RBA decision, Japanese wages, China’s measures

Stock benchmarks in mainland China and Hong Kong rose 2% on Tuesday, led by healthcare and tech stocks, respectively.

The move is aimed at calming recent market declines, including a statement from the country’s Securities and Regulatory Commission that Chinese regulators will “guide institutional investors…to enter the market with greater effort.” This is in response to the measures taken.

The biggest gainer on the CSI 300 index was Beijing Wandai Biopharmaceutical Enterprises, which jumped 10%, and the biggest gainer on the Hang Seng Index was tech giant Alibaba, whose shares rose 5.9%.

Fund manager Cole Smeed says there are opportunities in the banking sector despite concerns about rising volatility and deep losses for some financial institutions.

A portfolio manager at Sumed Capital said he remains bullish on the two banks despite the KBW Regional Bank Index falling more than 7% last week.

One of Smeed’s choices is a regional U.S. bank, and the other is a former global systemically important bank.

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— Ganesh Rao

The Reserve Bank of Australia is scheduled to release a policy statement at the end of its two-day meeting on Tuesday.

Analysts do not expect the RBA to make a dovish pivot and expect the official cash rate to remain unchanged at 4.35%.

Although the inflation rate in the fourth quarter of 2023 fell to 4.1%, the lowest level in two years, it remains well above the RBA’s target range of 2-3%, and the outlook is for the inflation rate to remain unchanged. became stronger.

Helen Chao, China and Asia Economist at BofA Global Research, said: “While a dovish turn is unlikely at this meeting, further traction from higher interest rates, progress towards the CPI target, and interest rates peaking. “A change in tone is expected as we address the confirmation that this has been reached.” Client notes.

The S&P/ASX 200 extended its losses from Monday, falling 0.9%, while the Australian dollar fell 0.06% against the US dollar.

— Shreyashi Sanyal

Goldman said in a January report that short-term benefits are already well-known and their performance already reflects a “consensus view,” so investors should look to companies that benefit from AI in the long term. He said that the focus should be on

Here are the names in the basket of long-term beneficiaries of AI and how much their underlying returns could be increased by AI.

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— Tan Weizhen

Japan’s household spending fell more than expected in December, falling 2.5% from a year earlier, compared with the 2.1% decline expected by economists polled by Reuters.

The decline was smaller than the 2.9% decline in November, with the average monthly expenditure per household being 329,518 yen ($2,217.11).

The average monthly income per household was 1,099,805 yen, a nominal decrease of 4.4% and a real decrease of 7.2% compared to the previous year.

These numbers have implications for the Bank of Japan’s monetary policy considerations, as the bank has said sustainable wage growth is one of the preconditions for lifting ultra-easy monetary policy.

— Lim Huijie

Oil prices rose and settled on Monday following US retaliatory attacks on Iranian forces and allied militias over the weekend.

West Texas Intermediate for March rose 50 cents, or 0.69%, to settle at $72.78 a barrel. The April Brent contract rose 66 cents, or 0.85%, to settle at $77.99 per barrel.

The United States launched airstrikes late Friday against Iran’s Islamic Revolutionary Guard Corps and allied militias in Iraq and Syria. The airstrike, which hit more than 85 targets, came after three U.S. soldiers were killed in a drone strike by Iranian-allied militants.

— Spencer Kimball

Traders are tempering expectations for a rate cut after warnings from Federal Reserve officials.

The probability of a much-anticipated March rate cut fell to just 14.5% on Monday morning, according to CME Group FedWatch metrics. Just two weeks ago, the expectation rate was over 80%.

For the full year, the market was even expecting a switch from forecasting six production cuts to forecasting five production cuts, with about a 44.6% chance of the total being reduced to four.

The move follows an interview given by Federal Reserve Chairman Jerome Powell to “60 Minutes.” The interview aired on Sunday, and saw Powell not only cast doubt on the March rate cut, but also raise the prospect of just three rate cuts this year, as expressed in the central bank’s December “dot plot.” We featured what we supported.

— Jeff Cox

Shares of Boeing Co. fell about 1.7% on Monday after the company said it would rework 50 undelivered 737 Max jets after it was discovered that some of the fuselages had holes drilled incorrectly. This rework may result in short-term delivery delays.

The news comes amid intense scrutiny of Alaska Airlines following an in-flight accident involving one of its 737 Max 9 aircraft.

In 2024, stock prices will fall by 21%.

— Ha-Kyung Kim

UBS said investors should pay particular attention to U.S. tech stocks. The Wall Street firm expects a soft landing scenario in its base case, saying these companies will be able to weather the slowdown in economic growth.

“We believe blue-chip stocks will continue to be core holdings for investors in the stock market,” the company’s chief investment office said in a note released Monday. “As shown, blue-chip stocks tend to outperform during periods of slow economic growth.” Global asset management.

“We maintain our most favorable stance on the U.S. IT sector, which is home to many blue-chip stocks.We also maintain our most favorable stance on the U.S. IT sector, which is home to many blue-chip stocks. The home should be well-positioned to capture further upside if the market continues to rise,” the note continued.

— Sarah Min