Bank of Japan announces unscheduled bond purchases
The Bank of Japan announced two rounds of unscheduled purchases of Japanese government bonds in attempt to contain upward pressure in yields, according to a notice.
The central bank offered to buy unlimited amounts of two- and five-year notes at a fixed rate – and another offer to buy 600 billion yen ($4.5 billion) of one-to-10 year bonds, it said.
This is in addition to its latest announcement to purchase JGBs every business day at a rate of 0.5% starting Dec. 20.
The 10-year JGB yield was last 0.22% lower to stand at 0.465%. Bond yields move inversely to prices.
The central bank last week widened its band of yield curve tolerance for 10-year JGBs to 0.5% of either side of its 0% target from the previous range of 0.25%.
—Lee Ying Shan
South Korea’s retail sales see third month of declines, industrial output recovers
South Korea’s November retail sales fell 1.8% on an annualized basis, declining further after seeing a 0.2% drop in October, government data showed.
Meanwhile, its industrial production inched up 0.4% for the month, slightly recovering after seeing four straight months of declines previously.
South Korea is expected to release its consumer price index on Friday, in which economists polled by Reuters are expecting to see further cooled inflation of 5%.
– Jihye Lee
Oil prices dip as China’s reopening optimism fizzles
Oil prices dipped marginally as China continues to see a rising number of Covid cases as well as a strain in medical resources fizzle optimism in the nation’s reopening and fuel demand outlook.
Brent crude futures shed 0.46% to stand at $82.88 per barrel. Similarly, the U.S. West Texas Intermediate dropped 0.49% to $78.58 per barrel.
“Even the China re-opening narrative may be hobbled by record Covid breakout in China,” Mizuho Bank’s Vishnu Varathan wrote in a note, adding that its reopening should also not be mistaken for an “enduring immunity” from global recession risks.
—Lee Ying Shan
Apple’s Asia suppliers fall after shares from the tech giant record fresh low
Italy makes Covid tests mandatory for travelers from China: Reuters
Italy will require all inbound travelers from China to undergo Covid tests, Reuters reports its health minister as saying, after authorities in Milan reported that almost 50% of passengers on two flights from China tested positive.
It has not been specified what measures would be imposed on arrivals who test positive, Reuters reported.
Separately, the UK is considering following suit after the U.S. announced mandatory testing on arrivals from China, the Telegraph reported.
—Lee Ying Shan
CNBC Pro: Tech is ‘down but by no means out’ — watch these stocks in 2023, fund manager says
It’s been a bad year for tech companies, and many investors have been wondering when tech stocks will rebound.
Tech fund manager Jeremy Gleeson of AXA Investment Managers told CNBC Pro Talks last week that he still believes in the sector.
He explains why and names the stocks to buy.
CNBC Pro subscribers can read more here.
— Weizhen Tan
Crypto exchange Kraken to shut down Japan operations
Digital currency exchange Kraken announced it will cease operations in Japan next month, and deregister from Japan’s Financial Services Agency on Jan. 31, 2023.
The exchange cited a confluence of “current market conditions in Japan” and a “weak crypto market globally” as the reasons behind its move.
The decision was also part of Kraken’s efforts to “prioritize resources and investments in those areas that align with [its] strategy and will best position Kraken for long term success.”
Bitcoin fell 0.64% in the past 24 hours and last traded at $16,571.12, according to Coin Metrics. Ether dropped 1.18% to $1,193.34.
— Ryan Browne, Lee Ying Shan
U.S. will require negative Covid test from China travelers
Airline passengers entering the U.S. from China will need to have a negative Covid test, a federal health official announced on Wednesday.
The rule goes into effect on Jan. 5 and applies to all travelers who are at least two years of age from China, Hong Kong and Macau. The rule applies regardless of nationality or vaccination status.
After attempting a zero Covid policy for much longer than other major countries, China is now seeing a wave of infections after rolling back its public health restrictions in recen weeks.
— Jesse Pound
Apple breaks key technical level, sets new 52-week low
Apple fell through the key $129 level and set a new 52-week low for a second day Wednesday.
Some analysts look at Apple, the largest market cap stock, as a bellwether for the overall market and a major influence on investor sentiment.
“It’s not great for the overall market,” said Todd Sohn, technical analyst at Strategas. “The end of year is a funky time, but if it continues into the first couple of weeks of the year, it’s for real.”
Apple fell through $129 support in early trading Wednesday and touched a low of $126.41 before reversing. The stock was at $127.15 in afternoon trading.
“If your largest weight is weak and making new lows, that’s not great. Your top player is not scoring,” he said. Sohn said the five largest market cap names are still losing steam. “The silver lining is the influence on the (S&P 500) index is dropping.”
–Patti Domm
CNBC Pro: China eases its Covid restrictions. That could spell a buying opportunity in these stocks
An reopening in the world’s second-largest economy could spell a buying opportunity for investors as China unwinds much of its Covid restrictions.
Investors have taken recent developments as a signal to start snapping up China equities. They expect that China’s economy could get a boost in 2023, while the U.S. and Europe continue to deal with the lagging effect of monetary tightening that could put a damper on economic growth.
“A lot of institutional investors have been very underweight Chinese equities,” said Carlos Asilis, co-founder and CIO at Glovista Investments.
“And I think that that’s been a mistake, because it has ignored this very important potential baseline case which is now being priced in, which is that of the Chinese economy undergoing next year a similar recovery path that we saw this year in the case of the United States,” he added.
CNBC Pro subscribers can read the full story here.
— Sarah Min