Asia markets trade mixed as contagion fears from banking turmoil ease

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

Bondi Beach in Sydney, Australia
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Stocks in the Asia-Pacific traded mixed on Tuesday after Wall Street saw eased investor fears of contagion from the recent banking turmoil after First Citizens BancShares agreed to buy large parts of Silicon Valley Bank.

Hong Kong's Hang Seng index was up 1.1%, leading gains in the region, and the Hang Seng Tech index gained 0.7%. 

In Australia, the S&P/ASX 200 rose 1.04% to close the day at 7,034.1. Banks largely traded higher, and retail sales in February rose 6.4% compared to a year ago.

Meanwhile, Japan's Nikkei 225 climbed 0.15% to close at 27,518.25 and the Topix saw a larger gain of 0.25% to end at 1,966.67.

South Korea's Kospi rose 1.07% to finish at 2,434.94, and the Kosdaq was also up 0.7% to close at 833.51 as investors further digested economic data from the region.

Mainland Chinese markets were the outlier in the region, as the Shanghai Composite closed 0.19% lower at 3,245.38 and the Shenzhen Component shed 0.72% to end at 11,564.45.

Overnight in the U.S., stocks on Wall Street ended higher – the Dow Jones Industrial Average gained almost 200 points, or 0.6% higher, and the S&P 500 was up 0.2%. However, the Nasdaq Composite finished lower by 0.5% at 11,768.84.

— CNBC's Tanaya Macheel and Alex Harring contributed to this report.

Chinese companies are scrutinized in the U.S. due to the Chinese Communist Party: analyst

Tim Cook's Beijing visit: China and U.S. tech ecosystems are 'intertwined,' analyst says
China and U.S. tech ecosystems are 'intertwined,' analyst says

Chinese companies are getting scrutiny in the U.S. due to their links to the Chinese government, Lindsay Gorman, senior fellow at the German Marshall Fund's Alliance for Securing Democracy, told CNBC.

"There is this intense geopolitical competition [between the U.S. and China]. Chinese companies are getting a ton of scrutiny in part because of their ties to the Chinese Communist Party," said Gorman, on CNBC's "Squawk Box Asia" Tuesday.

Short-video app TikTok faces a potential ban in the U.S. due to concerns over sharing American user data with its Chinese parent ByteDance. Its CEO told U.S. lawmakers on Thursday that ByteDance's China-based employees may still have access to some of TikTok's U.S. data.

"I would push back on one thing that there is no evidence that Chinese companies are using communications and technologies to spy," said Gorman.

"It's important to look at the broader context of the Chinese Communist Party's efforts to interfere in democratic institutions to suppress free speech and democracies," said Gorman.

The Chinese government had said that it would "strongly oppose" a forced sale of TikTok from ByteDance on Thursday.

— Sheila Chiang

Japan, U.S. announce trade deal on EV battery minerals

The U.S. and Japan announced a trade deal on electric vehicle battery minerals that would grant Japanese automakers access to the Biden administration's $7,500 EV tax credit scheme as part of the Inflation Reduction Act.

The announcement added that the two countries share a common interested in raising "resilience against threats such as economic coercion and non-market policies."

The IRA states plug-in electric vehicles much be produced in North America to qualify for the tax incentives.

"This is a welcome moment as the United States continues to work with our allies and partners to strengthen supply chains for critical minerals, including through the Inflation Reduction Act," U.S. Trade Representative Katherine Tai said in a statement.

She added that the announcement is "proof" of the U.S. government's "commitment to building resilient and secure supply chains."

South Korean officials have also been engaging in discussions to adjust regulations to work around the eliminated tax credits for EVs made outside of North America.

– Jihye Lee, Michael Wayland

South Korean defense stocks rise after Kim Jong Un orders nuclear materials production

South Korean defense stocks largely rose on Tuesday as North Korean leader Kim Jong Un called for an increase in weapons-grade nuclear material production, state media KCNA reported.

Korea Aerospace, which manufactures satellites and aircraft rose over 4.3%, while shares of aircraft engine producer Hanhwa Aerospace rose 3.34%.

The largest gainer by percentage change was Firstec, which makes components for South Korean defense systems like fire controllers and sensors. Firstec shares surged by just over 5% on Tuesday.

— Lim Hui Jie

Bitcoin, ether fall after Binance's founder named in U.S. complaint

Prices of bitcoin and ether fell roughly 3% in Asia's morning trade, according to Coin Metrics – after U.S. officials filed a complaint against crypto exchange Binance and its co-founder Changpeng Zhao.

The filing alleged that the firm actively solicited U.S. users and subverted the exchanges own "ineffective compliance program."

Bitcoin fell 3.09% in the past 24 hours, according to Coin Metrics, and traded at $27,003 – while ether also fell 2.95% to $1,712.

Bitcoin is up roughly 63% quarter-to-date and on pace to mark the best quarter since the first quarter of 2021, when bitcoin gained 103.73%. It is also on pace to see the third consecutive month of gains.

Ether is also up 41.3% quarter-to-date and on pace for the best quarter since the first quarter of 2021, when the cryptocurrency gained over 150%.

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– Rohan Goswami, Gina Francolla, Jihye Lee

Australia's prudential regulator says country's banks "among the best equipped"

Australian Prudential Regulation Authority chairman John Lonsdale, said the country's banking system is "among the best equipped in the world to handle a crisis."

Speaking at a banking summit, Lonsdale pointed out that Australia's banks have higher capital requirements and a narrower range of definitions of high-quality liquid assets compared to its global peers.

Most notably, Australia is the only jurisdiction in the world that mandates banks carry capital to address the risk of rising interest rates as part of their core capital requirements, referred to as interest rate risk in the banking book, he said.

"Some banks had expressed displeasure about the application of capital for IRRBB, but two weeks ago the IRRBB requirement proved its worth," Lonsdale said, referring to the collapse of Silicon Valley Bank and its exposure to rising interest rates.

Still, Lonsdale noted, in light of SVB's rapid fallout, Australia's regulators may need to look at whether the regulatory framework needs strengthening.

"As the speed of crises has accelerated, regulators have less time to respond than they once did. We can no longer expect to have days or weeks to debate and plan considered responses," he said.

"We need to be ready to act quickly, but we also need greater confidence than ever in the prudential safeguards we have in place."

— Lim Hui Jie

Asia-Pacific financials, banks rise as SVB deal offers relief on Wall Street

Shares of banks in the Asia-Pacific rose, tracking Wall Street's moves overnight after First Citizens bought a large chunk of failed Silicon Valley Bank.

Australia's Macquarie Group rose 1.5% in Asia's morning trade, alongside Westpac, National Australia Bank and Commonwealth Bank of Australia all up roughly 1%.

South Korea's financials also rose – Shinhan Financial Group rose 3.44%, KB Financial Group climbed 3.53% and Woori Financial Group gained more than 2%.

In Japan, Mizuho Financial Group also gained 3.15%, Mitsubishi UFJ Financial Group rose 2.42% and Sumitomo Mitsui Financial Group rose more than 3%.

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— Jihye Lee

Australia retail sales rise 6.4% year-on-year in February,

Australia's retail sales in February rose at a slower month-on-month rate of 0.2% compared to January's 1.9%, coming in at A$35.14 billion.

On a year-on-year basis, retail sales rose 6.4% compared to February 2022.

Data from Australia's statistics bureau showed that the main drag was from the "other retailing" category, which fell 0.4%, while the best performing sector was departmental stores, which rose 1%.

The retail sales data is a key input to the Reserve Bank of Australia's April policy rate decision whether to pause or continue rate hikes, along with Wednesday's consumer price index release for February.

— Lim Hui Jie

Hong Kong trade deficit almost doubles in February to $5.78 billion

Hong Kong's trade deficit has almost doubled to HK$45.37 billion ($5.78 billion) in February, compared to January's figure of HK$25.37 billion.

Data from the economy's census and statistics bureau showed that imports in February dipped 4.1% year-on-year to HK$331.57 billion, while exports fell 8.8% compared to the same period the year before at HK$286.2 billion.

Hong Kong's total trade value for February came in HK$617.77 billion, compared to HK$659.69 billion in February 2022.

— Lim Hui Jie

CNBC Pro: As small caps hit multi-decade lows, one fund manager reveals 3 stocks to buy

The market sell-off earlier this month has hurt small-cap stocks more than their larger peers.

Yet Josh Bennett, senior portfolio manager at Alger, believes the volatility has created opportunities for investors to pick stocks that will outperform in the medium to long term.

Bennett named three stocks that he says are likely to have resilient earnings through a potential recession.

CNBC Pro subscribers can read more here.

— Ganesh Rao

CNBC Pro: Morgan Stanley has upgraded a raft of stocks to overweight — here are 5

Despite the market volatility, Morgan Stanley upgraded a raft of stocks in March, including both U.S. and global picks.

The bullish calls spanned tech, pharmaceuticals and more, with the bank giving one stock a double upgrade. Here are five of the stocks upgraded by the investment bank:

CNBC Pro subscribers can read more here.

— Weizhen Tan

Alibaba shares rise after Jack Ma reportedly returns to China

Jack Ma, the billionaire co-founder of Chinese e-commerce giant Alibaba, returned to China after roughly one year away, according to a Wall Street Journal report citing people familiar with the matter.

Ma, who was largely gone from public life after altercations with Chinese regulators, was the subject of speculation following his disappearance. According to the report, Ma spent most of the past year in Japan before recently returning to China. He was also recently in Hong Kong, Singapore and Australia.

Alibaba shares were up 0.5% in Monday premarket trading.

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Alibaba shares 1-day

— Sarah Min

Deutsche Bank climbs after last week's steep losses

U.S.-listed shares of Deutsche Bank were higher in premarket trading on Monday. The stock added 3.6% before the opening bell after declining 3.1% on Friday.

Citi maintained its buy rating on the stock, despite continuing worries toward the health and stability of the overall banking sector. German Chancellor Olaf Scholz largely dismissed concerns that Deutsche could be subject to fallout similar to Credit Suisse, saying that the firm is still "very profitable" and "fundamentally modernized."

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DB rises

Still, Deutsche stock is still under pressure as investors weigh whether a true end is in sight contagion in the banking sector. Shares are down nearly 19% year to date.

— Brian Evans

Regulators considering more support to help First Republic

In an effort to give First Republic Bank more time to get its finances in order, U.S. regulators are considering expanding an emergency lending facility, Bloomberg reported over the weekend.

The move would apply to all banks but especially could aid First Republic, which has had problems with assets similar to those that toppled three other regional banks. First Republic has remained open but concerns have grown over its operations and its stock has plunged.

Discussions are in an earl stage over expanding the Bank Term Funding Program, and any expansion would apply to all banks.

First Republic shares soared more than 28% in premarket trading Monday. The stock is down nearly 90% over the past month.

—Jeff Cox

Deposit drain from small banks has slowed, sources say

Movement of deposits from small banks to giants like JPMorgan Chase and Wells Fargo has slowed in recent days, sources told CNBC.

Customers have grown increasingly skittish following the closure of Silicon Valley Bank, which ignited a crisis in the bank sector. While the crisis has pushed some to move their deposits to bigger banks that they see as less likely to be subject to a bank run, that trend has slowed over recent days, according to sources familiar.

That gives regulators time to address strains in the U.S. banking system as investors and customers alike wonder if contagion could spread.

— Hugh Son