Japanese stocks rose nearly 2%, topping gains in Asia ahead of the Fed’s key interest rate decision

Gold prices have more room to run as global banks struggle and investors wait for the US Federal Reserve’s interest rate decision, and it could rise to $2,600 an ounce.

Refinitiv data showed that the metal’s prices on Monday crossed $2,000, hitting the highest level since March 2022. The all-time high was $2,075 in August 2020.

CMC market analyst Tina Ting, who sees gold prices between $2,500 and $2,600 an ounce, told CNBC: “Sooner the Fed raises rates is likely to cause gold prices to rise again due to lower interest rates.” Possible additional dollar and US bond yields. .

Fitch said that gold prices are expected to maintain record levels as well.

“We believe escalating global financial instability is likely to push gold prices towards all-time highs of $2,075 in the coming weeks,” Fitch Solutions wrote in a March 20 report, and expects gold prices to remain “high in the coming years compared to previous levels.” before covid.”

– Lee Ying Chan

It will be very difficult for venture capital firms and startups to find another startup-friendly bank like the collapsed Silicon Valley bank, said US-based venture capital firm Race Capital.

“SVB wasn’t just another bank around the corner. They really were the bedrock of Silicon Valley,” Edith Young, general partner at Race Capital, said on CNBC’s “Squawk Box Asia” on Wednesday.

Young said SVB was Race Capital’s primary bank and two of their portfolio companies had 100% funds in SVB.

“If you are the founder of a startup, you may be able to find another bank to keep your money,” she said.

“But going forward, it’s certainly very difficult to find a bank that’s very startup-friendly, and that’s able to provide risk debt to many, many startups. That goes for startups in Silicon Valley and China,” she added.

– Sheila Chiang

Technology investor Paul Meeks has been bearish in the tech space for some time, but he’s finally starting to warm up to the sector.

“I’m creeping back into the sector after defending for a long time a position of less weight in it,” he told CNBC on Friday. He joins a group of investors who have turned more bullish on the sector in recent weeks.

Pro subscribers can read more about Meeks’ top stock picks here.

– Xavier Ong

Chinese President Xi Jinping will conclude his visit to Russia soon, and analysts say Beijing will leverage its strong position to cash in on President Vladimir Putin.

“Putin is weak, he’s entering this negotiation from a real soft spot,” said Timothy Ash, an emerging markets analyst at BlueBay Asset Management, adding that he wonders “what price Xi will produce to bail out Putin…he has to get something out of it.”

China has the upper hand economically over Russia in general, said Alicja Pachulska, a policy fellow at the European Council on Foreign Relations. “If China supports Russia in a more fundamental way, this will continue further,” she added.

Read the full story here.

Yoo Bon Bing, Holly Ellytt

Morgan Stanley says it is “time to turn bullish” in growth stocks in Asia and emerging markets.

While markets may be pricing in a rate hike at the Fed’s March meeting, many are also anticipating rate cuts later this year. Analysts said the easing of financial conditions should benefit growth stocks.

CNBC Pro subscribers can read more here.

– Jihee Lee, Christine Wang

Nike reported that sales in China fell 8% during the holiday quarter even as the country ended its anti-coronavirus policies.

reported the sportswear giant Greater China sales totaled $1.99 billion In the quarter ended February 28. That’s less than Wall Street’s forecast of $2.09 billion, according to StreetAccount’s compiled estimate.

However, Nike CEO John Donahue remained optimistic, saying the company saw growth “really pick up” in the second month of the quarter as Covid controls eased.

“The fundamentals of this market are good, right? It’s a very big market that’s growing. Sports and health is a major trend and tailwind there. There’s a desire for innovation and style. The key to winning in this market is simply positioning: having great innovation and connecting with Chinese consumers in a locally relevant way.” .

Nike shares fell 2.25% in the after-hours session.

– Christine Wang, Gabrielle Vonrouge

Other names that led the index were Toyota Motor Corporation, investment manager SoftBank and Sony Technology.

– Lim Hwi Ji

Treasury Secretary Janet Yellen said on Tuesday that while authorities believe they have taken sufficient action to stem liquidity problems in the banking sector, the government is ready to guarantee more deposits if the banking crisis worsens.

“The steps we took were not focused on helping specific banks or classes of banks. Our intervention was necessary to protect the broader US banking system,” she said in prepared remarks to address the American Bankers Association. “Similar measures may be warranted if small institutions experience deposit inflows that pose a risk of contagion.”

Tanaya Machel, Jeff Cox

First Republic shares were up more than 38% Tuesday morning. The move represented a reversal of the bank’s losses yesterday, after Standard & Poor’s downgraded its credit rating again over the weekend. Investors are optimistic after Janet Yellen’s reassurances early Tuesday.

Other US regional bank stocks continued to decline. Backwest Bancorp shares gained about 15.7%. Zions Bancorp and KeyCorp rose 5.3% and 5.8%, respectively. New York Community Bancorp stock rose. 1.8% and Fifth Third Bancorp rose 3.8%.

– Piya Singh

Chief executives from major banks, including JPMorgan’s Jamie Dimon and Bank of America’s Brian Moynihan, will gather in Washington on Tuesday for a scheduled two-day meeting, Reuters reportedAccording to sources familiar with the matter.

Reuters reported that First Republic Bank, which is under pressure due to the large percentage of uninsured deposits, will be discussed at the meeting.

– Yun Lee

As the Federal Reserve looks to announce its final monetary policy decision on Wednesday, Investment Insight believes that inflation will remain elevated in 2023.

“It is unlikely that the 2% inflation target will be met in 2023, but there is some hope that we may see a more normal inflation environment by 2024,” Brendan Murphy, North America’s head of core fixed income, wrote in a note on Tuesday.

“As the delayed impact of the Fed’s policy rate increases in tandem with the recent tightening of financial conditions linked to banking sector concerns, the effects are likely to be disinflationary. These same conditions present several risks to the growth picture,” added Murphy.

Insight Investment expects the central bank to raise interest rates by 25 basis points on Wednesday, but added that “recent market volatility may be an opportunity for them to pause at this meeting.”

“The case for a pause is strong as a further 25 basis point increase could be seen as contributing to market volatility and financial instability,” Murphy said.

“However, not offering 25 basis points could cause some to question the Fed’s resolve to lower inflation which could lead to a whole new set of problems. Pausing could ease financial conditions that are working against their inflation targets.”

– Hakyung Kim