New Zealand Achieves Biggest Rate Hike Ever; Inflation in Singapore fell in October

UBS Wealth Management expects a full reopening for China by the third quarter of next year due to a number of factors.

“We think it takes time for the government to want to review public messaging because [some] the concerns of the Chinese public are very real,” UBS Global Wealth Management’s Min Lan Tan said on CNBC’s “Squawk Box Asia.”

She added that the country should strive to increase the vaccination rate of its elderly population and ensure that an adequate medical system is in place before a full reopening.

Regarding the latest measures to ease quarantine for international travelers, Tan described it as “two steps forward and one step back.”

Reopening the country “will be a process, not an event,” she said.

– Jihye Lee

Singapore’s core inflation rate fell from 0.2% to 5.1% in October on an annualized basis, the Ministry of Trade and Industry (MTI) reported – after seeing the same index to 5.3% in September.

The latest consumer price index for October is lower than a Reuters poll predicting 5.3% for October.

The inflation rate for all items also fell to 6.7% in October on an annualized basis after registering a rate of 7.5% in September.

MTI said the easing was due to smaller increases in goods and services, as well as gas and electricity prices.

“Energy and food prices have risen above the highs reached earlier in the year, but remain high given supply constraints,” the ministry said in a statement.

— Lee Ying Shan

Shares listed in Malaysia were little changed as the country’s political stalemate continues and local media reported that Malaysia’s King, the Yang di-Pertuan Agong, would make a decision, without giving a timeline.

The benchmark KLCI fell 0.09% after two negative sessions.

Among the index heavyweights, Genting Malaysia fell 2.33% after reporting its third quarter results, and Top Glove also lost 1.1% – while Nestlé gained 0.28% and CIMB lost 0.28%. increased by 0.18%.

The malaysian bell strengthened slightly against the US Dollar in the morning session and last settled at 4.5690.

—Jihye Lee

Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr said the bank’s sole objective was to bring the official exchange rate to a point where inflation can be reduced.

Orr’s comments come after the central bank announced its biggest rate hike of 75 basis points.

“Our underlying inflation rate is too high,” Orr told a press conference, adding that the central bank is “well on the path of the tightening cycle.”

In a separate press release shortly after the decision, the RBNZ said: “Committee members agreed that monetary conditions should continue to tighten further.

— Lee Ying Shan

Shares of BYD Hong Kong-listed traded down 2.64% after Warren Buffett’s Berkshire Hathaway announced it was cutting its stake in the Chinese electric vehicle maker.

According to an HKEX filing, the company sold 3.2 million shares worth about HK$630 million ($80.6 million), reducing its stake in the company to 15.99% against 16.28%, according to the file.

Separately, the company also announced that it would increase the prices of some of its electric vehicle models, according to Reuters.

– Jihye Lee

Xiaomi is expected to see a drop in revenue for the third quarter of 2022, according to an average of Refinitiv poll estimates.

The company is expected to see a 9.66% decline in revenue to 70.52 billion yuan ($9.87 billion) for the July-September quarter, from 78.06 billion yuan in the same period last year. last year.

The expected decline is likely due to “tepid smartphone sales,” as well as weak macroeconomic environment and consumer sentiment, Daiwa Capital Markets wrote in a note.

Shares of Xiaomi fell as much as 1.72% in morning trading ahead of the release, and were last around 1% lower.

–Lee Ying Shan

The New Zealand dollar strengthened to 0.6192 against the dollar after the central bank raised rates by 75 basis points, its biggest rise on record.

The NZD last traded at 0.6170 against the dollar and the NZX 50 index in New Zealand fell 0.8%.

The New Zealand 10-year Treasury yield briefly touched 4.305% shortly after the decision, and last traded at 4.235%. Yields move inversely to prices and one basis point is equal to 0.01%.

– Lee Ying Shan

According to Goldman Sachs, batteries for electric vehicles are gaining “critical importance” in the context of the energy transition.

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—Weizhen Tan

Singapore’s economy is expected to grow by around 3.5% in 2022, according to forecasts by the Ministry of Trade and Industry, citing an easing in the outlook for external demand following the energy crisis in Europe and the ongoing Covid-related restrictions in China.

The figure is a cut estimate from its previous projection range of between 3% and 4% – and reflects annualized growth of 4.1% in the third quarter and growth of 1.1% from the previous quarter.

The ministry also said it expects the country’s GDP growth in 2023 to be between 0.5% and 2.5%.

—Jihye Lee

Electric vehicles are rapidly gaining popularity, especially in China, the world’s largest market for electric vehicles.

But UBS believes self-driving will be an even bigger megatrend than electrification – with a market size in China alone of around $100 billion by 2030.

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— Zavier Ong

The Reserve Bank of New Zealand raised its key cash rates by 75 basis points, its largest increase on record, to 4.25%.

The decision is in line with analysts’ expectations, according to a Reuters poll.

This is the ninth consecutive hike since the RBNZ began its rate hike cycle in October 2021, including five hikes of 50 basis points.

Inflation in New Zealand currently stands at 7.2%, just below three-decade highs.

— Lee Ying Shan

According to Eva Lee, head of China equities at UBS Global Wealth Management’s chief investment office, investors should take advantage of the bumpy rise in Chinese tech stocks to look to smaller, less established companies.

“Under current regulations, second-tier players will do better than the best. Take advantage of this opportunity to turn to second-tier companies,” such as those with resilient revenues, she told CNBC’s “Street Signs Asia”.

Additionally, tech giants are seen as “macro-reclaimers”. [proxies]and the path to an eventual full reopening “is going to be up and down, it’s going to be choppy,” she said.

“We will eventually move there, but it takes time,” she said.

—Abigail from

Stocks rose on Tuesday, with the three major averages gaining more than 1%, with Wall Street betting that interest rate hikes and inflation will ease as the end of the year approaches. The S&P 500 also closed at a level not seen since September.

The Dow Jones Industrial Average closed at 397.82 points, or 1.18%, up at 34,098.10. The Nasdaq Composite also gained 1.36% to 11,174.41.

The S&P 500 rose 1.36% to close at 4003.58, its first close above the 4000 level since September.

—Carmen Reinicke

Nineteen S&P 500 stocks hit 52-week highs so far on Tuesday and, of those, 16 (84%) also hit all-time highs. Three of the 19 (TRV, MRK, IBM) are also in the Dow Jones Industrial Average, and two of them are among the all-time highs:

• General Parts Co. (GPC), the highest since an IPO in 1948
• O’Reilly Auto (ORLY), historic record since IPO in 1993
• TJX Cos. (TJX), all-time high since IPO in 1987
• General Mills (GIS), historical records throughout history dating back to 1927
• Monster Beverage (MNST), all-time high since its predecessor’s Nasdaq listing in 1992
• Highest ever Pepsico (PEP), dating back to Pepsi-Cola’s merger with Frito-Lay in 1965
• Marathon Petroleum (MPC), historic record back to Marathon Oil spin-off in 2011
• Aflac Inc. (AFL), historical data from CNBC in 1973
• Arthur J Gallagher (AJG), all-time high since 1984 IPO
• Globe Life (GL), historical data record of predecessor in 1980
• MetLife (MET), all-time high since its IPO in 2000
• Progressive (PGR), all-time high since IPO in 1971
• Travelers (TRV), historical record of return to Citi spin-off in 2002
• Gilead Sciences (GILD), at its highest since April 2020
• Merck & Co. (MRK), all-time history in CNBC history from 1978
• PACCAR (PCAR), all-time high since 1971 IPO
• Quanta Services (PWR), all-time high since 1998 IPO
• Snap-On (SNA), at its highest since June 2021
• International Business Machines (IBM), at its highest since February 2020

There were two 52-week lows in the S&P 500 early Tuesday:

• Tesla (TSLA), lowest since November 2020
• Medtronic (MDT), the lowest since March 2020

No comment.

—Scott Schnipper and Christopher Hayes