Asia markets trade mostly higher as investors come back from long weekend

Shares of Nintendo rose in Monday’s afternoon trade as “The Super Mario Bros. Movie” was released in theaters with expectations to see a massive opening weekend despite poor reviews by critics.

Nintendo traded 3.6% higher — the movie opened with reportedly the biggest opening weekend in the year so far.

The movie took in a total of about $204 million in the U.S. over its first five days since release, and added $173 million worldwide.

— Jihye Lee

The U.S. Navy on Monday morning said it embarked on a “navigational rights mission” of its own in the South China Sea with its guided-missile destroyer USS Milius.

The operation “asserted navigational rights and freedoms in the South China Sea,” the U.S. Navy said in a release.

This comes after the Chinese military conducted a three-day military drills over the weekend after Taiwanese President Tsai Ing-wen’s trip to the U.S., including a meeting with House Speaker Kevin McCarthy, Reuters reported.

State media added the Chinese military drills included simulations of attacks on Taiwan as a measure to “pressure Taiwan independence forces,” it said.

— Jihye Lee

Triple-digit crude oil prices “seems unlikely” given China’s lackluster demand and how the market has already priced in OPEC’s recent output cuts, said lead oil analyst at Kpler, Matt Smith.

He added that Saudi Arabia’s removal of barrels off the market at the start of the year always takes the edge off OPEC’s production cut.

“We think the Saudis have actually been taking barrels off the market through the first quarter of this year… it also means that the impact of this OPEC production cut isn’t going to have as big of a bang for its buck.”

Brent crude futures were last trading 0.27% lower at $84.89 a barrel, while the U.S. West Texas Intermediate futures stood 0.17% lower at $80.56 per barrel.

—Lee Ying Shan

Taiwan Semiconductor Manufacturing reported a 11.1% year on year increase in revenue for February, with sales coming in at NT$163.17 billion ($5.35 billion).

Revenue for January and February 2023 totaled NT$363.23 billion, an increase of 13.8% compared to the same period in 2022.

Shares of TSMC were trading 0.19% on Monday morning.

This week will see key economic data from some of the largest global economies, including the U.S., China, and India.

Most notably, investors will be looking at the U.S. consumer price index release on Wednesday, with Refinitiv data forecasting that inflation is expected to come in at 5.2% on a year on year basis, lower than February’s figure of 6%.

China and India will also release their inflation figures for March on Tuesday and Wednesday respectively, while South Korea’s central bank interest rate decision is due on Tuesday.

In Southeast Asia, the Philippines will release its trade balance for February, while Singapore will round off the week with its flash GDP estimates for the first quarter of 2023.

— Lim Hui Jie

Asia-Pacific is aging rapidly — especially China.

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— Weizhen Tan

Samsung Electronics estimated its first-quarter operating profit likely fell to 600 billion won ($455 million) according to the company’s latest earnings guidance released on Friday.

That’s a 95.7% plunge from its operating profit of 14.12 trillion won reported in the same quarter in 2022.

Revenue is expected to have fallen nearly 20% compared with last year’s 63 trillion won, Samsung said in its release.

Shares of Samsung Electronics sharply rose 3.2% at the open following the company estimates.

— Jihye Lee

The Bank of Korea is expected to hold its benchmark interest rate steady at 3.5% again in its monetary policy decision on Tuesday, according to Reuters survey of economists.

DBS was the outlier in the survey and expects the BOK to raise rates by 25 basis points to 3.75%.

The South Korean central bank in its last meeting in February paused its tightening cycle after seven consecutive rate hikes since March 2022.

The Reuters poll also expects the central bank to start cutting rates by as much as 50 basis points in the first quarter of 2024 and even further in the third and fourth quarter of next year.

— Jihye Lee

The first-quarter earnings season kicks off next week with big banks including JPMorgan and Citigroup reporting. Consensus expectations are for S&P 500’s earnings per share to fall by 7% year over year, the largest decline since the third quarter of 2020, according to Goldman Sachs. It will also mark a “significant deterioration” from the 1% decline in the prior quarter, the bank said.

— Yun Li

St. Louis Federal Reserve President James Bullard said Thursday he doesn’t see inflationary pressures going away soon.

We’ve got a long ways to go and I think inflation is going to be sticky going forward, it’s going to be difficult to get inflation back down to the 2% target … so we are going to have to stay at it in order to apply pressure to make sure inflation gets back down,” Bullard said, according to Reuters.

The Fed is scheduled to meet next month, with traders pricing in a near 50-50 chance of another rate hike.

— Fred Imbert

The two-year Treasury yield, most sensitive to monetary policy, dipped 3 basis points to 3.73% Thursday. The short-term rate has fallen for five straight sessions in a row.

The Federal Reserve is next scheduled to meet in early May, and the market is split on whether the central bank will pause or hike rates by a further 25 basis points, according to the CME Group’s FedWatch tool.

— Yun Li

Trading volume was muted on Thursday ahead of the holiday. As of 2:20 pm ET, only 38 million shares of SPDR S&P 500 ETF changed hands, much lower than the 30-day average of over 103 million shares.

— Yun Li