Crude oil futures rise on hopes of recovery in Chinese demand
Oil futures rose in Asian morning trading. Optimism that China’s reopening of the economy will lead to a recovery in demand outweighed fears of a recession.
Brent crude futures rose 1.16% to $79.96 a barrel and US West Central Texas futures rose 1.18% to trade at $75.17 a barrel.
China recently announced plans to increase flights to accommodate a recovery in travel for the upcoming Chinese New Year holidays. reported by Caixin last week.
Officials plan to target nearly 90% of pre-pandemic levels by the end of January, according to the report.
— Lee Ji-hye
Hong Kong casino stocks fall despite license renewal
Hong Kong-listed Macau casino shares fell in the morning session in Asia despite winning a 10-year concession to run an integrated resort.
A concession is essentially an operating contract with the government, which grants a license to the operator.
Wynn Macau is down 8% and MGM China is down around 12%. Sands China also dropped his 4%, while Galaxy Entertainment dropped 3%.
The movement looks like the media reported The rising death toll observed in Beijing and Shanghai ordering school closures has dampened investor sentiment on China’s reopening path.
— Jihye Lee, Contessa Brewer
China to focus on economic stability in 2023: Xinhua
China will prioritize economic stabilization and stronger policy coordination to meet key targets set for 2023, state media says Xinhua News Agency reported Last week, we presented the conclusions of the annual Central Economic Work Conference.
“Aggressive fiscal policy should be strengthened to enhance its effectiveness, with a better mix of tools such as budget deficits, special purpose bonds and interest subsidies,” the report said.
Hao Hong of Glow Investment Group said he expected supportive measures such as rate cuts but didn’t think it would be its own kind of quantitative easing. Quantitative easing is a policy previously taken by the US Federal Reserve to stimulate economic activity by increasing cash.
“While some prominent economists have argued for China’s quantitative easing, the recent Central Economic Work Conference suggests a more cautious approach,” he said. “We believe that increased liquidity will be structural and targeted rather than blanket easing,” he said.
— Lee Ji-hye
CNBC Pro: Goldman Sachs Reveals Greater China Tech Outlook, Names Top Picks for 2023
After a tough few years for Chinese tech stocks, investors now hope the worst is behind them.
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— Xavier Ong
Federal Reserve’s Daly says ‘only hope’ on inflation data, ‘far away’ from target
San Francisco Federal Reserve Governor Mary Daly said Friday that while she thinks recent inflation news is welcome, it isn’t enough to change her views on where policy should go.
The October and November CPI numbers were “good news,” but “at the moment we see nothing but hope in the inflation data. We are confident in the evidence, not the hope. So I hope we’re on track, but until we see repeated evidence that inflation will return to a 2% pace over the next few years, we won’t be too confident.
“We are far from meeting the price stability target,” she added.
Earlier this week, the Fed raised its benchmark borrowing rate by 0.5 percentage points.
Daly, a no-vote this year for the Federal Open Market Committee, which sets interest rates, said her own expectations of where interest rates are headed are likely higher than current market prices. Vote again in 2024.
— Jeff Cox
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According to the International Energy Agency, the expansion of renewable energy is projected to grow exponentially over the next five years.
The IEA forecast a five-fold growth in solar and wind power this month.
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— Ganesh Rao
Wharton’s Siegel says Fed is making a ‘bad mistake’ in raising rates further
Jeremy Siegel, a professor of finance at the Wharton School of Management at the University of Pennsylvania, said the Fed plans to keep raising interest rates next year, increasing the odds of a very difficult recession. pointing out.
“I think the Fed is making a terrible mistake,” he told CNBC’s “Squawk on the Street” on Friday. “Their plans, their dot plots are too tight. Inflation is basically over. rice field. [Jerome] Powell characterizes it. “
Siegel said central banks should refrain from raising rates further or next year.
“I think talk of rising and staying high in 2023 warrants a very sharp recession,” he said.
— Samantha Soobin
UBS raises China growth outlook for 2023, lowers 2022 outlook
UBS has raised its 2023 gross domestic product (GDP) forecast to 4.9% from 4.5% previously, said UBS chief China economist Wang Tao.
Wang said he expects GDP to weaken in the fourth quarter of 2022, lowering his full-year forecast to 2.7% from 3.1%, pointing to weaker growth in November due to the recent spike in Covid cases. did.
The company added that the central economic working council is likely to prioritize stabilizing growth and supportive macro policies next year.
“Fiscal policy is expected to remain aggressive with a modest increase in the budget deficit and a new special LG. [local government] Fixed income, monetary and credit policies will continue to maintain ample liquidity, but further policy rate cuts are unlikely.”
— Lee Ji-hye
