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Tag Archives: reopening
Asia shares up on Fed rate wagers, China reopening lifts yuan
SYDNEY, Jan 9 (Reuters) – Asian shares rallied on Monday as hopes for less aggressive U.S. rate hikes and the opening of China’s borders bolstered the outlook for the global economy.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) rose 2.0% to a five-month top, with South Korean shares (.KS11) gaining 2.2%.
Chinese blue chips (.CSI300) added 0.7%, while Hong Kong shares (.HSI) climbed 1.4%. China’s yuan also firmed to its highest since mid-August under 6.8000.
Japan’s Nikkei (.N225) was closed for a holiday but futures were trading at 26,215, compared with a cash close on Friday of 25,973.
S&P 500 futures added 0.2% and Nasdaq futures 0.3%. EUROSTOXX 50 futures gained 0.6%, while FTSE futures firmed 0.3%.
Earnings season kicks off this week with the major U.S. banks, with the Street fearing no year-on-year growth at all in overall earnings.
“Excluding Energy, S&P 500 EPS (earnings per share) is expected to fall 5%, driven by 134 bp of margin compression,” wrote analysts at Goldman Sachs. “Entering reporting season, earnings revision sentiment is negative relative to history.
“We expect further downward revisions to consensus 2023 EPS forecasts,” they added. “China reopening is one upside risk to 2023 EPS, but margin pressures, taxes, and recession present greater downside risks.”
A sign of the strain came from reports Goldman would start cutting thousands of jobs across the firm from Wednesday, as it prepares for a tough economic environment. read more
In Asia, Beijing has now opened borders that had been all but shut since the start of the COVID-19 pandemic, allowing a surge in traffic across the nation. read more
Bank of America analyst Winnie Wu expects China’s economy, the second-largest economy in the world, to benefit from a cyclical upturn in 2023 and anticipates market upside from both multiple expansion and 10% EPS growth.
FADING THE FED
Sentiment on Wall Street got a boost last week from a benign blend of solid U.S. payroll gains and slower wage growth, combined with a sharp fall in service-sector activity. The market scaled back bets on rate hikes for the Federal Reserve.
Fed fund futures now imply around a 25% chance of a half-point hike in February, down from around 50% a month ago.
That will make investors ultra sensitive to anything Fed Chair Jerome Powell might say at a central bank conference in Stockholm on Tuesday.
It also heightens the importance of U.S. consumer price index (CPI) data on Thursday, which is forecast to show annual inflation slowing to a 15-month low of 6.5% and the core rate dipping to 5.7%.
“We at NatWest have lower than consensus CPI forecasts, and if right that will likely solidify the market pricing of 25bps vs 50bps,” said NatWest Markets analyst John Briggs.
“In context, it should still be seen as a Fed that is still likely to hike a few more times and then hold rates high until inflation’s decline is guaranteed – to us that means a 5-5.25% funds rate.”
Friday’s mixed data had already seen U.S. 10-year yields drop a steep 15 basis points to 3.57%, while dragging the U.S. dollar down across the board.
Early Monday, the euro was holding firm at $1.0673 , having bounced from a low of $1.0482 on Friday. The dollar eased to 131.48 yen , away from last week’s top of 134.78, while its index was flat at 103.600 .
The Brazilian real had yet to trade after hundreds of supporters of far-right former President Jair Bolsonaro were arrested after invading the country’s Congress, presidential palace and Supreme Court. read more
The drop in the dollar and yields was a boon for gold, lifting it to an eight-month peak around $1,877 an ounce .
Oil prices were steadier, after sliding around 8% last week amid demand concerns.
Brent bounced 80 cents to $79.37 a barrel, while U.S. crude rose 78 cents to $74.55 per barrel.
Reporting by Wayne Cole; Editing by Bradley Perrett and Christopher Cushing
Our Standards: The Thomson Reuters Trust Principles.
Travelers rush to take advantage of China reopening
BEIJING (AP) — After two years of separation from his wife in mainland China, Hong Kong resident Cheung Seng-bun made sure to be among the first in line following the reopening of border crossing points Sunday.
The ability of residents of the semi-autonomous southern Chinese city to cross over is one of the most visible signs of China’s easing of border restrictions, with travelers arriving from abroad also no longer required to undergo quarantine.
“I’m hurrying to get back to her,” Cheung, lugging a heavy suitcase, told The Associated Press as he prepared to cross at Lok Ma Chau station.
Travelers crossing between Hong Kong and mainland China, however, are still required to show a negative COVID-19 test taken within the last 48 hours — a measure China has protested when imposed by other countries.
Hong Kong has been hard-hit by the virus, and its land and sea border checkpoints with the mainland have been largely closed for almost three years. Despite the risk of new infections, the reopening that will allow tens of thousands of people who have made prior online bookings to cross each day is expected to provide a much-needed boost to Hong Kong’s tourism and retail sectors.
On a visit to the station Sunday morning, Hong Kong’s Chief Executive John Lee said the sides would continue to expand the number of crossing points from the current seven to the full 14.
“The goal is to get back as quickly as possible to the pre-epidemic normal life,” Lee told reporters. “We want to get cooperation between the two sides back on track.”
Communist Party newspaper Global Times quoted Tan Luming, a port official in Shenzhen on the border with Hong Kong, saying about 200 passengers were expected to take the ferry to Hong Kong, while another 700 were due to travel in the other direction, on the first day of reopening. Tan said a steady increase in passenger numbers is expected over coming days.
“I stayed up all night and got up at 4:00 a.m. as I’m so excited to return to the mainland to see my 80-year-old mother,” a Hong Kong woman identified only by her surname, Cheung, said on arrival at Shenzhen, where she was presented with “roses and health kits,” the paper said.
Hong Kong media reports said around 300,000 travel bookings from the city to mainland China have already been made.
Limited ferry service had also been restored from China’s Fujian province to the Taiwanese-controlled island of Kinmen just off the Chinese coast.
The border crossing with Russia at Suifenhe in the far northern province of Heilongjiang also resumed normal operations, just in time for the opening of the ice festival in the capital of Harbin, a major tourism draw.
China’s borders remain largely sealed, however, with only a fraction of the previous number of international flights arriving at major airports.
Beijing’s main Capital International Airport was expecting eight flights from overseas on Sunday, according to the airport. Shanghai, China’s largest city, received its first international flight under the new policy at 6:30 a.m. with only a trickle of other international flights to follow.
That number is expected now to tick upward, with booking inquiries for overseas flights overwhelming some online travel services ahead of the Lunar New Year travel rush later this month. Capital International is preparing to reopen arrival halls that have been quiet for most of the past three years.
Shanghai, meanwhile, announced it would again start issuing regular passports to Chinese for foreign travel and family visits, as well as renewing and extending visas for foreigners. Those restrictions have had a particularly devastating effect on foreign businesspeople and students in the key Asian financial center.
China is now facing a surge in cases and hospitalizations in major cities and is bracing for a further spread into less developed areas with the start of China’s most important holiday of the year, set to get underway in coming days.
Authorities say they expect domestic rail and air journeys will double over the same period last year, bringing overall numbers close to those of the 2019 holiday period before the pandemic hit.
Meanwhile, the controversy continues over testing requirements being imposed on Chinese travelers by foreign governments — most recently Germany and Sweden. On Saturday, German Foreign Minister Annalena Baerbock urged citizens to avoid “unnecessary” travel to China, noting the rise in coronavirus cases in the country and saying that China’s Health system is “overburdened.”
The German regulation also allows for spot checks on arrival and Germany, like other European nations, will test wastewater from aircrafts for possible new virus variants. The measures come into force at midnight Monday and are due to last until April 7.
Apparently concerned about its reputation, China says the testing requirements aren’t science-based and has threatened unspecified countermeasures.
Chinese health authorities publish a daily count of new cases, severe cases and deaths, but those numbers include only officially confirmed cases and use a very narrow definition of COVID-19-related deaths.
Authorities say that since the government ended compulsory testing and permitted people with mild symptoms to test themselves and convalesce at home, it can no longer provide a full picture of the state of the latest outbreak.
Government spokespeople have said the situation is under control and reject accusations from the World Health Organization and others that it is not being transparent about the number of cases and deaths or providing other crucial information on the nature of the current outbreak that could lead to the emergence of new variants.
Despite such assertions, the Health Commission on Saturday rolled out regulations for strengthened monitoring of viral mutations, including testing of urban wastewater. The lengthy rules called for increased data gathering from hospitals and local government health departments and stepped-up checks on “pneumonia of unknown causes.”
Criticism has largely focused on heavy-handed enforcement of regulations, including open-ended travel restrictions that saw people confined to their homes for weeks, sometimes sealed inside without adequate food or medical care.
Anger was also vented over the requirement that anyone who potentially tested positive or had been in contact with such a person be confined for observation in a field hospital, where overcrowding, poor food and hygiene were commonly cited.
The social and economic costs eventually prompted rare street protests in Beijing and other cities, possibly influencing the Communist Party’s decision to swiftly ease the strictest measures and reprioritize growth.
As part of the latest changes, China will also no longer bring criminal charges against people accused of violating border quarantine regulations, according to a notice issued by five government departments on Saturday.
Individuals currently in custody will be released and seized assets returned, the notice said.
The Transportation Ministry on Friday called on travelers to reduce trips and gatherings, particularly if they involve elderly people, pregnant women, small children and those with underlying conditions.
___
Associated Press reporters Alice Fung and Karmen Li in Hong Kong and Frank Jordans in Berlin contributed to this report.
Travel curbs rack up as COVID-hit China readies reopening
SHANGHAI/BEIJING, Jan 6 (Reuters) – More countries around the world are demanding that visitors from China take COVID tests, days before it drops border controls and ushers in an eagerly awaited return to travel for a population that has been largely stuck at home for three years.
From Sunday, China will end the requirement for inbound travellers to quarantine, the latest dismantling of its “zero-COVID” regime that began last month following historic protests against a suffocating series of mass lockdowns.
But the abrupt changes have exposed many of China’s 1.4 billion population to the virus for the first time, triggering an infection wave that is overwhelming some hospitals, emptying pharmacy shelves of medication and causing international alarm.
Greece, Germany and Sweden on Thursday joined more than a dozen countries to demand COVID tests from Chinese travellers, as the World Health Organisation said China’s official virus data was under-reporting the true extent of its outbreak.
Chinese officials and state media have struck a defiant tone, defending the handling of the outbreak, playing down the severity of the surge and denouncing foreign travel requirements for its residents.
Foreign Ministry spokesperson Mao Ning warned on Friday of possible reciprocal measures after the European Union recommended pre-departure testing for Chinese passengers.
“The EU should listen more to … rational voices and treat China’s epidemic prevention and control objectively and fairly,” Mao told a regular media briefing in Beijing.
The Global Times, a nationalistic tabloid published by the official People’s Daily, said in an editorial that some Western media and politicians “would never be satisfied” no matter what steps China takes.
The global aviation industry, battered by years of pandemic curbs, has also been critical of the decisions to impose testing on travellers from China. China will still require pre-departure testing for inbound travellers after Jan. 8.
HOSPITALS PACKED
Some Chinese citizens think the reopening has been too hasty.
“They should have taken a series of actions before opening up … and at the very least ensure that the pharmacies were well stocked,” a 70-year-old man who gave his surname as Zhao told Reuters in Shanghai.
China reported five new COVID deaths in the mainland for Thursday, bringing its official virus death toll to 5,264, one of the lowest in the world.
But that appeared to be at odds with the reality on the ground where funeral parlours are overwhelmed and hospitals are packed with elderly patients on respirators. In Shanghai, more than 200 taxi drivers are driving ambulances to meet demand for emergency services, the Shanghai Morning Post reported.
International health experts believe Beijing’s narrow definition of COVID deaths does not reflect a true toll that could rise to more than a million fatalities this year.
Investors are optimistic that China’s reopening can eventually reinvigorate a $17-trillion economy suffering its lowest growth in nearly half a century.
Those hopes, alongside policy measures to help revive its troubled property sector, lifted China’s yuan on Friday.
Meanwhile, both China’s blue-chip CSI300 Index (.CSI300) and the Shanghai Composite Index (.SSEC) have gained more than 2% in the first trading week of the year.
“While the re-opening is likely to be a bumpy affair amid surging COVID-19 cases and increasingly stretched health systems, our economists expect growth momentum across Asia to gather steam, led by China,” Herald van der Linde, HSBC’s head of equity strategy, Asia Pacific, said in a note.
SOUTHEAST ASIA OPEN
With the big Lunar New Year holidays late this month, the mainland is also set to open the border with its special administrative region of Hong Kong on Sunday, for the first time in three years.
Ferry services between the city and the gambling hub of Macau will resume on the same day.
Hong Kong’s Cathay Pacific Airways (0293.HK) said on Thursday it would more than double flights to mainland China. Flights to and from China remain at a tiny fraction of pre-COVID levels.
The WHO has warned that the holiday, which starts on Jan. 21 and usually brings the biggest human migration on the planet as people head home from cities to visit families in small towns and villages, could spark another infection wave in the absence of higher vaccination rates and other precautions.
Authorities expect 2.1 billion passenger trips, by road, rail, water and air, over the holiday, double last year’s 1.05 billion journeys during the same period.
The transport ministry has urged people to be cautious to minimise the risk of infection for elderly relatives, pregnant women and infants.
One region poised to be a major beneficiary of China’s opening is Southeast Asia, where countries have not demanded that Chinese visitors take COVID tests.
Except for airline wastewater testing by Malaysia and Thailand for the virus, the region’s 11 nations will treat Chinese travellers like any others.
As many as 76% of Chinese travel agencies ranked Southeast Asia as the top destination when outbound travel resumed, according to a recent survey by trade show ITB China.
Many people in China have taken to social media to announce their travel plans but some remain wary.
“You want to see the world, but the world might not want to see you,” wrote one WeChat user from Tianjin city.
Reporting by Brenda Goh in Shanghai, Bernard Orr, Eduardo Baptista, Martin Pollard and Liz Lee in Beijing, Farah Master in Hong Kong, and Xinghui Kok in Singapore; Writing by John Geddie and Greg Torode; Editing by Robert Birsel and Andrew Heavens
Our Standards: The Thomson Reuters Trust Principles.
Xi says COVID control is entering new phase as cases surge after reopening
WUHAN/BEIJING, Dec 31 (Reuters) – Chinese President Xi Jinping called on Saturday for more effort and unity as the country enters a “new phase” in its approach to combating the pandemic, in his first comments to the public on COVID-19 since his government changed course three weeks ago and relaxed its rigorous policy of lockdowns and mass testing.
China’s abrupt switch earlier this month from the “zero-COVID” policy that it had maintained for nearly three years has led to infections sweeping across the country unchecked. It has also caused a further drop in economic activity and international concern, with Britain and France becoming the latest countries to impose curbs on travellers from China.
The switch by China followed unprecedented protests over the policy championed by Xi, marking the strongest show of public defiance in his decade-old presidency and coinciding with grim growth figures for the country’s $17 trillion economy.
In a televised speech to mark the New Year, Xi said China had overcome unprecedented difficulties and challenges in the battle against COVID, and that its policies were “optimised” when the situation and time so required.
“Since the outbreak of the epidemic … the majority of cadres and masses, especially medical personnel, grassroots workers braved hardships and courageously persevered,” Xi said.
“At present, the epidemic prevention and control is entering a new phase, it is still a time of struggle, everyone is persevering and working hard, and the dawn is ahead. Let’s work harder, persistence means victory, and unity means victory.”
New Year’s Eve prompted reflection online and by residents of Wuhan, the epicentre of the COVID outbreak nearly three years ago, about the zero-COVID policy and the impact of its reversal.
People in the central city of Wuhan expressed hope that normal life would return in 2023 despite a surge in cases since pandemic curbs were lifted.
Wuhan resident Chen Mei, 45, said she hoped her teenage daughter would see no further disruptions to her schooling.
“When she can’t go to the school and can only have classes online it’s definitely not an effective way of learning,” she said.
VIDEO REMOVED
Across the country, many people voiced similar hopes on social media, while others were critical.
Thousands of users on China’s Twitter-like Weibo criticised the removal of a video made by local outlet Netease News that collated real-life stories from 2022 that had captivated the Chinese public.
Many of the stories included in the video, which by Saturday could not be seen or shared on domestic social media platforms, highlighted the difficulties ordinary Chinese faced as a result of the previously strict COVID policy.
Weibo and Netease did not immediately reply to a request for comment.
One Weibo hashtag about the video garnered almost 4 million hits before it disappeared from platforms at about noon on Saturday. Social media users created new hashtags to keep the comments pouring in.
“What a perverse world, you can only sing the praises of the fake but you cannot show real life,” one user wrote, attaching a screenshot of a blank page that is displayed when searching for the hashtags.
The disappearance of the videos and hashtags, seen by many as an act of censorship, suggests the Chinese government still sees the narrative surrounding its handling of the disease as a politically sensitive issue.
HOSPITALS OVERWHELMED
The wave of new infections has overwhelmed hospitals and funeral homes across the country, with lines of hearses outside crematoriums fuelling public concern.
China, a country of 1.4 billion people, reported one new COVID death for Friday, the same as the day before – numbers that do not match the experience of other countries after they reopened.
UK-based health data firm Airfinity said on Thursday that about 9,000 people in China were probably dying each day from COVID. Cumulative deaths in China since Dec. 1 have likely reached 100,000, with infections totalling 18.6 million, it said.
Zhang Wenhong, director of the National Centre for Infectious Diseases, told the People’s Daily in an interview published on Saturday that Shanghai had reached a peak of infections on Dec. 22, saying there were currently about 10 million cases.
He said those numbers indicated that some 50,000 people in the city of 25 million would need to be hospitalized in the next few weeks.
At the central hospital of Wuhan, where former COVID whistleblower Li Wenliang worked and later died of the virus in early 2020, patient numbers were down on Saturday compared with the rush of the past few weeks, a worker outside the hospital’s fever clinic told Reuters.
“This wave is almost over,” said the worker, who was wearing a hazmat suit.
A pharmacist whose store is next to the hospital said most people in the city had now been infected and recovered.
“It is mainly old people who are getting sick with it now,” he said.
In the first indication of the toll on China’s giant manufacturing sector from the change in COVID policy, data on Saturday showed factory activity shrank for the third straight month in December and at the sharpest pace in nearly three years.
Reporting by Martin Quinn Pollard, Tingshu Wang and Xiaoyu Yin in Wuhan, Eduardo Baptista in Beijing; Writing by Sumeet Chatterjee
Editing by Helen Popper and Frances Kerry
Our Standards: The Thomson Reuters Trust Principles.
South Korea inflation, China reopening
Week ahead: PMIs in Asia-Pacific, trade data, inflation readings
Key economic events in the Asia-Pacific next week will be dominated by Purchasing Managers’ Index readings in the region.
China’s National Bureau of Statistics is scheduled to release the official manufacturing and non-manufacturing PMI prints on Saturday. Reuters expects China’s factory activity to show a contraction with a reading of 48.
South Korea is also slated to report its December trade data over the weekend, in which economists polled by Reuters predict will show a drop of 10.1% compared with a year ago.
Singapore is scheduled to release manufacturing PMI readings next week, while S&P Global is scheduled to release its PMI readings for South Korea, Indonesia and India on Monday.
Inflation prints for the Philippines and Indonesia will also be closely watched, with the releases scheduled for Tuesday and Monday, respectively.
Japan’s PMI reading and China’s private survey for services PMI will be released on Wednesday. Singapore will release November’s retail sales on Thursday as well as South Korea’s unemployment rate for December.
– Jihye Lee
Yamaguchi emerging as candidate for next Bank of Japan governor: Sankei
Former Bank of Japan deputy governor Hirohide Yamaguchi is emerging as a candidate to lead the central bank, Japanese local media Sankei reported, citing people familiar with the matter.
Yamaguchi, who held the deputy position at the central bank until 2013, has been a vocal critic of the current governor Haruhiko Kuroda’s ultra-dovish monetary policy.
The newspaper added that Yamaguchi would indicate a shift away from former Japanese Prime Minister Shinzo Abe’s economic stimulus strategy also known as “Abenomics.”
Sankei reported Yamaguchi is garnering attention as current Prime Minister Fumio Kishida moves away from the stimulus-oriented monetary stance, and that the appointment for the next central bank head would become clear next month.
– Jihye Lee
Foreign talent to be less inclined to come to Singapore after Hong Kong’s reopening, says UOB
With Hong Kong’s reopening, foreign nationals may be less inclined to move to Singapore, said Alvin Liew, senior economist at United Overseas Bank.
“Singapore has benefited in terms of the talent pool that came here due to the more stringent rules in Hong Kong itself,” Liew said, adding that the influx of workforce moving to Singapore “may see some easing” now that the city has reopened.
“Talent pool itself may be less inclined to move here,” the Singapore-based economist said.
Liew also added Hong Kong’s reopening is a step in the right direction for the region to “return back to business as usual,” Liew said.
China’s markets to see a “tactical” recovery next year, says analyst
Chinese markets will likely see a “tactical bounce” of a recovery in the coming year, Port Shelter Investment Management said.
“It’s only obvious to say that we’re likely to see a tactical bounce,” Richard Harris, chief executive of the firm told CNBC.
“It will be tactical, because China, at the end of the day, has to fit in with the rest of the world,” he said.
Harris expects China’s recovery to take place in the first quarter of the year, and carry on the sentiments into the second quarter as well.
This recovery also hinges on many currently unknown elements, such as whether heavy stimulation will be injected into the Chinese economy, and what will be done about inflation when the economy picks up, he added.
—Lee Ying Shan
New China tech ETF can ‘bring retail liquidity’ to Singapore market: Investment firm
The Singapore-listed CSI Star and ChiNext 50 Index Exchange Traded Fund can bring liquidity from mainland China to Singapore, Ding Chen, CEO of CSOP Asset Management, told CNBC’s “Squawk Box Asia.”
The firm’s ETF was listed on the Singapore Exchange on Friday and is a sub-fund of the CSOP SG ETF Series I, a Singapore unit trust, according to the fund’s page.
“Through SGX, Singapore investors and global investors can also get access to China-listed ETFs,” said Ding, adding that China investors can also directly invest in Singapore ETFs.
When asked about the evolution of the firm’s ETF portfolio, Ding said that it will “bring more emerging, younger generation of tech companies” on the market.
– Sheila Chiang
South Korea’s inflation unchanged in December
South Korea’s December consumer price index rose 5% on an annualized basis, statistics from the Bank of Korea showed.
The reading maintained cooler levels for the month and remained unchanged from November.
The print is in line with economists’ expectations polled by Reuters.
– Jihye Lee
Stocks close higher Thursday
All of the major averages ended higher on Thursday.
The Dow Jones Industrial Average rose 345.09 points, or 1.05%. The S&P 500 gained 1.75% and the Nasdaq Composite climbed 2.59% to 10,478.09.
— Tanaya Macheel
CNBC Pro: Chip stocks did badly this year — but this fund manager is still bullish, naming 2 to buy
Jobless filings rose last week; continuing claims hit highest since February
Jobless claims increased last week amid Federal Reserve efforts to cool the economy and in particular the labor market.
First-time filings for unemployment benefits totaled 225,000 for the week ended Dec. 24, the Labor Department reported Thursday. That was an increase of 9,000 from the previous week and slightly above the 223,000 estimate from Dow Jones.
Longer-term, continuing claims, which run a week behind the headline number, jumped to 1.71 million, an increase of 41,000 to the highest level since early February.
The numbers this time of year are always noisy due to the holidays. Claims not adjusted for seasonal factors surged by 23,146, a 9.3% increase.
—Jeff Cox
CNBC Pro: Citi names its top biotech stock picks for 2023 — and gives one 73% upside
Biotech is set to remain a “stock-pickers market” in 2023, according to Citi.
The bank explains how biotech could perform based on various economic scenarios, and names three top picks for 2023.
CNBC Pro subscribers can read more here.
— Weizhen Tan
South Korea inflation, China reopening
Week ahead: PMIs in Asia-Pacific, trade data, inflation readings
Key economic events in the Asia-Pacific next week will be dominated by Purchasing Managers’ Index readings in the region.
China’s National Bureau of Statistics is scheduled to release the official manufacturing and non-manufacturing PMI prints on Saturday. Reuters expects China’s factory activity to show a contraction with a reading of 48.
South Korea is also slated to report its December trade data over the weekend, in which economists polled by Reuters predict will show a drop of 10.1% compared with a year ago.
Singapore is scheduled to release manufacturing PMI readings next week, while S&P Global is scheduled to release its PMI readings for South Korea, Indonesia and India on Monday.
Inflation prints for the Philippines and Indonesia will also be closely watched, with the releases scheduled for Tuesday and Monday, respectively.
Japan’s PMI reading and China’s private survey for services PMI will be released on Wednesday. Singapore will release November’s retail sales on Thursday as well as South Korea’s unemployment rate for December.
– Jihye Lee
Yamaguchi emerging as candidate for next Bank of Japan governor: Sankei
Former Bank of Japan deputy governor Hirohide Yamaguchi is emerging as a candidate to lead the central bank, Japanese local media Sankei reported, citing people familiar with the matter.
Yamaguchi, who held the deputy position at the central bank until 2013, has been a vocal critic of the current governor Haruhiko Kuroda’s ultra-dovish monetary policy.
The newspaper added that Yamaguchi would indicate a shift away from former Japanese Prime Minister Shinzo Abe’s economic stimulus strategy also known as “Abenomics.”
Sankei reported Yamaguchi is garnering attention as current Prime Minister Fumio Kishida moves away from the stimulus-oriented monetary stance, and that the appointment for the next central bank head would become clear next month.
– Jihye Lee
Foreign talent to be less inclined to come to Singapore after Hong Kong’s reopening, says UOB
With Hong Kong’s reopening, foreign nationals may be less inclined to move to Singapore, said Alvin Liew, senior economist at United Overseas Bank.
“Singapore has benefited in terms of the talent pool that came here due to the more stringent rules in Hong Kong itself,” Liew said, adding that the influx of workforce moving to Singapore “may see some easing” now that the city has reopened.
“Talent pool itself may be less inclined to move here,” the Singapore-based economist said.
Liew also added Hong Kong’s reopening is a step in the right direction for the region to “return back to business as usual,” Liew said.
China’s markets to see a “tactical” recovery next year, says analyst
Chinese markets will likely see a “tactical bounce” of a recovery in the coming year, Port Shelter Investment Management said.
“It’s only obvious to say that we’re likely to see a tactical bounce,” Richard Harris, chief executive of the firm told CNBC.
“It will be tactical, because China, at the end of the day, has to fit in with the rest of the world,” he said.
Harris expects China’s recovery to take place in the first quarter of the year, and carry on the sentiments into the second quarter as well.
This recovery also hinges on many currently unknown elements, such as whether heavy stimulation will be injected into the Chinese economy, and what will be done about inflation when the economy picks up, he added.
—Lee Ying Shan
New China tech ETF can ‘bring retail liquidity’ to Singapore market: Investment firm
The Singapore-listed CSI Star and ChiNext 50 Index Exchange Traded Fund can bring liquidity from mainland China to Singapore, Ding Chen, CEO of CSOP Asset Management, told CNBC’s “Squawk Box Asia.”
The firm’s ETF was listed on the Singapore Exchange on Friday and is a sub-fund of the CSOP SG ETF Series I, a Singapore unit trust, according to the fund’s page.
“Through SGX, Singapore investors and global investors can also get access to China-listed ETFs,” said Ding, adding that China investors can also directly invest in Singapore ETFs.
When asked about the evolution of the firm’s ETF portfolio, Ding said that it will “bring more emerging, younger generation of tech companies” on the market.
– Sheila Chiang
South Korea’s inflation unchanged in December
South Korea’s December consumer price index rose 5% on an annualized basis, statistics from the Bank of Korea showed.
The reading maintained cooler levels for the month and remained unchanged from November.
The print is in line with economists’ expectations polled by Reuters.
– Jihye Lee
Stocks close higher Thursday
All of the major averages ended higher on Thursday.
The Dow Jones Industrial Average rose 345.09 points, or 1.05%. The S&P 500 gained 1.75% and the Nasdaq Composite climbed 2.59% to 10,478.09.
— Tanaya Macheel
CNBC Pro: Chip stocks did badly this year — but this fund manager is still bullish, naming 2 to buy
Jobless filings rose last week; continuing claims hit highest since February
Jobless claims increased last week amid Federal Reserve efforts to cool the economy and in particular the labor market.
First-time filings for unemployment benefits totaled 225,000 for the week ended Dec. 24, the Labor Department reported Thursday. That was an increase of 9,000 from the previous week and slightly above the 223,000 estimate from Dow Jones.
Longer-term, continuing claims, which run a week behind the headline number, jumped to 1.71 million, an increase of 41,000 to the highest level since early February.
The numbers this time of year are always noisy due to the holidays. Claims not adjusted for seasonal factors surged by 23,146, a 9.3% increase.
—Jeff Cox
CNBC Pro: Citi names its top biotech stock picks for 2023 — and gives one 73% upside
Biotech is set to remain a “stock-pickers market” in 2023, according to Citi.
The bank explains how biotech could perform based on various economic scenarios, and names three top picks for 2023.
CNBC Pro subscribers can read more here.
— Weizhen Tan
Casa Bonita sets a reopening date, now owned by “South Park” creators
Call it a Christmas miracle: Casa Bonita finally has an open date.
According to a Thursday announcement, the famous eatertainment venue in Lakewood will reopen in May for the first time since 2020, when it closed at the beginning of the COVID-19 pandemic.
“Guys, I saw a thing in the news about what Coloradans want for Christmas, and besides a new football team and fresh snow, they said they wanted an opening date for Casa Bonita,” said Trey Parker, co-creator of “South Park” and co-owner of Casa Bonita, in a video announcement. “So guess what?!”
“We’re opening in May!” said Parker, co-owner/co-creator of “South Park” Matt Stone and chef Dana Rodriguez said in unison.
Thursday’s announcement is the first fans have heard since November 2021, when Casa Bonita announced it had hired three-time James Beard-nominated Denver chef Dana Rodriguez to lead the kitchen.
It’s been a long time coming, too. The venue closed in March 2020 due to COVID-19 and the “South Park” creators purchased it in September 2021.
The original plan was to reopen by late 2022, but this summer, Stone and Parker said they couldn’t confirm an opening date due to unforeseen challenges with the building’s renovation. In June, for example, Casa Bonita’s iconic fountain was razed amid concerns about its crumbling foundation. According to city permitting documents and construction plans, the renovations are expected to cost about $12 million.
“Have you ever seen ‘Kitchen Nightmares’? It’s the very, very worst one of those you could possibly ever imagine,” Parker told The Post in August. “What we thought would be, ‘Oh this will be cool. We can buy this and open it and it’ll be around again,’ turned into ‘Oh this is going to be what we have to put all our money into and hope that it works.’”
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China’s sudden ‘reopening’ reveals new economic challenges
People line up outside a fever clinic in Beijing on Dec. 14, 2022, just days after the country relaxed its Covid controls amid below-freezing weather in the capital city.
Yuxuan Zhang | Afp | Getty Images
BEIJING — Mainland China’s swift rollback of many Covid-related restrictions has been unexpectedly sudden, revealing a new set of economic challenges.
In the last two weeks, local and central government authorities relaxed several measures that had forced many people to stay home and businesses to operate mostly remotely. Notably, the central government said last week negative virus tests and health code checks were no longer needed to travel domestically.
Meanwhile, reports of locals falling ill have surged. Beijing city said that on Sunday, its fever clinics saw 22,000 visits — up 16 times from a week ago.
“This reopening has come rather suddenly, and rather resolutely. It’s exceeded our expectations,” said Gang Yu, co-founder and executive chairman of 111, an online seller of medicines and health-care services. That’s according to a CNBC translation of his comments in Mandarin.
Shortage of staff and medicines
Since late November, orders for fever-reducing products and related medicines have surged tenfold, Yu said in a phone interview Thursday. He said there’s an “extraordinary shortage” of medicines that factories can’t keep up with, a situation he expects will last for at least another three or four weeks.
On top of the high demand, tens of workers at 111’s warehouses or offices in different parts of China have tested positive for Covid, creating an “extraordinary shortage” of staff, Yu said.
That’s a different challenge from earlier this year, when widespread Covid lockdowns meant thousands of new orders were getting stranded at different distribution points each day, Yu said.
Delivery is still slower than normal in parts of the country.
Even as of Sunday, China’s postal agency said more than 400 distribution points in Beijing and other parts of the country remained closed for Covid-related reasons.
For a sense of scale, the postal service said Tuesday it was collecting more than 360 million parcels a day — that’s more than one package per person in the U.S.
We reckon that the incoming migration around the Chinese New Year holiday in late January could bring about an unprecedented spread of Covid and severe disruptions to the economy.
JD.com announced Wednesday that more than 1,000 couriers from other parts of the country had arrived in the capital city of Beijing. Anecdotally, in the last few days in Beijing, app-based food and grocery services that typically deliver within an hour were only doing so at far longer intervals, or a next-day basis.
Surging infections may offset easing
“Over the past two weeks, the Chinese government did a sudden 180-degree turn on ending its zero Covid policies, with most of the domestic prevention measures completely ditched,“ Nomura’s Chief China Economist Ting Lu and a team said in a report Thursday.
“Surging Covid infections may offset the positive impact of the easing in the near term.”
“The rapid surge of infections in big cities might be only the beginning of a massive wave of Covid infections,” the analysts said.
“We expect major activity indices to remain weak or even to drop further in December. We reckon that the incoming migration around the Chinese New Year holiday in late January could bring about an unprecedented spread of Covid and severe disruptions to the economy.”
China reported Thursday a worse-than-expected drop in retail sales in November, as well as slower growth in industrial production and fixed asset investment.
Get through winter first
Social activity remains subdued amid the surge of infections and below-freezing weather in northern cities. Traffic data from Baidu indicate that most people in large cities such as Beijing and Guangzhou have not ventured out, with congestion levels still very low as of Thursday.
Management at Chinese travel booking site Trip.com were also reserved in how soon domestic travel would rebound.
“We actually saw a very strong sequential increase in domestic flights and hotel reservations in the past two weeks,” they said Thursday, according to a FactSet earnings call transcript.
“But in the very near term, we are still cautious as winter is usually a flat season for both business and leisure travel,” they said.
“And it also might take some time for people to get through the first wave of infections before travel demand could fully release and rebound. But we anticipate to see a very nice rebound and growth in the domestic travel segment next year.”
China eases some of its Covid restrictions, in significant step toward reopening
CNN
—
China announced sweeping changes to its national pandemic response on Wednesday, the clearest and most significant sign yet that the central government is moving away from its strict zero-Covid approach that prompted protests across the country.
In a statement reported by state broadcaster CCTV, China’s State Council unveiled 10 new guidelines that loosen some restrictions – most notably, allowing home quarantine and largely scrapping the health QR code that has been mandatory for entering most public places.
Local governments had already taken steps this week that indicated a possible change in direction – including some major cities loosening requirements on Covid testing.
But this is the first official change in Covid policy on a national level – a notable turnaround by Beijing, which for the past three years has insisted that unwavering restrictions are the only effective way to stamp out the highly transmissible virus.
Here are some of the biggest changes.
Since early in the pandemic, China has used health codes on mobile phones to track individuals’ health statuses. The color of these codes – in red, amber or green – decides whether users can leave their homes, use public transport and enter public places, or potentially need to quarantine.
Under the guidelines released Wednesday, people will be able to enter most places without showing a negative test result or their health code – a significant step after nearly three years of disruption to people’s daily routines and livelihoods.
Only a few exceptions will still require these checks, including nursing homes, medical institutions and secondary schools. Businesses can now determine their own prevention and control policies, the report added.
In another massive change, asymptomatic Covid patients or those with mild symptoms will be allowed to quarantine at home instead of being taken to a government facility, unless they choose otherwise.
Patients whose condition deteriorates will be transferred to hospital for treatment, the report said. Close contacts can also quarantine at home.
Throughout the pandemic, Chinese residents have described the chaos and stress of going into quarantine camps, many saying it was unclear when they would be allowed to leave, and others complaining of crowded or poor conditions.
In several cases, health workers reportedly killed the pets of those taken to government quarantine, citing health risks – triggering outrage on Chinese social media each time. Others criticized the policy after reports earlier this year of elderly residents being forced out of their homes in the middle of the night for transport to quarantine.
– Source:
CNN
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Man dragged out of home after allegedly refusing to go to quarantine facility
00:59
– Source:
CNN
The new guidelines also urge authorities to “ensure the normal functioning of society and basic medical services,” saying areas that aren’t designated high-risk should not restrict people’s movements or close businesses.
Lockdowns are only allowed in “high-risk areas,” and even then, should be “promptly” lifted if no new cases are found for five consecutive days, it said. It added that authorities are forbidden from blocking fire escapes, apartment or building entrances, and other gates, so residents can still evacuate and seek medical attention if needed.
This particular guideline comes at a particularly sensitive time, with China still reeling from a wave of rare public protest in late November and early December, that had been triggered by a deadly fire in the far western Xinjiang region. Public fury had swept the nation after videos of the incident appeared to show lockdown measures had delayed firefighters from reaching the victims.
During the protests, thousands across the country took to the streets to call for an end to lockdowns and other zero-Covid measures – with some voicing broader grievances against censorship and the ruling Communist Party’s authoritarian leadership.
– Source:
CNN
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‘Chilling’: Protester tells CNN what the atmosphere is like in China
The State Council on Wednesday also emphasized the need to accelerate Covid vaccination among the elderly, saying all locations should be “administrating as many vaccinations as possible.”
While the Omicron variant is milder than previous strains and China’s overall vaccination rate is high, experts say even a small number of severe cases among vulnerable and under-vaccinated groups like the elderly could overwhelm hospitals if infections spike across the country of 1.4 billion.
More than 86% of China’s population over 60 are fully vaccinated, according to China’s National Health Commission. That leaves around 25 million who have not received any shot, according to a comparison of official population figures and November 28 vaccination data. But booster rates are lower, with more than 45 million of the fully vaccinated elderly yet to receive an additional shot.
For the most at-risk over 80 age group, around two-thirds were fully vaccinated, but only 40% had received booster shots as of November 11, according to state media.
The rules also make domestic travel within China easier, with cross-regional travelers no longer needing to provide a negative test result or their health code – or test upon arrival.
These former requirements, as well as other travel restrictions such as provincial border closures and provincial train and bus suspensions, have made domestic travel difficult over the last few years.
For the many in China who left their hometowns to find work in other cities and provinces, that meant being separated from family for long stretches – or being stranded far from home without an income during snap lockdowns.
In recent days, some social media users have pointed out that Lunar New Year is just a month away – the country’s biggest annual holiday, a time when people typically travel home to gather with family, akin to the American Thanksgiving.
For some, the prospect of mass nationwide travel has raised concern of the virus spreading once more. Others, long fatigued with the toll of zero-Covid, greeted the news with relief.
“I haven’t been home for Chinese New Year for two years now, I’m crying,” one person said on Weibo. Another wrote: “It’s been a long time. Welcome home.”
A few other guidelines are also likely to ease the transition away from zero-Covid toward a less disruptive model.
For instance, schools without Covid outbreaks are now asked to carry out “normal offline teaching activities,” and to reopen on-campus facilities such as cafeterias, libraries and sports venues. Schools with Covid cases can continue “normal teaching and living,” as long as they designate certain “risk areas” with control measures.
The guidelines also emphasize the need to make medicine widely accessible, dropping restrictions that previously made it difficult to buy cold and fever medication in pharmacies. Since early in the pandemic, China has required a prescription and negative Covid test to buy these.
Perhaps reflecting public concern that the relaxation in rules could cause a surge in cases, residents have rushed to drug stores, with reports last week that cold and fever medicines were flying off shelves.
The State Council also urged doctors and local medical institutions to continue closely monitoring the health situation of key populations, including the risks posed to elderly or immunocompromised residents.
Some experts have warned that a broader reopening inevitably brings health risks, especially to those vulnerable groups.
“The key risk when countries decide to move away from a zero-Covid policy is really the strain this will exert on the health care system,” said Ruklanthi de Alwis, deputy director for the Centre for Outbreak Preparedness at the Duke-NUS Medical School in Singapore.