Aurelia Butler

LONDON (Reuters) – Stocks markets were subdued on Friday after prolonged pressure, with investors watching the contrasting fortunes of the dollar and yuan, and mulling central bank meetings and U.S. data on the horizon.U.S. stock index futures were little changed.The tech sector was in focus after about $200 billion was wiped from Apple’s market capitalisation in two days on reports of China curbing iPhone use by state employees and on Friday protectionism fears were weighing on shares of suppliers.Apple shares (NASDAQ:AAPL) were flat in pre-market trading on Friday.Oil prices hovered above $90 a barrel, helped by tighter supply.The dollar was set to clock up its best winning streak since 2014, bolstered by a resilient run of U.S. economic data. In contrast, the yuan fell to its weakest level since 2007 on worries about China’s slowing economy.Investors were focused in upcoming central bank meetings this month and next batch of U.S. data.”Everything is geared towards the next couple of weeks, with European Central Bank, Federal Reserve and Bank of England meeting. I think they will all sit on their hands,” said Mike Hewson, chief market strategist at CMC Markets (LON:CMCX).Robust economic data in the United States this week have left some investors worried that even if the Fed leaves rates unchanged this month, they could remain high for longer than anticipated.The U.S. Consumer Price Index reading for August is due on Sept. 13 ahead of the Fed’s next meeting in the following week.Stocks sought to stabilise after a week of easing, with the MSCI All Country stock index slightly weaker at 676.83 points, and down about 1.5% for the week so far, though still up nearly 12% for the year.In Europe, the STOXX index of 600 companies eased 0.3% and heading for a loss of about 1% for the week, and on course for its longest run of losses since November 2016.Patrick Spencer, vice chair of equities at Baird, said investors were trying to guess at what pace the Fed could begin cutting interest rates next year.”Maybe you are going to see slightly higher for longer rates and they may not come down as quickly next year, and that in itself will slow consumption and consumer confidence,” Spencer said, adding that a U.S. government shutdown is also a worry.YUAN AT 16-YEAR LOWDollar gains have pushed the Chinese yuan to a 16-year low and have also prompted a step up in rhetoric from Japanese policymakers growing uncomfortable with the yen’s slide.”Given challenges facing China, and more signs of a re-tightening of the U.S. jobs market, it is not surprising that the dollar is finding support, allowing the ‘dollar juggernaut’ to continue its rampaging run,” analysts at ANZ Bank said in a note.The yen has found new 10-month lows and, at 147.45 per dollar is heading towards the vicinity of 150, where traders see high risks of authorities stepping in with support.Japan’s top currency diplomat Masato Kanda said on Wednesday that authorities will not rule out any option to clamp down on “speculative” moves, while chief cabinet secretary Hirokazu Matsuno said the government was watching with “urgency”.In currencies, the euro is down 0.5% this week and traded little changed on the day at $1.07045Benchmark 10-year U.S. Treasury yields were trading at 4.2621%, while two-year yields were trading at 4.9549%, also little changed on the day.Brent crude prices are up this week, but gains on recently robust U.S. data have been tempered by softening indicators of demand in Europe and China. Brent futures up 0.7% at $90.58 a barrel. More

Investors poured about $57.38 billion into global money market funds in their most significant weekly net purchases since June 7, LSEG data showed.Investors favoured safer assets on worries that a slowdown in China and Europe would weigh down global growth.Data from the euro area and Britain showed activity in the services industries contracted in August. Meanwhile, a private-sector survey showed that China saw services activities expanding at the slowest pace in eight months in August.By region, U.S., European and Asian money market funds drew $32.18 billion, 20.75 billion and $1.64 billion, respectively, in inflows.Meanwhile, withdrawals from global equity funds eased as investors pulled out a net $2.45 billion, the smallest amount in five weeks.Investors withdrew $463 million from communication services sector funds, while metals & mining, healthcare and consumer staples saw outflows of about $300 million each. On the other hand, global bond funds drew $9.24 billion worth of inflows, the biggest amount in nine weeks.Among commodities, precious metal funds saw $518 million worth of net selling, the 15th weekly outflow in a row, but energy funds received inflows for a second week, worth about $101 million. Data for 28,201 emerging market funds showed equities suffered outflows for a fourth successive week, valuing $1.81 billion on a net basis. Investors also pulled out about $271 million from bond funds. More

BENGALURU (Reuters) -U.S. chip firm Nvidia (NASDAQ:NVDA) and telecom-to-retail giant Reliance on Friday announced an AI partnership to create language models, generative apps and a cloud infrastructure platform for AI development in the South Asian nation.Nvidia will provide the computing power required for the efforts, while Reliance unit Jio will manage and maintain the AI infrastructure and oversee customer engagement, the companies said.”Reliance will create AI applications and services for their 450 million Jio (telecom) customers and provide energy-efficient AI infrastructure to scientists, developers and startups across India,” Nvidia said.Mukesh Ambani, the billionaire chairman of Reliance, has previously talked up the need of “digital infrastructure in India that can handle AI’s immense computational demands”. Nvidia globally has a near-monopoly on the computing systems used to power services like ChatGPT, OpenAI’s blockbuster generative AI chatbot. The AI powering such apps is known as a large language model because it takes in a text prompt and from that writes a human-like response.The partnership will give Reliance access to the latest version of Nvidia’s Grace Hopper Superchip, its AI chips that are optimized to perform AI inference functions that effectively power apps like ChatGPT.Reliance said the new AI infrastructure will speed up a range of India’s key AI projects, including chatbots, drug discovery, and climate research.Neil Shah, a partner at Counterpoint Research, said the AI move is critical for Jio to “make sense” of the data it has from millions of users, and become a tech company providing services beyond telecom.”The AI infra will enable it to provide accurate recommendations and cross sell products and services across its giant network of clients in retail, telecom, and financial space,” he said.Reuters on Friday exclusively reported that oil-to-retail conglomerate Reliance is also considering a foray into chip manufacturing in India.Separately, India’s Tata Group too is set to announce an AI partnership with Nvidia later during Friday, a source with direct knowledge of the matter told Reuters. More

BEIJING/SHANGHAI (Reuters) – A new series of smartphones launched by China’s Huawei Technologies has drawn global attention for containing technology that indicates the company has managed to overcome U.S. sanctions and could come back as a rival to Apple (NASDAQ:AAPL)In late August, the company unveiled the Mate 60 and Mate 60 Pro, and on Friday launched two more smartphones, the Mate X5 which is a new version of its foldable phones, and the Mate 60 Pro+. The Mate 60 is priced from 5,999 yuan ($817.70), the same as Apple’s iPhone 14 in China.Here are some key things to know about Huawei’s new phones, their suppliers, and what they could mean for the world’s largest smartphone market:WHAT IS THE MATE 60 SERIES CAPABLE OF?Huawei has mainly advertised the smartphones’ ability to support satellite communications which allow users to place calls or send messages even in areas where there are no mobile signals or internet, such as on mountains or at sea.It has not disclosed details of the chips used, but analysis firm TechInsights has found that the phone is powered by a new Kirin 9000s chip that was made in China by Semiconductor Manufacturing International Corp (SMIC).Speed tests shared by buyers on Chinese social media have suggested that the Mate 60 Pro is capable of download speeds exceeding those of top line 5G phones.Chinese buyers comparing the phones to Apple’s latest iPhone 14 have posted reviews online saying they have comparable specifications like storage and memory. Huawei’s launch also comes days before Apple is expected to launch its new iPhone 15 on Sept. 12.WHO ARE THE MATE 60’S SUPPLIERS?Huawei has not officially named the suppliers for the phones’ components, though apart from SMIC, TechInsights also said it found South Korea’s SK Hynix’s DRAM and NAND components in the phone.SK Hynix, which said it stopped doing business with Huawei since the United States introduced restrictions on the firm in 2019, has said it is investigating.The Mate 60 Pro contains more Chinese-made chip components than previous models, TechInsights also said.Lists of possible Chinese suppliers have been widely circulated online, with shares of companies touted as possible candidates soaring on the speculation.Most of these are existing suppliers to Huawei. Shares in Dongguan Chitwing Technology Co. Ltd, which makes molds, for instance rose by the daily upward limit of 10% in the days after Huawei’s launch. It did not respond to a Reuters’ request for comment.Suzhou-based display maker Visionox Technology, whose shares have risen by 15% since the new smartphones were launched on Aug. 29, told Reuters it was a supplier for the new Mate 60 series.WHAT COULD IT MEAN FOR APPLE IN CHINA’S SMARTPHONE MARKET?Huawei was once the world’s largest smartphone firm by sales but saw its market share steadily slump after the United States cut its access to chip-making tools essential for producing the most advanced handset models. The company was left only able to sell limited batches of 5G models using stockpiled chips.Its market share in China, the world’s largest smartphone market, has fallen to 11% so far this year compared to 27% in 2020, in part also due to its move to sell its budget brand Honor in what it described then as a bid to ensure its survival.The U.S. restrictions left Apple as the main maker of premium smartphones in China. Over the same period, Apple’s market share in China rose to 19% from 11%，according to data from research firm Counterpoint.Analysts say the Mate 60 might mark Huawei’s comeback as a rival, with sales helped by patriotic fervor as state media and internet users cheer the launch as a blow against the United States amid rising tensions between Washington and Beijing.Ming-Chi Kuo, an analyst with TF International Securities, said he expects the Mate 60 Pro to ship between 5.5 to 6 million units for the second half of this year, up 20% from previously planned volumes.And cumulative shipments of Mate 60 Pro could reach at least 12 million units 12 months after launch, according to Kuo.($1 = 7.3364 Chinese yuan renminbi) More

LONDON (Reuters) – The dollar headed on Friday for its longest weekly winning streak in nine years, bolstered by a resilient run of U.S. economic data that has put the end of the Federal Reserve’s aggressive rate-increase cycle into question.China’s onshore yuan meanwhile ended its domestic session at the weakest since 2007, as it battles capital outflow pressures and a widening yield gap with major economies.The U.S. dollar index, which measures the greenback against major peers, was last 0.05% lower at 105 but remained not far from the previous session’s six-month high of 105.15.The index was on track to extend its gains into an eighth straight week, and is up 0.7% thus far.The euro, the largest component in the dollar index, was staring at eight straight weeks of losses, with the single currency last gaining 0.08% to stand at $1.0704, having fallen to a three-month low of $1.0686 on Thursday.”The relative divergence of the U.S. and European economy is a key topic again and the weaker dollar story has just faded away,” said Dane Cekov, senior macro and FX strategist at Nordea Markets. Data out this week showed the U.S. services sector unexpectedly gained steam in August and that jobless claims last week hit their lowest level since February, while in the euro zone, industrial production in Germany, Europe’s largest economy, fell by slightly more than expected in July.”The U.S. economic data is still robust and in Europe it’s flattening out. The dollar usually does well when the U.S. economy outperforms peers and at the moment the U.S. is the bright spot,” said Nordea’s Cekov. Sterling edged away from Thursday’s three-month low and last bought $1.2480, though was still set to clock a weekly loss of more than 0.8%.IN THE DOLDRUMSThe onshore yuan opened at 7.3400 per dollar on Friday and touched its weakest level since December 2007 at 7.3510, while its offshore counterpart sank to a 10-month low of 7.3621 per dollar.China’s currency has depreciated steadily since February as the faltering post-pandemic economic recovery and widening yield gap with other economies, particularly the United States, affected capital flows and trade.The onshore yuan has fallen roughly 6% against the dollar so far this year and has become one of the worst-performing Asian currencies alongside its offshore counterpart.”The travails of a stumbling (yuan) … reveals the complexity and profusion of China’s underlying economic stress points amid confidence deficit,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank.The yuan’s rapid decline has prompted authorities to step in to slow the pace of its depreciation.Also on trader radars was a struggling yen, which steadied at 147.39 per dollar but remained on the weaker side of the key 145 level that prompted intervention by Japanese authorities last year.Japanese Finance Minister Shunichi Suzuki said on Friday rapid currency moves were undesirable and that authorities wouldn’t rule out any options against excessive swings, in a fresh warning to investors trying to sell the yen.The Bank of Japan is the only major central bank yet to raise interest rates in the current global tightening cycle, although analysts expect a move could come this year. “It’s understandable why the Bank of Japan is moving in tiny steps after 30 years of very low rates,” Nordea’s Cekov said. “If you rock the boat you may get undesired consequences and the yen is collateral damage from that perception.” The Australian dollar was last 0.28% higher at $0.6395, but eyed a weekly loss of over 0.8%.The New Zealand dollar similarly was on track to lose roughly 0.5% for the week and last bought $0.5910. More