What to watch in Asia today

Japan: The Bank of Japan Monetary Policy Committee will announce its interest rate decision. Governor Haruhiko Kuroda is expected to remain one of the few doves amid an increasingly hawkish outlook globally. 

Solomon Islands: Prime Minister Manasseh Sogavare will meet Australia’s foreign minister Penny Wong to discuss concerns over the South Pacific nation’s security agreement with China. 

Markets: Stocks sold off sharply in the US on Thursday after Switzerland and the UK joined a global rush to raise interest rates. The S&P 500 slid 3.2 per cent for the day, while the technology-heavy Nasdaq Composite index tumbled 4.1 per cent. Australian equities dropped more than 2 per cent in early trading on Friday, while Japan’s Topix opened 1.6 per cent lower.

Musk tells Twitter staffers company must ‘get healthy’

© REUTERS

Elon Musk warned Twitter staffers its business needed to “get healthy” and undergo a “rationalisation of headcount” as he addressed the social media platform’s employees directly for the first time since launching his $44bn takeover bid.

Speaking at a planned employee meeting via video link, Musk laid out a bold vision for Twitter’s future if he succeeds in taking the company private, including increasing the number of people who use the platform to at least 1bn, according to a person familiar with the situation. The company has 229mn monetisable daily active users — logged-in users to whom the platform shows advertising.

However, the billionaire Tesla chief executive also hinted that lay-offs or a restructuring might be in store, adding: “Right now costs exceed revenue. That’s not a great situation.”

The hour-long meeting, during which questions from employees were read out to Musk, came after the entrepreneur accused Twitter’s leadership of failing to provide sufficient data on fake accounts and breaching its obligations around the deal. This has prompted speculation over whether he is manoeuvring to renegotiate at a lower price or walk away altogether.

Musk first made his bid for Twitter in April on the promise of bringing “free speech” to what he dubbed the “digital town square”, and rowing back against content moderation restrictions. On Thursday, he doubled down on those proposals, adding that he believed “pretty outrageous” tweets should be allowed on the platform, the person said.

S&P 500 ends down 3.2 per cent as pessimism about global economy spreads

Stocks sold off sharply in the US on Thursday after Switzerland and the UK joined a global rush to raise interest rates, stoking concerns that central banks’ attempts to tame high inflation could push economies across the globe into a downturn.

The S&P 500 stock index slid 3.2 per cent for the day, a move that took the broad gauge to a 6 per cent fall this week. The declines have battered valuations in recent days as pessimism about the global economic outlook has spread, with many investors warning more restrictive monetary policies from central banks could stamp out the recovery.

In a sign of the darkening outlook, almost every stock in the S&P 500 declined on Thursday, with losses pushing the share prices of hundreds of companies down to new 52-week lows. The technology-heavy Nasdaq Composite index tumbled 4.1 per cent.

The S&P had closed the previous session 1.5 per cent higher after the Federal Reserve raised its main interest rate by a historic 0.75 percentage points, tempered by comments from chair Jay Powell saying he expected rises of this magnitude to be relatively uncommon.

The Fed’s decision was followed on Thursday by the Swiss National Bank raising its policy rate for the first time in 15 years — topping forecasts with a 0.5-percentage point increase — in the latest sign of how central banks are stepping up their efforts to tackle inflation.

Trump called Pence ‘p-word’ in heated post-election call

Donald Trump called his vice-president Mike Pence a “wimp” and “the p-word” during a heated call on the morning of January 6 as the two men clashed over the results of the 2020 election, a congressional committee heard on Thursday.

Members of the bipartisan panel investigating last year’s mob attack on the US Capitol heard from multiple witnesses details of the call between the two men hours before the violence started.

Witnesses said Pence had made clear to the president he would not stop the election results being certified by Congress. Trump responded with anger, they said.

Nick Luna, Trump’s former personal assistant, said: “The conversation was pretty heated . . . In my memory, I remember hearing the word wimp.”

Julie Radford, the former chief of staff to Ivanka Trump, testified that the president’s daughter told her that her father had used “the p-word” on the call.

Despite the conversation, Trump continued to insist Pence could and might overturn the results of the election during a session of Congress on January 6. Those statements helped incite the crowd that then stormed the Capitol building, members of the committee argued.

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