William Ma says it’s “too early” to buy Hong Kong property until politicians pull talent out
It’s still too early to buy both real estate stocks and physical real estate in Hong Kong, said William Ma, chief investment officer of GROW Investment Group.
Speaking on CNBC’s Street Signs Asia, Ma said short-term investors will have to “wait and see” whether Hong Kong leader John Lee’s talent-attracting policies will lure people back to the city-state.
In addition, Ma expects property prices and stocks to fall on weak demand, adding what Hong Kong needs is “a real economic recovery.”
Ma also said Hong Kong’s financial importance will remain and Chinese companies still prefer to list on Hong Kong’s markets.
— Lee Ying Shan
Hong Kong climbers: Tech, EV, casino stocks fall in Macau; Real estate stocks shed previous gains
Shares of Hong Kong-listed tech companies and EV manufacturers continued to trade lower during Hong Kong leader John Lee’s keynote address, dragging the overall index along with Macau casino shares.
Xpeng Motors fell 8.24%, Bilibili fell 4.2% and Meituan also fell 3.64%. Tencent and Alibaba were also down more than 2.5%.
Casino shares in Macau also fell, with MGM China down 3.84% and Wynn Macau down 4.15%.
Meanwhile, real estate stocks trimmed past gains. Country Garden was last up 0.7% after trading more than 4% higher ahead of Lee’s speech.
China Overseas Land and Investment rose 2.25% after rising 5% earlier.
– Jihye Lee
Kakao co-CEO resigns after mass outage locks out 53 million users
A top Kakao Corp executive is set to resign after a data center fire sparked a mass outage over the weekend and disrupted services for the messenger’s 53 million users worldwide.
Co-CEO Namkoong Whon apologized after the outage and said he would step down.
“I feel the heavy burden of responsibility for this incident and will step down from my position as CEO and lead the emergency task force monitoring the aftermath of the incident,” Namkoong said at a news conference at the company’s office on the outskirts of Seoul on Wednesday.
Shares of Kakao were trading slightly lower at 2.43% after the news conference.
– Jihye Lee
Property shares in Hong Kong rise ahead of annual keynote speech
Shares of Hong Kong-listed property companies rose in morning trade ahead of Chief Executive John Lee’s keynote address.
China Overseas Land and Investment was up 5%, CK Asset was up 2.75% and Sino Land was up 2.5%. Country Garden was also up 4.26% ahead of Lee’s speech.
Local media in Hong Kong reports that foreign property owners could get rebates on buyer’s stamp duty.
– Abigail Ng
Apple supplier stocks fall after report of iPhone 14 Plus production cut
Shares of Apple suppliers in Asia slid after the tech company reportedly asked a manufacturer in China to halt production of an iPhone 14 Plus component as Apple reassessed demand for the product.
The Information reported that two other suppliers who assemble modules from this component have also drastically reduced production.
South Korea’s LG Innotek and SK Hynix lost around 2%, while Japan’s TDK Corporation and Murata Manufacturing each lost more than 1%.
Apple stock briefly slipped $4 per share overnight but ended the regular session up 0.94% as major indexes gained.
– Abigail Ng
CNBC Pro: Goldman Sachs outlines four economic scenarios and predicts how gold will fare in each
It’s been a choppy year for gold, with the precious metal “torn between growth and inflation risks and higher real interest rates and the strong dollar,” Goldman analysts wrote in an Oct. 11 note.
“In our view, much uncertainty remains about the future trajectory of US inflation, growth, interest rates and central bank (CB) response functions.”
Goldman ran through four different economic scenarios and predicted where the price of gold could end up in each case.
CNBC Pro subscribers can read more here.
US crude futures are up $1 a barrel on expectations that Biden will release oil from the Strategic Petroleum Reserve
West Texas Intermediate crude oil futures were up about $1, or 1.33%, and Brent crude oil futures were up $0.83, or 0.92%, on expectations that the Biden administration will buy more oil from the US Strategic Petroleum Reserve releases.
The plan could be announced as early as Wednesday, sources told CNBC.
The move aims to extend the current SPR delivery program, which began this spring, through December, the sources said.
–Kayla Tausche, Jihye Lee
RBNZ likely to deliver 75 basis point “jumbo lift” in November: ANZ
ANZ economists expect the Reserve Bank of New Zealand to report hikes of 75 basis points each at their upcoming November and February meetings.
The Reserve Bank of New Zealand raised interest rates by 50 basis points to 3.5% earlier this month, taking the policy rate to a seven-year high.
ANZ said the Reserve Bank of Australia is likely to take a more conservative path than the RBNZ, leading to a “much bigger policy difference in 2023”.
The next RBNZ monetary policy meeting is scheduled for November 23.
– Jihye Lee
Apple crashes after reporting a production cut
Apple’s shares fell, briefly turning negative after The Information reported that the tech giant was curtailing production of its new iPhone 14 Plus.
The move in Apple, the largest US stock, pushed the major averages back near their daily lows, though they’ve since recovered some of that bottom.
How much higher can the Fed push the 10-year yield?
The Fed is widely expected to hike another three-quarters of a percentage point next month, but the central bank may be reaching its limit for dictating long-term interest rates, according to The Leuthold Group’s Jim Paulsen.
“There is considerable precedent in past tightening cycles of bond market ‘flashing’ shutting down the Fed first. The Fed could soon try to raise interest rates to 4%, 4.5% or even 5%, at which point longer-dated bonds could simply stop climbing and refuse to follow the Fed’s lead,” Paulsen wrote in a note to clients on Tuesday .
The 10-year Treasury yield has traded above 4% for the past few days, hitting its highest level in more than a decade. It could be nearing a ceiling amid growing concerns of a 2023 recession, Paulsen said.
“Every time the Fed tightens monetary policy further, recession fears grow relative to inflation fears. Ultimately, as the Fed becomes more aggressive, recession becomes a bigger concern than inflation, and bond buyers outnumber bond sellers — meaning the bond market blinks,” Paulsen added.
— Jesse Pound