Asia Markets, US Federal Reserve, Tokyo Inflation, China Caixin Services, India

Chinese internet company Bilibili still has a long way to go to profitability, according to an analyst.

“A problem with revenue generation and net losses are concerns for investors. It’s a long way for them to reach the breakeven point,” Shawn Yang, CEO of Blue Lotus Capital Advisors, said on CNBC’s “Squawk Box Asia” on Friday.

His comments come as the company posted narrower fourth-quarter and full-year 2022 net losses on Thursday.

“China’s video sector is a very competitive segment. Bilibili needs to spend a lot on content building,” Yang said.

He said that while the company has always been very good at introducing more good content and attracting more users, the competitive landscape presents a challenge in monetizing the paid users. “If you look at the paying user, the quarter-on-quarter trend is already flat,” Yang added.

Hong Kong-listed shares of Bilibili rose 9.67% in Friday trading.

Goldman Sachs has named eight global stocks of companies that will become profitable this year and beat the broader market in a new research report.

The investment bank found that companies that move from unprofitable to profitable during a market upturn typically outperform the broader market.

According to Goldman, this phenomenon was observed in 2001 and 2008, with outperformance of over 50% in each case.

CNBC Pro subscribers can read more here.

– Ganesh Rao

China’s services sector activity expanded at the fastest pace in six months, as the Services Purchasing Managers’ Index for February rose to 55, sharply higher than the 52.9 recorded in January.

In its report, Caixin said this was also faster than the series average of 53.7. The 50-point mark separates expansion and decline in activity on a monthly basis.

The rise, Caixin reported, was supported by the strongest rise in new business since April 2021, as the easing of Covid-19 restrictions helped lift customer numbers and demand.

Growth in new export orders also accelerated, reaching the highest level in almost four years.

— Lim Hui Jie

Japan’s services sector in February expanded at its fastest pace since June 2022, a private survey by au Jibun bank showed.

The country’s purchasing managers’ index for services came in at 54, higher than 52.3 in January. A reading above 50 signals expansion, while a reading below 50 indicates contraction for the sector.

In its report, the bank noted that Japanese service providers indicated that business activity picked up sharply midway through the first quarter of 2023.

Activity increased at the fastest pace in eight months, “amid a markedly stronger increase in new business entry,” the report said.

— Lim Hui Jie

The headline S&P Global Singapore purchasing managers’ index fell to 49.6 in February, below the 50-point mark that separates growth from contraction.

February’s print saw a decline from January’s reading of 51.2, signaling “renewed deterioration in private sector conditions,” S&P said in a press release.

It added that purchasing activity shrank in February due to moderation in demand conditions.

“Business sentiment worsened, while caution on hiring and purchasing brought the overall PMI into contraction territory,” said Jingyi Pan, deputy chief economist at S&P Market Intelligence.

“While recent developments supported the easing of supply constraints and lowering of price pressures for businesses, the lack of improvement in the demand picture does not bode well for Singapore’s private sector in the coming months,” Pan said.

– Jihye Lee

Tokyo’s consumer price index rose 3.3% in February, in line with economists’ expectations polled by Reuters, and a lower print than January’s 4.3% public data showed.

Overall, CPI for the capital reached 3.4%, a cooler print from 4.4% last month, while prices excluding food and energy for Tokyo rose 1.8%, also a slower pace than January’s 1.7%.

The Japanese yen weakened slightly to 136.7 against the US dollar.

– Jihye Lee

China’s reopening from the pandemic has been a big theme in 2023. But the recent decline in Chinese stocks is an opportunity for investors to seize opportunities, according to Bernstein analyst Rupal Agarwal.

While A-shares and H-shares are both avenues for investors to gain exposure to the China reopening theme, Agarwal said she believes one is the better option.

Pro subscribers can read more here.

— Zavier Ong

Japan’s unemployment rate for January came in at 2.4%, down 0.1% from December and slightly below economists’ expectations of 2.5%

This is the lowest unemployment rate since February 2020, according to Refinitiv data.

Japan’s job-to-applicant ratio was also at 1.35, down from 1.36% in December.

— Lim Hui Jie

Now that the 10-year Treasury yield has broken above the psychological barrier of 4%, it should continue to move higher, according to Credit Suisse.

“This should open up a deeper rally within what we now expect to be an even wider range. Next support is seen at 4.11%, then the 4.325% October high,” analyst David Sneddon wrote in a note Thursday.

The yield on the benchmark 10-year index was last up almost 8 basis points to 4.073%.

Atlanta Federal Reserve President Raphael Bostic said he believes the central bank can stick to quarter-point rate hikes.

“I’m still very much of the mindset that slow and steady is going to be the right course of action,” Bostic told members of the media. He added that he favors rate hikes of 0.25 percentage points, a step down from the Fed’s meeting a month ago.

“Right now, I’m still very much on a four point pace,” he added.

Some other Fed officials have said they are open to hikes within half a point when they meet later this month. Market prices are currently pointing to this move, although the probability of a half-point increase has increased in recent days.

-Jeff Cox

Artificial intelligence has taken Wall Street by storm since ChatGPT launched and went viral – causing a surge in investor interest in which stocks could benefit from the trend.

But there’s another way to get in on the AI ​​buzz happening right now, according to tech investor Mark Hawtin, who names one stock to play it.

CNBC Pro subscribers can read more here.

— Weizhen Tan

The S&P 500 has been flirting with its 200-day moving average, and a drop below that level could signal more selling.

The 200-day was at about 3,940 on Thursday, and the index fell below that level but recovered on Wednesday. The S&P 500 traded near that level Thursday morning.

The 200-day is literally the average of the last 200 closing prices, and is seen as a momentum indicator for a stock or index. Stock chart analysts will see it as a negative signal if the index closes below that level and stays below it.

– Patti Domm

Credit-default swap (CDS) trading on US Treasuries has picked up since January, with implied default probabilities rising “to levels not seen since the 2013 debt ceiling debate,” MSCI researchers Andras Rokob and Andy Sparks wrote in a blog post on Thursday .

CDS spreads have widened in 2023, mirroring similar moves in both 2011 and 2013, during two other episodes that saw battles between Congress and the White House over raising the US debt ceiling, the researchers wrote.

“Assuming a 95% recovery, the CDS market’s one-year implied probability of default was 11.3%, as of February 24, a significant increase from the 3.3% probability at the start of the year,” MSCI said. “The consequences of a potential default by the US government extend beyond the immediate impact on holders of Treasurys,” Rokob and Sparks warned. “Major market dislocation and a sharp decline in economic activity could both be realistic possibilities.”

— Scott Schnipper; CNBC’s Jeff Cox contributed to this report