Asia-Pacific Shares Trade Higher as Investors Gear Up for Fed Rate Hike Decision

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This is CNBC's live blog covering Asia-Pacific markets.

Asia-Pacific shares traded higher as investors looked ahead to the Federal Reserve's Wednesday meeting, as well as some economic data in the region.

Australia's S&P/ASX 200 was up 0.33% to close at 7,501.7. Japan's Nikkei 225 gained 0.07% to end at 27,346.88 even as Japan's factory activity logs a third consecutive month of contraction in January.

South Korea's Kospi advanced 1.02% to 2,449.8 and the Kosdaq rose 1.41% to 750.96, as South Korea's export numbers in January fell 16.6% on an annualized basis.

Hong Kong's Hang Seng index rose 0.38% in early trade. Mainland China's Shanghai Composite added 0.9% to 3,284.92 and the Shenzhen Component was up 1.31% to close at 12,158.19 Hong Kong is set to release its fourth quarter GDP data later in the day.

Overnight on Wall Street, major indexes rose on the back of strong earnings and encouraging inflation data.

On Wednesday, the Fed will announce how much it is increasing interest rates to tackle high inflation, and markets are expecting a 25 basis point, or 0.25 percentage point, bump from the central bank.

India shares gain as budget reveals increase in capital expenditure

Indian shares strengthened on Wednesday as the country's finance minster unveiled the budget.

The Nifty 50 Index traded 1.5% higher, while the S&P BSE Sensex gained 0.8% during Asia's afternoon trading hours. The Indian rupee fell by 0.06%, and stood at 81.7 against the greenback.

Finance minister Nirmala Sitharaman presented the budget before parliament, which focused on job creation as well as increased spending in capital expenditure.

Sitharaman announced that outlay for capital spending will be increased by 33% to 10 trillion rupees ($122.3 billion) in the fiscal year 2023 to 2024.

— Charmaine Jacob

China's factory activity contracts again

China's factory activity in January signaled a further contraction from previous readings, albeit at a slower pace, marking the sixth monthly contraction in a row.

The Caixin manufacturing Purchasing Managers' Index for January came in at 49.2 on Wednesday, a slightly higher reading than December's 49.0 but still missing Reuters' expectations of 49.5

"Both manufacturing supply and demand continued to shrink last month. Fallout from the pandemic was a drag on production and sales," Caixin reported in the press release.

—Lee Ying Shan

CNBC Pro: This electric vehicle ETF soared 20% in January

The Global X Lithium & Battery Tech ETF just had its best week in nearly a year, and also outperformed in January.

That's a turnaround from its roughly-30% loss in 2022.

Automakers makers have been in the spotlight this month, with Tesla slashing prices to boost demand and Ford following suit. Analysts say Tesla's price cuts could spur an EV pricing war.

Using FactSet, CNBC Pro screened the Global X Lithium & Battery Tech ETF for stocks that analysts say have potential upside of at least 10%, on average, and buy ratings from over 40% of analysts covering them.

CNBC Pro subscribers can read more here.

— Weizhen Tan

Japan's factory activity shrinks again in January

Japan's factory activity logs another contraction in January, marking a third straight month of contraction.

The au Jibun Bank Flash Japan Manufacturing Purchasing Managers' Index held steady at 48.9, below the 50-point mark separating growth from contraction. The contraction follows December's reading of the same figure.

The rate of decline in manufacturing activity was, however, the slowest since October 2022.

"Input price inflation abated in January, with lower fuel costs helping to offset pressure on business expenses from higher raw material and energy bills," au Jibun Bank stated in their report.

—Lee Ying Shan

CNBC Pro: What Wall Street is expecting from Shell, TotalEnergies and BP earnings

European energy giants are expected to post record annual profits this earnings season, despite multi-billion-dollar windfall taxes.

On Thursday, Europe's largest energy company Shell is due to report earnings. Britain's BP and France's TotalEnergies are also due to report the following week.

CNBC Pro subscribers can read more on Wall Street's take on the upcoming earnings season.

— Ganesh Rao

South Korea marked worst trade deficit ever in 2022

South Korea saw a trade deficit of $47.5 billion for the year of 2022, official data from the customs agency showed.

It marked the worst trade deficit since the agency started compiling data in 1956 and more than the $20.6 billion trade deficit seen in 1996.

For the month of January, exports fell $46.3 billion, or 16.6% and imports fell $59 billion, or 2.6%, data showed, resulting in a deficit of $12.7 billion.

– Jihye Lee

Sea Limited falls 5.75% after e-commerce arm announces Malaysia expansion

Shares of Sea Limited traded 5.75% lower on Monday after its e-commerce arm Shopee committed to expanding its investments in Malaysia and creating more than 2,000 jobs in the process.

The plan was shared with Malaysia's Minister of International Trade and Industry, Tengku Zafrul Azi, during his visit to Sea and Shopee's headquarters in Singapore on Jan. 29.

The proposed expansion plans in Malaysia involved the setting up of cloud services, data hosting and processing, as well as a new logistics e-commerce warehouse, according to a press release from the ministry.

Shopee has been struggling with profitability and reducing its headcount. In December, Sea's founder Forrest Li wrote in an internal memo that the company "needs to focus on profitability after a difficult 2022" amid macro economic challenges and that it was freezing salary increases for most staff, Bloomberg reported.

It also recently closed its operations in Poland, after exiting from France, India and Spain.

- Sheila Chiang

Defiance's NFT ETF is shutting down

The Defiance Digital Revolution ETF (NFTZ) will begin liquidation next month, according to a press release, making it the latest casualty in last year's crypto decline.

The fund holds stocks that have exposure to the non fungible token market, or NFTs, which soared in value at the height of the crypto boom before seeing trading volume dry up quickly last year.

The Defiance fund, which launched in December 2021, has a total return of -54% over the past year and has less than $6 million in assets under management.

— Jesse Pound

Barclays reiterates equal weight on Apple, expects a miss in latest quarter

Investors can expect lackluster results from Apple when it reports this week, according to Barclays.

Analyst Tim Long reiterated an equal weight rating on Apple, saying the firm dealt with a challenging holiday season, and could issue weaker guidance.

"We see a miss for Dec-Q across hardware and Services. March-Q looks to be at risk due to deteriorating demand trends," Long wrote in a Monday note.

"What started out as production-driven cuts have moved to demand weakness across product categories. We are also concerned by decelerating Services growth. At a 20% premium to the S&P 500, we see the stock as fairly valued at best," Long continued.

Apple is expected to report its first year-over-year revenue decline since 2019. The tech giant couldn't make enough of its high-end iPhone models when its assembly plant in China was shut down because of Covid.

Apple shares are up more than 10% this year amid a broad rally for tech stocks. The iPhone maker was down more than 26% in 2022. The stock ticked up 0.2% in Tuesday morning trading.

Apple reports earnings after the bell Thursday.

— Sarah Min

Stocks close higher in final trading day of January

Stocks added to a strong January rally in the final trading day of the month.

The Dow Jones Industrial Average rose 368.95 points, or 1.09%, to 34,086.04. The S&P 500 gained 1.46% to 4,076.60. The Nasdaq Composite added 1.67% to 11,584.55, in what was its best January since 2001.

— Sarah Min

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