Asian markets rise as Wall Street is lifted by hopes of debt ceiling deal

Nomura cut its full-year China growth forecast from 5.9% to 5.5%, according to a statement on Wednesday.

“China’s post-Covid recovery has rapidly lost steam,” Nomura’s Ting Lu wrote, noting that the latest activity data and high-frequency data in May show that momentum has lost steam “in part due to weak confidence among consumers and business investors.”

“As disappointment sets in, we see an increasing risk of slower activity growth, rising unemployment, persistently lower inflation, falling market interest rates and a weaker currency,” he wrote.

Nomura added that it is also lowering its full-year 2024 forecast for China’s gross domestic product from 4.4% to 4.2%. It now expects second-quarter GDP to grow by 7.8%, the third quarter to grow by 4.9% and the final quarter of the year to grow by 5.0%.

– Jihye Lee

Japanese markets extended their winning streak on Thursday, with Nikkei 225 leading gains in the region and continues to trade above the 30,000 mark.

The Topix maintained levels not seen since August 1990.

Energy and technology stocks led the Topix, with its top gainers Sony and electronics companies Tokyo Electron.

Meanwhile, Factset revealed that electronics stocks drove the Nikkei, with the top gainer on the index being the semiconductor test equipment maker Advantestfollowed by Tokyo Electron.

— Lim Hui Jie

Japan’s trade deficit has decreased by almost half in April, falling to 432.41 billion from 854.93 billion a year ago.

Most notably, imports fell 2.3% year-on-year, more than the 0.3% expected by economists polled by Reuters.

Exports were broadly in line with expectations, rising 2.6% year-on-year versus the 3% expected.

— Lim Hui Jie

New Zealand’s producer price index rose by 0.3% in the first quarter of 2023 compared to the last quarter of 2022, government data showed.

The input price index for input goods rose 0.2% – with the agricultural price index up 0.7% and the capital goods price index up 1%.

The New Zealand Dollar slightly strengthened to 0.6242 against the US dollar.

– Jihye Lee

Nvidiathe company behind the most powerful chips used to enable artificial intelligence (AI), has the potential to increase its share value by five times within the next ten years, according to investor and fund manager Philip Ripman.

Investor enthusiasm for Nvidia centers around its business model of selling high-performance graphics processing units (GPUs) necessary to run the complex algorithms behind artificial intelligence technology. As AI has become increasingly important in all industries, the demand for graphics processors has increased.

CNBC Pro subscribers can read more of Ripman’s views on Nvidia here.

— Ganesh Rao

The year is nearing its halfway point and global stocks have fared much better than they did in the volatile 2022.

Many stocks have soared and beaten the overall market, but there is still more room for investors to be bullish.

CNBC Pro checked for stocks that are beating the market nearly halfway through the year — and that analysts love. One is a Buffett favorite, and two more are top picks by BofA and Citi.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Montana became the first US state to impose a complete ban on the video app TikTok.

Montana Gov. Greg Gianforte said in a statement, “The Chinese Communist Party’s use of TikTok to spy on Americans, violate their privacy and collect their personal, private and sensitive information is well documented.”

“Today, Montana is taking the most decisive action of any state to protect Montanans’ private data and sensitive personal information from being harvested by the Chinese Communist Party,” he wrote.

The governor also instructed the state’s chief information officer and executive agency directors to “prohibit the use of all social media applications associated with foreign adversaries on government equipment and for government business,” the press release added.

TikTok called the move “a bill that infringes on the First Amendment rights of the people of Montana,” adding that the ban is “unlawful.”

“We want to reassure Montanans that they can continue to use TikTok to express themselves, earn a living and find community as we continue to work to defend the rights of our users in Montana and beyond,” TikTok said in a statement.

– Jihye Lee

The Federal Reserve’s rate-hike cycle may be taking a break — and Bank of America thinks some smaller names may outperform.

The central bank implied in its statement after the May meeting that it may not raise rates beyond the current range of 5% to 5.25%. Bank of America said its economists expect cooling inflation and a mild recession in the coming months after the pause in monetary policy tightening.

If that’s the case and the Fed ends its rate hike campaign, investors may want to consider investing in some small-cap stocks that have performed well historically.

Subscribers to CNBC Pro can read about which stocks Bank of America thinks will outperform here.

—Hakyung Kim

Tech stocks climbed higher during Wednesday’s rally. The Technology Select Sector SPDR Fund (XLK) rose 1.2% to hit a 52-week high. It is the third session in a row that the fund reached that milestone.

The technical ETD is up 2% this month, pushing its 2023 gains to nearly 24%.

Investors leaned away from defensive stocks on Wednesday. Of the 11 S&P 500 sectors, only health care, consumer staples and utilities traded in negative territory during midday trading.

Healthcare stocks fell 0.9%, while utilities fell 0.5%. Consumer goods decreased by 0.4%.

—Sarah Min

House Speaker Kevin McCarthy expressed optimism Wednesday that while debt ceiling negotiations face obstacles, he foresees no default.

“I think at the end of the day we don’t have a debt default,” he said on CNBC’s “Squawk Box.” “I think we finally got the president to agree to negotiate.”

The comments come a day after President Joe Biden met with top congressional leaders to try to find a way around the debt default. McCarthy said the talks resulted in a “structure” to find a solution while noting that the deadline remains “tight” as Republicans look for spending cuts and Democrats seek a clean bill with no strings attached.

“There comes a moment in time when you hit the wall,” McCarthy said. “You cannot continue on this path if you want to continue to be the strongest nation in the world.”

-Jeff Cox