Aurelia Butler

(Reuters) – A look at the day ahead in Asian markets.A tech-fueled whoosh pushed Wall Street higher on Tuesday, which should give Asian markets a good foundation to build on at the open on Wednesday, but spiking U.S. bonds yields on the back of hotter-than-expected U.S. inflation data could limit the upside.There’s nothing on the local economic and policy calendar likely to move the Asian market dial much on Wednesday, with only New Zealand food prices, Indian trade and Indonesia consumer confidence data scheduled for release.Investor sentiment across Asia seems to be holding up well. The MSCI Asia ex-Japan index rose nearly 1% to a seven-month high on Tuesday, Chinese stocks hit their highest in nearly four months, and the correction in Japan has fizzled out for now.All that was before the rebound on Wall Street – the S&P 500 rose to a new record close and the Nasdaq gained 1.5%, boosted by a 7% bounce in market darling Nvidia (NASDAQ:NVDA) and 12% surge in Oracle (NYSE:ORCL). This was despite a solid rise in U.S. bond yields – the 10-year yield chalked up its biggest increase in three weeks – after consumer inflation figures for February came in slightly hotter than expected.U.S. equities have not risen often on days when Treasuries have sold off, so it may be premature to read too much into it. But the bullish view would be that it highlights the confidence underpinning the market, the resilience of tech and AI, and the potential upside still to run.The question for Asian markets is whether these tailwinds offset the headwinds of higher bond yields and stronger dollar.Improving domestic sentiment helped lift Chinese markets on Tuesday after the country’s No.2 property developer China Vanke said the impact of a Moody’s (NYSE:MCO) ratings downgrade on its financing activities was “controllable”.Successfully tackling the property sector crisis is key to reviving wider economic growth, fighting off deflation, and reversing the torrent of capital outflows. It’s a tall order but the 13% rebound in Chinese stocks in the past month points to some degree of optimism.Bank of Japan Governor Kazuo Ueda, meanwhile, cooled some of the bubbling optimism on Japan’s economy on Tuesday, telling lawmakers that the economy was recovering but also showing some signs of weakness.The slightly bleaker remarks come ahead of the BOJ’s policy meeting next week where the board will debate whether the outlook is bright enough to phase out its massive monetary stimulus.Ueda’s remarks helped push the two-year Japanese yield back from its 13-year high, while the yen had its biggest fall in a month.Here are key developments that could provide more direction to markets on Wednesday:- New Zealand food prices (February)- India trade (February)- Indonesia consumer confidence (February) (By Jamie McGeever) More

WASHINGTON (Reuters) – A leading U.S. bank regulator said Tuesday that the government will be “open-minded” about making changes to a contentious plan to raise large bank capital requirements.Michael Hsu, the acting Comptroller of the Currency, said regulators are carefully considering numerous comments critical of the so-called “Basel III endgame” proposal, which the industry has decried as overly burdensome. At the same time, he defended robust capital requirements for the largest banks, saying it is critical to ensure they can withstand shocks. More

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Shipping has been at the centre of the global economy for over 5,000 years, and it is no less important now than it was for our seafaring ancestors. For all our technological advances, it is still the most effective means of importing and exporting goods and raw materials. It remains crucial to national security, not just for the long-standing role it has played in the defence of nations and of trade but also because today’s port software and logistics platforms hold crucial data about which countries and companies are moving goods around the world.Even Adam Smith, the father of modern capitalism, believed that shipbuilding was one of the very few industries that deserved national support and should not be left to market forces alone. That’s a key part of the argument being made in a new petition for trade relief and state support of the US shipbuilding industry under a so-called section 301 case filed by the United Steelworkers union and other labour organisations on March 12. The petitioners accuse China of distorting global markets in the maritime, logistics and shipbuilding sectors through “unreasonable and discriminatory acts, policies, and practices”. The petition, which the US government now has 45 days to respond to, seeks a variety of penalties and remedies to level the global playing field in shipbuilding and stimulate demand for commercial vessels built in the US. These include port fees on Chinese-built ships docking at US ports, and the creation of a Shipbuilding Revitalisation Fund to help the domestic industry and its workers. A case that might appear focused on one industry in fact has dramatic global implications. Not only does it have the potential to reignite the US-China trade conflict, but it will also increase the focus on China’s growing military might and the massive commercial shipping industry that underpins it. At the same time, it raises questions about America’s ability and even willingness to reindustrialise in strategic sectors, which may bleed into the 2024 presidential election. You are seeing a snapshot of an interactive graphic. This is most likely due to being offline or JavaScript being disabled in your browser.Finally, it’s a window into whether the US has the ability to continue to play its traditional post-second world war security role, which includes policing global shipping lanes and securing the South China Seas for commercial transport, at a time when it no longer has the industrial capacity and workforce to build its own ships. The direction that the Biden administration takes on the case, and how China responds, will say much about the future economic and political shape of the world. As the secretary of the navy, Carlos del Toro, put it in a speech at the Harvard Kennedy School last September, “History proves that, in the long run, there has never been a great naval power that wasn’t also a maritime power — a commercial shipbuilding and global shipping power.” Over the past few decades, America has essentially stopped building its own ships. In 1975, the US shipbuilding industry was ranked number one in terms of global capacity, producing more than 70 commercial ships a year. Nearly fifty years later, the US now produces less than 1 per cent of the world’s commercial vessels, falling to 19th place globally. China meanwhile has tripled its production relative to the US over the past two decades, producing over 1,000 ocean-going vessels last year, versus America’s 10. The resulting asymmetry comes with both commercial and military concerns for the US, but also for any country that depends on it for security. More than 90 per cent of military equipment, supplies and fuel travels by sea, according to the 301 complaint, the vast majority on contracted commercial cargo vessels. All of these are made overseas, including some in China. What’s more, the complaint says, “Chinese companies — primarily state-owned companies — have become leaders in financing, building, operating and owning port terminals around the world.” According to research by Isaac B Kardon, an assistant professor at the China Maritime Studies Institute at the US Naval War College, and Wendy Leutert, an assistant professor at Indiana University, Chinese firms own or operate one or more terminals at 96 foreign ports, 36 of which are among the world’s top one hundred by container throughput. Shipping cranes made by Shanghai Zhenhua Heavy Industries Company (ZPMC) dot the Port of Oakland in California. The company provides 70 per cent of the world’s cargo cranes More

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