Australia’s central bank keeps rates unchanged at 3.6%
The Reserve Bank of Australia has held its its benchmark interest rate at 3.6%.
This marks the first halt in the RBA’s hiking cycle since it started raising rates in April 2022.
The Australian dollar weakened following the move to 0.6782 against the U.S. dollar.
– Lim Hui Jie
Shares of Chinese EV makers slide despite better first quarter results
Shares of Chinese electric makers slid sharply on Tuesday, following the moves of Tesla shares falling 6% on Monday, after its deliveries report raised investor concern that the company will further slash prices of its cars further in a bid to drive sales.
Chinese EV makers Nio, Xpeng and Li Auto were all lower on Wednesday, with Nio shares notably seeing a 8.18% slide. Xpeng and Li Auto saw losses of 5.07% and 3.28% respectively.
Li Auto largely reported better deliveries for the first quarter of 2023.
JPMorgan says OPEC+ move to cut supply targets is ‘preemptive’
JPMorgan analysts said that the move by OPEC+ was a “preemptive” move and that it had expected similar measures to come earlier.
“We view the current reduction in supply as a preemptive measure, assuring that surpluses that started accumulating in the global oil market since mid-2022 don’t extend into the second half of 2023 as the global economy slows following almost 400 bps of cumulative hikes since 2022,” analysts including Natasha Kaneva wrote in a late Sunday note.
Contrary to Goldman Sachs that raised its forecast for Brent oil rising to $95 per barrel by December 2023, JPMorgan said their forecast remains unchanged at $89 in the second quarter of this year – rising to $94 by the fourth quarter of 2023 and ending the year at $96 per barrel.
– Jihye Lee
Australia to ban TikTok on government devices
Australia’s Attorney-General Mark Dreyfus said in a statement that a TikTok ban on government devices “will come into effect as soon as practicable.”
“After receiving advice from intelligence and security agencies, today I authorised the Secretary of the Attorney-General’s Department to issue a mandatory direction under the Protective Security Policy Framework to prohibit the TikTok app on devices issued by Commonwealth departments and agencies,” Dreyfus said in a Tuesday statement.
Australia’s move come after similar measures taken by the U.S., which was followed by the United Kingdom and the European Union.
– Jihye Lee
HSBC expects Singapore to tighten its monetary policy in April
HSBC forecasts the Monetary Authority of Singapore to re-center the mid-point of the exchange rate policy band known as the Nominal Effective Exchange Rate, or S$NEER upwards to the “prevailing level” in its next meeting.
A team of economists led by Yun Liu wrote in a late Monday note that they expect MAS to also keep the slope unchanged at 1.50% at its the meeting as its final move, adding that the latest volatilities seen in markets make it a “tougher job to decide.”
The MAS is expected to hold its next monetary policy meeting no later than April 14, according to its advance release calendar on its website.
“We also acknowledge the risk of the MAS maintaining its monetary settings unchanged, if it feels the risk of moderating growth trumps inflation concerns,” HSBC said in its note.
The Singapore dollar stood at 1.3270 against the U.S. dollar on Tuesday morning.
Currency check: Australia dollar slightly weakens ahead of RBA meeting
The Australian dollar weakened slightly to 0.6783 against the U.S. dollar ahead of the Reserve Bank of Australia’s meeting later in the day.
The New Zealand dollar meanwhile traded at fractionally stronger levels at 0.6298 against the greenback as of Asia’s morning.
The Korean won also strengthened to 1,307.72 against the U.S. dollar as the nation’s inflation dropped to the lowest in a year. The Japanese yen weakened 0.16% to 132.61 against the greenback.
The dollar index meanwhile was flat at 102.107.
– Jihye Lee
South Korea’s inflation rate slows to 4.2% in March
South Korea’s consumer price index for March slowed to 4.2% on a year-on-year basis, just slightly lower than economists expectations of 4.3%
According to government data, this was lower than February’s figure of 4.8%. On a month-on-month basis, the CPI for March rose 0.2%, lower than February’s figure of 0.3%.
The South Korean won strengthened marginally against the U.S. dollar on Tuesday, trading at 1,308.6.
— Lim Hui Jie
CNBC Pro: Bank of America just added this global stock with 60% upside to its top ideas list
Bank of America has added a global aerospace giant to its “top 10 best ideas” list for the second quarter of 2023.
The Wall Street bank cited several factors, including supply chain improvements and increased demand, for adding the stock to the list.
CNBC Pro subscribers can read more here.
— Ganesh Rao
Tesla near session lows
Tesla shares were down 7%, near the lows of the day, following the release of weaker-than-expected deliveries data for the first quarter. Tesla delivered 422,875 vehicles in the first quarter, while analysts polled by FactSet expected 432,000.
TSLA falls
Oil heads for biggest jump in nearly a year
The surprise output cut from OPEC+, which is pulling back production by 1.16 million barrels per day, has sent oil prices surging. West Texas Intermediate crude futures jumped 6% to roughly $80 per barrel, on track for their biggest one-day gain since April 12, 2022.
Brent futures, meanwhile, gained more than 6% to $84.79 per barrel.
WTI hit $81.69 per barrel at one point in the session, its highest since January of this year.
WTI crude one-year
— Brian Evans, Nick Wells
Warren Buffett’s two big energy bets on the rise
Warren Buffett’s two big energy stocks staged a strong rally Monday as the broader sector got a boost from surging oil prices.
Shares of Occidental Petroleum jumped nearly 6%. Berkshire Hathaway added to its already large stake in multiple occasions in March, now owning 23.5% of the Houston-based energy producer.
Meanwhile, Chevron, Berkshire’s third largest holding as of the end of 2022, rose over 4% on Monday. The conglomerate drastically hiked this stake to one of its biggest early last year.
ISM Manufacturing at 46.3 in March, a three-year low and below estimate
Manufacturing activity in the U.S. slipped further into contraction territory in March, according a reading Monday.
The ISM Manufacturing Index, a closely watched barometer for the sector’s health, posted a reading of 46.3 for the month. That was down from 47.7 in February and below the Dow Jones estimate for a 47.3 reading.
Anything below 50 represents contraction for the index, which measures the percentage of companies that report expansion. The March reading was the worst in three years.
The prices index fell 2.1 points to 49.2, while employment dropped 2.2 percentage points to 46.9. None of the sub-indexes were above 50.
—Jeff Cox
