Asia-Pacific markets rise mostly as investors digest Fed’s smallest quarter-point hike

Signs of ‘sequential acceleration’ in Hong Kong despite economic contraction in 2022: UBP

Hong Kong’s economy is “positioned to return to expansion” this year, UBP told CNBC’s “Squawk Box Asia” on Thursday.

“We are seeing signs that there was a sequential acceleration in January. So that’s the good news,” said Carlos Casanova, UBP’s senior economist for Asia.

This is despite new figures from the Hong Kong government showing its economy contracted 4.2% in the fourth quarter, falling for four consecutive quarters in 2022. Real GDP also shrank 3.5% year-on-year.

“We are confident that we should be able to resume expansion in 2023, not just because of mainland tourists [are] come back after the reopening, but … we have more favorable stock market valuations which are certainly contributing to sentiment in Hong Kong,” Casanova added.

—Goh Chiew Tong

Bitcoin rises around 4% and approaches $24,000

Bitcoin rose 3.72% in the past 24 hours, prices showed on Coin Metrics, as investors continued to applaud the U.S. Federal Reserve’s smallest rate hike of 25 basis points.

The cryptocurrency briefly touched $24,000 and last traded at $23,986.65, hovering at the highest levels since mid-August 2022.

Ether rose 5.77% and last traded at $1,677.13.

US dollar index fluctuates, hovers around 100

The dollar index fell more than 0.3% to 100.92, the lowest levels seen since April 2022, when it last fell below 101, according to Refinitiv data.

The dollar index hit an overnight low of 101.036, its lowest level since 22/04/2022, when it traded as low as 100.473.

The index is down 0.74% since the beginning of the week and on pace for its fourth consecutive negative week for the first time since its 4-week streak ending on January 14, 2022.

– Chris Hayes, Gina Francolla, Jihye Lee

Australia building approvals rise 18.5% and beat expectations

Total building approvals approved in Australia rose by 18.5%, according to the Australian Bureau of Statistics, far more than the 1% rise economists expected in a Reuters poll.

Private sector house approvals fell 2.3%, while private sector building approvals excluding houses rose 56.6%, the ABS said in its statement.

The value of non-residential buildings decreased by 1.7%, while the value of all buildings increased by 3%.

– Jihye Lee

South Korea’s consumer price index rose 5.2% in January

South Korea’s consumer price index rose 5.2% in January on an annualized basis, according to data from Statistics Korea.

The latest printout shows a slight rise from previous readings, after rising from 5.7% in October 2022 to 5.0% in November and remaining unchanged in December.

Prices for basic necessities increased by 6.1% compared to a year ago, while fresh food products increased by 2.4%.

– Jihye Lee

Adani Enterprises withdraws follow-on public offering overnight

Investors will be watching shares of Adani Group companies closely after Adani Enterprises withdrew its $2.5 billion follow-on public offering overnight, although the sale was fully subscribed, which many considered as a vote of confidence from investors.

The company cited “the unprecedented situation and current market volatility” for the decision, adding that it is working to return the proceeds to investors.

“Given these extraordinary circumstances, the company’s board of directors felt that moving forward with the matter would not be morally correct,” founder Gautam Adani said in a statement.

“The interests of investors are paramount and therefore to protect them from any potential financial loss, the board has decided not to proceed with the FPO,” he said.

The move comes after shares of Adani continued to sell off during Wednesday’s trading session in Mumbai, reflecting the erosion in investor sentiment since Hindenburg Research announced its short position in Adani Group companies.

Shares of Adani Enterprises plunged 28% at Wednesday’s market close. Adani Port and Special Economic Zone fell 19%, Adani green energy fell 5.6%, Adani Total Gas lost 10% while Adani Transmission closed down 2.8%.

– Jihye Lee

CNBC Pro: JPMorgan Says Hong Kong Stocks Will Rebound in February, Names 5 Stocks to Hold

JPMorgan named five stocks to hold amid an expected rise in the broader Chinese stock market in February.

Strategists at the Wall Street bank attributed the selloff in Hong Kong-listed stocks last week to profit-taking by some investors.

They said the broader stock market would “rise” this month, but turn to “consumption-grade laggards as well as cyclical spaces of value and growth.”

CNBC Pro subscribers can learn more about the 5 stocks JPMorgan named.

—Ganesh Rao

CNBC Pro: Worried about Alibaba’s share price drop? Analysts have 4 alternative technology choices

Alibaba shares have rebounded strongly this year, although a recent drop in its share price has worried some investors.

But the Wall Street favorite is far from the only game in town, with several stocks also offering exposure to China’s internet sector.

Pro subscribers can learn more here.

— Zavier Ong

Federal Reserve hikes 25 basis points, but expects ‘continued’ increases

The Federal Reserve raised overnight lending rates by 25 basis points, or 0.25 percentage points, in line with investor expectations. The rise takes the Fed’s target range to 4.5%-4.75%, the highest level since 2007.

In its statement, however, the Fed kept the language by noting that the FOMC still sees the need for “continued increases in the target range.” Market participants had hoped for some softening of the phrase, but the statement, unanimously approved, kept it intact.

—Jeff Cox

Don’t expect a rate cut in 2023, says Powell

Jerome Powell said he doesn’t expect the Fed to cut rates this year, as some top strategists expect.

“Given our outlook, I don’t see us cutting rates this year, if our outlook materializes,” the Fed Chairman said.

Powell also said he was “not concerned” about the bond market implying further decline before a pause, as some market participants expect inflation to fall faster than the Fed.

“If we see inflation come down much faster, of course that will play into our policy,” Powell said.

—Jesse Pound

Economy still in ‘early stage’ of reducing inflation, Powell says

Powell acknowledged there had been positive signs in recent jobs reports even though the labor data remained strong, but said it was too early for celebration.

“It’s a good thing that the disinflation we’ve seen so far hasn’t come at the expense of the labor market,” Powell said, but added that the economy is still in an “early stage. of a slowdown in inflation.

He said a drop in property prices and data showing recent softening in the rental housing market is a “good story”.

However, he said the Fed “is not yet seeing disinflation” in the core services portion of inflation, excluding housing.

—Jesse Book

Gold hits intraday high not seen since April

Gold hit a session high not seen since April.

The metal traded as high as $1,956.60 during Wednesday’s trading. This is the highest it has traded since April 22, 2022, when gold hit $1,957.80.

—Alex Harring, Gina Francolla

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