Asia markets were mixed as contagion fears from banking turmoil faded

Lindsey Gorman, a senior fellow at the German Marshall Fund’s Securing Democracy Coalition, told CNBC that Chinese companies are under scrutiny in the United States because of their links to the Chinese government.

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

Short video app TikTok faces a possible ban in the US over concerns that US user data was shared with Chinese parent company ByteDance. The company’s CEO told US lawmakers on Thursday that ByteDance employees based in China may still have access to some US TikTok data.

“One thing I would dispute 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.

The Chinese government said it would “firmly” oppose the compulsory sale of TikTok from ByteDance on Thursday.

– Sheila Chiang

South Korea’s defense stocks rose significantly on Tuesday with North Korean leader Kim Jong Un He called for an increase in the production of weapons-grade nuclear materialthe official media reported the Central News Agency.

Shares of Korea Aerospace, which makes satellites and aircraft, rose more than 4.3%, while shares of Hanhwa Aerospace, which makes aircraft engines, rose 3.34%.

The biggest gainer by percentage was Firstec, which makes components for South Korean defense systems such as fire controls and sensors. Shares of Firstec rose just over 5% on Tuesday.

– Lim Hwi Ji

Bitcoin and ether prices are down nearly 3% in Asian morning trade, according to currency metrics After US officials filed a complaint against cryptocurrency exchange Binance and its co-founder Changpeng Zhao.

The order alleged that the company actively responded to US users and sabotaged the exchanges’ “ineffective compliance program.”

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

Bitcoin is up nearly 63% qoq and is on pace to mark its best quarter since Q1 2021, when bitcoin was up 103.73%. It is also on track for a third straight month of gains.

Ether is also up 41.3% on a quarterly basis and is on pace to post its best quarter since Q1 2021, when the cryptocurrency gained more than 150%.

– Rohan Goswami, Gina Francola, Jihye Lee

The head of the Australian Prudential Regulatory Authority, John Lonsdale, said the country’s banking system is “among the best equipped in the world to deal with the crisis”.

Speaking at a banking summit, Lonsdale noted that Australian banks have higher capital requirements and a narrower range of definitions of HQLA than their global counterparts.

He explained that Australia is the only jurisdiction in the world that requires banks to carry capital to face the risk of rising interest rates as part of their basic capital requirements, which is referred to as interest rate risk on the bank book.

“Some banks have expressed dissatisfaction with applying capital to the IRRBB, but a couple of weeks ago the IRRBB requirements proved their worth,” Lonsdale said, referring to the collapse of the Silicon Valley bank and its vulnerability to rising interest rates.

However, Lonsdale noted, in light of the rapid fallout from the SVB, Australian regulators may need to consider whether the regulatory framework needs to be strengthened.

“With the pace of crises accelerating, regulators have less time to respond than they did before. We can no longer expect days or weeks to discuss and plan deliberate responses,” he said.

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

– Lim Hwi Ji

Australian retail sales in February rose at a slower month-over-month rate of 0.2% compared to 1.9% in January, reaching A$35.14 billion.

On an annual basis, retail sales increased by 6.4% compared to February 2022.

Data from the Australian Bureau of Statistics showed that the main draw was in the “Other Retail” category, which fell 0.4%, while the best-performing sector was the Department Stores sector, which rose 1%.

Retail sales data is a key input for the RBA’s April rate decision on whether to pause or continue raising interest rates, along with Wednesday’s release of the Consumer Price Index for February.

– Lim Hwi Ji

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

Data from the Bureau of Statistics and Economic Census It showed that imports in February fell 4.1% year-on-year to HK$331.57 billion, while exports fell 8.8% year-on-year to HK$286.2 billion.

The total trade value in Hong Kong for the month of February was HK$617.77 billion, compared to HK$659.69 billion in February 2022.

– Lim Hwi Ji

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

However, Josh Bennett, senior portfolio manager in Algeria, believes that volatility has created opportunities for investors to pick stocks that will outperform in the medium to long term.

Bennett identified three stocks that he says have the potential to generate resilient profits through a potential recession.

CNBC Pro subscribers can read more here.

– Ganesh Rao

Despite market volatility, Morgan Stanley upgraded a handful of stocks in March, including US and global stocks.

The bullish calls extended to technology, pharmaceuticals and more, with the bank giving one stock a double upgrade. Here are five of the stocks promoted by the investment bank:

CNBC Pro subscribers can read more here.

– Wizen tan

Jack Ma, the billionaire co-founder of Chinese e-commerce giant Alibaba, has returned to China after nearly one year, according to Wall Street Journal report Citing people familiar with the matter.

Ma, who largely left public life after spats with Chinese regulators, has been the subject of speculation following his disappearance. According to the report, Ma spent most of the past year in Japan before returning recently to China. He also recently visited Hong Kong, Singapore and Australia.

Alibaba shares rose 0.5 percent in Monday’s trading.

Shares of US-listed Deutsche Bank rose in pre-market trading on Monday. The stock rose 3.6 percent before the opening bell, after falling 3.1 percent on Friday.

Citi maintained a Buy rating on the stock, although concerns remain about the overall health and stability of the banking sector. German Chancellor Olaf Scholz has largely denied fears that Deutsche would suffer a similar fallout to Credit Suisse, saying the company remains “very profitable” and “fundamentally young”.

However, Deutsche stock remains under pressure as investors weigh whether the real end to a contagion in the banking sector is on the horizon. Shares are down nearly 19% since the start of the year.

– Brian Evans

In an effort to give First Republic Bank more time to put its finances in order, US regulators are considering expanding an emergency lending facility, Bloomberg reported during the Weekend.

The move would apply to all banks, but it could particularly help the First Republic, which has had problems with assets similar to those that have knocked out three other regional banks. First Republic remained open, but concerns increased about its operations and its inventory declined.

Discussions are at an early stage about expanding the term bank financing programme, and any expansion would apply to all banks.

First Republic shares jumped more than 28% in pre-market trading Monday. The stock is down nearly 90% over the past month.

– Jeff Cox

Sources told CNBC that the movement of deposits from small banks to giants such as JPMorgan Chase and Wells Fargo has slowed in recent days.

Customers became increasingly fickle after the Silicon Valley bank closed, sparking a crisis in the banking sector. While the crisis prompted some to transfer their deposits to larger banks that they see as less likely to be subject to bank withdrawals, this trend has slowed down over recent days, according to informed sources.

This gives regulators time to address pressures in the US banking system as investors and customers alike wonder if the contagion could spread.

– Heo Sun