Before an hour
Chinese companies under scrutiny in US by Chinese Communist Party: analyst
Chinese companies are under scrutiny in the US because of their ties to the Chinese government, Lindsay Gorman, a 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 under a ton of scrutiny, in part because of their ties to the Chinese Communist Party,” Gorman said on CNBC’s Squawk Box Asia on Tuesday.
Short-video app TikTok is facing a possible ban in the US over concerns about sharing American user data with Chinese parent company ByteDance. Its CEO told U.S. lawmakers Thursday that ByteDance’s China-based employees may still have access to some of TikTok’s U.S. data.
“One thing I want to withhold is that there is no evidence that Chinese companies are using communications and technology to spy,” Gorman said.
“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,” Gorman said.
The Chinese government had announced that it would “decidedly oppose” a forced sale of TikTok by ByteDance on Thursday.
– Sheila Chiang
Before an hour
Japan and US Announce Trade Deals on EV Battery Minerals
The US and Japan announced a trade deal on battery minerals for electric vehicles that would give Japanese automakers access to the Biden administration’s $7,500 electric vehicle tax credit program under the Inflation Mitigation Act.
The announcement added that the two countries share a common interest in increasing “resilience against threats such as economic coercion and non-market policies.”
The IRA states that plug-in electric vehicles must be manufactured in North America to qualify for the tax incentive.
“This is a welcome moment as the United States continues to work with our allies and partners to strengthen critical mineral supply chains, including through the Inflation Reduction Act,” U.S. Trade Representative Katherine Tai said in a statement.
She added that the announcement was “demonstration” of the US government’s “commitment to building resilient and secure supply chains.”
South Korean officials have also engaged in discussions to adjust the regulations to circumvent the abolished tax credits for electric vehicles manufactured outside of North America.
– Jihye Lee, Michael Wayland
2 hours ago
South Korean defense stocks rise after Kim Jong Un orders production of nuclear materials
South Korean defense stocks rose sharply 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, a maker of satellites and airplanes, rose over 4.3%, while shares in aircraft engine maker Hanhwa Aerospace rose 3.34%.
The biggest gainer by percentage change was Firstec, which makes components for South Korea’s defense systems such as fire control devices and sensors. Firstec shares rose just over 5% on Tuesday.
— Lim Hui Jie
4 hours ago
Bitcoin, Ether Fall After Binance Founder Named in US Lawsuit
Bitcoin and ether prices fell about 3% in morning trading in Asia, according to Coin Metrics – after US officials filed a complaint against crypto exchange Binance and its co-founder Changpeng Zhao.
The filing alleged that the firm was actively recruiting US users and undermining the exchange’s own “ineffective compliance program.”
Bitcoin is down 3.09% over the past 24 hours, according to Coin Metrics, to trade at $27,003 – while Ether is also down 2.95% to $1,712.
Bitcoin is up about 63% quarter-to-date and on track to mark its best quarter since Q1 2021, when Bitcoin gained 103.73%. It’s also on track to see its third straight month of gains.
Ether is also up 41.3% quarter-to-date and is on track for its best quarter since Q1 2021, when the cryptocurrency gained over 150%.
– Rohan Goswami, Gina Francolla, Jihye Lee
6 hours ago
Australia’s regulator says the country’s banks are among the best-resourced
Australian Prudential Regulation Authority Chair John Lonsdale said the country’s banking system was “among the best equipped in the world to deal with a crisis”.
At a banking summit, Lonsdale pointed out that Australian banks have higher capital requirements and a narrower range of definitions of high quality liquid assets compared to their global peers.
Notably, Australia is the only jurisdiction in the world where banks require capital to address the risk of rising interest rates as part of their Tier 1 capital requirements, known in the banking book as interest rate risk, he said.
“Some banks had expressed displeasure at using capital for IRRBB, but two weeks ago the IRRBB requirement stood the test,” Lonsdale said, citing the collapse of Silicon Valley Bank and its exposure to rising interest rates.
Still, Lonsdale said, given the rapid impact of SVB, Australian regulators may need to consider strengthening the regulatory framework.
“As the speed of crises has accelerated, regulators have less time to react than they used to. We can no longer expect to have days or weeks to discuss and plan considered responses,” he said.
“We must be ready to act quickly, but we also need more confidence than ever in the regulatory safeguards that we have in place.”
— Lim Hui Jie
5 hours before
Asia Pacific financials and banks rise as SVB deal offers relief on Wall Street
5 hours before
Australia retail sales up 6.4% yoy in February,
Australia’s retail sales rose at a slower monthly rate of 0.2% in February compared to January’s 1.9% to reach A$35.14 billion.
Compared to February 2022, retail sales increased by 6.4% year-on-year.
Data from Statistics Australia showed that the main drag came from the Other Retail category, which fell 0.4%, while the best-performing sector was Department Stores, which rose 1%.
Retail sales are a key input to the Reserve Bank of Australia’s April interest rate decision on whether to pause or continue rate hikes, along with February’s CPI release on Wednesday.
— Lim Hui Jie
5 hours before
Hong Kong’s trade deficit almost doubles to $5.78 billion in February
Hong Kong’s trade deficit nearly doubled to HK$45.37 billion ($5.78 billion) in February, compared to HK$25.37 billion in January.
Data from the Census and Statistics Bureau of Economy showed that imports fell 4.1% yoy to HK$331.57 billion in February, while exports fell 8.8% yoy to HK$286.2 billion. HK$ declined.
Hong Kong’s total trade value was HK$617.77 billion in February, compared to HK$659.69 billion in February 2022.
— Lim Hui Jie
6 hours ago
CNBC Pro: As small-caps fall to decade-lows, a fund manager announces three stocks for purchase
The market sell-off earlier this month hurt small-cap stocks more than their larger peers.
However, Josh Bennett, senior portfolio manager at Alger, believes that volatility has provided opportunities for investors to pick stocks that will outperform over the medium to long term.
Bennett named three stocks he says are likely to post robust gains in a potential recession.
CNBC Pro subscribers can read more here.
— Ganesh Rao
6 hours ago
CNBC Pro: Morgan Stanley upgraded a number of stocks to overweight — here are 5
Despite market volatility, Morgan Stanley upgraded a number of stocks in March, including both US and global names.
The bullish calls included technology, pharmaceuticals and more, with the bank giving a stock a double upgrade. Here are five of the stocks upgraded by the investment bank:
CNBC Pro subscribers can read more here.
— Wheat Tan
18 hours ago
Alibaba shares rise after Jack Ma reportedly returned to China
Jack Ma, the billionaire co-founder of Chinese e-commerce giant Alibaba, returned to China after about a year, according to a Wall Street Journal report, citing people familiar with the matter.
Ma, who has largely disappeared from public life after clashes with Chinese regulators, has been the subject of speculation after his disappearance. According to the report, Ma spent most of the past year in Japan before recently returning to China. He has also recently been to Hong Kong, Singapore and Australia.
Alibaba shares rose 0.5% in premarket trading on Monday.
See grafic…
Alibaba shares 1 day
20 hours ago
Deutsche Bank is rising after last week’s heavy losses
U.S.-listed Deutsche Bank shares were higher in premarket trading on Monday. The stock gained 3.6% before the opening bell after falling 3.1% on Friday.
Citi maintained its buy rating on the stock despite ongoing concerns about the health and stability of the broader banking sector. Chancellor Olaf Scholz largely dismissed concerns that Deutsche could suffer similar consequences to Credit Suisse, saying the company was still “very profitable” and “fundamentally modernised”.
Nonetheless, Deutsche shares remain under pressure as investors weigh whether a real end to the contagion in the banking sector is in sight. Shares are down nearly 19% year-to-date.
– Brian Evans
19 hours ago
Regulators are considering more support to help First Republic
To give First Republic Bank more time to get its finances in order, US regulators are considering expanding an emergency lending facility, Bloomberg reported over the weekend.
The move would apply to all banks, but could particularly help First Republic, which has faced similar asset woes as the other three regional banks. First Republic has remained open, but concerns about its operations have grown and its shares have plummeted.
Discussions about expanding the Bank Term Funding Program are at an early stage and any expansion would apply to all banks.
First Republic shares are up more than 28% in premarket trading on Monday. The stock is down nearly 90% over the past month.
– Jeff Cox
Sunday, March 26, 2023 6:36 p.m. EDT
Deposit outflows from small banks have slowed, sources say
The movement of deposits from small banks to giants like JPMorgan Chase and Wells Fargo has slowed in recent days, sources told CNBC.
Customers have become increasingly nervous following the closure of Silicon Valley Bank, which sparked a crisis in the banking sector. While the crisis has prompted some to move their deposits to larger banks, which they say are less likely to be hit by a bank run, that trend has slowed in recent days, according to well-known sources.
That gives regulators time to address the strains in the US banking system, as investors and customers alike question whether contagion could spread.
– Hugh’s son