Tesla lowers some model prices in China, suppliers increase
Tesla has cut prices on some models in China for the second time in three months, the company announced in a Weibo post.
The company said its Model 3 and Model Y now cost 229,900 yuan and 259,900 yuan in China.
That’s down from 6% to 13.5%, according to a separate calculation by Portal.
Shenzhen-listed shares of Tesla’s Chinese suppliers rallied amid optimism that the price cut could boost demand for the electric-vehicle maker.
Shares in Anhui Shiny Electronic Technology rose as much as 10% in Asian trading and Hengdian Group DMEGC Magnetics surged almost 9%. Zhejiang Chint Electrics rose about 10% and Shandong Jinjing Science & Tech rose more than 7%.
– Jihye Lee
More Chinese electronics companies want to take market share from Taiwanese companies like Foxconn: Investment Fund
More Chinese electronic component makers will take market share from Taiwanese competitors like Foxconn, Kirk Yang, chairman and CEO of Kirkland Capital, told CNBC’s Squawk Box Asia on Friday.
Apple supplier Foxconn is facing Luxshare, which has won an order for iPhone production in China, even as Foxconn posted record earnings and its Zhengzhou plant returned to normal after Covid restrictions and labor unrest.
“Chinese companies are becoming quite competitive for iPhone assemblers. Aside from semiconductors, China is doing pretty well in pretty much everything,” Yang said.
Yang added that Taiwanese companies in China have come under severe pressure over the past five years due to China-Taiwan geopolitical tensions. “Many of them are moving away from China,” Yang said.
That’s why Apple needs to diversify, he said, adding that the tech war between the US and China is also causing companies to move even faster out of China to diversify.
-Sheila Chiang
Samsung Electronics could throttle production in the coming months, says CLSA
Samsung Electronics could follow its rivals Micron Technology and SK Hynix in cutting production towards the end of 2023, said Sanjeev Rana, a senior analyst at CLSA.
The company has “no choice but to scale back production because inventories are building up quickly,” Rana said on CNBC’s Squawk Box Asia on Friday.
“If they don’t cut production, inventories could rise even more,” he said, adding that demand for IT products has slumped in recent months, which has also slowed sales of memory chips.
On the demand side, Rana said China’s reopening could lead to double-digit growth in smartphone shipments to China on an annualized basis.
Oil prices will remain around $85 a barrel for the next five years, an analyst says
Oil prices are expected to hover around $85 a barrel over the next five years due to “underinvestment on the supply side” and likely rising demand, said Dan Pickering of Pickering Energy Partners.
Once China weathers its Covid wave, “a million to two million barrels of additional demand per day can be expected,” Pickering said, adding that this will support prices of the commodity.
He added that further support will be priced in once the world emerges from the global economic downturn.
Brent crude futures were up 1.12% to trade at $79.57 a barrel. Similarly, the US West Texas Intermediate rose 1.15% to $74.74 a barrel.
Overnight in the US also reported lower fuel inventories following a winter storm, which added pressure on supply.
– Lee Ying Shan
China eases minimum mortgage interest rates for first-time homebuyers
The People’s Bank of China and the China Banking and Insurance Regulatory Commission announced the approval of lower mortgage rates for first-time homebuyers if new-build home prices fall for three consecutive months, a statement said.
Recent measures show continued government support for the real estate sector.
Home sales in China fell by more than 20% on an annual basis every month through November last year, Factset data showed. Home prices fell for the fourth consecutive month on a monthly basis in November, Portal reported.
Hong Kong-listed property stocks were mostly higher, with Logan Group up 5.48% and Cifi Holdings up 0.79%. Country Garden and Longfor Group remained flat in Friday’s morning session.
– Jihye Lee
CNBC Pro: Veteran investor sees energy as the biggest winner of 2023 — and names stocks to play with
After a stellar performance in 2022, energy stocks are off to a slow start to the year.
But veteran investor Louis Navellier is unimpressed. He believes the sector is in for another record year in 2023 and has a number of stock picks to play with.
Pro subscribers can read more here.
– Zavier Ong
Japan’s service sector grows for fourth consecutive month
Japan’s service sector activity posted a fourth straight month of growth in December as the country’s central bank maintained ultra-dovish policies in contrast to its dovish global peers.
The final Purchasing Managers’ Index from au Jibun Bank Japan Services rose to 51.1, compared to a sharp decline in November to 50.3 from October’s 53.2.
The 50-point mark in PMI readings separates contraction from expansion.
The Japanese yen traded slightly stronger after the report, last trading at 133.38 against the greenback.
– Jihye Lee
Samsung Electronics’ earnings forecast points to a nearly 70% drop in quarterly earnings
Samsung Electronics posted its worst quarterly earnings in nearly 8 years, with operating profit falling about 70% in the most recent quarter, according to the company’s latest earnings forecast.
The tech giant estimated that its October-December profit slumped to 4.3 trillion won ($3.37 billion) on weaker global demand, after posting a profit of 13.87 trillion won (10, 92 billion US dollars).
Shares of the tech giant rose 0.17% shortly after the forecast was released.
– Jihye Lee
CNBC Pro: Citi’s Chronert says recession is near; shares his “highest persuasion calls” to get through it
Citi’s Scott Chronert expects a mild recession in the first half of this year and revealed three strategy calls that could help investors trade the downturn.
He shared with CNBC three “top confidence calls” that could help investors navigate the macro environment.
CNBC Pro subscribers can read more here.
— Wheat Tan
St. Louis Fed President James Bullard says 2023 is poised to be a disinflationary year
According to St. Louis Federal Reserve Bank President James Bullard, there are a number of factors that could make 2023 a disinflationary year.
He noted that GDP growth is likely to have improved in the second half of 2022 and inflation has been falling recently, although overall it is too high.
He added that while current policies are not “enough restrictive” yet, they are getting closer and will reach that level this year. This signaled markets that he could cut the 5%-plus final interest rate he expects from the central bank before pausing or reversing rate hikes and pushing stocks off daily lows.
The labor market strength seen amid a hiking cycle is unprecedented, he said.
– Carmen Reinicke
CNBC Pro: Goldman Sachs reveals 7 under-the-radar global stocks to buy this year
According to Goldman Sachs, many under-the-radar stocks are key to a green energy shift — and they’re expected to take off in 2023.
The Wall Street Bank said the decade-long trend of investing in big clean energy stocks will shift this year, with the focus shifting to smaller supply chain companies.
The investment bank identified seven stocks in the Europe, Middle East and Asia regions that will benefit from the new trend.
CNBC Pro subscribers can read more here.
— Ganesh Rao
Big declines for Silvergate, Bed Bath & Beyond highlight midday moves
Here are some of the biggest stock moves during Thursday’s trading session:
SILVERGATE — Shares of the crypto-focused bank fell more than 42% after Silvergate announced massive customer withdrawals in the fourth quarter. The bank said it had $3.8 billion in assets from customers with digital assets at the end of December, down more than 60% from three months earlier. The company also sold more than $5 billion in debt to cover the withdrawals, resulting in a $718 million loss on those sales.
Bed Bath & Beyond – The homewares retailer plunged 24% after reporting it was running out of cash and is considering bankruptcy as sales came in weaker than expected. The company said it was evaluating financial options, including restructuring, seeking additional capital or selling assets, in addition to a possible bankruptcy.
Lamb Weston Holdings – The food processing company rose 9% after beating quarterly earnings and sales estimates. Lamb Weston also raised its full-year financial guidance.
You can find more relocation helpers here.
— Jesse Pound
The continued decline in jobless claims signals the strength of the job market
Initial jobless claims rose slightly to 225,000 in the week ended Dec. 24, according to the Labor Department. But ongoing claims – which count those who have been out of work for more than a week – fell.
Ongoing claims fell by more than 24,000 to 1,569,764 in the previous week. This signals that people are finding new jobs amid a strong labor market.
– Carmen Reinicke