Taiwan elections, the People’s Bank of China keeps the multilateral fund steady, and inflation in Japan

Indian stock markets started the week on a positive note, with the benchmark Nifty 50 index hitting a record high of 22,081.95. The index rose in the latest trading by 0.63%.

The BSE Sensex crossed the 73,000 level for the first time, trading 0.76% higher on Monday.

The Sensex is up about 18.7% in 2023, while the Nifty is up about 20% in the same period. Indian stocks rose to new highs last year on the back of strong growth expectations, rising domestic participation and optimism ahead of the general elections.

Indian IT companies were the leaders on this day.

Cocoa has jumped to its highest levels in 46 years as concerns over supply continue to grow. Cocoa futures rose to $4,323 per metric ton, the highest level since September 1977, according to data from FactSet.

Cocoa prices made big gains last year after West African supplies were hit hard by heavy rains amid other problems including fungal diseases.

BMI, a research unit of Fitch Solutions, does not expect a significant easing of these supply constraints in 2024. In a recent research note, analysts estimate that cocoa production and quality from major producers in Ivory Coast and Ghana could continue to be compromised by “previous surplus “. Rainfall and crop diseases.”

-Li Ying Shan

Shares of Chinese technology company Baidu fell more than 8% on Monday, following a report in the South China Morning Post that the Chinese military tested its artificial intelligence system on Baidu’s Ernie Bot, which uses large language models similar to ChatGPT.

“Chinese scientists are teaching experimental military AI more about confronting unpredictable human enemies with the help of ChatGPT-like technologies,” the report, released late Friday, said.

Citing scientists involved in the project, SCMP reported that a research laboratory of the People’s Liberation Army (PLA) Strategic Support Force tested the AI ​​system on Baidu’s Ernie and iFlyTek’s Spark.

PLASSF is the Chinese military’s space, cyber and electronic warfare force.

In response to the SCMP, Baidu said on Saturday that it “does not have any other affiliation or partnership with the academic institution in question.”

China’s central bank kept the interest rate on medium-term policy loans unchanged in a surprise move on Monday, but continued to pump liquidity.

The People’s Bank of China said in a statement that it kept the interest rate at 2.50% on about 995 billion yuan ($138.84 billion) of one-year medium-term lending facility loans.

A poll conducted by Reuters expected that the People’s Bank of China would reduce the interest rate of the multilateral fund.

Reducing the Multilateral Fund would have helped boost China’s economic recovery.

The CSI 300 index trimmed some of its previous losses, falling by about 0.29% after the decision.

– Shreyashi Sanyal

The Taiwan-weighted index started the week up 0.5% after Lai Ching-te won the island’s presidential election on Saturday.

Lai helped secure the Democratic Progressive Party’s third consecutive victory. A staunch China skeptic, Lai won more than 40% of the popular vote and said he was “determined to protect Taiwan from threats and intimidation from China.”

Beijing, which often described Lai as The “stubborn worker for Taiwan independence” and dangerous separatist rejected his victory.

Lai has pledged to remain open in his governing style, but his government has not yet formed a parliamentary majority. His victory also raised concerns about tepid Sino-US relations as well as security in the Indo-Pacific region.

Taiwanese stocks rose more than 26% in 2023, while China’s CSI 300 index fell more than 11% last year.

Semiconductor stocks had a good year in 2023, rebounding from post-pandemic underperformance in 2022.

The PHLX Semiconductor Index (Sox) is up 65% in 2023, outpacing the S&P 500.

Banks like BofA and UBS remain bullish on the semiconductor sector despite its strong run in 2023.

CNBC Pro delved into recent research conducted by Wall Street in January to look for the top semiconductor picks for 2024 cited by analysts.

Subscribers can read more here.

-Weezin Tan

Europe’s utilities sector may have been under pressure over the past three years, but Goldman Sachs says a turnaround is underway, as it names stocks to play the industry in 2024.

“We believe that improved expectations on inflation and interest rates are likely to favor capital-intensive/longer-term assets, such as renewable energy (where the capital cycle appears to have reversed favorably, as evidenced by rising yields) and power grids (where the capital cycle appears to have reversed favorably, as evidenced by rising yields) Money has turned favorably, as evidenced by rising yields) and energy grids (as the market appears to be ignoring incremental organic growth opportunities),” the bank’s analysts wrote.

The investment bank has named a group of stocks that it expects to rise by 30%.

CNBC Pro subscribers can read more here.

– Amala Balakrishner

US crude oil prices on Friday followed a familiar pattern in response to rising tensions in the Middle East, rising briefly due to the latest escalation before falling later in the day.

West Texas Intermediate crude futures briefly broke $75 a barrel after the US and British airstrike on Houthi militants in Yemen, but retreated later in the session to settle at $72.68. Brent crude futures exceeded $80 per barrel before settling at $78.29.

On Friday, several tanker companies suspended traffic towards the Red Sea after the air strikes. But traders remain unconvinced about the possibility of a broader conflict erupting in the Middle East and disrupting crude oil supplies. Analysts say the Strait of Hormuz is the real potential flashpoint that could push prices higher.

“The market will wait to see if we see this spreading to an important oil waterway like the Strait of Hormuz,” Helima Croft of RBC Capital Markets told CNBC on Friday.

-Spencer Kimball

The producer price index fell 0.1% in December, a sign that inflation may be declining. Economists polled by Dow Jones expected a 0.1% increase.

-Fred Imbert

Citigroup shares rose slightly on Friday after CEO Jane Fraser announced a new wave of job cuts to boost the bank’s stock price and earnings results.

Citigroup said that 20,000 employees, or about 10% of its workforce, will be laid off in the “medium term” as part of a new overhaul of the company. Shares had earlier risen nearly 2% on the news.

The layoffs were announced after the bank reported a loss of $1.8 billion in the fourth quarter, which was related to various risks and expenses. The company’s fourth-quarter revenue was $17.44 billion, below the $18.75 billion expected by analysts surveyed by LSEG.

-Lisa Kailai Han

Shares of JPMorgan Chase rose more than 2% premarket even after the bank reported lower fourth-quarter earnings due to a $2.9 billion charge related to regional bank failures last year.

Specifically, the bank said that profits fell by 15% to 9.31 billion year-on-year.

– Fred Imbert, Hyo-sun