Asian markets trade mixed as fears of contagion ease from banking turmoil

Chinese companies are under scrutiny in the U.S. because of their ties to the Chinese government, Lindsay Gorman, senior fellow at the German Marshall Fund’s Alliance for the Defense of Democracies, told CNBC.

“There is this intense geopolitical rivalry [between the U.S. and China]. “Chinese companies are under a ton of scrutiny because of their ties to the Chinese Communist Party,” Gorman said on CNBC’s “Squawk Box Asia” Tuesday.

Short-video app TikTok is facing a ban in the US over concerns about sharing US user data with its Chinese parent company ByteDance. Its CEO told US lawmakers on Thursday that Byte Dance’s China-based employees may still have access to some of TikTok’s US data.

“One thing I would push back is that there is no evidence that Chinese companies are using communications and technologies for espionage,” Gorman said.

“It’s important to look at the broader context of the Chinese Communist Party’s efforts to interfere with democratic institutions to suppress free speech and democracies,” Gorman said.

On Thursday, the Chinese government said it would “strongly oppose” the forced sale of TikTok from Byte Dance.

– Sheila Chiang

South Korean defense stocks rose sharply on Tuesday after North Korean leader Kim Jong Un It called for increased production of nuclear weaponsState media KCNA

Shares of satellite and aircraft maker Korea Aerospace rose more than 4.3%, while aircraft engine maker Hanwha Aerospace rose 3.34%.

FirstTech made huge profits from a percentage change that makes components for South Korean defense systems, such as fire controllers and sensors. FirstTech shares rose just 5% on Tuesday.

– Lim Hui Jee

Bitcoin and Ether prices fell around 3% in Asian morning trade Currency Measurements – after US authorities filed a complaint against crypto exchange Finance and its co-founder Changpeng Zhao.

The filing alleges that the company actively solicited US users and replaced the exchanges’ own “useless compliance program.”

Bitcoin fell 3.09% in the last 24 hours, trading at $27,003, according to Coin Metrics — while Ether also fell 2.95% to $1,712.

Since the first quarter of 2021, when Bitcoin gained 103.73%, Bitcoin is up approximately 63% quarter on quarter, on pace to mark its best quarter ever. It is on pace to see gains for the third month in a row.

Ether also surged 41.3% in the quarter, on pace for the best quarter since the cryptocurrency gained more than 150% in the first quarter of 2021.

– Rohan Goswami, Gina Brancola, Jihye Lee

John Lonsdale, chairman of the Australian Prudential Regulation Authority, said the country’s banking system was “one of the best tools in the world to handle a crisis”.

Speaking at a banking summit, Lonsdale pointed out that Australia’s banks have high capital requirements and a narrow range of definitions of high-quality liquid assets compared to their global peers.

More importantly, it is the only jurisdiction in the world where banks carry capital to address the risk of rising interest rates as part of their core capital requirements, referred to as interest rate risk in the banking book, he said.

“Some banks were unhappy with the IRRBB’s use of capital, but two weeks ago the IRRBB requirement proved its worth,” Lonsdale said, referring to Silicon Valley Bank’s collapse and exposure to rising interest rates.

However, Lonsdale noted that in light of SVB’s rapid decline, Australia’s regulators should consider strengthening the regulatory framework.

“As the pace of crises has increased, regulators have less time to respond than they once did. We can no longer expect days or weeks to deliberate and plan considered responses,” he said.

“We need to be ready to act quickly, but we also need more confidence than ever in the prudential safeguards we have in place.”

– Lim Hui Jee

Australia’s retail sales in February rose at a slower monthly rate of 0.2% compared to January’s 1.9%, to A$35.14 billion.

On a year-on-year basis, retail sales increased by 6.4% compared to February 2022.

Data from the Australian Bureau of Statistics showed a 0.4% drop from the main drag “other retail”, while the best-performing sector was department stores, which rose 1%.

The retail sales data will be a key input for the RBI’s April policy decision on whether to pause or continue rate hikes, along with the consumer price index release for February.

– Lim Hui Jee

Hong Kong’s trade deficit nearly doubled to HK$45.37 billion ($5.78 billion) in February, compared with HK$25.37 billion in January.

Data from the Bureau of Census and Statistics of the Economy Imports fell 4.1% year-on-year to HK$331.57 billion in February, while exports fell 8.8% to HK$286.2 billion a year earlier.

Hong Kong’s total trade value for February came in at HK$617.77 billion, compared to HK$659.69 billion in February 2022.

– Lim Hui Jee

The market sell-off earlier this month affected small-cap stocks more than their large-cap peers.

Nevertheless, Josh Bennett, senior portfolio manager at Alger, believes the volatility has created opportunities for investors to pick stocks that have outperformed over the medium to long term.

Bennett named three stocks that he says could see a rebound through a potential recession.

CNBC Pro subscribers can read more here.

– Ganesh Rao

Despite market volatility, Morgan Stanley upgraded several stocks in March, including U.S. and global picks.

Better calls spread across technology, pharmaceuticals and more, with the bank offering a two-fold upgrade per share. Here are five stocks upgraded by the investment bank:

CNBC Pro subscribers can read more here.

– Weissen Don

Jack Ma, the billionaire co-founder of Chinese e-commerce giant Alibaba, has returned to China after nearly a year. The Wall Street Journal reports Quoting people in the know.

Ma, who has largely stayed out of public life after disputes with Chinese regulators, has been the subject of speculation following his disappearance. According to reports, Ma spent most of last year in Japan before returning to China recently. He was also recently in Hong Kong, Singapore and Australia.

Alibaba shares rose 0.5% in premarket trading on Monday.

Shares of US-listed Deutsche Bank were higher in premarket trading on Monday. After falling 3.1% on Friday, the stock added 3.6% before the opening hours.

Citi maintained its buy rating on the stock despite continued concerns about the health and stability of the banking sector as a whole. German Chancellor Olaf Scholes dismissed concerns that Deutsche could be subject to the same collapse as Credit Suisse, saying the company was still “very profitable” and “fundamentally modernized”.

However, Deutsche shares are still under pressure as investors weigh whether they can see a real end to the banking sector. Shares are down nearly 19% year to date.

– Brian Evans

US regulators are considering extending an emergency credit facility to First Republic Bank in an attempt to give it more time to get its finances in order. Bloomberg reported week end.

The move applies to all banks, but could especially help First Republic, which has problems with assets like the one that brought down the other three regional banks. First Republic remains open, but concerns about its operations have grown and its stock has plummeted.

Discussions on expanding the Bank Term Funding Scheme are at an early stage and any expansion would apply to all banks.

First Republic shares jumped more than 28% in premarket trading on Monday. Shares have fallen nearly 90% in the past month.

– Jeff Cox

The flow of deposits from smaller banks to giants like JPMorgan Chase and Wells Fargo has slowed in recent days, sources told CNBC.

Customers are increasingly confused following the closure of a Silicon Valley bank that triggered a crisis in the banking industry. While the crisis has pushed some to move their deposits to bigger banks, they feel less exposed to banking, a trend that has eased in recent days, sources familiar with the matter said.

That gives regulators time to address strains in the U.S. banking system as investors and customers wonder whether the pandemic will spread.

— Son of Hugh