Analysts say China’s activity since reopening has yet to reflect oil prices
![Analysts say we're not going to come up with a bullish picture of oil](https://image.cnbcfm.com/api/v1/image/107199995-16774614081677461406-28361346357-1080pnbcnews.jpg?v=1677468312&w=750&h=422&vtcrop=y)
Demand from China’s reopening shouldn’t be yet fully reflected in oil prices, said Paul Sankey, president and principal analyst at Sankey Research.
“The data from China looks really full of life from a mobility and activity point of view, however it doesn’t really show up in oil prices,” he said, adding that oil prices usually are not performing as well as they’d hoped.
Brent Crude futures rose 0.10% to $83.24 a barrel, while US West Texas Intermediate futures rose 0.17% to $76.45 a barrel.
Sankey went on to say OPEC member Saudi Arabia would really like an oil price $10 above current levels.
“I feel Saudi Arabia will manage the market until the summer and convey us closer to $100 a barrel,” he said.
—Lee Ying Shan
The People’s Bank of China keeps a moderately dovish tone in the report
The People’s Bank of China kept a moderately dovish tone quarterly reportmaintaining its current position, which was deemed appropriate to promote economic growth and stability.
The central bank reiterated its support for an intercyclical adjustment to spur demand and supply stronger support to the economy.
It also reiterated its commitment to maintain sufficient liquidity and credit growth while keeping the growth of money supply and social financing close to its nominal gross domestic product.
The PBOC added that cuts in the reserve requirement rate last yr were one of the tools utilized by the central bank to support lending, without further explanation.
— Jihye Lee
CNBC Pro: Investor Says Technology Hasn’t Hit Bottom – Reveals FAANG Stocks to Avoid
Bear market rally or latest bull market? Market professionals are hesitant about this yr’s tech rebound, but investor Mark Hawtin believes the worst could also be yet to come.
And while FAANG stocks are popular with many investors, Hawtin believes some stocks are riskier than others.
Pro subscribers can read more here.
— Zavier Ong
Chip stocks proceed to fall after U.S. reportedly mulls over quotas for South Korean chipmakers
Shares of South Korean chipmakers continued their decline on Monday.
Shares of major chipmakers such as Samsung and SK Hynix saw a decline of 1.63% and 1.54% respectively, while LG Electronics saw a smaller decline of 1.32%. Kospi led the losses in Asia, down 1.46%.
This comes after Reuters reported on Friday that the US is probably going to impose a limit on the level of chips produced by South Korean firms in China.
Reuters quoted U.S. Department of Commerce Undersecretary of Industry and Security Alan Estevez as saying “it’s likely to be a cap on the levels they’ll rise to in China,” when asked what happens after the U.S. government releases the rules imposed on chip makers in China.
Stocks of other major chipmakers also posted losses on Monday, with Taiwanese chipmakers Hon Hai precision industry (also known as Foxconn) fell 1.94% and Taiwanese semiconductor manufacturing lower by 1.35%.
— Lim Hui Jie, Jihye Lee
CNBC Pro: ‘The Market Has Gone Too Far’: Leading Global Strategist Predicts When Fed Will Cut Interest Rates
Despite efforts by the U.S. central bank to tighten financial conditions, “the market has gone too far,” according to Seema Shah, chief global strategist at Principal Global Investors,
The strategist told CNBC how the Federal Reserve might respond and when it could cut rates of interest, which could spur stock markets.
CNBC Pro subscribers can read more here.
![The chief global strategist at Principal Global Investors predicts when the Fed will cut interest rates](https://image.cnbcfm.com/api/v1/image/107199392-16772313791677231376-28325526872-1080pnbcnews.jpg?v=1677248473&w=750&h=422&vtcrop=y)
Fed’s Mester says rates need to go above 5% to stifle inflation
Rates of interest must rise much more to bring inflation down, Cleveland Federal Reserve Chairman Loretta Mester said on Friday.
“I see we’re going to have to raise rates of interest above 5%,” she told CNBC’s Steve Liesman during an interview with Squawk Box. “We’ll learn the way much above. It will rely on how the economy evolves over time. But I feel we’d like to be barely above 5%. up to 2 percent.”
Mester was in the news recently when she revealed that she was amongst a small group of Fed officials who, between Jan. 1 The Federal Open Market Committee wanted an rate of interest hike of half a percentage point as an alternative of the quarter-point move approved by the panel.
—Jeff Cox
China Renaissance claims that Bao Fan is working with a government probe
Missing Chinese investment banker Bao Fan is working with a government investigation, his firm Chinese Renaissance he said in Sunday’s filing.
“The board has learned that Mr. Bao is currently cooperating with an investigation by some authorities in the People’s Republic of China,” the company said, noting that its business operations remain normal.
Hong Kong-listed China Renaissance shares have fallen 29% since the company said Feb. 16 that it was unable to reach Bao. Amongst other things, he’s the controlling shareholder of the firms, the chief executive officer and the founder.
— Evelyn Cheng
A week ahead in Asia: Growth, Inflation and Purchases readings for managers
Regional readings of the Purchasing Managers Index, Japan’s Industrial Production and Australia’s Gross Domestic Product will probably be some of the most vital economic events to happen this week.
Recent Zealand is due to report fourth-quarter retail sales on Monday, while Taiwan observes Peace Memorial Day until Tuesday.
Japan is due to report industrial production and retail sales data on Tuesday, while Australia is due to release its current account for the fourth quarter.
On Tuesday, India also reports its gross domestic product for the fourth quarter. At night, we may even know consumer confidence in the US for February.
The South Korean market will probably be closed on March 1 due to Independence Movement Day.
On Wednesday, China’s National Bureau of Statistics will release the government’s reading of the Purchasing Managers Index after it showed a return to growth of 50.1 in January.
Australia will release its inflation reading and gross domestic product for the fourth quarter. Economists polled by Reuters expect seasonally adjusted growth of 2.8% on an annual basis.
Indonesia may even announce its February Consumer Price Index, which is predicted to rise to 5.42% from a previous reading of 5.28%, according to a Reuters poll.
On Thursday, Q4 trade data from Recent Zealand and industrial production and retail sales in South Korea will probably be published. The S&P Global Manufacturing PMI for South Korea can be scheduled to be released.
Japan’s January unemployment rate is predicted to reach 2.5% on Friday, according to a Reuters poll. The Tokyo consumer price index for all items except fresh food is predicted to increase by 3.3% in January.
— Jihye Lee
Investors need to “control what they’ll control,” says Baird
According to Baird analyst Ross Mayfield, the market is currently experiencing the effects of “an excessive amount of excellent news directly”. As inflation stays high and the Federal Reserve is predicted to proceed raising rates of interest, Mayfield advises investors to “control what”. [they] can control.”
“First, automate things: averaging costs in dollars (investing at regular intervals) is an amazing way to find higher performance in volatile/sideways markets,” Mayfield wrote in a Friday note.
“Second, review your allocation again to be certain that you are well diversified and on target.”
— Hakyung Kim
Stocks sum up the worst week of the yr
US stock markets ended their declines on Friday, ending the worst week of 2023.
The Dow Jones industrial average decreased by 336 points, or 1.0%. The S&P 500 AND Nasdaq Composite it fell by 1.0% and 1.7%, respectively. The Dow fell as much as 510 points, or 1.54%, at the start of the trading session.
— Hakyung Kim