Aurelia Butler

CHICAGO (Reuters) -Tens of millions of Americans were in the pathway of dangerous and damaging weather conditions as snowstorms moved across the Northwest and Midwest, flooding threatened the East Coast and potential tornadoes were on tap in the South.Airlines delayed more than 7,600 flights across the U.S. on Friday, including planes grounded at Chicago’s O’Hare International Airport due to winds and blinding snow. In Iowa, Republican presidential candidates canceled events three days out from the state’s caucuses, the first of the state-by-state contests in which parties pick their nominees ahead of November’s general election.Blizzards arrived in much of the upper Midwest on Friday morning with heavy snows and fierce winds of up to 60 miles per hour (96 kph) that were expected to continue into Saturday, the National Weather Service (NWS) warned. More than 133,000 homes and businesses lost power in Michigan, according to data from . The lights went out for another 150,000-plus customers in Wisconsin, West Virginia, Ohio and Pennsylvania. “This storm system is definitely dangerous,” said Zack Taylor, a meteorologist with the NWS’ Weather Prediction Center in College Park, Maryland. The service cautioned against unnecessary travel, noting that visibility on some roads in Chicago was less than half a mile.Taylor warned of risks of frostbite and hypothermia in Iowa, where temperatures for most of the state were forecast to drop below zero degrees Fahrenheit (minus 18 degrees Celsius).The forecast for Monday in Des Moines, the state capital, was a low of minus 18 F (minus 28 C). Temperatures for Monday’s caucuses, which entail long meetings in churches and school gyms, are expected to be the coldest on record for that political event. Republican presidential candidate Nikki Haley, a former ambassador and South Carolina governor, canceled all three campaign events planned for Friday, substituting them for phone-in events.Fred Schuster, 68, braved Friday morning’s blizzard to watch Ron DeSantis, Florida’s governor, campaign in Ankeny, Iowa.”I am worried about the weather,” Schuster said. “I think it’s going to impact how many people attend the caucuses.”Officials canceled a planned rally in Pella, Iowa, for supporters of Donald Trump, who is seeking a second White House term after losing 2020’s election.By midmorning on Saturday, there could be 3 to 6 inches of snow in downtown Chicago. Throughout Friday, as the snow falls, strong winds could bring whiteout conditions.Chicago Public Schools remained open while dozens of other districts across the metro region canceled in-person classes for the day. The snow and wind contributed to 2,230 flight cancellations and more than 7,600 delays of flights within, into or out of the United States on Friday, according to FlightAware, with Chicago’s O’Hare and Midway airports topping the list. Milwaukee, Wisconsin, is expected to receive some of the heaviest snow as the blizzard will drop 12 to 18 inches, with wind gusts up to 40 mph through the weekend.Western New York, including Buffalo, could get more than a foot of snow. But after this system pushes east, “lake-effect” snow could bring several more inches through Monday to the Buffalo area.Another 13 million people who live near the Atlantic Ocean or large waterways in Virginia north into New England were under the threat of flooding from heavy rains and snows over the past few days. To the south in Mississippi, some 3 million people were under the threat of tornadoes and severe thunderstorms as the NWS warned that the winds of up to 60 mph could damage roofs and take down trees and power lines.A winter storm system was also hitting the Pacific Northwest on Friday, and tracking through the Central Rockies with heavy snow that could drop “a couple feet of snow” at the higher elevations over the weekend, Taylor said. More

Kishida announced the plan after his visit to the northwest Japanese region hit by a powerful earthquake struck earlier this month.($1 = 144.9000 yen) More

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.In the run-up to a summit on February 1, policymakers are still struggling to tie up loose ends in the midterm review of the current EU budget, which runs from 2021 to 2027. Time spent on this is time not spent on looking ahead. Even if the next budget is years away, it is urgent that political leaders lift their eyes to that horizon.On the normal schedule, the first proposals will have to be made next year. But on the normal schedule, leaders take years to haggle over hundredths of 1 per cent of gross domestic product, not over the strategic role a budget should play. In the pandemic, they showed strategic thinking by creating the Recovery and Resilience Facility, a separate one-off budget almost as big as the regular one. The need for boldness, however, did not pass with the lockdowns.The next multiyear budget must be planned for an era of great strategic imperatives. It will have to be significantly larger than previous ones. In part, this is due to the political commitment to Ukraine’s membership talks. Designing a budget going up to 2034 which did not provide for Ukraine joining by that point would be a political gift to Vladimir Putin, on top of being terrible financial planning. The budget also needs to match the task of decarbonising and digitising the European economy and beef up the region’s ability to defend itself. That requires massive investments, not enough of which will be done if left to national budgets. And to the extent that national budgets could do the job, unequal subsidies between more and less fiscally powerful states would ruin the level playing field between them.The penny will drop sooner or later in northern Europe: when investment needs are huge, you cannot be both frugal and a protector of the single market, any more than you can be both a fiscal hawk and a defence hawk when war rages on your border.At the same time, how money is spent has to change. One consistent message from net contributors is that the next budget cannot just “add on” Ukraine — and the transfers that entails — while leaving everything else as it currently is. As the main priority changes from “solidarity” of rich with poor countries to addressing common threats and challenges, so must the composition of the budget.Forging a new common vision of what the budget could do takes time. The later leaders leave it, the less opportunity they have even to contemplate how things could be changed fundamentally, let alone agree. Old political positions will be locked in and negotiations limited to haggling over relatively small adjustments within the existing framework. This is also a fruitful time to think big because of fresh or imminent lessons from other policies. One is the flirtation with separate budgets. It has been suggested, for example, that Ukraine could be funded on an intergovernmental “at 26” basis to overcome a Hungarian veto. The recent Franco-German group tasked with imagining treaty reforms opened the possibility of bespoke budgets for purposes not everyone was ready to endorse.The RRF, which uses common borrowing to fund grants and loans to member states for projects agreed with the commission, has also shown that it is possible to do things in new ways. While the EU-funded national plans have not been without problems, there is a sense that the process of jointly agreeing projects has been constructive. Discussions persist of whether to seek an “RRF 2.0”, and whether the common debt issued to fund the original version should be maintained rather than paid down. It is a mistake for northern contributing states to want to simply shut these discussions down rather than engage on the merits within the broader budget discussion.The contours of a grand bargain between net contributors and net recipients is clear enough. It would involve a much bigger budget, but a markedly different composition, shifting spending from old to new priorities. It would prefer direct common procurement or RRF-style allocation methods over old-style transfers and co-funding. It would focus much more on pan-European public goods — think power grids and defence procurement — and might be a lot less redistributive.Each element is anathema to some countries. That is why they must be agreed as a package or not at all. The role of statecraft is to get from the latter to the former. The task of democratic statecraft, moreover, is to involve citizens in the agreement. EU voters go to the polls in five months. The moment to start the big budget debate is [email protected] More

German companies are expected to go bust at a higher rate this year following a sharp increase in insolvencies in 2023, as businesses hit by high energy costs and the end of pandemic aid throw in the towel.Restructuring experts warn that many “zombie” companies kept afloat after the coronavirus pandemic by generous government aid and a suspension of the obligation to file for bankruptcy — which caused insolvencies to drop to unusually low levels — are now collapsing.Since the start of this year, several well-known German companies — including the department store chain Galeria Karstadt Kaufhof and Hamburg-based bag maker Bree, whose customers include Chancellor Olaf Scholz — have filed for insolvency.The ranks of struggling companies have been swelling because of Germany’s economic stagnation, combined with high interest rates, rising wages, elevated energy prices and a government budget squeeze. This is expected to push insolvencies up by between 10 per cent and 30 per cent this year, experts warn, taking them above pre-pandemic levels.One such company is 85-year-old wooden toymaker Haba. Delivery failures caused by “wrong decisions” on IT systems at Haba’s online children’s clothing operation compounded the “heavy burden” the company was already enduring from the soaring cost of energy and wood, according to spokesperson Ilka Kunzelmann. Ultimately, it was too much for the family-owned business based in Bad Rodach, a spa town in central Germany. Haba was granted insolvency by a court in December and expects to emerge in March after it has shed about a third of its 1,500 employees, shut its online clothing arm and sold a school furniture factory.Haba, a wooden toymaker in Bad Rodach, central Germany, was granted insolvency by a court in December, and expects to emerge in March after shedding about a third of its 1,500 employees More

The Financial Services Commission said it found two global investment banks were engaged in the practice of naked short-selling transactions, which involves selling shares without borrowing them first.The FSC did not identify their names.South Korea has been widening a probe into global investment banks to weed out illegal short-sellers from the local stock market after it imposed a full ban on short-selling in November through the end of June 2024.In December, it said it would fine two unnamed global investment banks and one local brokerage 26.5 billion won ($20.2 million) in total for naked short-selling.($1 = 1,313.2200 won) More

SINGAPORE (Reuters) -Japanese stocks have made a blazing start to 2024, surging to three-decade highs as a weaker yen and expectations of interest rates staying low have re-ignited the strongest rally for years. A 6% gain in the Nikkei over the past two weeks is the best start to the year in a generation, according to LSEG data, and comes on the heels of a 28% jump last year — the biggest annual gain in 10 years.As chart levels break, dealers say hedge funds are rushing to chase the momentum and that the index’s 1989 peak of 38,957 is in sight as more cash from home and abroad flows in.Foreigners were net sellers in the first week of January, if derivative trade is taken into account, but were buyers of cash equities according to exchange data and sales desks say this week was even busier and that sellers have been scarce.Last year drew 6.3 trillion yen ($43.5 billion) worth of net equity buying from foreigners, the largest in data stretching back a decade.”Since the start of the year we see nine times more volume than December,” said Tareck Horchani, head of prime brokerage dealing at Maybank Securities in Singapore, with buying heavy in the technology sector.”This flow is coming from long-short equity funds … global investors who were hesitant to buy Japan in last quarter of 2023 now have more conviction to invest,” he said. The attraction is a domestic economy emerging from decades of deflation, an export sector supported by a weak yen and an expectation – strengthened by a deadly earthquake off the west coast in January – that monetary policy will stay supportive. Core inflation seems to be settling in just above 2% and the Bank of Japan has given no indication of being in a hurry to arrest it – keeping the yen cheap by historical standards and traders expecting rates to stay negative until at least April.That setup, Nomura analysts noted, has deterred selling – in contrast with world markets which have dipped 0.5% so far this year.”The absence of sellers in the market may continue to support strong share prices for the time being,” they said.”We think the Nikkei 225’s rise is unlikely to stop even at 35,000. Our forecast range for January–March is 33,000–37,000.” Kenji Abe, a strategist at Daiwa Securities, said his year-end forecast is 40,000. The index closed at 35,577 on Friday. (T)STRENGTH TO STRENGTHInvestors also feel a shift in market leadership over the past few months is breathing new life into the rally.In 2023, many foreign money managers said that a push by the Tokyo Stock Exchange to improve corporate governance and tighten up Japan Inc’s notoriously flabby balance sheets drove stock buybacks, cross-holding sales, price gains and investment.Now, however, the precision-instrument sector, comprising “hidden jewel” companies making semiconductors or software, is gaining fastest, said Richard Kaye, Japan-based portfolio manager at asset manager Comgest.He said large foreign investors, who brokers estimate remain under-exposed to market that had disappointed for many years, are taking note.”We have six large long institutions looking at our fund right now, if that’s representative of who’s buying what and why.”In a presentation this week, portfolio managers at Santa Fe-based Thornburg Investment Management listed chipmaking-equipment builder Disco (OTC:DSCSY) Corp among companies offering exposure to the “picks and shovels” of the AI gold rush.Its stock price has doubled since May 2023.To be sure, the speed and scale of recent gains invites reversal and technical indicators are flashing warning signs. Nikkei volatility has spiked and the relative strength index hit 73.63, with readings above 70 suggesting overheating.Thornburg’s Brian Burrell also said that a rise in the yen and rotation out of exporters’ stocks present risks.But there are signs the gains are durable.Bank of America noted a weakening yen and anticipation of wage increases mirrored the backdrop to a rally that lifted the Nikkei almost 20% between April and June last year and said overhauled tax breaks could spur buying by domestic investors.”Strength begets strength,” said Pepperstone analyst Chris Weston. “Find a market that’s strong and massage your entry points.” ($1 = 145.0100 yen) More