Australia PMI, Japan Jibun Flash PMI, Lunar New Year Holiday

Passenger numbers at New Zealand’s Auckland airport reached 74% of pre-pandemic levels in November

New Zealand’s Auckland Airport saw its total passenger volumes for November reach 74% of levels seen in the fiscal year to June 2019, or the last full year not affected by the pandemic, according to the airport’s monthly traffic update.

International travelers were at 67% of pre-pandemic levels, the release said, adding that the majority of recovered overseas travel was short-haul flights from Australia and the Pacific Islands.

Demand for routes between New Zealand and North American regions has reached 86% of pre-pandemic levels, including two added destinations in Texas (Dallas/Fort Worth) and New York.

– Jihye Li

CNBC Pro: These 6 low-debt global stocks are poised to outperform, says Bernstein

Rising interest rates have a larger impact for companies with large amounts of debt, as they will experience higher costs from increased borrowing.

As interest rates continue to rise, analysts at Bernstein expect stocks with lower credit risk and higher quality of credit to outperform.

The investment bank named a handful of global low-debt stocks with investment-grade credit ratings that are likely to outperform.

CNBC Pro subscribers can read more here.

Ganesh Rao

Zip shares reverse after early rally

Australian “buy now, pay later” company zip fell more than 10% after a short-term rally following its quarterly results.

Zip traded 15% lower, a sharp turnaround from its earlier gain of more than 10% after posting 12% revenue growth.

The company said that underlying “monthly cash burn continues to decrease and further improvement is expected.” It said the cash and liquidity position currently available is “sufficient to see the company through to generating positive cash flows” and is expected to deliver positive cash EBITDA by the first half of fiscal 2024.

The week ahead: PMIs, Australia and Singapore inflation reports, South Korea GDP

Here are some of the key economic events in the Asia-Pacific region that investors will be watching closely this week.

Stock markets in mainland China and Taiwan will remain closed until trading resumes on January 30.

On Tuesday, regional purchasing managers’ index readings for Japan and Australia will be in focus, while most markets will be closed for the Lunar New Year. , Except Australia, Japan and Indonesia.

Inflation reports will be the focus on Wednesday as Australia and New Zealand release their consumer price index readings for the final quarter of 2022. Singapore will publish its inflation print for December.

Hong Kong’s market is due to resume trading on Thursday.

Fourth-quarter GDP for South Korea and the Philippines will be published on Thursday, while the Bank of Japan will issue a summary of its views from its latest monetary policy meeting in January. Japan also reported its Service Producer Price Index on Thursday.

Japan’s headline CPI reading for the capital Tokyo will be a barometer of where monetary policy will be headed.

Australia’s producer price index and trade data will also be closely watched ahead of the Reserve Bank of Australia meeting in the first week of February.

– Jihye Li

Australia’s business situation worsened last month: NAB survey

National Australia Bank’s monthly business survey gave a poor business situation reading for December with a 12-point reading, a decline from November’s 20-point print.

NAB said the survey reflects deteriorating business conditions, profitability and employment.

“The main message from the December monthly survey is that growth has slowed significantly in late 2022, while price and procurement cost pressures have probably peaked,” said Alan Oster, chief economist at NAB.

Meanwhile, business confidence rose 3 points to -1 in December, a better reading than the -4 points seen in November.

– Jihye Li

Japan’s headline factory data shows second month of contraction

The AU Jibun Bank Flash Japan Manufacturing Purchasing Managers’ Index was unchanged at 48.9 for the second month in a row in January, well below the 50 points that separate contraction and growth from the previous month.

Read “Signals joint-strongest decline in health [of] Japanese manufacturing sector from October 2020,” said S&P Global.

The Au Jibun Bank Flash Composite Output Index rose to 50.8 in January, slightly higher than the reading of 49.7 seen in December.

Flash services business activity further increased with a print of 52.4, higher than December’s reading of 51.1.

– Jihye Li

CNBC Pro: Wall Street is bullish about Chinese tech — and loving one mega-cap stock

After more than 2 years of regulatory action and a pandemic-induced slump, Chinese tech names are back on Wall Street’s radar, with one stock in particular standing out as a top pick for many.

Pro subscribers can read more here.

Xavier Ong

The Journal reports the Fed is likely to discuss next week when to stop the hikes

According to a report in the Wall Street Journal, Federal Reserve officials are almost certain to approve another cut in interest rate hikes next week, while also discussing when to completely freeze the hikes. Go

The rate-setting Federal Open Market Committee is set to convene Jan. 31-Feb. 1, there is almost a 100% chance of a quarter-point increase in the central bank’s benchmark rate in line with market pricing. Most prominently, Fed Governor Christopher Waller said on Friday that he sees a 0.25 percentage point hike as the preferred move for the upcoming meeting.

However, Waller said he doesn’t think the Fed has tightened yet, and several other central bankers have echoed that sentiment in recent days.

Citing public statements from policy makers, the Journal report said that slowing the pace of growth could provide an opportunity to assess how the growth so far is affecting the economy. The series of rate hikes that began in March 2022 has resulted in an increase of 4.25 percentage points.

Market pricing is currently indicating a quarter-point increase over the next two meetings, a period of no action, and then a half-point decrease through the end of 2023, according to data from CME Group.

However, several officials, including Governor Lael Brainard and New York Fed President John Williams, have used the expression “stay the course” to describe the future policy path.

Jeff Cox

Nasdaq on pace for back-to-back gains as tech stocks rally

The Nasdaq Composite declined more than 2.2% during midday trading Monday, lifted by shares of beaten-up technology stocks.

The move put the tech-heavy index on pace for a steady gain of more than 2%. The index ended 2.66% higher on Friday.

Rising semiconductor stocks helped push the index up. Tesla And appleMeanwhile, they gained 7.7% and 3.2%, respectively, as China’s reopening boosted hopes of boosting their businesses. western digital and Advanced Micro Devices while each increased by about 8% Qualcomm And NVIDIA Jumped about 7%.

Information technology was the best performing S&P 500 sector, rising 2.7%. This was partly due to gains in the chip sector. Communication services up 1.9%, preferred netflix, meta platform, Alphabet And match group,

-Samantha Subin

El-Arian says Fed should hike by 50 basis points, calls smaller increase ‘mistake’

Inflation has shifted from goods to services sector, says Mohammed Al-Arian

Rising inflation may appear largely past, but a 25 basis point hike at the next Federal Reserve policy meeting is a “mistake,” according to Allianz chief economic adviser Mohamed El-Arian.

“I’m in a very, very small camp that thinks they shouldn’t go up to 25 basis points, they should do 50,” he told CNBC’s “Squawk Box” on Monday. “They should take advantage of this growth window that we’re in, they should take advantage of where the market is, and they should try to tighten financial conditions because I think we still have an inflation issue.”

Inflation, he said, has shifted from the goods to services sector, but it could very well revive if energy prices pick up when China reopens.

El-Arion expects inflation to stabilize around 4%. This, he said, would put the Fed in a difficult position as to whether they should continue to throttle the economy to reach 2%, or promise that level in the future and hope investors return to 3% to 4% near-term. can remain stable.

“It’s probably the best result,” he said of the latter.

-Samantha Subin

Earnings slowdown is imminent according to Morgan Stanley

According to Michael Wilson, equity strategist at Morgan Stanley, there is going to be a slowdown in earnings this year.

“Our outlook has not changed as we expect the earnings path in the US to disappoint both consensus expectations and current valuations,” he said in a note to clients on Sunday.

Some positive developments have emerged in recent weeks — such as the reopening of China in Europe and a drop in natural gas prices — and have contributed to some investors taking a more optimistic view of the market’s prospects.

However, Wilson advises investors to remain bearish on the equity, citing price action as the main influence for this year’s rally.

“The rally this year has been led by low-quality stocks with huge shortages,” he said. “It has also seen a strong move in cyclical stocks relative to defensive ones.”

Wilson based his forecasts on margin disappointment, and he believes the case for it is growing. Many industries are already facing revenue slump, as well as inventory bloating, low productive headcount.

“It’s just a matter of timing and magnitude,” Wilson said. “We advise investors to stay focused on the fundamentals and ignore the false signals and confusing reflections in this bear market hall of mirrors.”

– Hakyung Kim

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