Asian markets are mostly lower as the Fed warned of recessionary risks from the banking crisis

Markets do not appear to have anticipated a potential recession in the US, despite expectations that a recession is on the horizon, according to Alex Wolff, managing director of JPMorgan Private Bank and head of investment strategy in Asia.

Speaking to CNBC’s Squawk Box Asia, Wolf explained that while there has been a “long-term call” for a US recession in the second half of 2023, the recent turmoil in the banking sector has “somewhat propelled our expectations.”

In terms of equity, Wolf thinks there’s “potentially some downside to earnings,” and for fixed income, he says that earnings will move “much lower” in a recession.

For Asia specifically, he described most of the markets and economies in this region as “highly cyclical,” meaning that if there has been a “widespread cyclical downturn” in the United States, or even a broader recession involving Europe, “historically, [it] It was not positive for Asia.”

– Lim Hwi Ji

Apple is said to be in talks with suppliers to produce MacBooks in Thailand, as the US tech giant seeks to expand its manufacturing operations outside of China, According to NikkiCiting sources.

The report said Apple suppliers involved in the talks already have manufacturing facilities in Thailand for other customers, and are discussing the possibility of assembling and producing components and modules for MacBooks.

Apple is also set to open its first physical stores in India next week, highlighting the tech company’s ongoing efforts to reduce its dependence on China.

The fragility was exposed in China last year, after production disruptions due to the COVID-19 outbreak and protests by workers at the world’s largest iPhone factory in Zhengzhou, China, which is run by Taiwanese company Foxconn.

– Sumathi Bala

Australian mining company BHP has received shareholder approval for its A$9.6 billion (US$6.4 billion) acquisition of Oz Minerals, a nickel and copper company.

At the shareholder meeting, 78.93% of the proxy vote of shareholders voted in favor of the deal.

Bhp offered For A$28.25 per share for the acquisition, consisting of A$26.50 paid by BHP in cash and A$1.75 paid by Oz Minerals as special dividend.

If the acquisition receives approval from the Australian Federal Court on April 17, Oz Minerals shares will be delisted on April 18.

Australia’s unemployment rate for March came in at 3.5%, unchanged from February and less than the 3.6% expected by economists.

In March, the country The Census Bureau revealed Employment increased by 31,700 people to 13.88 million people, which is a slight increase of 0.2%.

The employment rate is one of the key gauges the RBA will watch to decide whether it should resume raising interest rates, after it paused at 3.6% in March.

– Lim Hwi Ji

Shares of Hong Kong-listed Chinese tech giant Alibaba fell 3.9% in early trade Thursday, tracking losses in its US-listed shares.

Overnight, shares of US-listed Alibaba fell nearly 3% in after-hours trading after regulatory filings revealed that SoftBank sold a majority of its stake in the company.

that analysis Corporate filings by the Financial Times revealed that SoftBank sold approximately $7.2 billion in shares in the Chinese e-commerce giant via prepaid futures contracts.

Because of the sales, the report noted that SoftBank will now only retain a 3.8% stake in Alibaba, which has a market capitalization of nearly $250 billion.

– Lim Hwi Ji, Jonathan Fanian

Real estate developer Sunac China fell 55% at the Hong Kong opening after The company has resumed trading on the Hong Kong Stock Exchange for the first time in a year.

Sunak China said in filing A request to resume trading earlier this week said it was in the process of implementing a restructuring plan.

Trading in the company’s shares has been suspended along with a slew of Chinese developers who defaulted on debt last year.

Sunac China has reached an agreement to restructure $9 billion of its debt by switching to new bonds and convertible notes backed by its Hong Kong shares as well as those of its Sunac Services unit.

The Philippine central bank indicated that it may pause interest rate hikes at its meeting next month.

In brief “Maybe we will pause at the next meeting because the inflation data is so good,” Governor Felipe Medalla said, broadcasting on Facebook.

The country raised interest rates at the fastest pace in Asia, with interest rates jumping 425 basis points since May 2021.

Its current policy rate stands at 6.25%, after raising interest rates by 25 basis points in March.

– Lim Hwi Ji

Australia’s unemployment rate is expected to rise to 3.6% in March, up from 3.5% in February, according to a Reuters poll.

The job participation rate in March is expected to hold steady at 66.6%, the same as the reading from last month.

Overall employment figures are set to fall to a third of what was seen in February, with economists expecting to see the reading at 20,000 employees, compared to 64,600 in February.

The Australian dollar rose slightly to 0.6691 against the US dollar before the release.

– Jihe Lee

Bank of Japan Governor Kazuo Ueda confirmed that inflation in Japan will fall below the central bank’s 2% target in the middle of the year, stressing that the Bank of Japan will continue monetary easing until price stability is achieved. mentioned.

Ueda was speaking at a meeting of the Group of Seven finance ministers and central bank governors in Washington.

He added that the risk of inflation falling below its target is greater than the risk of major problems caused by overshoot, highlighting the need to follow policy accordingly.

Ueda’s words were similar to the message delivered in his inaugural address when he emphasized his position on maintaining the Bank of Japan’s yield curve control and negative interest rates.

– Jihe Lee

The China Online ETF, or KWEB, fell more than 3% on Wall Street overnight and is on track for a seventh day of decline.

Wednesday’s session was also the worst day for the ETF in more than a month, when KWEB lost about 5.5% on March 9.

Weibo, JD.com, and Autohome were the main losers, with all names seeing drops of nearly 11% month-to-date.

– Gina Francola, Jihye Lee

Exports in China are expected to see a year-on-year decline of 7%, sharper than the 6.8% decline in February, according to economists polled by Reuters.

A Reuters poll showed that imports are expected to drop 5 percent, down from 10.2 percent in the previous month.

In US dollars, China’s trade balance is expected to reach a surplus of over $39 billion after seeing a surplus of $116 billion last month.

The offshore Chinese yuan rose slightly to 6.8790 against the US dollar in Asian morning.

– Jihe Lee

Despite the benefits of large deposit inflows and strong deposit growth in a sluggish growth environment, State Bank of India (SBI) has seen its share price plunge for the year now due to its controversial exposure to Adani.

Meanwhile, shares of HDFC Bank are up 4% this year.

However, only one of the two banks has a Buy rating from almost all analysts.

CNBC Pro subscribers can read more here.

– Ganesh Rao

South Korea saw an even larger drop in export and import prices in March.

Export prices fell 6.4% for the month after seeing a 2.7% decline in the previous month. Export prices have fallen for seven consecutive months and have lost the most since October 2020.

Government data showed that import prices fell 6.9% in March, down more than February’s drop of 0.5%. This marks 11 consecutive months of declines in import prices and the largest drop since January 2021.

– Jihe Lee

Andrew Slimmon of Morgan Stanley expects an economic slowdown in the US to come later than many expected.

Senior portfolio manager at Morgan Stanley Investment Management names stocks to buy and avoid in the face of market uncertainty.

CNBC Pro subscribers can read more here.

– Wizen tan

In an interview on CNBC’s “Squawk on the Street,” Richmond Fed President Thomas Barkin said that while the peak of inflation may be behind the US, “we still have a way to go.”

He noted the continuing high inflation rates for shelter and services. If you want to get to 2% [inflation]I think we’re still a long way from that.”

– Fred Imbert

Berkshire Hathaway Chairman and CEO Warren Buffett said he didn’t think he could run the Federal Reserve as well as Jerome Powell. The central bank leader’s rate hike campaign has drawn criticism from those who say Powell waited too long to target rising inflation.

“You have to act on inadequate information, and you have ultimate responsibility to the American public,” Buffett told Becky Quick Wednesday on CNBC’s “Squawk Box.”

“It doesn’t mean you can stop recessions, it doesn’t mean you can turn bad loans into good loans or anything. But it does mean you have to keep the system running. And the system came close to stopping.”

He added, “Thank God, you know, Jay Powell was there” in March 2020.

– Sarah Maine, Alex Haring

Stocks rose at the open on Wednesday, as traders digested the latest US CPI data.

The Dow Jones rose more than 100 points, while the S&P 500 and Nasdaq rose 0.5% and 0.8%, respectively.

– Fred Imbert