Asia-Pacific markets mixed as Japan stocks see second day of losses

Indonesia will implement a ban on bauxite exports starting from June next year, President Joko Widodo announced in a briefing broadcast.

The ban comes after nickel export ban that took effect in January 2020, and is seen to be part of a wider government move to stimulate domestic processing of its mineral resources.

Indonesia is the sixth largest producer of bauxite, which is key component of aluminum.

Aluminum prices traded up 0.84% at $2,391.5 per tonne. The government had also last year mulled a ban of copper shipments in 2023.

—Lee Ying Shan

The next financial crisis will come from private cryptocurrencies, Shaktikanta Das, India's central bank governor said on Wednesday.

Speaking at the BFSI Insight Summit 2022 organized by Business Standard, Das said he stands firm that cryptocurrencies should be prohibited, adding that it has no underlying value and poses risks for macroeconomic and financial stability.

Bitcoin was last higher by about 0.24% at $16,840, according to Coin Metrics. Ether rose 14% to $1,211.77.

— Charmaine Jacob

The yield on 2-year Japanese government bonds briefly rose above zero for the first time since 2015 in Wednesday morning trade. The note gained 2.7 basis points to stand just below the flatline.

The yield on the 10-year JGB jumped more than 3 basis points to stand at 0.451%, also reaching 2015 highs, while the yield on the 30-year JGB inched up 2 basis points to trade at 1.6%.

Yields move inversely to price, and a basis point is equal to 0.01%.

— Jihye Lee

Hong Kong's stock exchange operator launched its New York office in a bid to expand its international reach and grow its global client base.

The new office of the Hong Kong Exchanges and Clearing Limited (HKEX) will be promoting its connectivity with Mainland China's markets and its liquid primary and secondary cash markets, it said.

"At HKEX, we are fully focused on supporting the growth ambitions of our customers around the globe," said HKEX CEO Nicolas Aguzin.

"We look forward to deepening our relationships with investors, companies and risk managers across the region, connecting capital with opportunities and East with West," he added.

About 41% of Hong Kong's cash equities market trading turnover are attributed to international investors. HKEX currently has offices in Beijing, Shanghai and Singapore. 

— Lee Ying Shan

Japan-listed stocks of financial institutions and banks rose for a second day, as the wider Nikkei 225 index fell – continuing its gaining streak after the Bank of Japan's announcement to widen its yield curve control band.

Mitsubishi UFJ Financial Group, or MUFG, rose more than 8% in Japan's morning session.

Sumitomo Mitsui Financial Group also rose more than 6% and Mizuho Financial Group also gained more than 4%.

– Jihye Lee

The Japanese yen strengthened further overnight, after the Bank of Japan announced to widen its yield curve control band.

The currency strengthened by more than 5% against the Australian dollar and the New Zealand dollar – while it strengthened past 3% against the U.S. dollar.

– Jihye Lee

Market watchers are increasingly worried about a looming recession and fund manager Steven Glass is no exception.

Against this backdrop, he says he's focusing on companies with earnings visibility that are trading at attractive valuations.

His picks include a Big Tech name that he said is "extremely cheap" with "huge margin potential."

Pro subscribers can read more here.

— Zavier Ong

Stocks eked out a gain Tuesday, snapping a four-day streak of losses.

The Dow Jones Industrial Average rose 92.47 points, or 0.28%, to close at 32,850.01. The S&P 500 gained 0.11% to 3,821.73, while the Nasdaq Composite ticked up 0.01% to close at 10,547.11.

—Carmen Reinicke

The Bank of Japan's surprise policy shift sent interest rates rising globally, as investors reacted to more evidence central bankers around the world will continue to pressure interest rates higher.

"It was definitely a surprise. I don't think there was anyone out there who expected it," said Ben Jeffrey, rate strategist at BMO. The Japanese central bank moved sooner-than-expected to tighten policy. The BOJ changed its yield curve policy to allow the yield on the 10-year Japanese government bond to move 50 basis poins either side of its zero target rate, up from 25 basis points.

The announcement drove rates higher around the world, as yields on Japanese government bonds (JGBs) rose to 7-year highs. Rates move opposite yield. The U.S. 10-year jumped o 3.68%.

"They were definitely the last one standing in terms of being dovish, and now they're still dovish but less so," said Jeffrey. "It's obviously bearish JGBs and fixed income globally, but in the longer term it should help the yen which will make Treasurys more attractive to Japanese investors next year."

--Patti Domm

Atlantic Equities analysts are anticipating a more challenging backdrop for the global consumer in 2023.

"Inflation may well have peaked on a headline basis but input costs still remain elevated and companies will be looking to at least hold if not take further pricing in some cases," analyst Edward Lewis said in a note Tuesday. "That may become more challenging as levels of elasticity are beginning to normalize with U.S. retailers starting to push back against pricing, in line with where European peers have been all year."

He highlighted Coca-Cola and Pepsi as some of his favorite consumer picks, citing "category momentum, ongoing investment and strong execution supporting elevated growth."

— Tanaya Macheel

It's been a rough year for stocks, which are currently in a bear market and down year to date.

From the market's yearly high on January 3 to this morning, U.S. stocks have shed $11.7 trillion in market cap, according to data from Bespoke Group.

"The max drawdown was $13.6 trillion at the low on 9/30, so we've seen market cap increase by just under $2 trillion since then," analysts wrote Tuesday. "In dollar terms, this drawdown has been more extreme than anything investors have ever experienced. That's pretty deflationary if you ask us!"

Of the $11.7 trillion, more than $5 trillion in losses come from just five companies - Apple, Microsoft, Amazon, Alphabet, Meta and Tesla.

—Carmen Reinicke