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Hong Kong tech leads losses in Asia; China cuts rates ahead of Fed, Bank of Japan meetings this week

Abigail Ng

This is CNBC's live blog covering Asia-Pacific markets.

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Shares in the Asia-Pacific fell on Monday ahead of major central bank meetings this week.

The Hang Seng index in Hong Kong was 0.89% lower in the final hour of trade, with the Hang Seng Tech index down 1.93%. South Korea's Kospi shed 1.14% to 2,355.66 and the Kosdaq was 2.35% lower at 751.91.

In mainland China, the Shanghai Composite dipped 0.35% to 3,115.60 and the Shenzhen Component also declined 0.48% to 11,207.04. The People's Bank of China cut its 14-day reverse repo rates.

The S&P/ASX 200 in Australia was 0.28% lower at 6,719.90. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.59%.

Japan's market was closed for a holiday Monday.


Later this week, the Federal Reserve and the Bank of Japan will be announcing their interest rate decisions.

Traders are betting on a 75-basis-point rate hike from the Fed, with the probability standing at 82%,  according to the CME FedWatch tracker of Fed funds futures bets.

The Bank of Japan is expected to keep rates on hold at ultra-low levels, analysts predicted in a Reuters poll.

Bitcoin, ether tumble after Ethereum's merge last week

Prices of bitcoin and ether tumbled sharply during Asia's morning trade.

Ether fell below $1,300 following the Ethereum network's migration to the proof-of-stake consensus mechanism last week, also known as the "merge." It was last trading at $1,294.58.

Bitcoin also lost more than 6%, and was hovering below $18,500.

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— Jihye Lee

China's central bank cuts 14-day reverse repo rates

The People's Bank of China reduced the borrowing cost of 14-day reverse repurchase agreements, it announced on its website.

The central bank also said it injected 2 billion yuan ($285 million) through the 7-day reverse repos and 10 billion yuan through the 14-day operations. The 7-day rate was kept unchanged.

— Abigail Ng

Cathay Pacific shares rise on report that Hong Kong may end hotel quarantines

Shares of Cathay Pacific rose more than 2% in morning trade following a South China Morning Post report that said, citing a source familiar with the matter, hotel quarantines for people arriving from overseas may be scrapped soon.

The airline on Friday also raised its projected passenger flight capacity for the year-end to one-third of pre-pandemic levels, around double its earlier prediction in August.

— Abigail Ng

Oil prices climb as lifting of Chinese Covid lockdown boosts demand outlook

Oil prices climbed on Monday as the Chinese megacity of Chengdu exits a two-week lockdown.

Both oil benchmarks each rose more than 1% earlier in the session, and Brent crude futures was last up 0.66% at $91.95 per barrel. U.S. West Texas Intermediate gained 0.56% $85.59 per barrel.

The boost in demand outlook offsets fears that potential rate hikes later this week will raise recession risks.

— Lee Ying Shan

CNBC Pro: This ETF carries risk — but outperforms when volatility spikes

As volatility rears its head once again, investors looking for a short-term trade could opt for this ETF with a track record of outperformance in times of extreme market moves.

"It is probably the prospect of very quick and sizable gains when everyone else in the market seems to be losing their shirts that I believe is appealing about this fund," Daniel Martins, head researcher and portfolio strategist at DM Martins Research, said.

Yet, despite the potential for high returns, the ETF carries a high level of risk, and is not for every investor.

Pro subscribers can read more here.

— Zavier Ong

Chinese yuan has room to weaken further in the near-term, Goldman Sachs says

There's still room for the Chinese yuan to weaken further, economists at Goldman Sachs said after both the onshore and offshore yuan fell to their lowest levels since July 2020 last week.

"We expect CNY weakness to persist in the near-term, underpinned partly by broad USD strength," strategists said in a note, adding the next key level to watch is 7.20, which was last tested in May 2020.

Such a move, however, will come in tandem with a "sizable" strengthening the U.S. dollar, they said in the note, adding "CNY is unlikely to weaken by 3% in isolation."

—Jihye Lee

CNBC Pro: Buy these inflation-beating funds to protect your money, strategist says

As inflation remains stubbornly high, where can investors hide out given that U.S. stocks and bonds alike have been volatile?

There are three types of funds that look appealing right now, according to Mark Jolley, global strategist at CCB International Securities. He named his favorites in each category.

CNBC Pro subscribers can read more here.

— Weizhen Tan