New Zealand interest rate hikes, inflation data

UBS expects China to fully reopen by the third quarter of 2023

UBS Wealth Management expects a full reopening for China by the third quarter of next year due to a number of factors.

“We think the government wants to test public messaging because it needs time [some] The anxiety among the Chinese people is very real,” Min Lan Tan of UBS Global Wealth Management said on CNBC’s “Squawk Box Asia.”

He added that the country needs to increase vaccination rates for its elderly population as well as work to ensure adequate medical care before a full reopening.

On the latest measure to ease quarantine for international travelers, Tan described it as “two steps forward and one step back”.

Reopening the country “is going to be a process, not an event,” he said.

– Jihye Li

Singapore’s inflation rate is eased by small increases in gas and electricity prices

Singapore’s core inflation rate fell 0.2% to 5.1% on an annualized basis in October, the Ministry of Trade and Industry (MTI) reported – after seeing the same index at 5.3% in September.

The latest consumer price index for October was lower than the 5.3% forecast for October in a Reuters poll.

The inflation rate for all items declined to 6.7% on an annualized basis in October after seeing a rate of 7.5% in September.

MTI said the easing was due to lower prices of goods and services as well as gas and electricity.

“Energy and food prices have reached the beginning of the year, but remain high due to ongoing supply constraints,” the ministry said in a statement.

— Lee Ying Shan

Malaysian stocks were little changed as the country’s wait for a new prime minister continued

Malaysia-listed stocks were little changed as the country’s political deadlock continued and local media said Malaysia’s king, the Yang di-Pertuan Agong, would make the decision without giving a deadline.

The benchmark KLCI index fell 0.09% after two negative sessions.

Among index heavyweights, Genting Malaysia fell 2.33% after reporting its third-quarter earnings, and Top Glove also lost 1.1% — while Nestlé rose 0.28% and CIMB rose 0.18%.

The Malaysian ringgit The US Dollar strengthened slightly against the US dollar in the morning session and ended at 4.5690.

— Jihye Li

Chinese online gaming stocks are higher as a crackdown on the sector appears to be easing

New Zealand’s central bank has signaled further hikes

Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr said the bank’s sole aim was to get the official cash rate to a point where inflation could be reduced.

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Orr’s comments came after the central bank raised its largest rate of 75 basis points.

“Our core inflation rate is very high,” Orr told a press conference, adding that the central bank is “well down the path of a tight cycle.”

In a separate press release soon after the decision, RBNZ said, “The committee members agreed that there is a need for further tightening of financial conditions.

— Lee Ying Shan

BYD shares fell after Berkshire Hathaway trimmed shares

share of BYD Hong Kong-listed shares fell 2.64% after Warren Buffett’s Berkshire Hathaway announced it was reducing its stake in the Chinese electric vehicle maker.

According to an HKEX filing, the company sold 3.2 million shares worth about 630 million Hong Kong dollars ($80.6 million), reducing the company’s holding from 16.28% to 15.99%, the filing showed.

Separately, the company announced that it will raise the prices of some of its EV models, according to Reuters.

– Jihye Li

Kuaishou, shares of Baidu rose after reporting earnings

Xiaomi is expected to post a decline in revenue for the third quarter

xiaomi Revenue is expected to decline in the third quarter of 2022, according to Refinitive Poll estimates.

The company is expected to see revenue fall 9.66% to 70.52 billion yuan ($9.87 billion) for the July to September quarter, compared with 78.06 billion yuan in the same period last year.

Daiwa Capital Markets wrote in a note, the expected decline is likely due to “discomforting smartphone sales” as well as weak macro environment and consumer sentiment.

Shares of Xiaomi fell as much as 1.72% in morning trade before the release and were nearly 1% lower at the close.

– Lee Ying Shan

The New Zealand dollar strengthened after the biggest rate hike

The New Zealand dollar strengthened to 0.6192 against the greenback after the central bank hiked 75 basis points, the biggest increase on record.

NZD last traded at 0.6170 against the dollar and the NZX 50 index in New Zealand was down 0.8%.

New Zealand’s 10-year Treasury yield briefly touched 4.305% shortly after the decision and last traded at 4.235%. Yields move inversely to prices and equal one basis point to 0.01%.

– Lee Ying Shan

CNBC Pro: Goldman says EV batteries are becoming ‘critical’ and names 2 stock picks.

According to Goldman Sachs, electric vehicle batteries are gaining “significant importance” in the energy transition.

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The investment bank named two top stocks to play in the EV battery sector, which has an upside of nearly 70%.

CNBC Pro subscribers can read more here.

— Wizen Tan

Singapore released narrow GDP projections for 2022

Singapore’s economy is projected to grow by around 3.5% in 2022, according to a Ministry of Trade and Industry forecast, citing a softening external demand outlook following Europe’s energy crisis and China’s continued Covid-related restrictions.

The figure is a narrower estimate than the previous estimate range of between 3% and 4% — and reflects a 4.1% annual increase in the third quarter and a 1.1% increase from the previous quarter.

The ministry also said it sees GDP growth between 0.5% and 2.5% in 2023.

— Jihye Li

CNBC Pro: UBS says self-driving cars could become $100 billion market in China — and names stocks to drive it

Electric vehicles are rapidly gaining traction, especially in China, the world’s largest EV market.

But UBS believes that autonomous driving will be an even bigger megatrend than electrification – with a market size of around $100 billion by 2030 in China alone.

Here’s how investors can play this megatrend, according to UBS.

Pro subscribers can read more here.

— Javier Wong

New Zealand’s central bank hiked rates by 75 basis points

The Reserve Bank of New Zealand raised its official cash rate by 75 basis points, the largest increase on record, to 4.25%.

The decision was in line with analysts’ expectations, according to a Reuters poll.

This is the ninth consecutive increase since the RBNZ first started its rate hike cycle in October 2021, five of which were 50 basis point increases.

Inflation in New Zealand currently stands at 7.2%, below a three-decade high.

— Lee Ying Shan

Investors should rotate to the second tier of Chinese tech stocks: UBS Global Wealth Management

According to Eva Li, head of broader China equities at UBS Global Wealth Management’s chief investment office, investors should take advantage of the bumpy ride of Chinese tech stocks to move into smaller and less established companies.

“Under current regulations, second-tier players will do better than the top ones. Use this opportunity to rotate into second-tier companies,” such as those with resilient earnings, he told CNBC’s “Street Signs Asia.”

In addition, the tech giants are considered to be in “macro recovery”. [proxies]And the path to an eventual full reopening is “going to be up-and-down, it’s going to be torn up,” he said.

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“We’re getting there eventually but it takes time,” he said.

— Abigail Ng

Stocks rose, with the S&P 500 closing above the key 4,000 level for the first time since September.

Stocks rose on Tuesday with the three major averages gaining more than 1% as Wall Street bets that interest rate hikes and inflation will ease headlines later in the year. The S&P 500 closed at levels not seen since September.

The Dow Jones Industrial Average closed up 397.82 points, or 1.18%, at 34,098.10. The Nasdaq Composite also rose 1.36% to 11.174.41.

The S&P 500 closed up 1.36% at 4,003.58, its first close above the 4,000 level since September.

-Carmen Reinick

Today’s 19 S&P 500 all-time record 84% of 52-week high

Nineteen stocks in the S&P 500 hit 52-week highs through Tuesday, and of those, 16 (84%) hit all-time highs. Three of the 19 (TRV, MRK, IBM) are also in the Dow Jones Industrial Average, and two of them are at all-time highs:

  • General Parts Co. (GPC), highest since 1948 IPO
  • O’Reilly Auto (ORLY), all-time high since 1993 IPO
  • TJX Cos. (TJX), all-time high since 1987 IPO
  • General Mills (GIS), all-time high through history since 1927
  • Monster Beverage (MNST), predecessor Nasdaq listing in 1992, all-time high
  • PepsiCo (PEP), all-time high, goes back to Pepsi-Cola’s merger with Frito-Lay in 1965
  • Marathon Petroleum (MPC), spin-off from Marathon Oil in 2011 returns to all-time high
  • Aflac Inc. (AFL), all-time back to 1973 via CNBC data history
  • Arthur J. Gallagher (AJG), all-time high since 1984 IPO
  • Globe Life (GL), all-time high in predecessor data in 1980
  • MetLife (MET), publicly returned to an all-time high in 2000
  • Progressive (PGR), all-time high since 1971 IPO
  • Travelers (TRV), a spin-off from Citi in 2002, is at an all-time high
  • Gilead Sciences (GILD), highest since April 2020
  • Merck & Co. (MRK), the all-time high through CNBC history that began in 1978
  • PACCAR (PCAR), all-time high since 1971 IPO
  • Quanta Services (PWR), all-time high since 1998 IPO
  • Snap-On (SNA), max from June 2021
  • International Business Machines (IBM), highest as of February 2020

The S&P 500 hit two 52-week lows early Tuesday:

  • Tesla (TSLA), lowest since November 2020
  • Medtronic (MDT), the lowest since March 2020

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— Scott Sniper and Christopher Hayes

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