Singapore manufacturing data, Japan service PPI

Japan’s services producer price index climbed 2.1% year over year in February, according to official data.

The services PPI had risen at the same rate in January as well.

The Bank of Japan ended its experiment with negative rates last week, along with other unconventional easing tools that were aimed at reflating its economy.

Markets in Japan traded higher on Tuesday, with the Nikkei 225 index trading well about the 40,000 level. The broader Topix index was up 0.08%.

— Shreyashi Sanyal

Regulators in China are urging banks to speed up approvals for new loans to private property developers, according to an exclusive report by Reuters.

The banking regulator wants faster loan approvals for residential projects under the “whitelist” mechanism, with effect from last week, Reuters said.

The so-called “whitelist” mechanism covers projects of state-backed and private developers that need fresh financing of 1.5 trillion yuan ($207.51 billion).

China is seeking to revive homebuyer sentiment, and these efforts come as prices of new homes fell in China for an eighth straight month in February.

— Lim Hui Jie, Reuters

As high inflation appears to be waning, a long-neglected set of stocks stands to benefit from consumers settling into a new normal spending pattern, according to HSBC.

The investment bank named two stocks that will benefit from the emerging trend—one of which uses AI to enhance its products. The bank also expects the stock to rise by more than 85% over the next 12 months.

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— Ganesh Rao

Chipmaker Nvidia has been in the spotlight over the past year, especially since its shares logged an astronomical 240% rise in 2023, on the back of the artificial intelligence buzz.

However, one investor is steering clear, saying the stock looks far too expensive.

“Even if some may say it’s not as expensive because earnings have gone up dramatically … when you see stocks start to triple over a year and a half to become one of the top on the S&P 500, you need to be cautious,” said David Dietze, managing principal and senior portfolio strategist at Peapack Private Wealth Management, which has over $10 billion of assets under management and administration.

Instead, he named the sectors — and four stocks — to consider buying instead.

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— Amala Balakrishner

Strong U.S. economic data and an artificial intelligence-powered rally have boosted stocks so far this year, and equities are likely to remain at their current levels into year-end, according to UBS.

“Our base-case scenario is for a soft landing in the US, in which economic growth moderates, inflation recedes further, and interest rates fall,” the bank wrote. “We expect this to create a supportive backdrop for equity markets. However, we think a lot of good news is already priced in at the index level.”

On the other hand, UBS also cautioned against near-term choppiness in the market that might materialize as traders adjust their expectations for the Federal Reserve’s policy easing.

— Lisa Kailai Han

Most investors and the Federal Reserve’s dot plot anticipate four rate cuts this year, but not Morgan Stanley’s global director of research.

“We continue to expect a June start, followed by cuts at the Sep, Nov, and Dec meetings,” the bank wrote. “Despite a higher long-run rate, the long-run growth projection was unchanged at 1.8%, indicating the Fed sees recent supply-side factors driving growth higher as temporary.”

Morgan Stanley research added that small-cap stocks could feel the pressure if U.S. Treasury yields continue to increase.

“While large caps have exhibited declining rate sensitivity over the past few months, small caps’ correlation with rates remains meaningfully negative, suggesting to us that they are more at risk than large-caps if UST yields move higher,” the bank wrote.

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