Asia-Pacific markets rise after Wall Street sees bank stocks rebound

Shenzhen-listed shares of Contemporary Amperex Technology (CATL) fell slightly after Reuters reported the battery giant had delayed plans for a $5 billion listing in Switzerland, citing people with knowledge of the matter.

Reuters reported there was a delay in the expected approval from Chinese regulators, and it comes after Chinese President Xi Jinping expressed mixed feelings about the state of his role in a booming drug industry. electric vehicles.

UBS named a number of Chinese stocks it says have remained “resilient” during times of heightened geopolitical tensions between the United States and China.

In a March 13 note to clients, the Swiss bank said greater market volatility is expected when a possible U.S. ban on investment in certain Chinese sectors is announced.

CNBC Pro subscribers can learn more about UBS’s stock picks here.

—Ganesh Rao

Bank stocks in Singapore and South Korea rose across the board on Wednesday morning after Wall Street banks’ gains overnight.

In Singapore, OCBC Bank led the gains among the country’s three major banks, up 2.24%, while UOB and DBS posted gains of 2.08% and 1.64% respectively.

South Korean financials posted slightly larger gains, with KB Kookmin Bank, Shinhan Financial and Woori Financial up 2.69%, 1.71% and 2.79% respectively.

—Lim Hui Jie

China’s industrial production rose 2.4% between January and February, according to official data.

Retail sales increased by 3.55% for the same period, in line with expectations.

China’s investment in fixed assets in the first two months of the year rose 5.5%, beating expectations of economists polled by Reuters who forecast growth of 4.4%.

China’s onshore yuan weakened after the data was released and traded at 6.8822 against the US dollar.

The People’s Bank of China kept the rate on 481 billion yuan of one-year medium-term loans at 2.75%.

Minutes from the Bank of Japan’s policy meeting in January showed members reiterated the need to maintain its ultra-dovish stance.

“The Bank should carefully explain that it needed to continue monetary easing, that its monetary policy accommodation had not changed and that it would take time to reach the price stability target of 2% sustainably and stably,” one MP reportedly said.

Minutes of the meeting also showed that board members expect the recovery of the Japanese economy to continue.

“Some members felt that the economy continued to recover, driven by domestic demand; specifically, a recovery in demand for services and a virtuous circle in the business sector had become the driving forces,” he said. he declares.

The yield on Japanese 10-year government bonds rose slightly to 0.296% after dipping above the upper ceiling of its tolerance range last Thursday to hit 0.276% on Tuesday.

– Jihye Lee

Japanese financial stocks rose in Wednesday morning trade, reversing the direction seen earlier in the week and after Wall Street banks rebounded.

Tokyo-listed shares of Mitsubishi UFJ Financial Group rose 3.25%, Sumitomo Mitsui Financial Group gained 2.73% and Mizuho Financial Group also rose 2.04%. Nomura Holdings also rose 1.7%.

Tech giant SoftBank Group meanwhile continued to post marginal losses of 0.62%.

South Korea’s seasonally adjusted unemployment rate for February fell slightly to 2.6%, down from January’s figure of 2.9%.

This figure was also lower than the figure of 2.8% from the same period a year ago.

The total number of unemployed stood at 743,000, down from 842,000 in January and 797,000 in February 2022.

—Lim Hui Jie

The collapse of the US-based Silicon Valley Bank is unlikely to affect Southeast Asian startups raising funds, venture capital firms told CNBC.

“I think [the impact on fundraising is] careful, but I don’t think the contagion is spreading,” David Gowdey, managing partner of Southeast Asian venture capital firm Jungle Ventures, told CNBC’s “Squawk Box Asia” on Tuesday.

He added that “funds in Southeast Asia are well capitalized” and “there is a lot of capital to deploy.”

Vinnie Lauria, managing partner at Golden Gate Ventures, said it was “a time to shine” for Southeast Asia.

“[Southeast Asia] now looks like a golden child to American investors,” Lauria said on CNBC’s “Street Signs Asia” on Tuesday.

“Investors are starting to say, I want to diversify into different bank accounts, different geographies, different currencies.”

—Sheila Chiang

On Monday, Moody’s Investors Service changed its view of the U.S. banking system from negative to stable, citing a “rapidly deteriorating operating environment.”

The move comes as the sectors tumble after the shutdowns of Silicon Valley Bank and Signature Bank. Bank stocks made a comeback on Tuesday after slipping in recent sessions as concerns about contagion from shutdowns swirled.

“We have changed our outlook on the U.S. banking system from stable to reflect the rapidly deteriorating operating environment following deposit runs at Silicon Valley Bank (SVB), Silvergate Bank and Signature Bank (SNY) and failures of SVB and SNY,” Moody’s said in a statement.

—Alex Harring, Jeff Cox

Markets have had a tough March so far as inflation fears returned and the collapse of Silicon Valley Bank pushed investors into risk aversion mode.

Against this backdrop, CNBC Pro used FactSet to select stocks from the MSCI World Index and S&P 500 that appear well positioned to weather volatility and should perform well going forward.

CNBC Pro subscribers can learn more about the stocks here.

—Weizhen Tan

Despite some speculation that recent bank failures could prompt the Fed to delay interest rate hikes, market prices indicate that the central bank is still on the right track.

Consumer price index data released on Tuesday morning was in line with market expectations, showing that the Fed still has work to do in its efforts to bring inflation down.

Traders were pricing in an 86.4% chance of a 25 basis point (0.25 percentage point) hike at next week’s Federal Open Market Committee meeting, up from earlier levels. in the morning. Additionally, the implied level of the peak, or terminal, rate has risen to just under 5%, according to data from the CME Group.

There were some whispers, however, that the Fed should take a more cautious approach in light of the Silicon Valley Bank and Signature Bank implosions.

“To be clear, we believe further hikes are now unnecessary; the lagged effect of hikes over the past year is sufficient to bring inflation back to target, but Fed officials have not so far ‘now didn’t want to accept this argument and until last week they showed new bulls,’ wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics.

“Recent events argue for a pause until May, but at this point that would be a pleasant surprise rather than our base case scenario,” he added.

—Jeff Cox

Worried about contagion from the Silicon Valley Bank collapse? Veteran strategist Kenny Polcari thinks the impact of SVB’s failure will be quite limited.

While investors mainly avoid the banking sector in the short term, Polcari sees “very interesting opportunities” in the space, as well as in other market segments.

Pro subscribers can learn more here.

— Zavier Ong

The S&P 500 financials sector rebounded more than 2% to lead the broader market higher, boosted by regional banks that sold off heavily in the previous session. Shortly after 10 a.m. ET, the sector was poised for its biggest one-day gain since Nov. 10, when it jumped 5.1%.

Communication services and energy also gained more than 2%, along with technology.

—Fred Imbert

The consumer price index rose 0.4% in February from the previous month, matching a Dow Jones estimate. The year-over-year increase of 6% was also in line with expectations.

—Fred Imbert