Asia markets mostly fall as Japan hovers near 33-year highs

Pharmaceutical company AstraZeneca is mulling a plan to spin off its China business and list it in Hong Kong, the Financial Times reported.

Citing three people familiar with the talks, the FT reported the U.K.-based company began discussing the idea with bankers several months ago. A listing in Shanghai was also possible, one of the three people told the FT.

Under the plans, AstraZeneca would carve off its operations in China into a separate legal entity, but would retain control of the business.

Citing a person briefed on the plans, FT also reported that a separated listing in either Hong Kong or Shanghai could insulate it politically from any moves by China to crack down on foreign companies.

Also, the separate listing could also help investors in the remaining company reassure themselves that they had less exposure to China-related risk, FT said.

— Lim Hui Jie

The week of June 19 will be a key period for central banks in the region, with the People’s Bank of China in focus ahead of its loan prime rate announcement and key policy meetings taking place in Southeast Asia.

Inflation numbers for Japan, Singapore and Malaysia will also be closely watched.

On Monday, the U.S. marks the Juneteenth federal holiday. Hong Kong will release its unemployment rate for the month of May.

China’s June loan prime rate announcement is scheduled for Tuesday with further easing expected from the central bank. The Reserve Bank of Australia will also release minutes from its latest monetary policy meeting.

Hong Kong will release its inflation figures for May on Tuesday as well.

On Wednesday, South Korea’s producer price index for May will be published. The Bank of Japan will release its April meeting minutes.

Mainland China and Taiwan will observe a market holiday for the Dragon Boat Festival from June 22 to the 24 and Hong Kong resumes trade on Friday.

New Zealand’s May trade figures are due on Thursday. The Philippines and Indonesia’s central bank rate decisions are also set to take place on that day.

On Friday, private surveys for Australia and Japan’s purchasing managers’ index will be published alongside inflation data for Japan, Malaysia, and Singapore.

— Jihye Lee

Oil prices dipped more than 1% as concerns over China’s economic recovery continue to loom over markets after major banks trimmed their 2023 GDP forecasts for the world’s largest oil importer.

Brent crude futures dropped 1.46% to $75.49 a barrel, while U.S. West Texas Intermediate crude futures shed 1.39% to $70.78 a barrel.

The cooling economic rebound forecast in China erased the more than 2% gains made by both benchmarks last week.

“The prospects of stronger demand in China helped push crude oil prices higher last week. Beijing issued larger than normal crude oil import quotas for domestic refiners,” ANZ’s analysts said in daily note Monday.

—Lee Ying Shan

U.S. stocks aren’t the only ones soaring this year.

Some global indexes have followed those gains and climbed.

Analysts are still optimistic about some parts of the U.S. market, but some expect international markets to do better this year.

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— Weizhen Tan

Morgan Stanley expects five of its top Asia stock picks to rise by more than 50% over the next 12 months.

The Wall Street bank is bullish on a set of Asian stocks as the broad MSCI Asia Pacific equities index has entered a new bull market, rising 25% from last October’s low.

Alibaba is the investment bank’s top pick in the China internet sector.

CNBC Pro subscribers can read more about the remaining 4 stocks here.

— Ganesh Rao

Stocks closed lower on Friday, with the S&P 500 notching its best week since March.

The 30-stock Dow Jones Industrial Average fell 108.94 points, or 0.3%, to close at 34,299.12. The tech-heavy Nasdaq Composite slipped 0.7% to finish the session at 13,689.57, while the S&P 500 fell 0.4% to close at 4,409.59. The S&P 500 and Nasdaq Composite’s Friday fall broke their six-session winning streaks.

— Brian Evans

Consumer inflation expectations tumbled in June, providing support for the Federal Reserve in its battle against rising prices.

The closely watched University of Michigan Survey of Consumers showed that one-year expectations plunged to 3.3%, down from 4.2% the prior month. That’s the lowest level since March 2021.

The headline reading for the survey posted a 63.9 reading, better than the Dow Jones estimate for 60.2 and up from May’s 59.2.

—Jeff Cox

Richmond Federal Reserve President Thomas Barkin said Friday that he would be fine with raising interest rates if inflation doesn’t continue coming down.

“I want to reiterate that 2% inflation is our target, and that I am still looking to be convinced of the plausible story that slowing demand returns inflation relatively quickly to that target. If coming data doesn’t support that story, I’m comfortable doing more,” Barkin said in prepared remarks for a speech in Maryland.

“I recognize that creates the risk of a more significant slowdown, but the experience of the ’70s provides a clear lesson: If you back off inflation too soon, inflation comes back stronger, requiring the Fed to do even more, with even more damage,” he added. “That’s not a risk I want to take.”

Barkin is a nonvoting member this year on the rate-setting Federal Open Market Committee.

— Jeff Cox

Federal Reserve Governor Christopher Waller on Friday vowed that the central bank would not back down in its efforts to bring down inflation.

“The Fed’s job is to use monetary policy to achieve its dual mandate, and right now that means raising rates to fight inflation,” Waller said in prepared remarks for a speech in Oslo, Norway.

Addressing the banking crisis in March, he rejected the notion that the Fed’s aggressive rate hikes were a cause.

“It is the job of bank leaders to deal with interest rate risk, and nearly all bank leaders have done exactly that. I do not support altering the stance of monetary policy over worries of ineffectual management at a few banks,” he said.

— Jeff Cox