China keen to move into new areas of growth to spur economy: HSBC
China wants to shift to new high-end growth areas like IT to spur the economy, said Herald van der Linde, head of equity strategy, Asia Pacific at HSBC.
“They don’t want to go back to the old growth model, which was real estate and investments in infrastructure. They’ve had enough of that,” he told CNBC’s “Squawk Box Asia.”
Instead, “they want to move to a new growth model,” that focuses on high-end technology, renewables and election vehicles, he added. But there is no clear direction from Beijing’s policymakers on those specific details yet, he said.
“We’ve got a new economic team that came in February this year. They presumably have met, they’ve come up with plans and supposedly in the next month or so, we’re going to get some more details on what exactly they’re going to do,” noted Linde.
“And I think this is what the market is waiting for. It gives us an idea of what direction they’re really going to go for.”
— Sumathi Bala
China holds one year and five year loan prime key rates unchanged at 3.55% and 4.2%.
China left its one year and five year loan prime rates unchanged at 3.55% and 4.2% respectively, days after it also left its medium term facility loan rates unchanged at 2.65%.
This also comes after the country saw its second quarter GDP growth come in below expectations on Monday, recording a 6.3% rise year on year compared to the 7.3% expected by economists polled by Reuters.
China last cut its loan prime rate in June, when its lowered the one-year and five-year loan prime rates by 10 basis points.
— Lim Hui Jie
CNBC Pro: Goldman Sachs shares its top stock picks for China A.I. — and 2 are on its conviction list
Goldman Sachs named Chinese stocks it says are likely to benefit from developments in generative artificial intelligence — and two are on the bank’s conviction list of buy-rated names.
In two research notes dated July 16, Goldman gave an overview of opportunities and risks created by generative AI and picked the stocks likely to benefit.
CNBC Pro subscribers can read more here.
— Lucy Handley
Japan records first trade surplus in almost two years
Japan recorded a surprise trade surplus of 43.05 billion yen ($308.5 million) in June, marking the first time in 23 months that the world’s third-largest economy has posted a surplus.
This was a sharp reversal from the 1.38 trillion yen deficit recorded in May, and the 1.37 trillion yen seen in June 2022.
Government data showed that the surplus was mainly due to a fall in imports. Imports slid 12.9% year on year in June, while exports recorded a 1.5% rise compared with the same period last year.
— Lim Hui Jie
CNBC Pro: ‘They are real, they are proliferating’: Tech investor names 2 internet-of-things stocks to own
Major technology trends like artificial intelligence dominate headlines. But some niche plays like the Internet of Things (IoT) offer significant potential despite lower hype, according to tech investor Richard Clode.
Clode, fund manager at Janus Henderson Investors, named two IoT stocks he sees as long-term winners. He manages the $3.2 billion Horizon Global Technology Leaders Fund, which is invested in both stocks.
CNBC Pro subscribers can read more here.
— Ganesh Rao
CNBC Pro: ASML shares surged more than 30% this year. Here’s where Wall Street sees the stock going
Shares of ASML have soared this year on the buzz around semiconductor firms and artificial intelligence — its Netherlands-listed shares have jumped about 32% in the year to date, while its U.S.-listed ones have surged almost 40%.
But it’s facing a number of risks, including U.S.-China tensions.
Where will the stock go from here? CNBC Pro trawled through Wall Street research to find out.
CNBC Pro subscribers can read more here.
— Weizhen Tan
Second-quarter earnings scorecard
Second-quarter earnings season is just getting started, with 10% of S&P 500 companies posting results so far. Of the 50 companies that have reported, 64% have topped revenue estimates, while 80% have beaten earnings per share expectations, according to Refinitiv data.
Based on the blended growth rate, earnings are expected to fall more 8.2% from a year ago and revenues are expected to drop 0.8% year over year. The rate combines data from firms that have already reported data and those waiting to report.
— Samantha Subin
Goldman Sachs misses on earnings
Wall Street behemoth Goldman Sachs undershot expectations for the second-quarter on Wednesday, despite the firm trying to level expectations beforehand.
Goldman reported an adjusted $3.08 per share and $10.9 billion in revenue, while analysts polled by Refinitiv forecasted $3.18 and $10.84 billion, respectively. Goldman stock slipped 0.4% in premarket trading.
— Brian Evans
Regional bank stocks rise after first wave of earnings
Investors appear to breathing a sigh of relief after the first wave of regional bank earnings.
The SPDR S&P Regional Banking ETF (KRE) rose about 1% in early trading as investors and analysts shift through reports from Western Alliance, US Bancorp and others.
Shares of Phoenix-based Western Alliance rose more than 2% despite earnings per share of $1.96 per share, 2 cents below estimates, according to Refinitiv.
— Jesse Pound
Agricultural commodities rise Wednesday
Corn, wheat and soybeans jumped Wednesday. Concerns over dry weather forecasts in the U.S. Midwest and Russian air strikes on the Black Sea port of Odessa following its withdrawal from the Black Sea Grain Initiative spurred wheat prices higher.
Wheat futures are up 5.4% Wednesday and almost 6% week to date, on track for their best week since June 23.
Soybean futures are up 1.7% as of Wednesday morning, reaching a high of 437.4 dollars per short ton.
Corn futures jumped 3.1%Wednesday to 551.5 cents per bushel. Corn is up 7.2% week to date, on track for its best week since May 26.
— Hakyung Kim, Nick Wells