Asia-Pacific markets trade lower; China keeps LPR steady

Malaysian voters are leaning towards conservatism in weekend polls, analysts said

'Moderate Malays' will be stunned by Malaysian election results, Najib's brother says

The absence of a clear winning coalition in Malaysia’s elections over the weekend shows that politics in the country is changing, analysts said. While reforms to the long-ruling Barisan Nasional coalition were once popular, voters including youth are leaning towards more conservative and religious parties.

Oh Ei Sun, senior fellow at the Singapore Institute of International Affairs, told CNBC that the liberal opposition party Pakatan Harapan’s “somewhat reformist image” is under threat for some voters.

“I think it will be extremely difficult for PH, despite winning the most seats, to form a coalition government or even to join,” Oh said.

Former prime minister and long-time statesman Mahathir Mohamad’s historic loss of his Langkawi seat shows that politics in Malaysia is shifting, according to Better Malaysia Assembly counsel and brother of former prime minister Najib Razak, Nazir Razak, who is in the was imprisoned.

“It’s extraordinary. I mean, it’s like saying, you know, people don’t vote for brands. They vote for what you can deliver for them. So I think politics is changing,” he told CNBC ‘s “Squawk Box Asia” said Monday.

Read the full story here.

— Su-Lin Tan

Malaysia sees sell-off in ‘sin’ stocks after right-wing party wins more seats

Malaysian coalitions' party manifestos mention nothing close to fiscal responsibility: analyst

Stocks linked to gambling and alcohol consumption in Malaysia sold off on Monday after an Islamist party won more seats than it held before Saturday’s election.

In the past, Parti Islam Se-Malaysia, or PAS, has made it very clear that it does not want gaming and alcohol in Malaysia, said Anand Pathmakanthan, head of regional equity research at Maybank Kim Eng.

Gambling-related companies such as Magnum shares fell 8%, while Genting lost 5.13% and Sports Toto 6.86%. Beer companies listed in Malaysia, including Carlsberg, fell about 5%, and Heineken fell more than 6%.

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“The sin sectors remain at risk,” says Pathmakanthan, although he said PAS’s more radical policies may have been watered down.

“What we need now is clarity on how they are going to treat these sectors going forward, with PAS now having a much bigger say,” he said.

The broader benchmark index earlier fell as much as 1.49%, but was last down 0.5%.

— Abigail Ng

Oil prices fall as China faces Covid worries, Goldman Sachs cuts forecast

Oil prices fell by almost a dollar as concerns about Covid grew in China, while the country saw the first virus-related deaths recorded since May this year.

Brent crude futures shed less than a dollar, or 0.9%, to stand at $86.83 a barrel and American West Texas Intermediate futures fell 1.09% to $79.21 a barrel.

Goldman Sachs cut its forecast for Brent oil by $10 to $100 a barrel for the fourth quarter of 2022, citing depressed demand in China with growing concerns over Covid and insufficient details of the latest Group of 7 price cap on Russian oil.

“We believe the market is right to be anxious about the fundamentals going forward,” economists led by Jeffrey Currie said in the note, adding the potential for further curbs in China is on par with the latest production cut by OPEC+.

– Lee Ying Shan

Hong Kong movers: Reopening and tech stocks fall as China reports Covid-related deaths

Trading houses in Japan rise as Berkshire Hathaway reportedly increases stake

Shares of some Japanese trading houses rose early in the Asia session, despite pullbacks in the region’s markets, after billionaire Warren Buffett’s Berkshire Hathaway increased its stake in the firms, according to individual regulatory filings.

Berkshire increased its stake by more than 1 percentage point Mitsubishi, Mitsui & Co, Itochu, Marubeni and Sumitomo to hold more than 6% in each of the firms, the filings showed.

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Japan-listed shares of Mitsubishi rose 1.89% in the morning session, Marubeni rose 2.12% and Sumitomo rose more than 1%. Itochu was also up 0.84% ​​and Mitsui was up 0.16%.

It comes days after Berkshire Hathaway disclosed that it had increased its holdings of Taiwan Semiconductor Manufacturing Company’s U.S. depositary receipts, sending Taiwan-listed shares of the company up more than 10% in the Asia session.

– Jihye Lee

China keeps its lending prime rates on hold as expected

China left its benchmark lending rate unchanged for a third month in a row, according to an announcement from the People’s Bank of China.

The one-year loan prime rate is steady at 3.65%, and the five-year rate is also held at 4.3%, the notice said.

— Abigail Ng

South Korea saw exports fall further in the first 20 days of November

South Korea’s exports for the first 20 days of November fell 16.7% year-on-year, with demand from China lagging behind, according to data from the customs agency.

The slump in exports is a sharp drop from the 5.5% decline seen in October compared to the same period a year ago.

Imports also fell 5.5% for the first 20 days of November, leading to a slight improvement in the trade deficit – $4.4 billion for the period, compared to a $4.9 billion deficit recorded in October has been reported.

The country recorded a total of $40 billion in trade deficit year-to-date, statistics from the agency showed.

– Jihye Lee

CNBC Pro: Morgan Stanley’s Mike Wilson predicts S&P 500 bottom, calls it a ‘fantastic buying opportunity’

Morgan Stanley’s chief US equity strategist Mike Wilson says we are in the “final stages” of the bear market, but the situation will remain challenging for a while.

He predicts when – and at what level – the S&P 500 will hit a “new low”.

CNBC Pro subscribers can read more here.

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— Weizhen Tan

China is expected to keep its benchmark lending rates steady, Reuters poll says

China’s central bank is expected to keep its one-year and five-year lending prime rates on hold, according to analysts polled by Reuters.

The one-year rate currently stands at 3.65%, and the five-year LPR is at 4.3%.

The People’s Bank of China last cut both rates in August.

China’s offshore yuan was weaker at 7.1376 against the US dollar before the decision early Monday.

— Abigail Ng

CNBC Pro: Strategist Says Chinese Tech Stocks Like Alibaba Are ‘Deeply Undervalued’

This year’s 30% drop in the value of Chinese Big Tech stocks, such as Alibabamade them “incredibly cheap”, according to investment bank China Renaissance.

Its head of equities, Andrew Maynard, believes not only that the stock market appears to have bottomed, but also that investors could miss out on a rally if they remain underweight China.

“Without a shadow of a doubt, underweight China is going to cost you going forward,” Maynard said.

CNBC Pro subscribers can read more here.

– Ganesh Rao

Markets are watching for more clues about Fed hikes and the economy in the week ahead

Investors may be a little more cautious in the week ahead, with stocks looking for direction in quiet trading and the bond market’s warnings about a recession intensifying.

The Thanksgiving holiday on Thursday should mean markets are likely to be quiet on Wednesday and Friday. Retailers will monitor Black Friday holiday shopping reports for consumer feedback.

“This is really a week where data dependency is the key phrase,” said Julian Emanuel, senior managing director at Evercore ISI. “The prejudice [for stocks] is higher unless data continues to deteriorate and the Fed remains on its hawkish slant … which has clearly strengthened in the past 48 hours.”

Check out our full dive into what to expect in the week ahead here.

— Patti Domm, Tanaya Machel


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