Asia markets fall as investors assess trade data from China and Australia; oil slightly rebounds

Asia-Pacific markets slumped across the board, mirroring moves on Wall Street as investors assessed trade data from China and Australia.

China’s November trade numbers surprised expectations, with exports climbing 0.5% and imports falling 0.6% year on year. Economists polled by Reuters expected a 1.1% year-on-year drop in exports and a 3.3% climb in imports.

The trade surplus for the world’s second-largest economy also widened to $68.39 billion, beating forecasts of $58 billion.

Separately, prices of oil have rebounded slightly after hitting their lowest level since June, with the West Texas Intermediate contract for January up 0.66%, to trade at $69.82 a barrel.

The Brent contract for February also gained 0.7%, to trade at $74.88 a barrel.

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In Australia, the S&P/ASX 200 narrowed losses, inching down 0.07% and ending at 7,173.3 after the country’s trade surplus in October widened to 7.13 billion Australian dollars, but missed Reuters poll estimates of AU$7.5 billion.

Japan’s Nikkei 225 fell 1.76% to close at 32,858.31 after leading gains in Asia on Wednesday, while the Topix slid 1.14% to 2,359.91.

South Korea’s Kospi shed 0.13% to finish at 2,492.07, while the small-cap Kosdaq closed 0.77% at 813.2.

Hong Kong’s Hang Seng index dropped 0.66%, paring losses in its final hour, while the mainland Chinese CSI 300 slipped 0.24%, hitting new four year lows at 3,391.28.

.N225Nikkei 225 Index*NIKKEI32766.34458.481.42
.HSIHang Seng Index*HSI16000.84-333.53-2.04
.AXJOS&P/ASX 200*ASX 20071972.10.03
.KS11KOSPI Index*KOSPI2518.560.710.03
.FTFCNBCACNBC 100 ASIA IDX*CNBC 1008307.61-34.08-0.41

Overnight in the U.S., all three major indexes retreated on Wednesday as investors assessed data indicating falling inflation while awaiting jobs report.

The Dow Jones Industrial Average lost 0.19%, while the S&P 500 shed 0.39% and the Nasdaq Composite dropped 0.58%.

It was the third losing day for the 30-stock Dow and the S&P 500 — the first since October for both indexes.

— CNBC’s Lisa Kailai Han and Alex Harring contributed to this report.

THU, DEC 7 20232:15 AM EST

Blackpink’s contract renewal lifts burden on YG’s stock price: analyst

Following the news of K-pop girl group Blackpink renewing their contracts with agency YG Entertainment, Samsung Securities senior analyst Minha Choi said that a “significant burden” on the label’s stock price has been lifted.

On Wednesday, shares of YG spiked 25% after the contract renewal announcement, but pared gains on Thursday, falling about 2.3%.

In an email to CNBC, Choi forecast that even with the renewal of the four member group, he still expects YG’s earnings to decline in 2024, adding that if Blackpink did not renew with YG, he would expect earnings to fall further.

China’s November exports beat expectations, trade surplus widens

China’s exports climbed 0.5% year on year in November, reversing from a 6.4% fall in October and exceeding expectations of a 1.1% decline from a Reuters poll.

However, imports to the world’s second largest economy dropped 0.6% compared to the same period a year ago, surprising forecasts of a 3.3% rise.

China’s trade balance widened to $68.39 billion in November, higher than the $56.53 billion in October and surpassing estimates of $58 billion.

— Lim Hui Jie

WED, DEC 6 20238:09 PM EST

Australia trade surplus widens in October, but misses estimates

Australia’s trade balance in October widened to AU$7.13 billion from 6.79 billion Australian dollars ($4.45 billion) the month before, but fell short of the AU$7.5 billion estimated by a Reuters poll of economists.

The country’s statistics bureau revealed that exports rose 0.4% month-on-month, or AU$182 million, driven by metal ores and minerals.

On the other hand, imports fell 1.9%, or A$763 million, from the previous month, mainly due to declines in imports of industrial transport equipment.

— Lim Hui Jie

WED, DEC 6 20236:57 PM EST

CNBC Pro: Morgan Stanley picks ‘alpha’ opportunities in China tech – giving one 52% upside

The Chinese economy may have been in a funk this year, but Morgan Stanley sees promise in the tech sector – naming stocks to play the theme into the new year.

Looking ahead, the bank’s analysts expect 2024 to be “another year of an alpha-driven market as subpar macro improvements weigh on industry growth.”

″[We] expect alpha-driven performance for select stocks,” they added, naming four alpha stocks they are overweight on, and two stocks they have a conservative stance on.


— Amala Balakrishner

WED, DEC 6 20236:57 PM EST

CNBC Pro: Forget ‘obvious’ AI stocks: Top Morningstar strategist likes 2 AI derivative plays trading at a discount

Artificial intelligence has been a huge theme this year, with investors rushing into many AI-related stocks.

Nvidia soared over 200% year to date, and Microsoft around 56%.

Dave Sekera, Morningstar’s chief U.S. market strategist, said he would move to an underweight position on tech stocks now and take profit in overvalued stocks.

But he flagged opportunities in two derivative plays on AI that investors can consider. “Not everything in the technology sector is overvalued. While the obvious plays in artificial intelligence have already run up, we see opportunities in those stocks we consider as second derivative plays on AI,” Sekera told CNBC on Wednesday.

CNBC Pro subscribers can read more here.

— Weizhen Tan

WED, DEC 6 20233:51 PM EST

U.S. crude falls below $70 a barrel, closing at lowest since June

U.S. crude fell 4% on Wednesday, closing at its lowest point since June with retail gasoline hitting its cheapest since January.

The West Texas Intermediate contract for January fell $2.94, or 4.07%, to settle at $69.38 a barrel, while the Brent contract for February declined $2.90, or 3.76%, to settle at $74.30 a barrel.

U.S. crude and the global benchmark have fallen for five straight days, despite efforts by OPEC+ to boost prices by promising to slash supply in the first quarter of 2024.

Prices at the pump in the U.S., meanwhile, have followed oil prices lower to hit $3.22 a gallon on average as of Wednesday, the lowest price since Jan. 3, according to AAA.

— Spencer Kimball

WED, DEC 6 20233:46 PM EST

Fed has successfully navigated a ‘perfect Goldilocks scenario’ ahead of a soft landing, says Schwab’s Omar Aguilar

For all its efforts this year, the Federal Reserve seems to have pulled off a successful soft landing, according to Omar Aguilar, CEO and chief investment officer of Schwab Asset Management.

“Where we are now, it’s almost seeing exactly what the Fed wanted to have. It’s almost like the perfect Goldilocks scenario for what they have been working at throughout the year,” he told CNBC’s “Squawk on the Street” on Wednesday.

As signs of this strength, he cited growing U.S. economic resiliency, decreasing wage growth and “inflation moving to the right places.”

“Clearly the soft landing scenario seems to be the most plausible case,” he added.

As for how to invest in 2024, Aguilar believes that the mega-cap tech names that outperformed this year will “probably take a backseat.”

Instead, he suggested investors focus on more traditional and sensitive areas of the market, such as materials and financials. Investors would be wise to practice being “very conservative” and rotating in and out of assets slowly.

— Lisa Kailai Han

WED, DEC 6 202312:30 PM EST

Jamie Dimon on crypto: ‘I’d close it down’

JPMorgan Chase CEO Jamie Dimon on Wednesday again criticized cryptocurrency, suggesting that bitcoin and its many cohorts in the $1.6 trillion space should be banned.

“The only true use case for it is criminals, drug traffickers … money laundering, tax avoidance,” the head of the largest U.S. bank by assets said during a Senate Banking Committee hearing. “If I was the government, I’d close it down.”

Earlier this year, Dimon called bitcoin a “hyped-up fraud,” a comment he later walked back, and prior to that, a “pet rock.”

Under questioning from Sen. Elizabeth Warren (D-Mass.), Dimon and the heads of other big Wall Street banks all agreed that crypto companies should face the same anti-money laundering regulations as they do.

—Jeff Cox

WED, DEC 6 202312:19 PM EST

GDP on track to grow 1.3% in Q4, Atlanta Fed indicator says

The U.S. economy is on track to show only marginal growth in the final quarter of 2023, according to an Atlanta Federal Reserve tracker.

GDPNow, which adjusts projections on a real-time basis according to incoming data, is now pointing to growth of just 1.3% in the October-through-December period, an update Wednesday showed. The latest reading was up from 1.2% in the previous update but well below the initial 2.3% estimate in late October.

Adjustments in the expectations for real spending growth and exports fueled the latest adjustments.

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