Aurelia Butler

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The Japanese retail giant said it was open to “sincerely consider” any proposals. But it would “resist any proposal that deprives our shareholder of the company’s intrinsic value that fails to specifically address very real regulatory concerns,” the company said in a letter addressed to Couche-Tard.Seven & I Holdings had a market capitalisation of about $39 billion based on its closing price on Thursday and its shares were up about 0.5% in morning trade on Friday.News of Couche-Tard’s approach for the global operator of the 7-Eleven convenience store chain, which would be the largest foreign takeover of a Japanese company, pushed Seven & I shares up almost 23% on Aug. 19. Couche-Tard, which operates Circle-K convenience stores, is valued at about $52 billion. More

TOKYO (Reuters) – The U.S. dollar sagged near a one-week low versus major peers on Friday with job market indicators sending mixed signals ahead of crucial monthly payrolls data later in the day that is almost certain to set the pace for Federal Reserve policy easing.The dollar index, which gauges the currency against a basket of six key counterparts, was steady at 101.03 as of 0015 GMT, after slipping about 0.2% overnight and touching 100.96 for the first time since Aug. 29. For the week, it has dropped close to 0.7%.A report on Thursday showed the number of Americans filing new applications for jobless benefits declined last week as layoffs remained low. That helped allay fears that the labor market was deteriorating rapidly, after figures released the previous day showed private jobs growth slumped to a 3-1/2-year low in August.The mixed data leaves traders guessing before Friday’s payrolls print, with economists surveyed by Reuters predicting an increase of 165,000 jobs in August, up from a 114,000 rise in July.What the Fed makes of the numbers will be almost immediately obvious, with both Governor Christopher Waller and New York Fed President John Williams separately taking to the podium in the final Fedspeak before the blackout period begins ahead of this month’s policy gathering.Traders currently see 40% odds for a super-sized 50-basis point (bp) Fed interest rate cut on Sept. 18, versus 60% probability of a quarter-point reduction, according to the CME Group’s (NASDAQ:CME) FedWatch Tool. A day earlier, wagers on the larger cut stood at 44%, but a week ago it was 34%.Fed Chair Jerome Powell signaled the central bank’s focus was shifting from fighting inflation to preventing deterioration in the jobs market when he strongly endorsed an imminent start to the monetary easing cycle at the annual economic conference in Jackson Hole last month.”Recent labor data has fanned fears of labor market softening (and) the August payroll report could be a ‘make or break’ moment,” TD Securities analysts including head of global strategy Rich Kelly wrote in a report.However, TD expects 205,000 jobs were added in August, setting up a quarter point cut this month, and triggering a dollar rebound.”There is simply lots of bad news priced into the USD, increasing the risks that a string of good news will kick-start a sizeable correction.”The dollar was steady at 143.25 yen, after dipping to 142.855 overnight for the first time since Aug. 5, pressured by a slide in U.S. Treasury yields, with that on the 10-year note dipping to a one-month trough of 3.721%.The euro held its ground at $1.1112, just below Thursday’s one-week high of $1.11195.Sterling was little changed at $1.31755, sticking close to the overnight top at $1.31855, the strongest level since Aug. 30.The risk-sensitive Australian dollar edged down slightly to $0.6739.Leading cryptocurrency bitcoin rose 0.2% to $56,167, attempting to recover from its slump to a nearly one-month low of $55,575.78 this week. More

New British Prime Minister Keir Starmer said he wanted the economy to achieve annual growth of 2.5% when campaigning in the run-up to July 4’s election – a rate that Britain has not regularly reached since before the 2008 financial crisis.An annual growth rate of 3% would require extra investment of 100 billion pounds a year in the next 10 years, particularly in energy, housing and venture capital, according to the report from UK financial services lobby group Capital Markets Industry Taskforce.The investment could come out of the six trillion pounds in long-term capital in Britain’s pensions and insurance sector, the report’s lead author Nigel Wilson, former boss of Legal & General, told Reuters.”We’ve underinvested in the UK for such a long time, there’s a massive gap between the other G7 countries and ourselves,” he said.”We have the long-term capital in the UK, it needs to be reallocated.”The British economy needs an extra 50 billion pounds annually in energy investment, as it seeks to meet net zero targets, 30 billion pounds in housing and 20-30 billion in venture capital, the report said. The government should look at incentives to investment, such as reductions in taxes on shares for retail investors, the report added. UK pensions have a “significantly lower” allocation to domestic and unlisted equities than most developed market pension systems globally, according to a separate report published on Friday by think tank New Financial.UK pensions could as much as double their allocations and still be in line with the pensions industry in other advanced markets, the report said.The UK government has called for a review of Britain’s pension system, as it seeks to increase UK pensions investment in domestic startups.($1 = 0.7594 pounds) More

Consumer spending edged up 0.1% in July year-on-year, compared with the median market forecast for 1.2% growth. On a seasonally adjusted, month-on-month basis, spending decreased 1.7% versus an estimated 0.2% drop.Data a day earlier showed Japan’s inflation-adjusted wages grew for the second straight month in July, primarily thanks to a bump in summertime bonuses. Base pay, or regular pay, marked the fastest pace of increase in nearly 32 years, reflecting results from this spring’s labour-management wage talks.But a government official said the big test would be whether real wages continue rising in August and beyond, without the seasonal factor of summer bonuses. Along with solid wages and durable inflation, robust consumption is among the factors the Bank of Japan says are key to its decision to raise interest rates further. The BOJ ditched negative interest rates in March and raised short-term rates to 0.25% in July on the view the economy was making progress toward durably achieving its 2% inflation target.The Japanese government last month upgraded its economic assessment for the first time in more than a year on signs of improving personal spending, which accounts for more than half of Japan’s economy. More

The new forecast marks a reduction of 4.75 percentage points compared to last month’s survey.Prices are seen rising by 3.5% in September, according to the poll, slowing down after a surge that followed deep spending cuts as well as the devaluation of the peso currency enacted by libertarian President Javier Milei in a bid to reduce sky-high inflation.Analysts also projected a 3.8% year-on-year drop in the South American economy’s real gross domestic product (GDP) for 2024, slightly lower than their prior estimate.”The activity level would begin to recover in the third quarter of the year, with a rise of 0.9%,” according to the survey, while participants estimated growth would average 3.5% in 2025.The survey polled 42 analysts from August 28-30. (Report by Nicolas Misculin; Editing by Sonali Paul) More

ORLANDO, Florida (Reuters) -The past month in markets has been littered with momentous events: a record burst in U.S. stock market volatility, near-confirmation from the Federal Reserve that U.S. interest rates will soon be cut, and the biggest ever one-day crash in a listed company’s market cap.    But one constant has been the resilience of bonds, which are once again fulfilling their role as the classic hedge in a traditionally diversified portfolio. This is a sign that the economic landscape is shifting and that investors may increasingly move away from equities – which are near record highs and, historically, on the expensive side – towards fixed income.If so, the 40% weighting of bonds in the traditional ’60-40′ investment portfolio is going to have to carry a heavy load.    To be sure, bonds’ strong performance didn’t start in the last few weeks. Yields across the U.S. Treasury curve have generally been falling since April, as asset managers have been steadily building their long Treasury futures positions for most of this year to new record-high levels.    According to Bank of America, global bond funds have attracted $425 billion of inflows this year, around $40 billion more than global equity funds. Investment Company Institute figures show that U.S. mutual funds’ year-to-date bond inflows are currently around $315 billion, nearly four times more than equity inflows.    This flight to bonds suggests that investors have been positioning for a breakout in fixed income returns that hasn’t yet occurred. The ICE BofA Treasury index is up only 3% this year while the S&P 500 is up over 15%, even after the recent turbulence.    But the balance appears to be shifting. RETURN TO ‘NORMAL’?    The theory behind the standard balanced portfolio is that the 60% allocation to equities provides the bulk of returns, while the 40% slice of bonds can offer downside protection in times of market volatility and economic uncertainty. But this only works if there is a negative correlation between equities and bonds when markets get rocky. And until recently the simple correlation between the S&P 500 and Treasuries was overwhelmingly positive, as investors fretted over elevated interest rates more than growth.But it has now flipped. Strategists at Truist Advisory Services note that core bond returns were positive during the S&P 500’s 8.5% drawdown in the three weeks through Aug. 5. In fact, the last time stocks fell more than 5% and bonds rose was more than four years ago.     True, one month does not make a trend. But markets may be at a turning point: the root cause of equity market angst is no longer ‘higher for longer’ borrowing costs but rather a ‘hard landing’. Growth is now the worry, not inflation.     Consider how dramatically markets have reacted to modestly negative economic data. Figures on Tuesday showed that U.S. manufacturing activity shrank in August, as it has done almost every month for the last two years. That was hardly a shock, but it sparked a stampede out of stocks and into bonds.     The S&P 500’s fall of 2.1% was the biggest one-day drop following an ISM data release since October 2022, notes Citi’s Stuart Kaiser. And then there was the explosion of volatility in the first week of August related, in part, to a slight uptick in U.S. unemployment. The risk/reward balance of holding equities has deteriorated as the economic slowdown becomes clearer.    So what happens if the soft landing fails to materialize and the economy tips straight into recession? History suggests equities will fall and Treasuries will rise.     And if growth slows but the economy manages to skirt recession? History indicates equities will probably rise, but bonds will too. Either way, bonds seem to be the safer bet.    It is probably safe to say that if the 60-40 portfolio struggles in the coming months, it won’t be bonds’ fault.    (The opinions expressed here are those of the author, a columnist for Reuters.) More

PORT-AU-PRINCE (Reuters) -U.S. Secretary of State Antony Blinken on Thursday called for renewing a United Nations mandate for an international security mission to help Haiti fight armed gangs that have taken over much of the country’s capital and expanded to nearby regions.The mission’s mandate, first approved for 12 months, is set to expire at the start of October, but has seen few results with few troops on the ground and far less funding than hoped.”At this critical moment you need more funding, you need more personnel to sustain and carry out the objectives of this mission,” Blinken told a press conference in Port-au-Prince.He said the U.S. – the mission’s largest financial backer – planned to convene a ministerial meeting at the U.N. General Assembly this month, to encourage more financial contributions and renew the mandate.”The mission itself needs to be renewed, that’s what we’re working on right now. But we also want something that’s reliable, that’s sustainable and we’ll look at every option to do that; a U.N. peacekeeping mission is one option,” Blinken said.The current U.N.-ratified mission is being led by Kenya, which with under a month left on the mandate remains the only country to have deployed, with around 400 police officers arriving in Port-au-Prince in June and July from an expected total of 1,000.A handful of other countries have together pledged at least 1,900 more troops, and hundreds of millions of dollars in support. By late August, just $63 million had been paid into the U.N.’s dedicated trust fund.The mission has faced setbacks such as delays in paying the Kenyan officers and supplying key equipment such as firing towers for armored vehicles.”Much remains to be done and we’re determined to continue,” Blinken said. “It’s starting to move.”He also urged Haitian authorities to put the country on track for elections next year. Haiti last held elections in 2016 and its last elected president was assassinated in 2021.Blinken met with Haitian Prime Minister Garry Conille and the head of its presidential council Edgard Leblanc Fils during his visit. He also announced a further $45 million in humanitarian aid for Haiti.Nearly 580,000 people have been internally displaced by the conflict, hundreds of thousands who fled the country have been deported back to Haiti, and close to 5 million people are facing severe hunger. More