Aurelia Butler

(Reuters) – A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist.Wall Street and world stocks may have shrugged off a spike up in long-term U.S. bond yields on Monday, but investors in Asia are likely to be in more cautious mood on Tuesday as they brace for the biggest fall in Chinese exports since the pandemic.The median forecast in a Reuters poll of economists is for a 12.5% year-on-year slump in Chinese exports in July, which would follow a 12.4% slide in June and mark the worst reading since February 2020.China’s July trade data top a heavy regional economic calendar on Tuesday, with current account, bank lending and household spending reports from Japan, current account data from South Korea and Australian consumer sentiment also on tap.Chinese imports are also forecast to have fallen in July, by 5.0% year on year, although that would be less than the 6.8% rate of decline in June. But for the world’s manufacturing and factory engine, focus is on the alarming weakness in exports.Chinese factory activity fell for a fourth straight month in July, further depressing the outlook for growth and increasing pressure on Beijing to inject substantial stimulus. The services and construction sectors are also teetering on the brink of contraction.Citi’s Chinese economic surprises index remains deeply negative, but has crept up off its lows recently. At -54.7, it is at its ‘highest’ level since June 30, but will soon be heading lower again if Tuesday’s trade data disappoint.Looking at markets and risk appetite more broadly, the trading week got off to a solid start on Monday as investors swatted away another rise in U.S. Treasury yields and a steepening of the yield curve. The curve steepening was again led by a selloff at the long end and spike higher in long-dated borrowing costs, but was less aggressive than some recent moves. Investors were also heartened to hear New York President John Williams say interest rates could begin to come down early next year.The S&P 500 and Nasdaq snapped a four-day losing streak, and the Dow jumped more than 1%. Equity and currency market volatility eased back on Monday although bond market volatility was more resilient.On the corporate front on Tuesday, Japan’s Softbank (OTC:SFTBY) Group is expected to report a profit of 75 billion yen ($525 million) for the April-June period, marking a return to profit after two consecutive years of losses. Nikon (OTC:NINOY) and Mazda are among the raft of Japanese companies also publishing results on Tuesday as the reporting season picks up pace.Here are key developments that could provide more direction to markets on Tuesday:- China trade (July)- Japan current account, bank lending, household spending (June) – Australia consumer sentiment (July) (By Jamie McGeever) More

Labour has accused ministers of dragging their feet in regulating the booming “buy now, pay later” sector, claiming that millions of hard-up Britons are at risk of being exploited by unethical operators.The Treasury promised in February 2021 to “act swiftly” and legislate to regulate the popular products that allow users to defer or divide payments into instalments without any interest, in order to make sure they came with the right protections.But with the issue still under review following a consultation, shadow City minister Tulip Siddiq has claimed the policy is being “kicked into the long grass” ahead of the general election expected next year.In a letter to City minister Andrew Griffith, seen by the Financial Times, Siddiq said: “I recognise that many people value BNPL deals, as they can be a useful way to budget and pay for items.“But the government’s failure to regulate the sector has left millions at risk from bad actors in the market.”Ministers are grappling with the trade-offs involved in regulating a sector that offers a financial lifeline to many Britons, including the risk that some operators could leave the market if rules are too severe. However, government insiders said Griffith was determined to press ahead with regulation and that the Treasury hoped to respond to the recent consultation in the autumn.The Treasury said: “Regulation of buy now, pay later products must be proportionate so borrowers are protected, while still being able to access these useful interest-free products.“No decisions have been made as we are reviewing the responses to our recent consultation and will report back in due course.”The finance ministry has been delaying policies that might exacerbate the cost of living crisis, including pausing Brexit-related plans on regulation and border controls that risk increasing prices.While traditionally seen as a tool for discretionary spending, BNPL deals have surged among all age groups in the UK, including older people, who find themselves squeezed by rising living costs and in need of short-term credit.The products soared in popularity during the pandemic but have come under increasing regulatory scrutiny over the rate of take-up and whether companies adequately assess customers’ ability to afford loans. In 2021, a review commissioned by the Financial Conduct Authority, which does not regulate the products, found that work on BNPL was “very urgent”.

Siddiq said Labour would work “hand-in-hand with industry to properly regulate the BNPL” sector. The legislative window is quickly closing in this parliament. November 7 will see King Charles set out the government’s last full legislative programme before the next general election.The FCA found in its latest annual survey of Britons’ finances that 8.8mn adults — 17 per cent — had used deferred payment credit or BNPL deals in the previous 12 months. Other markets, including Australia, are also looking to rein in the industry. In May, Australian financial services minister Stephen Jones announced that BNPL products would be more strictly regulated as credit products. More

Equity strategies are leading the industry’s gains in 2023, with a 2.03% last month. Still, they lag the benchmark index S&P 500, which surged 20.65% in the year through July.All four hedge fund strategies tracked by HFR – equity, event-driven, macro and relative value – ended July with positive returns. Overall, hedge funds rose 1.51% in July and roughly 5% in the year.Event-driven hedge funds, which include shareholder activism and those betting on mergers and acquisitions, led the industry performance in July, with 2.58% in gains. In the year, they are up 5.10%.Macro hedge funds, which struggled in March with the banking crisis, posted gains of 0.47% last month, but in the year they are still down 0.36%.Relative value strategies, which trade asset price asymmetries, ended July up 0.87% and 3.42% higher year-to-date.”Powerful technology and AI trends were complemented by a strong equity beta tailwind as banks recovered from the recent volatility,” said Kenneth J. Heinz, president of HFR, in a statement. More

(Reuters) – A federal appeals court on Monday blocked the Biden administration from proceeding with another piece of its student debt relief agenda, an effort to make it easier for people who are defrauded by their schools to have their loans forgiven.At the request of a group representing for-profit colleges, the New Orleans-based 5th U.S. Circuit Court of Appeals prevented the rule from taking effect pending the outcome of an appeal to be heard in November. The three-judge panel gave no reason for why it was granting the emergency injunction sought by the trade group, Career Colleges and Schools of Texas (CCST), which is appealing a lower-court judge’s decision to not block the rule.The rule is separate from Biden’s more sweeping student debt relief plan. The Supreme Court in June blocked his administration from canceling $430 billion in student loan debt for 43 million borrowers. The Democratic president has since announced plans to provide relief for student loan borrowers using a different approach.The 5th Circuit had previously administratively stayed the regulation so it could weigh the request. The panel’s three judges — Edith Jones, Kyle Duncan and Cory Wilson — were all appointed by Republican presidents.Neither CCST or the U.S. Department of Education responded to requests for comment.CCST sued in February after the Education Department in October finalized a rule changing a “borrower defense to repayment” program that allows students to seek debt relief if their schools mislead them.Students who have received debt forgiveness through the borrower defense program have attended for-profit colleges including Corinthian Colleges and ITT (NYSE:ITT) Technical Institute.The Biden administration’s rule amended the grounds for borrower relief, established new procedures through which the department would review their claims and allowed for a means for the agency to provide relief to entire groups from one school.CCST called the rule an unlawful and unconstitutional plan designed “to accomplish massive loan forgiveness for borrowers and to reallocate the correspondingly massive financial liability to institutions of higher education.” More