U.S. earnings, Hong Kong gains

Hong Kong-listed shares of Chinese electric vehicle companies rose in late morning trading after China’s commerce ministry revealed its plan for “healthy development of new energy vehicles” in the country.

Shares of BYD Company rose 2.7%, Nio jumped 3.3%, while Xpeng and Li Auto gained 1.2% each.

“The healthy development of new energy vehicle trade cooperation will help promote the transformation and upgrading of the automobile industry, and play an important supporting role in stabilizing and optimizing the structure of foreign trade,” the statement read.

The Hang Seng index gained 0.3%, while the CSI 300 index added 0.4%.

Earlier this year, BYD produced more than 3 million new energy vehicles in 2023, beating U.S. EV leader Tesla’s production numbers for a second straight year.

— Shreyashi Sanyal

Kakaobank shares jumped 7% on Wednesday after the digital payments firm reported higher fourth-quarter profit.

The company’s fourth-quarter net profit rose nearly 25% to 75.7 billion Korean won ($57.2 million) from a year earlier.

Kakaobank added 2.42 million new users to its platform, an 11.8% increase.

Operating revenue for the company stood at 663.7 billion Korean won ($501 million), a near 37% increase from the year-ago quarter.

— Shreyashi Sanyal

Australian energy firm Santos was the largest loser on the S&P/ASX 200 on Wednesday after merger talks with Woodside ended on Wednesday.

Shares of Santos plunged as much as 8.5%, while Woodside gained 2.38%.

Woodside said in an exchange filing that the two sides “ceased discussions regarding a potential merger.”

Santos also confirmed the announcement: “Following an initial exchange of information, sufficient combination benefits were not identified to support a merger that would be in the best interests of Santos shareholders.”

— Lim Hui Jie

Shares of Southeast Asia’s largest bank DBS Group rose 1.6% in early trading after reporting an increase in fourth quarter profit.

The Singaporean bank reported fourth-quarter net profit of 2.39 billion Singapore dollars, 2% higher than the SG$2.34 billion posted a year ago. The company benefited from higher interest rates.

But despite record profit in 2023, the lender cut compensation for its senior management including its chief executive, Piyush Gupta.

The variable compensation was collectively slashed by 21% from the previous year to account for a series of digital disruptions during the year. DBS said Gupta took a bigger cut of 30%, which amounted to SG$4.14 million.

DBS was the first of the three major Singapore banks to report fourth-quarter earnings. It maintained its full-year net income interest forecast for 2024 at the same levels as the last year.

The bank proposed a final dividend of 54 cents per share and 1-for-10 bonus issue.

Singapore’s main Straits Times index gained nearly 1% in the first hour of trading.

— Shreyashi Sanyal

New Zealand’s fourth-quarter unemployment rate came in at 4%, lower than the 4.2% expected by economists polled by Reuters.

It was higher than the 3.9% rate in the preceding quarter, and also more than the 3.4% recorded in the December 2022 quarter.

The country’s participation rate fell marginally to 71.9% in the fourth quarter, lower than the 72% seen in the third quarter.

— Lim Hui Jie

The Nikkei 225 index, one of Japan’s most important stock market benchmarks, could surge more than 50% over the next two years, according to Tokyo-based advisor Jasper Koll.

The former JPMorgan Japan equities research boss revealed what was needed to push up the stocks.

CNBC Pro subscribers can read more here.

— Ganesh Rao

Competition is fierce in the electric vehicle industry, with investor favorite Tesla competing with a slew of Chinese rivals.

But Jason Hsu, chairman and chief investment officer of Rayliant Global Advisors, believes that one stock will come out ahead.

According to FactSet, analysts covering the stock give it potential upside of 81.1% to the average price target, with 94% giving it a buy rating.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Cleveland Federal Reserve President Loretta Mester on Tuesday became the latest central banker to advocate a patient approach to cutting interest rates this year.

Like several other officials who have spoken recently, Mester said she’s not ready to start easing policy until she gains more confidence that inflation is on a stable path towards the Fed’s 2% goal. Having a strong economy allows policymakers to hold off on any dramatic moves, she added.

“If the economy evolves as expected, I think we will gain that confidence later this year, and then we can begin moving rates down,” Mester, a voting member this year on the rate-setting Federal Open Market Committee, said in prepared remarks for a speech in her home district. “My base case is that we will do so at a gradual pace so that we can continue to manage the risks to both sides of our mandate.”

Markets have moved back expectations for the first cut to May, with five total quarter percentage point moves lower priced in, according to the CME Group’s FedWatch futures gauge.

—Jeff Cox

Oil prices rose Tuesday as U.S. domestic crude production is expected to plateau this year after setting a record in 2023.

The West Texas Intermediate contract for March added 53 cents, or 0.73%, to settle at $73.31 a barrel. The Brent contract for April was settled at $78.59 a barrel, up 60 cents, or 0.77%.

U.S. crude output set a record of 13.3 million barrels per day in December before pulling back to 12.6 million bpd in January due to winter storms, according to data released by Energy Information Agency.

Domestic production will briefly return 13.3 million bpd in February but then decline through the middle of the year, according to the EIA. The U.S. will not exceed the production record of 13.3 million bpd until February 2025.

Record U.S. crude production has weighed on oil prices for months as traders worry that that the market is oversupplied amid a faltering economy in China.

— Spencer Kimball

The price of bitcoin rose 2% in afternoon tradin, pulling crypto related equities up with it.

Crypto exchange Coinbase gained more than 2%, while bitcoin proxy Microstrategy added 1.8%. Riot Platforms and Marathon Digital, the largest of the bitcoin miners, gain 4% and 3%, respectively.

The move in bitcoin coincided with a decline in the 10-year Treasury yield, which added to concerns about U.S. regional banks. New York Community Bancorp fell more than 20% Tuesday, extending a sell-off that began Wednesday. The Invesco KBW Regional Banking ETF lost 1.5%. Last year’s regional banking crisis proved to be a positive catalyst for bitcoin as investors who lost confidence in the banks turned to the cryptocurrency as a hedge against uncertainty.

Elsewhere in crypto, ether jumped more than 4%, lifted in part by bitcoin. It got a boost earlier in the day as investors rotated out of the coin tied to the Solana network, which suffered a brief outage in the morning.

— Tanaya Macheel

With just over half of S&P 500 companies having reported earnings for the previous quarter, here’s where this season stacks up, according to LSEG.

• Earnings are up 8.1% year over year
• Earnings are beating analyst expectations by 6.3%
• Revenue is up 3.2% year over year
• Revenue has topped expectations by 1.3%

— Jesse Pound, Robert Hum