Samsung earnings guide, Japan services PMI, US jobs data

Tesla has cut the prices of some models in China for the second time in three months.

The firm said the Model 3 and Model Y in China are now priced at 229,900 yuan and 259,900 yuan, respectively.

That’s down from 6% to 13.5%, a separate Reuters estimate showed.

Shenzhen-listed shares of Tesla’s Chinese supplier rose on optimism that a price cut could boost demand for the electric carmaker.

Shares of Anhui Shiny Electronic Technology rose as much as 10% in Asian trade, while Hengdian Group DMEGC Magnetics rose nearly 9%. Zhejiang Chint Electrics rose nearly 10% and Shandong Jinjing Science & Tech rose more than 7%.

– Jihye Lee

As more Chinese electronic component manufacturing companies are poised to take market share from their Taiwanese counterparts FoxconnKirkland Capital Chairman and CEO Kirk Yang told CNBC’s “Squawk Box Asia” on Friday.

apple supplier Foxconn faces competition from Luxshare, which has been awarded a contract to manufacture iPhones in China, even as Foxconn posted record profits and its Zhengzhou factory returned to normal after Covid restrictions and labor unrest.

“Chinese companies have quite a bit of competition for iPhone assemblers. China does well in almost everything except semiconductors,” Yang said.

Yang further added that with Sino-Taiwan geopolitical tensions, Taiwanese companies in China have seen a lot of pressure in the past five years. “Many of them are migrating from China,” Yang said.

That’s why Apple needs to diversify, he said, adding that the US-China tech war is also causing companies to diversify away from China even faster.

– Sheila Chiang

Samsung Electronics can track its competitors Micron Technology and SK Hynix Sanjeev Rana, senior analyst at CLSA, on output cuts in the latter part of 2023.

Rana said on CNBC’s Squawk Box Asia on Friday that the company had “no choice but to reduce production as inventories are accumulating rapidly”.

“If they don’t cut production, inventories could rise further,” he said, adding that demand for IT products has weakened in recent months and sales of memory chips have also fallen.

On the demand side, China’s reopening could lead to double-digit year-on-year growth in smartphone shipments to China, Rana said.

Dan Pickering of Pickering Energy Partners said oil prices are expected to remain around $85 a barrel for the next five years as a result of “underinvestment on the supply side” and likely increased demand.

After China moves through the Covid wave, “a million to two million barrels per day of increased demand” can be expected, Pickering said, which would support commodity prices.

He added that additional support would be appreciated once the world emerges from the global economic recession.

Brent oil futures rose by 1.12% to $79.57/barrel. Similarly, US West Texas Intermediate crude rose by 1.15% to $74.74 per barrel.

Overnight, the U.S. reported that fuel stockpiles were dwindling after a winter storm, adding to pressure on supplies.

– Lee Yingshan

The People’s Bank of China and the China Banking and Insurance Regulatory Commission announced that they have approved lower mortgage rates for first-time home buyers if new home prices fall for three consecutive months.

The latest measures show further government support for the property sector.

According to Factset data, housing sales in China fell more than 20% year-on-year in each month through November of last year. Reuters reports that house prices fell in November for the fourth month on a monthly basis.

Hong Kong-listed property stocks were mostly higher, with Logan Group up 5.48% and Cifi Holdings up 0.79%. Country Garden and Longfor Group were flat in Friday’s morning session.

– Jihye Lee

After an outstanding performance in 2022, it’s off to a slow start with energy stocks.

But veteran investor Louis Navellier isn’t worried. He believes the sector is set for another bumper year in 2023 and has a number of stock picks to play it.

Pro subscribers can read more here.

– Xavier Ong

Japan’s service sector activity rose for the fourth consecutive month in December as the country’s central bank continued its ultra-green policy, unlike its hawkish global peers.

The latest au Jibun Bank Japan Services Purchasing Managers’ Index rose to 51.1, compared with a sharp drop from 53.2 to 50.3 in October.

In PMI readings, the 50-point mark separates contraction from expansion.

The Japanese yen It traded marginally stronger after the report, last trading at 133.38 against the dollar.

– Jihye Lee

Samsung Electronics posted its worst quarterly profit in nearly eight years with a nearly 70% drop in operating profit last quarter, according to the company’s latest earnings guidance.

The tech giant estimated its profit fell to 4.3 trillion won ($3.37 billion) in the October-December period on weaker global demand, after posting a profit of 13.87 trillion won ($10.92 billion) in the previous quarter.

Shares of the tech giant rose 0.17% shortly after the guidance was issued.

– Jihye Lee

Citi’s Scott Chronert expects a mild recession in the first half of this year and laid out three strategy calls that can help investors trade the downturn.

He shared with CNBC three “key persuasive calls” that can help investors navigate the macro environment.

CNBC Pro subscribers can read more here.

– Weizhen Tan

There are a number of factors that could make 2023 the year of disinflation, St. Louis Federal Reserve Bank President James Bullard said Thursday.

He noted that GDP growth is likely to have picked up in the second half of 2022, and that inflation has eased recently, though overall remains very high.

He added that while the current policy is not yet “restrictive enough,” it is getting close and will reach that level this year. That signaled to markets that it could pull back above the 5% terminal rate it sees the central bank reaching before halting or reversing rate hikes, lifting stocks off the day’s lows.

The strength of the labor market seen in the middle of the hike is unprecedented, he said.

– Carmen Reinicke

According to Goldman Sachs, many under-the-radar stocks are key to the green energy transition – and it expects them to emerge in 2023.

The Wall Street bank said a decade-long trend of investing in large clean energy stocks will reverse this year, with the focus shifting to smaller supply chain firms.

The investment bank has identified seven stocks in the Europe, Middle East and Asia region that will benefit from the new trend.

CNBC Pro subscribers can read more here.

– Ganesh Rao

Some of the biggest stock moves during Thursday’s trading session:

Silvergate — Shares of the cryptocurrency-focused bank plunged more than 42% after Silvergate disclosed massive customer churn during the fourth quarter. The bank said it had acquired $3.8 billion in assets from its digital asset clients at the end of December, down more than 60% from three months earlier. The company also sold $5 billion in debt securities to cover the withdrawals, resulting in a $718 million loss on those sales.

Bed Bath & Beyond — plunged 24% after it said it was running out of cash and considering bankruptcy, citing weaker-than-expected home goods retail sales. In addition to potential bankruptcy, the company said it is exploring financial options, including restructuring, seeking additional capital or selling assets.

Lamb Weston Holdings — The food processor jumped 9% after beating quarterly profit and revenue estimates. Lamb Weston also raised its financial guidance for the full year.

Check out more carriers here.

– Jesse Pound

Initial jobless claims rose slightly to 225,000 in the week ended Dec. 24, according to the Labor Department. But ongoing claims, which count those who have been out of work for more than a week, have declined.

Pending claims fell to 1,569,764, down more than 24,000 from the previous week. This indicates that people are finding new jobs amid a strong labor market.

– Carmen Reinicke