Asia markets mostly rise as Tokyo stocks extend rally, China leaves loan rates unchanged

Jihye Lee
Lim Hui Jie

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

The People's Bank of China (PBOC) building in Beijing, China, on Tuesday, April 18, 2023.

Asia-Pacific markets mostly rose on Monday as stocks in Tokyo extended its rally and talks on the U.S. debt ceiling were slated to resume.

Hong Kong's Hang Seng index rose 1.23%, leading gains in the region as the Hang Seng Tech index jumped 2.17%. In mainland China, the Shanghai Composite closed 0.39% up at 3,296.47 and the Shenzhen Component was 0.32% higher and ended at 11,127.04 as the People's Bank of China left its 1-year and 5-year loan prime rates unchanged.

South Korea's Kospi rose 0.76% to end the day at 2,557.08 as chip stocks such as SK Hynix and Samsung Electronics saw gains. This comes after Beijing said it would bar operators of key infrastructure from buying products of Micron.

The Nikkei 225 gained 0.9% to close at 31,086.92 and the Topix rose 0.66% to end at 2,175.9, marking its seventh winning streak as stocks in Japan stayed at the highest levels since 1990. At this level, the Nikkei is up just over 20% year to date.

Stocks in Australia bucked the trend with the S&P/ASX 200 was 0.18% lower, finishing Monday at 7,266.6

.N225Nikkei 225 IndexNIKKEI30,526.88UNCHUNCH
.HSIHang Seng IndexHSI17,195.84-135.38-0.78%
.FTFCNBCACNBC 100 ASIA IDXCNBC 1007,880.33-100.67-1.26%

Stocks on Wall Street fell on Friday as talks on the U.S. debt ceiling were halted by GOP negotiators, stoking doubt of a deal being reached soon while the S&P 500 recorded its best week since March. The Dow Jones Industrial Average fell 0.33%, and the Nasdaq Composite was down 0.24%.

U.S. Federal Reserve chairman Jerome Powell meanwhile said that interest rates may not have to rise as much as expected to curb inflation, given current banking sector stresses.

— CNBC's Sarah Min and Samantha Subin contributed to this report

Mon, May 22 2023 2:28 AM EDT

China's recovery should reduce some U.S. dollar exceptionalism: Barclays

China's recovery should reduce some of U.S. dollar exceptionalism, leading to a weaker U.S. dollar, said Ashish Agrawal, head of Asia FX and emerging market macro strategy research at Barclays.

"This improvement in China growth — that itself should basically help some sort of rebalancing of global growth, reduce a little bit of the dollar exceptionalism angle, which kind of helps or informs our view of a weaker dollar over the medium term," said Agrawal on CNBC's "Street Signs Asia" on Monday.

Latest official data showed China's economy grew a faster-than-expected 4.5% year-on-year in the three months through March, the first quarter since China exited its harsh zero-Covid policy in December.

But the Chinese yuan could weaken further over the year, said Agrawal.

"This whole improvement in China is also going to come on the back of a little bit of a deteriorating external sector," said Agrawal. Exports in April grew at a slower pace as compared to the 14.8% surge in March, customs data showed.

"The current account surplus is going to be lower, outflows and some of the portfolio inflows are going to pick up — which we and many thought are taking a little time. So we have got dollar China lower over the year, but we have got it falling slower, especially with the broader dollar," he added.

The Chinese onshore yuan weakened 0.27% to 7.02 against the U.S. dollar on Monday afternoon.

— Sheila Chiang

Mon, May 22 2023 2:20 AM EDT

S&P expects 70% of global oil demand growth to come from Asia

S&P expects 70% of global oil demand growth this year to stem from Asia, with a lot of that being driven by jet fuel as travel returns to pre-Covid levels.

"Asia is the engine of that oil market and global economy. We're expecting about 70% of global oil demand growth this year coming from Asia," said S&P's Managing Editor of OPEC, Herman Wang.

S&P is forecasting a 2.1 million barrels per day of demand growth for 2023, relatively more conservative than OPEC's estimate of 2.3 million barrels per day.

Wang said that the upcoming June OPEC meeting will most likely center around Russian oil production numbers, and that there will "not [be] a lot of appetite for further cuts."

Global benchmark Brent futures traded 1.12% lower at $74.73 a barrel Monday, while the U.S. West Texas Intermediate futures was down 1.19% at $70.7 per barrel.

—Lee Ying Shan

Mon, May 22 2023 2:05 AM EDT

HSBC expects Bank of Japan to tweak its yield curve control policy in Q3

HSBC economists have pushed back their expectations for the Bank of Japan's policy changes to the third quarter of this year.

Citing "subdued market pressures and a focus on sustained wage increases," HSBC said in a Friday note that it now predicts the central bank to widen its yield curve control's trading range to 100 basis points above and below 0% for 10-year Japanese Government Bonds in the third quarter of this year.

HSBC had previous expected the Bank of Japan to widen its YCC band to 75 basis points in June.

"As these market pressures have moderated, so too has our base expectation of a change in policy by the BoJ," they wrote, adding the modified outlook reflects "incoming changes to be bigger and bolder, provided the price stability target is in sight."

They added by the third quarter of this year, the Japanese economy would see data that is "increasingly supportive of achieving conditions to begin its normalization process."

— Jihye Lee

Mon, May 22 2023 1:00 AM EDT

Southeast Asia’s worst-performing stock market is UBS’ ‘top pick’

Thai stocks are the worst performers in Southeast Asia this year, but UBS says Thailand is its "top pick" in the region. Thailand's SET index fell 0.5% on Monday's afternoon and is down by more than 9% this year.

Thailand stands to be a "big beneficiary" of a tourism boost from China once the latter's employment numbers increase, said UBS Global Wealth Management's Kelvin Tay told CNBC's "Squawk Box Asia."

However, Thailand's elections are a "potential game changer" and monarchy-linked companies could be set back by a change in government, he said.

— Audrey Wan

Mon, May 22 2023 12:47 AM EDT

Australia 'hopeful' for China resolution on Australian barley tariffs

The Australian Minister for Trade and Tourism is hopeful for "a favourable decision" soon on China abolishing tariffs on Australian barley imports.

"We are hopeful for a favorable decision in respect to tariffs on Australian barley into China," Don Ferrell told CNBC in an interview Monday.

Ferrell was in China earlier in May, becoming only the second Australian minister in Prime Minister Anthony Albanese's administration to visit China after Foreign Minister Penny Wong visited Beijing in December.

Australia agreed in April to temporarily suspend a World Trade Organization complaint against China for its 2020 decision to impose 80.5% duties on Australian barley at the height of diplomatic tensions.

"We are seeking to stabilize our relationship to China," Farrell said. "We believe the best way to peace in our shared region is through sensible trade rules regulating trade operations between our two countries."

Ferrell also said his Chinese counterpart, China Commerce Minister Wang Wentao, has accepted his invitation to visit Australia, without providing further details.

Clement Tan


Sun, May 21 2023 10:36 PM EDT

Shares of Chinese chipmakers rise after China bars some purchases on Micron products

Shares of Chinese chipmakers largely rose after China's Cyberspace Administration said it would bar operators of key infrastructure from buying products from U.S. memory producer Micron.

Hong Kong-listed Hua Hong Semiconductor rose as much as 3.14% on Monday, while SMIC rose 2.64%.

Other memory chip producers in mainland China like GigaDevice Semiconductor and Ingenic semiconductor also saw gains of up to 3.74% and 8.08% respectively.

See Chart...

China's Cyberspace administration explained that Micron products have failed its network security review, citing "serious potential network security issues."

The cyberspace administration did not specify which products will be prohibited or what security issues Micron's products had in its release.

— Lim Hui Jie

Sun, May 21 2023 8:39 PM EDT

China bars Micron product purchases after its security review

China's Cyberspace Administration has barred operators of "critical information infrastructure" in China from purchasing products from U.S. memory producer Micron.

This comes as the Cyberspace Administration of China said that Micron products have failed its network security review, citing "serious potential network security issues."

It added that this "poses a major security risk to China's critical information infrastructure supply chain and affects [its] national security."

The cyberspace administration did not specify which products will be prohibited or what security issues Micron's products had in its release.

Shares of Micron's rivals in South Korea rose Monday morning after the announcement, with SK Hynix rising 1.54% and Samsung Electronics gaining 0.5%.

— Lim Hui Jie

Sun, May 21 2023 10:20 PM EDT

China leaves 1-year, 5-year lending rates unchanged

The People's Bank of China left its benchmark lending rates unchanged for the ninth consecutive month.

China left its 1-year loan prime rate unchanged at 3.65% and its 5-year loan prime rate unchanged at 4.30%, in line with expectations by economists polled by Reuters.

The Chinese onshore yuan weakened 0.2% to 7.0205 against the U.S. dollar.

— Jihye Lee

Sun, May 21 2023 9:36 PM EDT

South Korean exports fall 16.1% year-on-year in May 1-20 period

Exports from South Korea have fallen 16.1% in the first 20 days of May compared to the same period a year ago, its customs agency said.

Imports in the same period also fell 15.3% year-on-year.

Exports value for the first 20 days came in $32.4 billion and imports stood at $36.7 billion, resulting in a $4.3 billion deficit for the May 1-20 period

Refinitiv data showed that South Korea's exports have declined for seven straight months, with April recording a 14.3% fall year-on-year.

— Lim Hui Jie

Sun, May 21 2023 8:39 PM EDT

Japan's core machinery orders fell in March

Japan's core machinery orders fell 3.9% in March compared to the previous month, falling further than expected.

Economists polled by Reuters had expected the reading to rise by 0.7% month-on-month.

Compared to a year ago, machinery orders also fell 3.5%, against expectations for the print to rise by 1.4%

Japan's machinery orders rose 9.8% year-on-year in February.

— Jihye Lee

Sun, May 21 2023 8:15 PM EDT

CNBC Pro: Tesla vs. BYD: Here's why one fund manager prefers the Buffett-backed automaker

In an era defined by the need to tackle climate change, electric vehicles (EVs) are seen as an increasingly important part of the solution.

For Philip Ripman, portfolio manager at Storebrand Asset Management, one global EV automaker stands out: China's BYD — not Elon Musk's Tesla.

As an investor, Ripman said that BYD's appeal goes beyond just manufacturing electric cars.

CNBC Pro subscribers can read why the fund manager is bullish on BYD here.

— Ganesh Rao

Sun, May 21 2023 8:15 PM EDT

CNBC Pro: These 4 stocks are on Goldman's 'conviction buy' list — and it gives one 115% upside

A look at Goldman Sachs' "conviction buy" stocks this year reveals some names with serious upside potential.

The Wall Street bank's list comprises its top buy-rated stocks that it expects to outperform.

CNBC Pro subscribers can read more about five of them here.

— Weizhen Tan

Sun, May 21 2023 6:17 PM EDT

Debt celing negotiations to resume on Monday

Federal leaders are expected to continue with negotiations on the U.S. debt ceiling on Monday as the country approaches a potential default.

President Joe Biden and House Speaker Kevin McCarthy, R-Calif., are scheduled to meet in person at the White House.

Treasury Secretary Janet Yellen said Sunday that "hard choices" will need to be made about which bills will go unpaid if the debt ceiling is not raised and reaffirmed her warning that the United States could default on its debt as early as June 1,

— Jesse Pound, Ashley Capoot

Fri, May 19 2023 11:46 AM EDT

Powell says rates may not have to rise as much as expected

Federal Reserve Chair Jerome Powell said Friday that interest rates may not have to rise as much as previously thought in part due to stresses seen in the banking sector.

"The financial stability tools helped to calm conditions in the banking sector. Developments there, on the other hand, are contributing to tighter credit conditions and are likely to weigh on economic growth, hiring and inflation," he said as part of a panel on monetary policy.

"So as a result, our policy rate may not need to rise as much as it would have otherwise to achieve our goals," he added. "Of course, the extent of that is highly uncertain."

— Jeff Cox

Fri, May 19 2023 8:55 AM EDT

Fed's Williams says 'era of very low' interest rates remains intact

New York Federal Reserve President John Williams said the longer-term trend in interest rates is likely lower, despite the recent increases in an attempt to battle inflation.

In a largely academic discussion during a forum in Washington, D.C., Williams said the "natural" rate of interest remains to the downside as the prospects for economic output are muted. That's despite the pandemic-era surge in inflation and the increases in the interest rates to combat the higher prices.

"Importantly, there is no evidence that the era of very low natural rates of interest has ended," Williams said.

—Jeff Cox

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