Aurelia Butler

Kishida moved the reshuffle, originally slated for early September, after a key memorial service for former premier Shinzo Abe who was fatally shot last month, earlier to solidify the leadership in the wake of a domestic COVID-19 resurgence and the intensifying Taiwan situation, the newspaper said.The reshuffle would come after Kishida’s conservative coalition government increased its majority in the upper house of parliament in a July election held two days after Abe’s death.Kishi, 63, a younger brother of the deceased Abe, has been serving as defence minister since September 2020.Foreign Minister Yoshimasa Hayashi and Chief Cabinet Secretary Hirokazu Matsuno in the Cabinet, as well as ruling Liberal Democratic Party Vice President Taro Aso and Secretary-General Toshimitsu Motegi will likely be retained at their positions, Yomiuri also reported. More

The bank’s monthly Market Expectations Survey (REM) shows July’s monthly inflation at 7.5%.A source from Argentina’s economy ministry told Reuters on Thursday that inflation in July could be so high that it will “shock” the government.Nonetheless, the 39 economists polled between July 27 and 29 moderately raised their economic growth projection for Argentina in 2022 to 3.4%, a increase of 0.2 percentage points from their projection last month.Participants also expect the average nominal exchange rate in Argentina in December to be 167.16 pesos to the dollar, which closed Friday at 132.9 pesos per dollar.Latin America’s third-largest economy has been suffering for years from very high inflation, which has been aggravated since March by the effects of the war launched by Russia in Ukraine. More

NEW YORK (Reuters) – A rally in U.S. stocks that has powered on despite skepticism from Wall St faces a reality check in the coming week, as key inflation data threatens to shut the door on expectations of a dovish shift from the Federal Reserve.The S&P 500 has walked a tightrope this summer, rising 13% from its mid-June lows on hopes that the Fed will end its market-bruising rate increases sooner than anticipated. A blowout U.S. jobs number on Friday bolstered the case for more Fed hikes but barely dented stocks – the S&P fell less than 0.2% on the day and eked out its third straight week of gains.More upside could hinge on whether investors believe the Fed is succeeding in its fight against soaring consumer prices. Signs that inflation remains strong despite a recent drop in commodity prices and tighter monetary policy could further weigh on expectations that the central bank will be able to stop hiking rates early next year, drying up risk appetite and sending stocks lower once again. “We’re at the point where consumer price data has reached a Super Bowl level of importance,” said Michael Antonelli, managing director and market strategist at Baird. “It gives us some indication of what we and the Fed are facing.” UNLOVED RALLYRebounds in the midst of 2022’s bear market have been short-lived and three previous bounces in the S&P 500 have reversed course to make fresh lows, fueling doubts that the most recent rally will last. Investors’ dour outlook was highlighted by recent data from BofA Global Research, which showed the average recommended allocation to stocks by sell-side U.S. strategists slipped to its lowest level in over five years in July, even as the S&P 500 rose 9.1% that month for its biggest gain since November 2020.Institutional investors’ exposure to stocks has also remained low. Equity positioning for both discretionary and systematic investors remains in the 12th percentile of its range since January 2010, according to Deutsche Bank (ETR:DBKGn) published last week.For their part, Fed officials have over the past week opposed the narrative of a so-called dovish pivot, with one of them – San Francisco Fed President Mary Daly – saying she was “puzzled” by bond market prices that reflected investor expectations for the central bank to start cutting rates in the first half of next year.U.S. rate futures have priced in a 69% chance of a 75 bps hike at its September meeting, up from about 41% before the payrolls data. Futures traders have also factored in a fed funds rate of 3.57% by the end of the year. Positioning in options markets, meanwhile, shows little evidence of investors rushing to chase further stock market gains. One-month average daily trading volume in U.S. listed call options, typically used for placing bullish bets, is down 3% from June 16, Trade Alert data showed.”We are surprised to not see investors start to chase upside calls in fear of underperforming the market,” said Matthew Tym, head of equity derivatives trading at Cantor Fitzgerald. “People are just watching.”Celia Rodgers Hoopes, portfolio manager at Brandywine Global, believes much of the recent rally has been driven by short covering, especially among many of the high-flying tech names that haven’t done well this year.”The market doesn’t want to miss out on the next rally,” she said. “Whether or not it’s sustainable is hard to tell.” Of course, investors aren’t uniformly bearish. Corporate earnings have come out stronger than expected for the second quarter, with some 77.5% of S&P 500 companies beating earning estimates, according to I/B/E/S data from Refinitiv, fueling some of the market’s gains.Antonelli of Baird also said a cooler than expected inflation number next week could push more investors back into stocks.“Is there a scenario right now where inflation comes down and the Fed isn’t going to engineer a hard landing? There could be, and nobody is positioned for that.”Others, however, are more skeptical. Tom Siomades, chief investment officer of AE Wealth Management, believes the market is yet to see a bottom and has urged investors to avoid chasing stocks.”The market seems to be engaging in some wishful thinking,” he said. Investors “are ignoring the age-old adage, ‘don’t fight the Fed.'” More

“Led by high beta strategies, hedge funds posted the strongest gains in 15 months, as powerful risk-on sentiment drove a sharp reversal in equity markets, while the U.S. economy entered a recession and the US Federal Reserve raised interest rates again in an effort to slow generational inflation,” said Kenneth J. Heinz, President of HFR.For the year to date, hedge funds remained down 4.1%, the fund weighted composite index showed.Equity hedge funds posted gains of 2.89%, underperforming the S&P 500, which went up 9.11% last month. For the year, equity hedge funds were down 9.2%.Macro hedge funds, which trade a broad range of assets, such as bonds, currencies, rates, stocks and commodities, were down 1.07%, their third consecutive month of losses. In the year they remained the best-performing category, with gains of 7.36%.Heinz said fund managers have positioned funds to preserve capital as well as to seize opportunities to take advantage of sudden shifts in macroeconomic conditions. More

Draghi, dubbed “Super Mario” due to his long career as a financial problem solver, had helped shape Europe’s tough response to Russia’s invasion of Ukraine and had boosted the country’s standing in financial markets during his tenure.”Risks to Italy’s credit profile have been accumulating more recently because of the economic impact of Russia’s invasion of Ukraine and domestic political developments, both of which could have material credit implications,” Moody’s said.The agency affirmed Italy’s sovereign rating at Baa3.Italy’s credit situation has also stoked concerns, with a government debt pile larger than those of the other four countries in the euro zone combined.Moody’s also noted higher funding costs, an increased risk that energy supply challenges would weaken economic prospects, and sluggish growth that may pressure Italy’s fiscal strength. Italy’s economy ministry said in a statement that Moody’s decision was “questionable”.”We remain confident that the implementation of Italy’s recovery plan, of policies to relaunch investments and secure energy sources will promptly continue after the upcoming general elections,” the Treasury said in a note.With snap elections planned on Sept. 25, Italy has approved a new aid package worth around 17 billion euros to help shield firms and families from surging energy costs and rising consumer prices.Despite the headwinds, preliminary data showed last month that Italy’s economy grew 1.0% in the second quarter of the year from the previous three months, a stronger-than-expected reading. More