Aurelia Butler

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(Reuters) -JD Sports Fashion has proposed to buy American athletic fashion retailer Hibbett Inc for about $1.08 billion, the companies said on Tuesday, as Britain’s biggest sportswear retailer looks to expand across the southeastern U.S. The deal comes as shares in athletic clothing retailers come under pressure globally after weak outlooks from sports apparel makers such as Nike (NYSE:NKE) and Puma.Last month JD (NASDAQ:JD)’s U.S. rival Foot Locker (NYSE:FL) also warned on 2024 profits, though Adidas (OTC:ADDYY) last week hiked its 2024 forecast on strong demand for the German sportswear giant’s sneakers. JD Sports, which sells Nike, adidas, HOKA and other sports brands, said last month it expects the Euro soccer championships, Paris Olympics and new styles of trainers and track suits would spark life into the lacklustre market.It will pay $87.50 per Hibbett share in cash, representing a premium of about 20% to the U.S. firm’s last closing price.Hibbett’s shares were up 18% to $85.70 in premarket U.S. trading.JD’s acquisition of Hibbett, which has about 1,169 stores across 36 U.S. states, will extend its breadth in the country from “coast to coast”, finance chief Dominic Platt said in an analyst call. It already owns Shoe Palace, which has a big presence on the U.S. west coast, and DTLR, which is established in the east.JD Sports shares, which have fallen more than 20% so far this year, were up 6% by 0900 GMT. The enlarged group would have combined revenues of about 4.7 billion pounds in North America, JD Sports said, adding that the region’s contribution to total sales would increase to about 40% from the current 32%.The deal is expected to add to the British firm’s earnings in the first full year of ownership, with cost savings expected to be at least $25 million, JD said.The Bury, Greater Manchester-based company said it expects to fund the deal and refinance Hibbett’s existing debt through its U.S. cash resources of $300 million and a $1 billion extension to its existing bank facilities.($1 = 0.8108 pounds) More

BENGALURU (Reuters) -The U.S. Federal Reserve will wait until September to cut its key interest rate, according to a majority of 100 economists polled by Reuters, with half saying there will be only two cuts this year and only about a third forecasting more. That change in the outlook – from a June start and two or more additional cuts in a poll published a month ago – follows evidence of persistent strength in the U.S. labor market and a series of stronger-than-expected inflation data.Fed Chair Jerome Powell also said on Tuesday “the recent data … indicate that it’s likely to take longer than expected to achieve that confidence” that inflation is falling back to the U.S. central bank’s 2% target, remarks that dimmed hopes for rate cuts anytime soon. Financial markets, which earlier this year were pricing six Fed rate cuts starting in March, are also expecting the first reduction in September and one more in either November or December. While Reuters polls have consistently forecast fewer Fed rate cuts than markets, both have now come into line in the latest survey following last week’s inflation report, blowout retail sales data and more hawkish remarks from Powell.Just over half of economists surveyed, 54 of 100, predicted the first decrease in the federal funds rate to happen in September, pushing that rate to the 5.00%-5.25% range. Twenty-six forecast a July cut and only four said it would happen in June. Last month a two-thirds majority, 72 of 108, expected the first rate cut in June. “This is an economy that surprises us again and again by just how resilient it is. We are having very strong growth and it doesn’t seem like the Fed’s policy has made that much of a difference,” said Jonathan Millar, senior U.S. economist at Barclays.Millar now expects the Fed to cut only once this year, in September, a change from his previous prediction of 75 basis points of rate cuts starting in June.The personal consumption expenditures (PCE) price index, which the Fed uses to gauge progress toward its 2% inflation target, rose to an annual rate of 2.7% in March, faster than the 2.5% reported for February, according to estimates presented by Fed Vice Chair Philip Jefferson this week.The outlook for the various inflation measures – the consumer price index (CPI), CPI excluding food and energy, or core CPI, PCE and core PCE – were broadly upgraded from last month in the latest Reuters survey. None of these measures of inflation were expected to reach 2% until at least 2026.”They say again and again policy is restrictive, but there’s a lot of metrics that may suggest they’re not nearly as restrictive as they think … the neutral policy rate in nominal terms is maybe 4.5% to 5.0%. That suggests they’re not overly restrictive,” Barclays’ Millar added.Although there was no majority on how many rate cuts would be delivered this year, half of the participants, 50 of 100, saw two quarter-percentage-point cuts, 34 said more than two, 12 saw only one reduction and four said none. A 60% majority of economists who replied to an additional question, 36 of 60, said the chances were high or very high the Fed would hold rates steady for the remainder of this year. The rest said the probability was low or very low.A few economists now expect the federal funds rate at the end of 2025 to be at least 100 basis points higher than they were expecting just recently, underscoring how quickly the outlook has changed. Steve Englander, head of North America macro strategy at Standard Chartered (OTC:SCBFF), said the March CPI data “raise the possibility inflation is proving harder to stamp out than the Fed had thought.””We have delayed our first cut, but also see a rising probability stubborn inflation will shift the question from ‘when’ to ‘whether’,” he said.The U.S. economy was forecast to expand at an average 2.3% this year, up from the 2.1% forecast last month.(For other stories from the Reuters global economic poll, click here.) More

(Reuters) -U.S. stocks were set to rise at open on Tuesday as some growth and chip stocks gained, while investors digested a raft of quarterly earnings updates, ahead of reports from Big Tech later in the week.Some megacap growth stocks, including Meta Platforms (NASDAQ:META), Microsoft (NASDAQ:MSFT) and Amazon.com (O:AMZN), edged up between 0.5% and 1.3% in premarket trading.The tech majors are scheduled to report their quarterly numbers this week, with Tesla (NASDAQ:TSLA) kicking off the cycle after markets close on Tuesday.Early gains in some chip stocks also offered support to equities, with Nvidia (NASDAQ:NVDA), Micron Technology (NASDAQ:MU) and Advanced Micro Devices (NASDAQ:AMD) up between 0.7% and 2.0%.Apple (NASDAQ:AAPL) was an outlier, down 0.2%, as market data showed its smartphone shipments tumbled 19% in China in the first quarter.On the earnings front, General Motors (NYSE:GM) advanced 4.9% after the automaker posted quarterly results above Wall Street targets and raised its annual forecast. Spotify (NYSE:SPOT) gained 8% after the Swedish music streaming company beat estimates for premium subscribers. GE Aerospace rose 4.3% after the aerospace giant raised its full-year profit forecast.Danaher (NYSE:DHR) jumped 7.6% after the life sciences firm beat quarterly profit and sales expectations.On the flipside, JetBlue plunged 10.8% as the low-cost airline trimmed its annual revenue forecast after reporting lukewarm first-quarter revenue.”Overall, people are happy with how (earnings) have gone because mostly they’re surprised that things aren’t worse,” said Will McDonough, chairman and CEO of Corestone Capital.Earnings are estimated to grow by 6% in the first quarter, as per latest estimates from LSEG.U.S. equities sold off sharply last week amid heightened tensions in the Middle East and as traders re-evaluated their rate-cut expectations from the Federal Reserve.The Personal Consumption Expenditures (PCE) index reading for March, the Fed’s preferred inflation measure, is due on Friday and will help ascertain the central bank’s monetary policy trajectory.Money markets are now pricing in just about 38 basis points of interest-rate cuts, down from about 150 bps seen at the start of the year, according to LSEG data. On the data front, investors will await the S&P Global Composite Flash PMI data for April, due shortly after the opening bell.At 8:34 a.m. ET, Dow e-minis were up 81 points, or 0.21%, S&P 500 e-minis were up 13.75 points, or 0.27%, and Nasdaq 100 e-minis were up 48.5 points, or 0.28%.Among other stocks, Cadence Design (NASDAQ:CDNS) Systems lost 6.4% in premarket trading after the chip design software maker forecast second-quarter revenue below analysts’ estimates. Nucor Corp (NYSE:NUE) shed 6.9% after the steelmaker missed Wall Street estimates for first-quarter earnings. Roblox added 4.2% after J.P. Morgan upgraded the gaming platform to “overweight” from “neutral” on significant monetization opportunity.Hibbett jumped 18.8% after JD (NASDAQ:JD) Sports Fashion proposed to buy the athletic fashion retailer for about $1.08 billion. More

The world’s biggest parcel delivery firm also is grappling with higher labor costs tied to its new Teamsters contract. In January said it would cut 12,000 non-union jobs as part of a bid to slash $1 billion in costs this year. First-quarter adjusted profit slumped to $1.43 per share, down 35% from last year but above analysts’ estimates for $1.29, according to LSEG data. Revenue was $21.7 billion, missing analysts’ target of $21.9 billion.UPS reported a 3.2% decline in average daily volumes in its key U.S. business and a 5.8% drop in its international segment, but said volumes “showed improvement through the quarter”.Revenue in both businesses “fell short of expectations,” Jonathan Chappell, equity analyst at Evercore ISI, wrote in a client note.To offset lower volumes, UPS is focusing on higher-margin deliveries for small businesses and healthcare companies. In particular, it plans to double its healthcare-related revenue to $20 billion by 2026. It reported an adjusted operating margin of 8% for the quarter, down from about 11.1% last year. The company earlier said this quarter’s margin would be its lowest in 2024, with business conditions improving in the second half.”UPS has been out of favor for several quarters,” said Chappell, who noted the company has had success with expense control.Meanwhile, UPS won a significant contract with the U.S. Postal Service, replacing rival FedEx (NYSE:FDX) as the agency’s largest air cargo service provider. That business was worth more than $1.7 billion to FedEx in fiscal 2023. UPS shares were virtually unchanged at $144.75 in premarket trading. More

Russia’s economic rebound from a 2022 slump relies heavily on state-funded arms and ammunition production as Moscow prosecutes its war in Ukraine, masking problems that are hampering an improvement in Russians’ living standards.The International Monetary Fund this month raised its 2024 forecast for Russia’s GDP growth to 3.2% from the 2.6% projected in January, pointing to strong government spending and investment related to the war, as well as higher consumer spending in a tight labour market and strong oil export revenues in spite of Western sanctions.Economy Minister Maxim Reshetnikov, speaking at a government meeting, said the main factor behind economic growth was domestic consumer and investment demand. The economy ministry expects GDP growth of around 2.3% in 2025-2026, while the rouble is forecast to make a steady decline to trade at an average of 101.2 to the dollar in 2026, compared with current levels around 93.Russia expects oil prices to fall, the forecast showed, and the export price of Russian oil until 2027 is seen at $65 a barrel. Russia’s Urals crude currently trades at around $79 per barrel.Russia’s success in circumventing the West’s oil price cap, through redirecting exports to friendly destinations and the opaque ownership of a so-called shadow fleets of ships to transport oil, has eased sanctions pressure, but reduced export revenues can still harm the budget deficit. RISKSRussia’s war in Ukraine is draining state coffers – the liquid part of Moscow’s rainy day fund has fallen sharply since the invasion – but economists say that even oil prices as low as $60 a barrel still allow Russia to retain a fiscal safety net that could last for years. Reduced export revenues are seen squeezing Russia’s trade and current account balances. The trade balance is expected to drop by more than 30% in the coming years, compared with previous estimates and expectations for the current account surplus are down threefold, to as low as $25.3 billion in 2026. “Risks also remain,” Reshetnikov said. “Externally, this is first and foremost a slowdown in the global economy as a whole and in the economies of countries that are Russia’s main trading partners, as well as continued sanctions pressure.”The ministry improved forecasts for real disposable incomes and retail trade. Incomes, partially driven by high government spending and the tight labour market, are seen increasing 5.2% in 2024, up from 2.7% growth in the previous forecast. The ministry expects inflation to end the year at 5.1%, above the previous estimate and the central bank’s 4% target. Analysts expect interest rates, currently at 16%, to stay in double digits until at least mid-2025. The ministry does not anticipate Russia solving its labour shortage conundrum any time soon, according to the forecasts. Unemployment, currently at a record low 2.8%, is seen hovering at 3% from 2024-2027. More