Aurelia Butler

(Reuters) – A look at the day ahead in Asian markets.With the MSCI World, Japanese Nikkei 225, Nasdaq, S&P 500 and Europe’s STOXX 600 indexes all finishing last week at record highs, Asian markets kick off the new week on Monday with a strong global tailwind behind them.The resilience of the U.S. economy, cooling inflation and an artificial intelligence-fueled frenzy in big tech are setting the positive tone globally, which should put a spring in Asian markets’ step on Monday.Industrial production, retail sales and purchasing managers’ index data from South Korea; New Zealand trade and Australian housing figures are the main events on the regional economic calendar, but investors’ attention will be turning to China.The annual National People’s Congress in Beijing opens on Tuesday and what is laid out by parliament could go a long way to determining the 2024 path for assets in China. And beyond.Premier Li Qiang will lay out Beijing’s annual growth and other economic targets, and – crucially – a plan for achieving them. Li is expected to set a growth target of around 5% for 2024 – the same as last year – to keep China on a path toward President Xi Jinping’s goal of roughly doubling the economy by 2035.If the stimulus policies and measures are credible in the eyes of investors, the rebound in Chinese stocks from the five-year lows a few weeks ago looks likely to continue. If they fail to convince investors, a re-test of these lows in the coming weeks cannot be ruled out.Chinese leaders are under pressure to take more radical steps to shore up the property sector, ward off deflation and revive growth. But capital outflows have weakened the exchange rate, and large-scale fiscal easing could exacerbate that outflow-declining currency doom loop.To be sure, some of the recent numbers have been encouraging. The Caixin manufacturing PMI last week was enough to lift China’s overall economic surprises index to its highest level since mid-December.Expectations have been lowered considerably in recent weeks as the data has underwhelmed, so it’s not clear that this reflects particularly strong economic activity per se. But positive surprises are preferable to negative surprises. Either way, Chinese equities have regained their footing and are up around 10% from the lows and are now in the green year to date. Looking ahead to the rest of the week in Asia, the main calendar events are inflation data from South Korea, Thailand, the Philippines and Taiwan, as well as GDP figures from South Korea and Australia, China’s Caixin services PMI, and an interest rate decision from Malaysia. Here are key developments that could provide more direction to markets on Monday:- South Korea retail sales, industrial output, mfg PMI- Australia housing sector data- New Zealand trade (By Jamie McGeever; editing by Josie Kao) More

WASHINGTON (Reuters) -U.S. congressional negotiators on Sunday unveiled a bill to fund key parts of the government through the rest of the fiscal year that began in October, as lawmakers faced yet another threat of a partial shutdown if they fail to act by Friday.The legislation sets a discretionary spending level of $1.66 trillion for fiscal 2024, a spokesman for Democratic Senate Majority Leader Chuck Schumer said. It fills in the details of an agreement that Schumer and Republican House of Representatives Speaker Mike Johnson set in early January.Lawmakers last week passed the fourth stopgap measure since Oct. 1 to keep the government funded, and set themselves two quick deadlines to act, with funding for a part of the government including the Department of Transportation and the Food and Drug Administration running out on March 8 and most other federal agencies partially shutting down on March 22.The 1,050-page bill lays out in detail funding for six of the dozen segments of the government that Congress is charged with allocating money for, with the next six due by later in the month. The bill “maintains the aggressive investments Democrats secured for American families, American workers, and America’s national defense,” Senate Majority Leader Chuck Schumer said in a statement.Johnson in a statement said “House Republicans secured key conservative policy victories, rejected left-wing proposals, and imposed sharp cuts to agencies and programs critical to the President Biden’s agenda.”While the top leaders of Congress have agreed on the deal, it still faces some challenges, notably opposition by hardline Republicans in the House, who have repeatedly called for sharp spending cuts and typically do not vote for spending bills.That hardline energy, which led to the ouster of Johnson’s predecessor Kevin McCarthy, has also gained steam in the traditionally more staid Senate, leading to top Republican Mitch McConnell’s decision last week to step down from his leadership role at the end of this year.House Republicans were touting the bill as a win, although with a deeply divided caucus they had little negotiating power. The bill includes a 10% cut in funding to the Environmental Protection Agency, 7% to the Bureau of Alcohol, Tobacco and Firearms and 6% to the FBI.Schumer meanwhile emphasized that the bill fully funds a health program for low-income families, “makes critical investments in our infrastructure, and strengthens programs that benefit services for our veterans.”The ongoing brinkmanship and the nation’s $34 trillion debt has unnerved credit agencies. Moody’s (NYSE:MCO) downgraded its financial outlook on the United States from “stable” to “negative” in November, citing large fiscal deficits and increasing political polarization, though Fitch on Friday affirmed a “stable” outlook.The House will have to vote on the bill first before the Senate can take up the package before Friday, Schumer said. The House is due to return to Washington on Tuesday. More

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LA NEGRA, Chile (Reuters) -U.S. Treasury Secretary Janet Yellen on Saturday predicted expanding demand for lithium – a core component needed in batteries for electric vehicles – would boost U.S. imports from Chile substantially in coming years.Yellen toured U.S. lithium producer Albemarle (NYSE:ALB) in northern Chile on Saturday as she wrapped up a visit to Chile that included meetings with President Gabriel Boric, Economy Minister Mario Marcel and business executives in Santiago.She told reporters after visiting the Albemarle site in La Negra, about 30 minutes southeast of Antofagasta (LON:ANTO), that rising demand for clean energy could generate some $3 trillion in global investment opportunities through 2050.Expanding U.S.-Chilean ties would benefit both countries, improve energy security and help achieve key climate goals, she said, noting that a core goal of the U.S. Inflation Reduction Act is to reduce overdependence on strategic goods, including critical minerals, from China.Yellen said the U.S. was keen to expand domestic production and find other sources of critical minerals like lithium needed to power electric vehicles.”We want to certainly acquire minerals from our free trade partners, especially a country like Chile that is producing with great environmental sensitivity and has its own strong climate agenda,” Yellen said.She said increased purchases of lithium would likely increase U.S. imports from Chile and increase its share of Chilean exports. China is now Chile’s biggest export market.”I can’t tell you numbers, but I imagine that we will be expanding substantially our purchases from Chile,” she said.Yellen’s visit to Chile is part of a broader push dubbed “friendshoring” to diversify U.S. supply chains by bolstering ties with key allies and partners such as Chile.Washington has a strong interest in Chile as the world’s largest producer of copper and the second largest producer of lithium, both components critical to the green transition.EXPAND TRADE FLOWS She told reporters on Friday that the U.S. wanted to expand its own trade flows with Chile, not dissuade it from trading with China, its biggest trading partner, adding, “It’s not a competition.”Yellen said Chile’s lead production role in copper was critical, noting that demand is projected to double by 2035, since the metal is required for everything from electric vehicles to offshore wind turbines and transmission networks.With 30% of global market share and the largest lithium reserves, Chile is also the world’s second biggest producer of lithium, which is expected to see a tripling of demand by 2030 given its key role in energy storage, such as for EV batteries.Chile’s 20-year-old free trade agreement with the United States means critical minerals from Chile help vehicles qualify for clean vehicle tax credits under the Inflation Reduction Act, which Yellen said would boost industries in both countries.She said Albemarle’s investment in Chile showed the benefit of expanded ties, noting the North Carolina-based company had two sites in Chile that employ 1,000 people: a production site in Salar de Atacama and a conversion plant in La Negra.There would be shifts in the medium to long term as the U.S. ramps up lithium production in the United States, Yellen said, citing a planned Albemarle lithium mine due to open in North Carolina by 2030 and a separate mine and processing facility in Nevada that broke ground one year ago.Yellen said Chile was working on recommendations as part of a new national lithium strategy, and said its goal was to ensure “they don’t end up in a situation where any one country totally dominates the production.”She said she could not comment on the details of the emerging regulatory framework, but noted that companies like Albemarle saw “a very bright future” ahead in Chile. More

SAN DIEGO (Reuters) – Seven months into a crackdown by the city of San Diego on homeless encampments, many of the tents that once lined downtown sidewalks are gone.Now two California state senators – a Republican and a Democrat – have joined forces to propose a statewide version of San Diego’s ordinance, which allows police to roust many homeless people even when shelter is unavailable.But advocates for homeless people said the enforcement strategy has merely chased the homeless onto riverbanks and other unseen places, as the number of shelter beds still fails to meet demand.The debate reflects growing urgency, as polls show homelessness and affordable housing as two of the most important issues to California voters. The state has spent more than $20 billion on housing and homelessness programs since the 2018-19 fiscal year but still has more than 180,000 homeless people.The U.S. Supreme Court is set to weigh in. The justices are scheduled to hear arguments on April 22 in a case from Oregon that may determine the legality of enforcing anti-camping laws and other regulations affecting homeless people when there is nowhere for them to go.The justices will hear an appeal by the city of Grants Pass in southern Oregon of a lower court’s ruling that found that local ordinances that outlawed camping on sidewalks, streets, parks or other public places violate the U.S. Constitution’s Eighth Amendment prohibition against “cruel and unusual” punishment. A ruling is expected by the end of June.SHOPPING CARTS AND DUFFLE BAGSHomeless people still congregate in downtown San Diego, pushing their possessions in shopping carts or sitting on duffle bags, awaiting city services such as referrals for shelter, food or clothing, or mental health and substance abuse treatment. The city has about 6,500 homeless people, according to a census conducted a year ago. About half found some kind of roof, but that still left 3,285 in the street.Homeless advocate Michael McConnell said a game of Whac-A-Mole has emerged, with politicians who failed to provide affordable housing now resorting to police force.”It hasn’t solved homelessness, it’s just scattered homelessness,” said McConnell, a former vice chair of the board of the Regional Task Force on Homelessness, an organization that administers public funding for shelters and other services.McConnell sold his coin shop business in 2018 to dedicate his time to the issue.San Diego in June 2023 passed the Unsafe Camping Ordinance with a 5-4 vote on a city council made up entirely of Democrats, allowing police to enforce camping laws at transit hubs, parks or within two blocks of a school or shelter, regardless of whether beds are available.It is an example of bipartisan agreement to prioritize enforcement, despite a consensus among government officials and advocates that a better solution is more affordable housing.Democrats including California Governor Gavin Newsom had asked the conservative-majority Supreme Court to take up the Oregon case. In a brief, Newsom said rulings by the San Francisco-based 9th U.S. Circuit Court of Appeals against measures in Grants Pass and Boise, Idaho, have “paralyzed” efforts to address unsafe and unsanitary encampments.’TWO LEFT SHOES’In the meantime, San Diego is enforcing its law. Other municipalities have faced civil lawsuits challenging camping bans by plaintiffs, citing the Grants Pass and Boise rulings.A San Diego homeless man who identified himself as Brother Shine said that as a result of the city’s enforcement efforts he is constantly being asked to move along, even if just around the corner.”That’s as wrong as two left shoes. It doesn’t make a lick of sense to Brother Shine,” he said shortly after an encounter with two uniformed police officers.A monthly survey by a business alliance shows the number of homeless people in downtown San Diego peaked at 2,104 in May 2023, before the law took effect on July 31. By December the number had fallen to 846, though it picked up to 1,019 in January, according to the survey.Advocate McConnell said many people are simply pushed outside the boundaries of where the survey is taken.San Diego Mayor Todd Gloria, a Democrat, acknowledged that some homeless people are just relocating, but said the city was putting more in contact with services.The city funds 1,856 shelter beds, nearly double the number when he took office in 2021, Gloria said. In addition, last year the city opened 533 tents for singles or couples at two safe sleeping sites, plus 233 safe parking places where people can sleep in their cars, according to the mayor’s office.”I’m an evangelist for housing,” Gloria told Reuters, saying his goal was to add another 1,000 shelter beds in 2024 and further streamline bureaucracy to expedite the construction of permanent housing.Republican state Senator Brian Jones introduced the homelessness bill, which was co-authored by Democrat Catherine Blakespear.Jones called the proposal one step toward a solution.”We want to get people off the streets and into permanent housing,” Jones said.Blakespear said dealing with homelessness should be treated as an emergency while long-term solutions are pursued.”I want to be able to walk on the sidewalk,” Blakespear said. “I live here in Sacramento, about seven blocks from the Capitol, and I don’t always feel comfortable walking home.” More

Milei, speaking to lawmakers in a state-of-the-union style address, laid out several of the proposals in the new package, which also seems to be wide-ranging. Milei said he would propose limiting terms of labor union heads – with whom the libertarian has clashed – and that he will cut benefits to politicians convicted of the crime of corruption for a second time.The political outsider took office in December looking to take a “chainsaw” to the country’s status quo as the nation faces economic crisis.Inflation over 250%, which predates Milei but rose after he devalued the peso currency sharply in December, has pushed up poverty levels seen nearing 60%, raising tensions among workers and unions, and prompting more strikes and protests.Milei on Friday also directly addressed lawmakers, telling them he would try to change policy with or without their support.The president, pausing frequently amid cheers from his bloc, told Congress that if they opposed him, they would face a “different type of animal.” More