Adani shares plunged further for second day of losses
Shares in Adani Group companies continued to see sharp losses for a second consecutive trading session in India after short-seller firm Hindenburg announced its short position in the conglomerate earlier this week.
Adani denied the claims in two separate statements, adding that the group is “evaluating relevant provisions under US and Indian law for remedial and punitive action against Hidenburg Research,” Adani Group’s legal chief, Jatin Jalundhwala, said in a statement
Shares of Mumbai-listed Adani Enterprises fell more than 5% in the India trading session on Friday. Adani Transmission fell 16.8%, Adani Green Energy shed 14.9% and Adani Power lost 8.4%. Adani Port’s share price also fell 8.4%.
Hindenberg doubled down on his initial position, emphasizing that Adani had not answered any of the questions raised in the claims.
“We fully stand by our report and believe that any legal action taken against us would be without merit,” he said.
— Jihye Lee
Tokyo inflation remains above the Bank of Japan’s target
Consumer prices in the Japanese capital Tokyo rose by 4.3% in January, higher than economists polled by Reuters.
The reading also remained above the Bank of Japan’s target of 2% inflation for an eighth consecutive month after a 2.1% increase in June 2022.
The Japanese yen strengthened 0.3% after the data was released and last traded at 129.82 against the US dollar.
CNBC Pro: These 6 global ETFs are the only ones to post annual gains for the past five years.
Only six global stock ETFs have consistently posted annual gains over the past five years, according to new analysis by CNBC Pro.
They are the only funds among 7,000 stock ETFs traded worldwide for:
- There is not a single year of negative returns between January 1, 2018, and December 31, 2022;
- And you must be in positive territory this year so far.
CNBC Pro subscribers can find out what ETFs are here.
– Ganesh Rao
Singapore house prices rose less in the last quarter of 2022
Private residential property prices in Singapore increased by 0.4% in the last quarter of 2022, a release from the Urban Redevelopment Authority showed.
The reading showed home prices rose less than 3.8% the previous period and the slowest growth since the second quarter of 2020.
House prices rose 8.6% for the whole year in 2022, the publication said, also less than the then 10.6% increase seen for the whole year in 2021.
— Jihye Lee
Australia’s producer price index rose 5.8% from a year ago
The producer price index in Australia increased 5.8% for the last quarter of 2022 on an annualized basis, data from the Australian Bureau of Statistics showed.
The reading was slightly lower than the print of the previous quarter of 6.4%, a signal inflation may be relieved in the nation.
On a quarterly basis, the index rose 0.7%, slower than the previous period’s reading of 1.9%.
There Australian Dollar strengthened slightly during the Asian morning session and last traded at 0.7123 against the US dollar.
— Jihye Lee
GDP, other fourth quarter data show the economic challenges ‘beginning to clear,’ economists say
Thursday’s GDP data added to a broader picture of economic growth in the fourth quarter, according to Curt Long, chief economist at the National Association of Federally-Insured Credit Unions. And this tells him that the economic outlook is improving.
“The provision of the big picture of economic growth in the fourth quarter is a positive one. Much of this growth was concentrated in building inventory, which is unlikely to grow at a similar pace in 2023,” Long said. “But with resilient consumer spending, low unemployment claims, and subdued inflation, some of the clouds that formed over the economy several months ago are beginning to clear.”
— Alex Harring
CNBC Pro: Buy the dip? Morningstar’s top strategist names 3 stocks trading at a steep discount
U.S. stocks are about 15% undervalued, according to Dave Sekera, chief U.S. market strategist for Morningstar, who says the extent of this undervaluation is rare.
Since late 2010, the market has traded at or below the current discount only 5% of the time, he said.
He picks three stocks that he says are trading at steep discounts.
CNBC Pro subscribers can read more here.
– Weizhen Tan
Tesla’s strong orders and weak margins have Wall Street analysts conflicted
Wall Street analysts are divided on Tesla after the electric car company’s latest quarterly results.
Tesla reported a beat on both earnings and revenue for the fourth quarter, easing investors’ fears of weaker growth in the company after recently issued a round of price cuts. While the move triggered a drop in used Tesla prices, they also supported demand for the cars.
“So far in January we’ve seen the strongest year-to-date orders ever in our history. We’re now seeing orders at almost twice the production rate,” Musk said during a call with analysts.
For Mark Delaney Goldman Sachs, that was “the most important part of the call.”
“Importantly, Tesla commented that since lowering prices it has seen the strongest year-to-date orders in its history, with orders running on 2X production. While we believe that this order rate cannot be sustained in light of the weak macroeconomic environment. , it would suggest that the company is tracking well in our delivery estimate of 1.8 million,” Delaney wrote.
Other analysts were more negative about the stock’s outlook, however, saying that Tesla’s automotive gross margin, which has been the lowest figure in the last five quarters, spells trouble ahead.
AllianceBernstein’s Toni Sacconaghi reiterated his negative rating on Tesla, saying the automaker’s latest results and earnings call had “something for bulls and bears,” adding that he remains “torn” on the company. While the strong orders are promising, the analyst said auto gross margins were too weak to ignore.
“Despite materially increasing our energy storage forecast, our FY EPS declined from $3.80 to $3.54 amid lower margins. Additionally, while no one (including Tesla) knows what the elasticity of demand is, we believe it uncertain whether wave demand will be sustained, particularly in China, where we believe further price cuts will be needed before the end of the year,” Sacconaghi wrote.
CNBC Pro subscribers can read the full story here.
— Sara Min
CNBC Pro: Morgan Stanley has a ‘simple’ technical book, names TSMC and others as stocks to buy now.
A recession may be coming, and the semiconductor sector – widely seen as cyclical and volatile – could be an easy safe haven for investors.
Morgan Stanley says chip stocks have historically done well in past recessions. The bank named its biggest chip stocks Asia – giving a single 40% head.
Pro subscribers can read more here.
— Zavier Ong
US GDP rose slightly more than expected in the fourth quarter
The US economy expanded at an annualized rate of 2.9% in the fourth quarter, slightly exceeding a Dow Jones estimate of 2.8%. The Commerce Department report comes even as inflation persists and the Federal Reserve continues to raise rates.
Consumer spending rose 2.1% for the period, slightly down from 2.3% in the previous period but still positive.
Bitcoin is heading for the best month since 2020
Bitcoin remains in rally mode despite pulling back the past two days and the cryptocurrency is on pace for its best month since 2020. Some investors see crypto prices as a leading indicator of investors’ risk appetite.
So far this month and year, bitcoin is up nearly 40% and is poised to post its best monthly performance since December 2020, when it gained 49.47% for the month.
Meanwhile, the S & P 500 rose about 5% this month.
— Tanaya Macheel