Asia-Pacific markets to 2023 trade of the region is mixed

IIFL Securities reports that India’s cement stocks are performing well with the government’s infrastructure spending

Sanjiv Bhasin, director of investment management firm IIFL Securities, said India’s domestic cement stocks will rise on the back of increased government spending on infrastructure.

“The government is spending on both commercial and real estate and [developments on] infrastructure will see cement companies doing well,” Bhasin said on CNBC’s “Street Signs Asia” on Tuesday.

said that he has a positive attitude towards companies like Larsen and Toubro, Ultratech Indiaand Kotak Mahindra Bankadded that cement prices in India are expected to rise as the country enters a period of high construction activity.

Australian miners, metal prices fall as Covid cases rise in China

Shares in Australian-listed mining companies fell in midday trade on Tuesday as metals prices fell in Shanghai as Covid infections surged in mainland China.

On the Shanghai Futures Exchange, the February copper contract fell 0.7% to 65,670 yuan a tonne, while aluminum fell 2.7% to 18,175 yuan a tonne.

Sandfire Resources inches was 0.18% lower Oz Minerals rose by 0.25% – Rio Tinto decreased by more than 1% Yancoal Australia decreased by more than 4.6% and Whitehaven It decreased by 5.89%. Fortescue Metals It lost 0.73% and South32 traded 0.5% lower.

– Jihye Lee

Consumer growth in Asia remains a “big challenge” for the region, the Singapore Exchange said

Inflation in Asia may peak earlier and lower than in the US and Europe, the strategist said

Geoff Howie, market strategist at the Singapore Exchange, said consumer growth in Asia remains a “massive challenge” for the region, as its economic growth depends heavily on trade.

Howie pointed to declines in South Korea and Taiwan’s exports since May 2021, as well as Singapore’s non-oil exports falling 14.6% in November.

“There is a lot to do with trade and technology, and we expect moderation in global trade,” he said on CNBC’s “Street Signs Asia” on Tuesday. “Consumer growth is an area we really need to watch,” Howie said.

– Charmaine Jacob

‘Rough first half, better second half for tech stocks’: Jefferies shares 2023 forecast

Tech stocks will face a tough environment in the first half of 2023, the analyst says

The first half of 2023 will be a “difficult structure” for tech stocks, Brent Thill, managing director and chief analyst at investment firm Jefferies, told CNBC’s “Street Signs Asia” on Tuesday.

“Going into the beginning of this year, you still have an economic overhang that will weigh on earnings. Companies have to cut numbers and expectations are still coming down,” Thill said.

He predicted that things would change in the second half of 2023 as the effects from macroeconomic conditions such as rising interest rates “take time” to play out and “investors start to look at the 2024 numbers being reset”.

“I think the worst-case scenario is that 2023 could be a total washout,” Thill said, adding that Jefferies expects the third-quarter recession to be later than expected.

– Sheila Chiang

The analyst says that the price of oil will fall to the level of 70 dollars by the end of 2023

Ed Morse, Citi’s global head of commodity research, added that volatility in oil markets will continue, with Brent oil prices expected to drop to $70 per barrel by the end of the year.

“We expect volatility to be similar to last year,” Morse said. “We are looking at Brent prices falling into the low 70s by the end of the year,” he said.

A number of oil-producing countries are facing extreme challenges, Morse said. It also expects oil demand to remain low due to the prolonged recession in China.

Events related to Russia’s war against Ukraine will add to price volatility, Morse added.

Brent oil fell by 0.43% to $85.57 per barrel. US West Texas Intermediate oil fell by 0.39% and was sold at $79.95.

– Lee Yingshan

The Japanese yen is at its strongest levels in seven months

The Japanese yen Refinitiv data hovered around its strongest levels since early June.

The currency traded at 129.7 against the US dollar after breaching the 130.4 key technical level last seen in August. At the end of last year, the yen weakened significantly and reached its weakest level in 32 years.

The currency passed 151 against the dollar in mid-October as the Bank of Japan continued its ultra-green monetary policy and yield curve control strategy. But the yen has since strengthened after the central bank widened the YCC band last month.

– Jihye Lee

China’s Caixin PMI shows further decline in factory activity

China’s factory activity slipped into contraction territory in December, a private sector survey showed.

The Caixin/Markit manufacturing PMI fell to 49 in December after reading 49.4 in November – below the 50-point mark that separates growth and contraction.

Optimism among businesses improved, the survey said, with companies saying they were confident the economy would recover after most of China’s tough Covid measures were eased.

Separately, China’s National Bureau of Statistics said the official manufacturing PMI fell to 47 on the month, the biggest drop since the start of the Covid epidemic in January 2020.

– Jihye Lee

Singapore’s economy grew by 3.8% in 2022

Singapore’s economy is expected to grow by 3.8% for the full year to 2022, the Ministry of Trade and Industry said on Tuesday.

The economy grew 2.2% in the fourth quarter from a year earlier, the slowest pace since mid-2021, but beat expectations of 2.1% from a Reuters poll.

The latest figures reflect a continued recovery in the services sector following the lifting of domestic and border restrictions from April, the ministry said, adding that the accommodation sector expanded for the first time since mid-2021.

– Jihye Lee

According to Nikkei, the Bank of Japan is considering raising inflation forecasts in January

Japan’s central bank is considering raising inflation forecasts in January to reflect price growth closer to its 2% target in fiscal 2024, Nikkei reported on Dec. 30, citing sources familiar with the matter.

According to the report, this step could pave the way for a transition to a tighter fiscal policy.

The report came more than a week after the Bank of Japan changed controls on bond yields, allowing long-term interest rates to rise further. The interest rate on the 10-year bond will be allowed to fluctuate half a percentage point above and below the country’s 0% target — above a range of a quarter percentage point.

Retail sales in Japan also rose for the ninth month in a row in November.

Darla Mercado

Next week: Asia-Pacific PMI, trade data, inflation readings

Next week, key economic events in the Asia-Pacific region will be dominated by Purchasing Managers’ Index readings in the region.

China’s National Bureau of Statistics plans to release official manufacturing and non-manufacturing PMI prints on Saturday. Reuters expects China’s factory activity to show a contraction of 48 readings.

South Korea is also scheduled to report December trade data at the weekend, where economists polled by Reuters forecast a 10.1% decline from a year earlier.

Singapore will release manufacturing PMIs next week, while S&P Global will release PMIs for South Korea, Indonesia and India on Monday.

Inflation prints for the Philippines and Indonesia will also be closely watched, with releases scheduled for Tuesday and Monday respectively.

Japan’s PMI reading and China’s private services survey will be released on Wednesday. Singapore will release November retail sales and South Korea’s unemployment rate for December on Thursday.

– Jihye Lee

CNBC Pro: Wall Street veteran names stocks and tech favorites that could go to $0

David Trainer, CEO of investment research firm New Constructs, has marked the end of the cheap money cycle in 2022, which is bad news for companies with a “growth anyway” approach.

He told CNBC Pro that next year, investors will have to do their due diligence to distinguish between good and bad firms.

That’s because the US Federal Reserve’s interest rate hikes in 2022 will “end the cycle of super easy money” and expose many companies with bad business models. He calls these companies “zombie stocks” with severe cash burn.

It lists such names to avoid and highlights what to buy instead.

CNBC Pro subscribers can read more here.

– Weizhen Tan

Final market statistics for 2022

Friday was the last trading day of 2022, for the quarter, month and year. Here’s how the major market averages fared during these time frames.

Dow finished:

  • decreased by 8.78% during the year
  • up 15.39% for the quarter
  • decreased by 4.17% during the month
  • decreased by 0.17% during the week

The S&P 500 concluded:

  • decreased by 19.44% during the year
  • up 7.08% for the quarter
  • decreased by 5.90% during the month
  • decreased by 0.14% during the week

The Nasdaq Composite ended:

  • decreased by 33.10% during the year
  • down 1.03% for the quarter
  • decreased by 8.73% during the month
  • decreased by 0.30% during the week

Russell 2000 finished small caps:

  • decreased by 21.56% during the year
  • up 5.8% for the quarter
  • decreased by 6.64% during the month
  • increased by 0.02% during the week

– Jesse Pound, Christopher Hayes

CNBC Pro: 2023 looks good for the market — especially for one ‘extremely attractive’ asset class: The fund manager

Markets have bottomed out and things are looking up for stocks and bonds that could rise more than 10% in 2023, according to one portfolio manager.

Jay Hatfield, CEO and portfolio manager at Infrastructure Capital Advisors, also highlighted “convinced investment themes” that he expects to be very attractive in 2023.

It includes an asset he says can beat his peers.

CNBC Pro subscribers can read more here.

– Weizhen Tan

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