Asia-Pacific markets were mixed on Tuesday as investors await regional private surveys for factory activity.
In Australia, the S&P/ASX 200 closed 0.21% lower at 7,336.3 as investors digest the nation's Judo Bank composite purchasing managers' index, which climbed to 49.2, below the 50-mark that separates growth and contraction.
The PMI index encompasses services and manufacturing, and is seen as a reliable gauge of economic health.
The Reserve Bank of Australia released minutes from its February policy meeting, which reiterated comments from governor Philip Lowe that more interest rate hikes will be needed.
In Hong Kong, the Hang Seng index led losses in the region as it fell 1.5% lower, and the Hang Seng Tech index slid 3.08%.
In Japan, the Nikkei 225 fell 0.21% to end the day at 27,473.1 and the Topix finshed marginally higher at 1,997.46, with Japan's PMI index coming in lower at 47.4. down from 48.9 in January.
South Korea's Kospi also rose 0.16% to close at 2458.96, while the Kosdaq ended 0.57% higher at 793.42.
While U.S. markets were closed due to Presidents' day holiday, U.S futures fell on Monday night following a week during which higher interest rates kept investor sentiment in check.
— CNBC's Fred Imbert contributed to this report.
South Korea's trade deficit narrows in first 20 days of February
South Korea's trade deficit narrowed to $6 billion in the first 20 days of February, customs data showed on Tuesday.
The nation's seasonally adjusted exports to China fell 22.7%, slightly improving from a decline of 24.4% seen in January. Chips exports fell 43.9%, a further decline of January's fall of 34.1% on an annualized basis.
Economists at Citi said South Korea's trade deficit for the full-month is expected to narrow further to $4 billion on improved exports growth as well as imports growth.
– Jihye Lee
Wage increases in Japan will be favorable to our business, Asahi Group CEO says
Consumption led companies like Asahi Group stand to gain should wages rise in Japan, said its CEO Atsushi Katsuki.
"If the wage goes up, it would of course translate to an increase to the personal consumption, which is good for our company's business performance," Katsuki told CNBC's "Squawk Box Asia" on Tuesday.
The food and drinks company has decided to increase the salaries of two subsidiaries — Asahi Beer and Asahi Soft Drinks by 5%, Katsuki highlighted.
Real wages fell by 3.8% in November in Japan compared to the same time in 2021, making it the highest decline in more than eight years, Reuters reported.
— Charmaine Jacob
The global economy is likely to see a "shallow recession": Wealth management firm
The global economy is likely going to see a "shallow recession", said Michael Yoshikami, founder and CEO of Destination Wealth Management on CNBC's "Squawk Box Asia" on Tuesday.
Yoshikami said that Wall Street will come around to the fact that inflation will be "higher for longer" and "above past averages", although not "as high as some people fear."
He foresees that the U.S. Federal Reserve will be "pretty hawkish" at Wednesday's Federal Open Market Committee meeting, and adds that there will be evidence that rate hikes are having an impact on inflation.
As such, Yoshikami said the "shallow recession" he predicts will happen because the Fed has increased interest rates sufficient to significantly slow down the economy.
"I think it's a possibility that if in fact the economy decides to fly towards recession, the Fed is going to be less hawkish, more dovish," he added.
- Sheila Chiang, Lim Hui Jie
CNBC Pro: These high-dividend stocks are set to rally, according to analysts, which expect one to rise by 60%
High-yielding stocks are back in the spotlight as volatility persists, inflation remains hot and Treasury yields continue to rise.
— Weizhen Tan
Hang Seng index weighed down by tech stocks; Hang Seng Tech slides 2%
The Hang Seng index led losses in Asia on Tuesday, weighed down mostly by tech stocks.
While the index itself is down just 0.99%, the more tech heavy Hang Seng Tech index has slid 2.5%.
The largest loser on the HSI was e-commerce company JD.com, which saw its share price slide by almost 7%.
On Monday, the South China Morning Post reported the company is launching a 10 billion yuan ($1.5 billion) subsidy campaign in early March to compete against rival PDD Holdings, who owns budget shopping app Pinduoduo.
Other notable losers on the Hang Seng Index include content technology company Kuaishou and multimedia giant Tencent, which their share prices fall 5.84% and 3.13% respectively.
— Lim Hui Jie
Singapore's digital banks are vying for market share with more incentives, but is it sustainable?
Singapore's digital retail banks are offering more incentives, lower fees and removing minimum account balances as they compete with established traditional banks such as DBS, OCBC and UOB in a largely banked market.
Trust Bank, a partnership between Standard Chartered and FairPrice Group, gives out free grocery vouchers while Grab-Singtel's GXS Bank removed certain fees.
But industry observers question if it's sustainable in the long term.
"It is tremendous returns, but there's no way that is sustainable," said Zennon Kapron, founder and director of research and consulting firm Kapronasia, in an interview with CNBC. "It has to be subsidized in some way," he added.
Read more about it here.
— Sheila Chiang
BHP cuts dividend by 40% after nearly a one-third drop in profit
Mining giant BHP has cut its dividend by 40% after it reported a drop in profits and revenue for its half year period from June-December 2022.
Dividends for the half-year came in at 90 U.S. cents, down from $1.50 a year ago.
In an earnings release, BHP reported that revenue fell 16% on an annualized basis from $30.5 billion to $25.7 billion, while profits came in at $6.5 billion, 32% lower compared to the $9.7 billion in the same period a year ago
However, CEO Mike Henry said the company is "positive"' on the demand outlook.
"We expect domestic demand in China and India to provide stabilizing counterweights to the ongoing slowdown in global trade and in the economies of the U.S., Japan and Europe," Henry said.
Shares of BHP Group in Australia were trading 1.9% lower following the announcement.
— Lim Hui Jie
Japan's Jibun Bank flash purchasing managers' index drops
The au Jibun Bank Flash Japan Manufacturing purchasing managers' index fell further into contraction territory to 47.4 in February, after recording 48.9 in January, a release showed.
Meanwhile a stronger service sector growth was seen in the economy, with a reading of 53.6 in February, a rise from 52.3 seen in January.
New orders and production dropped to the greatest extents in just over 2.5 years, S&P Global Market Intelligence's Economics Director Andrew Harker said.
– Jihye Lee
Australia's central bank reiterates hawkish remarks from Lowe
Minutes from the Reserve Bank of Australia's February meeting, when it hiked its cash rate by 25 basis points, showed a pause in its hikes was not an option.
Members had debated between a hike of 25 basis points and 50 basis points – the latter being from concerns of "incoming prices and wages data exceeding expectations," the statement said.
The case to raise its benchmark interest rate by 25 basis points recognized the need to bring "demand and supply in the economy more into balance," while noting that inflation was expected to reach its peak, it said.
The central bank's board "agreed that further increases in interest rates are likely to be needed over the months ahead to ensure that inflation returns to target and that the current period of high inflation is only temporary," the minutes said.
– Jihye Lee
CNBC Pro: Nvidia vs TSMC: Wall Street pros name their favorite stock as chip battle heats up
Nvidia and TSMC have both made headlines in recent weeks — albeit for different reasons. What's next for two of Wall Street's favorite chip stocks?
Pro subscribers can read more here.
— Zavier Ong
Australia private factory activity falls for fifth straight month in February
Australia's private sector output shrank for a fifth straight month in February, but at at its slowest pace since October 2022.
According to data from Juno Bank, the composite purchasing managers index in February came in at 49.2, higher than the 48.5 recorded in January.
A PMI above 50 shows expansion while a reading under 50 signals a contraction in growth.
The bank noted that lower demand for Australian goods and services led to overall business activity falling, though the rate of decline was marginal.
It also elaborated that a renewed deterioration in demand affected overall business activity, as firms listed higher interest rates and economic uncertainties as reasons dampening demand.
Foreign demand rose, however, due to better manufacturing sector export orders in February, while hiring activity continued at a "solid rate" as firms stayed optimistic and price pressures declined.
— Lim Hui Jie
CNBC Pro: 'Insure against the worst': Goldman picks stocks for a soft — and hard — economic landing
Investors are on edge after U.S. stocks fell for three consecutive weeks, signaling the possibility of higher interest rates for longer than expected.
Despite this challenging environment, Goldman Sachs remains optimistic and expects a "soft-landing" for the U.S. economy.
Nevertheless, the investment bank recommended that its clients: "Expect the best (soft-landing) but insure against the worst (hard-landing)," in a note published on Feb. 17.
The investment bank named a number of stocks it says will benefit from each scenario.
— Ganesh Rao
Week ahead: FOMC minutes, RBA, Bank of Korea, Xi speech
Here are the major events investors in the Asia-Pacific will be watching this week.
The U.S. Federal Open Market Committee will release minutes for its latest meeting concluding Feb. 1 later in the week.
On Monday, China will release its 1-year and 5-year loan prime rates for February. Malaysia will report its trade data later in the day.
On Tuesday, private surveys will release Australia and Japan's purchasing managers' index readings. U.S. will also release its PMI and New Zealand is slated to publish its producer price index for the fourth quarter.
Investors will also be closely watching for minutes from the Reserve Bank of Australia's latest rate decision meeting.
Japan will also release its producer price index on Wednesday. Australia's composite leading index for January and the nation's wage price index for the fourth quarter will be published on this day as well.
New Zealand will also release its trade balance for January on Wednesday.
The Bank of Korea will announce its rate decision on Thursday morning. Economists polled by Reuters are expecting to see the central bank pause and leave its benchmark interest rate unchanged. Singapore's consumer price index for January will be released as well.
Chinese president Xi Jinping will reportedly be delivering a 'peace speech' on the one-year anniversary of Russia's invasion on Ukraine, according to Reuters.
— Jihye Lee