Oil futures rise on hopes of China’s demand recovery
Oil futures rose in morning trade in Asia as optimism over China’s reopening led to a pick-up in demand outweighing recession fears.
Brent Crude futures gained 1.16% to settle at $79.96 a barrel, while US West Texas Intermediate futures rose 1.18% to trade at 75, $17 a barrel.
China recently released plans to increase flights to allow a rebound in travel for the upcoming Lunar New Year holiday, Caixin reported last week.
The report says officials have drawn up plans to target nearly 90% of pre-pandemic levels by the end of January.
— Jihye Lee
Hong Kong casino shares fall despite license renewals
Shares of Hong Kong-listed Macau casinos fell in the morning session in Asia despite securing 10-year concessions to operate their integrated resorts.
A concession is essentially an operating agreement with the government, which in turn grants licenses to operators.
Wynn Macau fell 8%, while MGM China lost around 12%. Sands China also fell 4% and Galaxy Entertainment lost 3%.
The moves come as media reported a spike in the death toll seen in Beijing and Shanghai ordered schools to be locked down, dampening investor sentiment on China’s path to reopening.
— Jihye Lee, Countess Brewer
China to focus on stabilizing economy in 2023 (Xinhua)
China will prioritize stabilizing its economy and accelerating political adjustments to meet key targets set for 2023, the official Xinhua News Agency reported last week, marking the conclusion of the Central Conference. annual on economic work.
“Proactive fiscal policy should be strengthened for its effectiveness, with a better mix of tools, including budget deficits, special purpose bonds and interest rate subsidies,” the report said.
Hao Hong of Grow Investment Group said that while he expects supportive policies such as interest rate cuts, he doesn’t think it will become his own version of quantitative easing. QE is a policy that the US Federal Reserve has previously adopted to stimulate economic activity by increasing liquidity.
“While some prominent economists argue for Chinese QE, a recent central economic work conference suggests a more measured approach,” he said. We believe the liquidity expansion will be structural and targeted, rather than a general easing.
— Jihye Lee
CNBC Pro: Goldman Sachs Reveals Greater China Tech Outlook – and Names Its Top Picks for 2023
After a tough few years for Chinese tech stocks, investors are now hoping the worst is behind them.
What’s next for the beaten sector? Goldman Sachs shares its outlook for Chinese technology and reveals how investors can trade the sector in 2023.
Pro subscribers can learn more here.
— Zavier Ong
Fed’s Daly says ‘nothing but hope’ in inflation data, ‘far’ from target
San Francisco Federal Reserve Chair Mary Daly said on Friday that she viewed the recent inflation news as welcome, but that it was not enough to change her view on the direction the economy should take. Politics.
The October and November readings of the consumer price index amounted to “good news”, but “we see nothing at the moment but hope in the inflation data, and I trust evidence, not hope So I hope we’re on a good truck but I won’t be confident until I see repeated evidence that inflation is really back on a 2% trajectory in the coming years,” Daly said in a conversation moderated by the American Enterprise Institute.
“We are far from our target of price stability,” she added.
Earlier this week, the Fed raised its benchmark borrowing rate by half a percentage point, the seventh hike of the year that brought the level of funds to a target range of 4.25% at 5 %.
Daly, who did not vote this year on the Federal Open Market Committee responsible for setting rates, said his own expectations for the direction of rates are likely higher than current market prices. Daly votes again in 2024.
—Jeff Cox
CNBC Pro: Analysts Love These 3 Renewable Energy Stocks That Offer Over 50% Upside
The expansion of renewable energy is expected to grow exponentially over the next five years, according to the International Energy Agency.
The IEA predicted earlier this month that solar and wind power would grow fivefold, equivalent to the clean energy capacity installed in the past 20 years combined.
Given these prospects for energy transition to renewable sources, CNBC Pro has selected stocks that may offer opportunities for investors in the sector.
CNBC Pro subscribers can learn more here.
—Ganesh Rao
The Fed is making a ‘terrible mistake’ in walking further, says Wharton’s Siegel
According to Jeremy Siegel, professor of finance at the University of Pennsylvania’s Wharton School of Business, the Federal Reserve’s plans include continuing to raise rates through next year above the odds of a very slow downturn. hard to come.
“I think the Fed is making a terrible mistake,” he told CNBC’s “Squawk on the Street” on Friday. Their plan, their point diagram, is way too tight. Inflation is all but over, despite the President’s way [Jerome] Powell characterizes it.
According to Siegel, the central bank should refrain from further raising or maintain the raised rates next year.
“Talking about going higher and staying higher in 2023, I think that would guarantee a very strong reduction,” he said.
— Samantha Subin
UBS raises 2023 China growth outlook, lowers 2022 guidance
UBS raised its outlook for China’s gross domestic product in 2023 to 4.9% from 4.5% previously, according to its chief China economist Wang Tao, citing faster and faster reopening in the country.
Wang said the company expects weaker fourth-quarter GDP for 2022, cutting its full-year forecast to 2.7% from 3.1%, pointing to weaker growth in November with a recent increase in Covid cases.
The company added that the Central Economic Work Conference will likely prioritize stabilizing growth as well as supportive macroeconomic policies for the coming year.
We expect fiscal policy to remain proactive with a slight increase in the headline deficit and new special LGs [local government] bonds, monetary and credit policy should remain supportive of continued ample liquidity, but further cuts in policy rates are unlikely,” Wang said in the note.
—Jihye Lee
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