Hong Kong shares rise 2% as Alibaba lifts technology stocks; Asia markets mostly rise

Alibaba’s major shakeup could be followed by its Chinese technology peers, according to KraneShares’ CIO Brendan Ahern.

“I think investors are saying what we saw in Alibaba, really the leader in China tech, that their plans might be utilized by others,” Ahern said, pointing to the ADR moves seen in Tencent, JD.com, and Baidu overnight.

Shares of Tencent rose 2.5%, Meituan gained 4.6%, Baidu rose nearly 2% and Kuaishou gained 3.8% in Hong Kong’s morning trade.

He added the company’s announcement showed that Alibaba founder Jack Ma, who was recently spotted in China after spending months abroad, was involved in the process.

“It’s very clear he played a role in this new structure that is really around what the company said in the press release, it’s about unleashing the shareholder value,” said Ahern.

– Jihye Lee

The latest overhaul in business announced by technology giant Alibaba is seen as a move by the Chinese government to further support its private sector, Kingston Securities Executive Director Dickie Wong said.

“The Chinese economy is back to growth mode. The Chinese government, they have to do something, therefore, introduced a lot of new policies to support the private sector.. especially the tech sector,” he said on CNBC’s Street Signs Asia.

He added the government is incentivized to meet its economic growth target of around 5% by creating new jobs in the technology sector – and Alibaba’s reform is seen as part of those efforts.

“Creating new jobs is one of the most important job[s] that [the] Chinese government needs to do,” said Wong, adding that he expects to see jobs created in cyber security or online gaming.

– Jihye Lee

Oil prices are seeing a boost because the situation is stabilizing after the recent banking turmoil, said S&P’s Vice Chairman Dan Yergin.

“What we’ve seen in the last several days is a sense the situation has stabilized… that has in turn led to some of the increase in oil prices,” he told CNBC’s Squawk Box.

Oil benchmarks were trading up after coming off a volatile trading week. Brent crude futures inched up 0.25% to $78.85 a barrel, while the U.S. West Texas Intermediate futures traded up 0.6% to $73.96 a barrel.

When asked if it will be tough for oil prices to hit $100 per barrel, Yergin, agreed, certainly, “unless there’s some dramatic thing that happens,” adding that air travel in China has yet to recover to 2019 highs.

—Lee Ying Shan

Australia’s monthly inflation pace for February came in at a slower pace at 6.8% compared to the same period a year ago.

This is lower than January’s figure of 7.4%, and also lower than the 7.1% economists expected.

Data from the country’s statistics bureau revealed that the most significant price rises were in the housing, followed by food and non-alcoholic beverages, then in transport.

The inflation data, as well as the retail sales data released on Tuesday, will be key to the Reserve Bank of Australia’s decision in April on whether to hike rates.

— Lim Hui Jie

Alibaba jumped more than 11% during midday trading Tuesday after the e-commerce giant said it will split its company into six business groups.

It’s the most significant restructuring in Alibaba’s history, with each of the six firms set to be managed by its own CEO and board of directors.

The move is “designed to unlock shareholder value and foster market competitiveness,” according to a company statement.

Separately, Morgan Stanley named it a research tactical idea following the announcement, saying the “share price will rise in absolute terms over the next 60 days.”

— Arjun Kharpal, Sarah Min

Banks led the stock market lower Tuesday afternoon, following a hearing in which three regulators said they would favor more stringent regulations in smaller institutions.

Federal Reserve Vice Chair Michael Barr, FDIC Chair Martin Gruenberg and Nellie Liang, the Treasury Department’s undersecretary for domestic finance, each said they would back tougher requirements for banks with more than $100 billion assets.

The remarks came during a Senate Banking Committee hearing on the recent failure of three regional banks. Sen Elizabeth Warren (D-Mass.) asked each if they would favor tougher rules for banks other than those identified as systemically important and if they would support reversing deregulatory changes made in 2018.

“I certainly think it’s appropriate for us to go back and review those actions in light of the recent episode and consider what changes should be made,” Gruenberg said.

The SPDR Regional Banking and the SPDR Bank ETFs dropped more than 1% each in afternoon trade.

—Jeff Cox

Stock markets have been on an upward trend in the first quarter of 2023, with the S&P 500 and MSCI World Index on track to post more than 4% in total gains.

This is particularly notable after a year of negative returns.

Here, CNBC Pro subscribers can read how markets have performed in similar conditions historically.

— Ganesh Rao

All three regulators testifying before the Senate Banking Committee on Tuesday said rules need to be toughened for regional banks.

“I anticipate the need to strengthen capital and liquidity standards for firms over $100 billion,” said Michael Barr, the Federal Reserve’s vice chair for supervision, in response to questions from Sen. Elizabeth Warren (D-Mass.).

Barr’s fellow authorities echoed his sentiments as they spoke about the recent failures of Silicon Valley Bank, Signature Bank and Silvergate Bank.

FDIC Chair Martin Gruenberg noted that he voted against deregulatory moves in 2018 and said, “My views haven’t changed.”

Nellie Liang, the undersecretary for domestic finance, said she agrees “that we need to prevent these types of banking failures.”

Bank stocks were slightly higher following the exchange.

—Jeff Cox

Markets have been hit by volatility over the past month leading some retail investors to question where to park their money.

If you had $10,000 to invest, where should you put it amid the uncertainty, and how much should you allocate to each asset class? CNBC Pro speaks to portfolio managers and investors to find out.

CNBC Pro subscribers can read more here.

— Weizhen Tan

The consumer outlook brightened a bit in March, despite the crisis in banking, according to a Conference Board index released Tuesday.

The board’s Consumer Confidence Index edged higher to 104.2, from 103.4 in February and ahead of the 100.7 Dow Jones estimate.

In addition, the expectations index, which measures the short-term outlook, rose to 73, from 70.4. However, the index remains below the 80 level that is consistent with recessions. The inflation index also remained elevated, at 6.3% for the outlook over the next 12 months.

—Jeff Cox