pro: UBS says self-driving cars could become a $100 billion market in China and names stocks to play it

EVs are rapidly gaining traction, particularly in China, the largest EV market in the world.

But UBS believes autonomous driving will be an even bigger megatrend than electrification, with a market size in China alone of about $100 billion by 2030.

Here’s how investors can interpret this megatrend, according to UBS.

Pro subscribers can read more here.

— Zavier Ong

The New Zealand central bank raises rates by 75 basis points

The Reserve Bank of New Zealand raised its official cash rates by 75 basis points, the largest hike on record, to 4.25%.

The decision is in line with analysts’ expectations, according to a Reuters poll.

This is the ninth consecutive hike since the RBNZ first embarked on its rate hike cycle in October 2021, five of which were 50 basis point hikes.

New Zealand inflation is currently at 7.2%, just off a three-decade high.

—Lee Ying Shan

Investors should pivot to China’s second-tier tech stocks: UBS Global Wealth Management

Investors should take advantage of the bumpy ride in Chinese tech stocks to move into smaller, less established companies, according to Eva Lee, head of major Chinese equities at UBS Global Wealth Management’s investment office.

“Under the current regulation, second-tier players will do better than top-tier players. Use this opportunity to move up to second-tier companies,” such as those with resilient income, he told CNBC’s “Street Signs Asia.”

Also, the tech giants are perceived as “macro shooting [proxies]and the path to eventual full reopening “is going to be up and down, it’s going to be unstable,” he said.

“Eventually we will move there, but it takes time,” he said.

— Abigail Ng

Stocks climb, S&P 500 closes above the key 4,000 level for the first time since September.

Stocks rose Tuesday with all three major averages gaining more than 1% as Wall Street bet that interest rate hikes and inflation will ease towards the end of the year. The S&P 500 also closed at a level not seen since September.

The Dow Jones Industrial Average closed 397.82 points, or 1.18%, up at 34,098.10. The Nasdaq Composite also gained 1.36% to 11,174.41.

The S&P 500 rose 1.36% to close at 4,003.58, its first close above the 4,000 level since September.

—Carmen Reinicke

84% of today’s 19 52-week highs in the S&P 500 are all-time highs

Nineteen S&P 500 stocks hit 52-week highs so far Tuesday, and of those, 16 (84%) also hit all-time highs. Three of the 19 (TRV, MRK, IBM) are also in the Dow Jones Industrial Average, and two of those are among all-time highs:

  • General Parts Co. (GPC), the highest since the 1948 IPO
  • O’Reilly Auto (ORLY), all-time high since 1993 IPO
  • TJX Cos. (TJX), all-time high until 1987 IPO
  • General Mills (GIS), all-time highs in history dating back to 1927
  • Monster Beverage (MNST), all-time high until its predecessor was listed on the Nasdaq in 1992
  • Pepsico (PEP), highest ever, dating back to Pepsi-Cola merger with Frito-Lay in 1965
  • Marathon Petroleum (MPC), all-time high after Marathon Oil spin-off in 2011
  • Aflac Inc. (AFL), all time through CNBC data history in 1973
  • Arthur J Gallagher (AJG), all-time high until 1984 IPO
  • Globe Life (GL), historical high compared to predecessor data in 1980
  • MetLife (MET), an all-time high, went public again in 2000
  • Progressive (PGR), all-time high until 1971 IPO
  • Travelers (TRV), all-time high, returns to Citi spin-off in 2002
  • Gilead Sciences (GILD), the highest since April 2020
  • Merck & Co. (MRK), all-time record in CNBC history since 1978
  • PACCAR (PCAR), all-time high until 1971 IPO
  • Quanta Services (PWR), all-time high until 1998 IPO
  • Snap-On (SNA), highest since June 2021
  • International Business Machines (IBM), the highest since February 2020

There were two 52-week lows in the S&P 500 early Tuesday:

  • Tesla (TSLA), lowest since November 2020
  • Medtronic (MDT), minimum since March 2020

No comment.

—Scott Schnipper and Christopher Hayes

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