Asia markets mixed as Australia raises interest rates; Baidu jumps on chatbot project
This is CNBC's live blog covering Asia-Pacific markets.
Stocks in the Asia-Pacific traded mixed on Tuesday, as investors digested the Reserve Bank of Australia's interest rate hike of 25 basis points, broadly in line with expectations.
The S&P/ASX 200 fell 0.46%, erasing earlier gains to 7504.1. The Australian dollar strengthened 0.67% to last trade at 0.6926 against the U.S. dollar.
South Korea's Kosdaq led gains in the region and rose 1.51% to 772.79, while the benchmark Kospi inched up 0.55% to close at 2,451.71. In Japan, the Nikkei 225 fell fractionally to end its session at 27,685.47 and the Topix rose 0.21% to 1,983.4.
Hong Kong's Hang Seng index rose 0.4% in its final hour of trade, while the Hang Seng Tech Index climbed 1.01% as shares of Baidu jumped on a recent announcement on its artificial chatbot.
In mainland China, the Shenzhen Component rose 0.12% to 11,926.88 and the Shanghai Composite rose 0.29% to 3,248.09.
Overnight in the U.S., Wall Street extended losses as investors digested last week's economic data that showed there's more room for the Federal Reserve to hike rates further.
The Nasdaq Composite led losses as investors grew increasingly cautious of rising bond yields. The Dow Jones Industrial Average and the S&P 500 also closed lower. Treasury bond yields rose overnight, with the benchmark 10-year yield up by nearly 11 basis points at 3.64%.
– CNBC's Alex Harring, John Melloy contributed to this report
Softbank records nearly $6 billion net loss in disappointing earnings report
Softbank Group saw a net loss of 783.42 billion yen ($5.93 billion) in the three-month period ending in the final month of 2022, according to its latest earnings report.
That compares to the 20.67 billion yen profit that it saw the same period a year ago.
For SoftBank Vision Funds, it saw a net loss of 730.36 billion yen in the period ending in December.
Shares of SoftBank Group closed 1% lower at Tokyo's market close.
– Jihye Lee
Kakao surges 4% after it announces acquisition of a larger stake in SM Entertainment
Shares of Kakao Corp. climbed more than 4% after it announced a deal to take a larger stake in South Korean entertainment giant SM Entertainment.
Kakao will acquire 1.23 million more shares of SM Entertainment for 112 billion won ($89.1 million), as well as 105 billion won of convertible bonds.
The deal will take Kakao's stake in SM Entertainment to 9.05%.
Shares of SM Entertainment dipped shortly after the announcement, and last traded about 2.28% lower.
SM Entertainment is one of South Korea's largest entertainment agencies, and is home to acts like aespa and Red Velvet.
—Lim Hui Jie
Correction: This story has been updated to reflect the accurate name of Kakao Corp. It also clarifies that the deal includes the buying of convertible bonds.
Most Adani stocks rise after company says promoters paid back $1 billion of loans
Most shares of Adani Group companies rose on Tuesday after the company said its promoters pre-paid over $1 billion in loans through share pledges.
The statement said 12% of their holding of Adani Ports and Special Economic Zone shares will released ahead of its maturity date of September 2024 – 3% will be released for Adani Green Energy, and 1.4% will be released for Adani Transmission.
Adani Enterprises rose 15% in early hours of Mumbai's trading session, Adani Port and Special Economic Zone rose 7.71%, Adani Transmission gained 5% and Adani Wilmar rose 4.9%.
Adani Power and Adani Total, meanwhile, lost roughly 5%.
– Jihye Lee
Australia raises interest rates by 25 basis points, reaching 3.35%
The Reserve Bank of Australia (RBA) has announced to raise its interest rates by 25 basis points to 3.1%, the highest since 2012.
"Inflation is expected to decline this year due to both global factors and slower growth in domestic demand," RBA Governor Philip Lowe said in a statement.
Lowe added the central bank's forecast for Australia's consumer price index is 4% 2023 and expects to reach 3% by mid-2025.
The latest decision comes after the central bank in December had considered several options including a 50 basis point increase.
The RBA also said it expects to increase interest rates further over the course of 2023, but not on a pre-set path.
The Australian dollar strengthened 0.7% to 0.6934 against the U.S. dollar.
— Lim Hui Jie
Baidu surges on reported AI chatbot project launch
Shares of Baidu jumped more than 13% in Hong Kong's trading session as the company announced that its artificial intelligence chatbot was almost ready for public launch.
The confirmation of prior reports comes as Microsoft-backed ChatGPT has surged in popularity and Google has rushed to develop its own.
It's unclear how Baidu's chatbot capabilities will compare with ChatGPT's.
Baidu said its AI chatbot project will likely complete internal testing in March before being made public.
The chatbot is named "ERNIE bot" in English or "Wenxin Yiyan" in Chinese, Baidu said.
In a recent presentation earlier this year, Chief Technology Officer Haifeng Wang emphasized the importance of deep learning as the core of Artificial Intelligence and that it's showing "increasingly strong potential."
– Evelyn Cheng, Jihye Lee
CNBC Pro: Market veteran is still bullish on tech despite earnings upset, and reveals his other top picks
Tech stocks have rallied strongly this year — a big turnaround for one of 2022's worst performers. But the strength of the rally now hangs in the balance, as investors weigh the implications of a series of earnings disappointments.
Market veteran Kenny Polcari, however, is still a fan of the sector and has a number of stock picks to play it.
Pro subscribers can read more here.
— Zavier Ong
Real wages in Japan rise for the first time in 9 months, but household spending falls
Real wages in Japan rose for the first time in nine months, inching up 0.1% in the final month of 2022 on an annualized basis, statistics from Japan's labor ministry showed.
Cash earnings also climbed 4.8% in December.
The increase was led by bonuses, which rose 7.8% compared to the same period a year ago.
Meanwhile, household spending in Japan fell 2.1% in December, better than expectations of a 0.3% growth from economists polled by Reuters.
This comes as Japan faces its highest rate of inflation since December 1981, with core consumer prices rising 3.7% in November on an annualized basis.
– Lim Hui Jie
Australia's goods and services exports fell in December, while imports rose
Australia's exports for goods and services fell 1% in December, according to the Australian Bureau of Statistics, led by other mineral fuels.
Meanwhile imports rose by 1% driven by travel services.
This resulted in a seasonally adjusted balance on goods and services dropping $1.23 billion Australian dollars ($849 million).
The Australian dollar strengthened roughly 0.3% to 0.6901 against the U.S. dollar.
– Jihye Lee
CNBC Pro: These ETFs and mutual funds face millions in losses amid the Adani crisis
Retail investors and pension funds are facing millions of dollars in losses on investments in Adani Group companies, CNBC Pro can reveal.
New analysis shows that 951 mutual funds and ETFs worldwide have cumulatively lost more than $4.2 billion in the value of their Adani shares this year.
CNBC Pro subscribers can search for mutual funds and ETFs that have been exposed to Adani companies here.
— Ganesh Rao
CNBC Pro: Want to play the ChatGPT buzz? Analysts love these A.I. stocks — giving one upside of 150%
Much buzz has been generated around ChatGPT, an artificial intelligence chatbot that's gone viral and reportedly reached 100 million monthly active users in January.
Its popularity has sparked much interest in artificial intelligence tech.
"You really have to consider the role that artificial intelligence is going to play … it's made this quantum leap almost, you know, overnight. And so I think that puts it right smack in the front and center of people's portfolios," Kenny Polcari, chief market strategist at SlateStone Wealth, told CNBC's "Street Signs Asia" on Monday.
For investors considering investing in AI, CNBC Pro screens for related stocks that analysts love, with big potential upside.
CNBC Pro subscribers can read more here.
— Weizhen Tan
Stocks close down Monday
Stocks ended Monday in the red as concerns over high bond yields weighed on investors.
The tech-heavy Nasdaq Composite led the three major indexes down, losing 1% in the session. The S&P 500 ended down 0.6%, while the Dow shed 0.1%.
— Alex Harring
Goldman cuts recession probability to 25%
Goldman Sachs, which already was doubtful of Wall Street's recession expectations, thinks there's even less of a chance now.
The firm cut its recession probability for the next 12 months to 25%, down from 35% previously. That's well below the 65% expectation from the most recent Wall Street Journal survey.
"Continued strength in the labor market and early signs of improvement in the business surveys suggest that the risk of a near-term slump has diminished notably," the firm said in a client note Monday.
GDP is likely to grow just 0.4% in the first quarter but then accelerate through the year, Goldman added.
Bond yields are popping higher. This is how investors can play them
Treasury yields jumped on Monday as investors awaited clues from Federal Reserve speakers on the next steps for monetary policy.
The yield on the 1-year T-bill leapt as high as 4.841% Monday morning, and the rate on the 2-year note jumped to 4.412%. These are the highest levels since Jan. 6. Yields on longer-dated Treasurys ticked higher, too, with the rate on the 10-year note climbing as high as 3.619%, the highest level since Jan. 10. Bond yields move inversely to prices.
Yields have been trending higher since the Fed embarked on its rate-hiking campaign last year, and bond prices tumbled. However, an opportunity has since opened for investors hoping to snap up these fixed-income instruments on the cheap and collect an attractive yield.
Read more on where advisors are looking to play the rising rate environment here.
-Darla Mercado, Gina Francolla