2025-01-23 07:31
Primark's Q1 like-for-like sales down 1.9% UK and Ireland like-for-like sales down 6.0% Cuts full-year forecast to "low single digit" sales growth Highlights pressure on lower-income UK consumers Shares down 3% LONDON, Jan 23 (Reuters) - Associated British Foods (ABF.L) , opens new tab cut annual sales guidance for its Primark budget fashion retailer after reporting weak trading in its main UK market in the Christmas quarter that it said reflected pressure on lower-income shoppers. The group said Primark was now targeting "low single digit" sales growth in 2025, having previously forecast "mid single digit" growth, but kept its forecast for an adjusted operating margin in line with the 11.7% achieved in 2023/24. Shares in AB Foods were down 3% on Thursday, extending losses over the last year to 18%. The group said Primark's total sales grew 2% over the 16 weeks to Jan. 4, its fiscal first quarter, helped by new store openings. However, on a like-for-like basis sales fell 1.9%, reflecting a 6.0% dip in the UK and Ireland - a market that accounts for about 45% of its sales. While it lost market share in the UK, sales in Europe and the U.S. were stronger. The group said growth in UK and Ireland like-for-like sales over the key Christmas trading weeks was more than offset by weaker autumn trading in "a challenging retail environment". Official data published on Friday showed overall UK retail sales fell unexpectedly in December, showing elements of a cost of living crisis remain and raising the risk of an economic contraction in the fourth quarter. Finance director Eoin Tonge said Primark's UK performance was consistent with that of other retailers who rely on lower-income shoppers. "It would appear to us that there are more challenges at the lower-income side of things," he told Reuters in an interview. Earlier this month, other retailers skewed towards lower-income shoppers - sportswear group JD Sports (JD.L) , opens new tab, general merchandise business Argos, baker Greggs (GRG.L) , opens new tab and discounter Poundland (PCOP.WA) , opens new tab - all reported subdued Christmas trading. In contrast, clothing retailers Next (NXT.L) , opens new tab and Marks & Spencer were more upbeat. However, Next did highlight relative weakness in stores compared with online sales. Unlike its rivals, Primark does not offer online delivery. It does, however, offer a click and collect service. "This isn't a story about the Primark model (being) challenged, it's a story about the consumer being challenged," said Tonge. AB Foods maintained its guidance for its grocery, sugar, agriculture and ingredients businesses. Revenue in grocery, which includes Twinings tea, Jordans cereals and Ovaltine drinks, grew 1% in the quarter. Sugar sales declined 2%. Tonge expects analysts' full-year consensus profit forecast for the group to fall about 2%. Sign up here. https://www.reuters.com/business/retail-consumer/primarks-underlying-sales-dip-christmas-quarter-2025-01-23/
2025-01-23 07:24
NEW DELHI, Jan 23 (Reuters) - India's state-run refiner Bharat Petroleum Corp (BPCL.NS) , opens new tab sees its Russian oil processing down to 20% in March from 31% this month as it awaits offers from traders, its head of finance Vetsa Ramakrishna Gupta told an analyst call on Thursday. The company and other state refiners such as Indian Oil Corp (IOC.NS) , opens new tab, Hindustan Petroleum (HPCL.NS) , opens new tab, and Mangalore Refinery and Petrochemicals (MRPL.NS) , opens new tab buy Russian oil in the spot market and the lack of clarity regarding its availability is forcing them to look for alternatives. BPCL's Russian oil processing declined to 31% in December quarter from about 35-40% in the previous month. The company, along with other Indian state refiners, received a lower supply of Russian oil in January and February. Gupta said lack of offers from traders for sale of Russian oil for March delivery could be 'temporary' as Russia has not cut its oil output. Washington has imposed sweeping sanctions targeting Russian producers and tankers, disrupting supply from the world's No. 2 producer and tightening ship availability. Gupta said his company meets 55% of its oil needs through annual contracts and up to 35% from the spot market. Indian refiners buy Russian oil on a delivered basis, with seller arranging the tanker and insurance. "Pre condition is that they (traders) do not move crude in any of the sanctioned vessel," he added. To make up for the shortfall, Indian refiners have floated tenders for oil imports and are purchasing grades such as Abu Dhabi's Murban grade. Sign up here. https://www.reuters.com/markets/commodities/indias-bpcl-sees-march-russian-oil-intake-down-20-it-awaits-offers-2025-01-23/
2025-01-23 07:18
Traders trim bearish bets on S.Korean won, Chinese yuan Indian rupee most shorted Asian currency Short bets on Indonesian rupiah highest since Nov 2022 Jan 23 (Reuters) - Investors scaled back bearish bets on most Asian currencies after U.S. President Donald Trump's inaugural policies suggested he would negotiate rather than immediately impose hefty tariffs on trading partners, a Reuters poll showed on Thursday. Short bets on the Chinese yuan , the Taiwanese dollar and the Thai baht were lower than a fortnight ago, according to a poll of 11 respondents. Short positions on the South Korean won - the best performing Asian currency so far in January - were also lower. Many investors expected tariffs to be among a raft of executive orders Trump signed in his first day in office. However, signs of a measured approach weakened the dollar and bolstered risk sentiment towards Asian currencies. Trump said his administration was discussing imposing a 10% tariff on goods imported from China and around 25% levies on Mexico and Canada from Feb. 1. "As long as market players remain convinced that the Trump 2.0 government will not quickly implement the tariff hike and the magnitude of the tariff hike won't be as severe as previously concerned, we could see Asian FX being supported by such views and somewhat weaker U.S. dollar as well as muted/lowered movement in the UST-10y yield," said Poon Panichpibool, a markets strategist at Krung Thai Bank. Short bets on the Singapore dollar also eased. Lower inflation and higher growth have created room for the Monetary Authority of Singapore to ease policy settings at its review on Friday, though analysts are split on whether the central bank would wait to assess the impact of Trump's policies. Bucking the trend, short bets on the Indian rupee rose to their highest since mid-July 2022. The rupee has declined about 3% since Trump won the U.S. election and is the second-worst performer among regional peers this month. "INR overvaluation, a growing RBI forward book, and broad USD strength remain factors likely to push the INR weaker," Barclays analysts said in a note, adding that foreign outflows in the equity market have also weighed on the rupee at a time when forex reserves have been falling. Bearish bets on the Indonesia rupiah also rose to their highest since November 2022. Last week, the Bank of Indonesia (BI) surprised markets with an unexpected rate cut to boost economic growth. Barclays analysts said that the rupiah was losing its policy rate anchor. "The shift in BI's stance towards a more dovish-leaning, pro-growth stance should open up further upside for USDIDR." The Asian currency positioning poll is focused on what analysts and fund managers believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht. The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3. A score of plus 3 indicates the market is significantly long U.S. dollars. The figures include positions held through non-deliverable forwards (NDFs). The survey findings are provided below (positions in U.S. dollar versus each currency): Sign up here. https://www.reuters.com/markets/asia-fx-bears-retreat-after-less-aggressive-start-trumps-tariff-plans-2025-01-23/
2025-01-23 07:16
Jan 23 (Reuters) - British trading platform CMC Markets (CMCX.L) , opens new tab said on Thursday that it remains on track to achieve annual net operating income as previously guided, and is confident of meeting its cost forecast due to market volatility in the final quarter of 2024. Firms such as CMC benefited from periods of high trading volatility seen in 2024 as global central banks maintained caution on monetary policy easing due to inflationary pressures, while geopolitical tensions, especially in the Middle East, compounded market uncertainties. Also, speculative trading in assets such as cryptocurrencies and commodities as well as the prospects of tariff-driven trade policy by Donald Trump in his second term as the U.S. president contributed to the market turmoil. Sign up here. https://www.reuters.com/markets/europe/britains-cmc-markets-track-meet-annual-net-operating-income-target-2025-01-23/
2025-01-23 06:59
LME thought it had solved the queue problem a decade ago Some traders use rent-capping to get free storage Queues stop consumers from getting the metal they need Percentage load-out rate an option for LME warehousing LONDON, Jan 22 - The London Metal Exchange (LME) plans to launch a consultation on revamping its warehouse storage rules, four sources with knowledge of the matter said, after bottlenecks resurfaced last year despite a previous overhaul. Nearly a decade ago, the LME thought it had solved the problem of gridlock in its approved storage facilities with queue-based rent capping (QBRC) rules. QBRC limits the rental income of warehouses to 80 days after the firm that owns the metal has given notice of intention to take delivery or cancelled the warrants - title documents conferring ownership. But one consequence has been that some traders with contractual obligations to deliver metal to customers beyond 80 days, in the knowledge there are queues, cancel warrants to get free storage. Consumers are also prevented from getting metal in LME warehouses with queues when they need it. Rent-capping has failed to stop the queues, which resumed last year after a large delivery of aluminium to ISTIM's facilities in Port Klang for a rent-sharing deal between the warehouse firm and the company depositing the metal. In response to a request for comment, the LME said only: "The LME has a comprehensive set of rules around queues, including a specific provision which caps the amount of rent which can be charged in a queue. As we have said previously, the LME keeps its warehousing rule sets under review." The LME introduced QBRC after the wait to take aluminum out of LME registered warehouses in Vlissingen in the Netherlands soared to two years and to 700 days in Detroit in 2014, which created artificial shortages and high prices for consumers on the physical market. The queues this time are significant, although shorter. In May last year, when the queue emerged, the wait time to take delivery of aluminium from ISTIM's warehouses in Port Klang was 253 days. At the end of last year, it was still 163 days. Most of the aluminium in Port Klang was produced in India rather than Russia. Many Western consumers have refused to buy metal produced in Russia, after its invasion of Ukraine in February 2022. PERCENTAGE 'LOAD-OUT' The sources, who spoke on condition of anonymity because they were not authorised to speak publicly, said one alternative to QBRC would be to stipulate the percentages of metal that would have to leave the warehouse, or be loaded out, within a certain period. They said no numbers had yet been floated. The concept would align with the principle the LME is the market of last resort for consumers, producers and traders with contracts to sell or buy metal, and that LME warehousing must be efficient for the physical industry. Percentage load-out would oblige warehouse keepers to ensure they can load out required percentages of their total inventory, meaning they would have to limit the quantity of metal in their storage facilities. It would also bring the LME in line with aluminium on the commodity exchange COMEX, which requires its approved warehouses to deliver out 2% of their total stocks of the metal. Aluminium, used in transport, construction and packaging, is the world's largest non-ferrous produced metal market and the LME's highest volume contract. OPPOSITION LIKELY The sources said they expected opposition to percentage load-out rules from firms whose business models focus on earning rent by storing large amounts of metal. Replacing QBRC would also make redundant the LME's load-in load-out rule (LILO), which specifies the tonnage that has to be shipped out when a queue is longer than 50 days and simplify warehouse regulations. Other potential changes the LME is expected to consult on are the banning of agreements known as "rent deals" that allow warehouses to share rental income with companies that deliver metal to them, the sources said. The firm that delivers the metal to a warehouse does not have to retain ownership under the rent deals, but still gets a share of the rent as long as the metal stays in the warehouse, and the fees are paid by the new owners of the metal. Three of the sources said the LME also wanted some control over warehouse charges, such as those for handling, warranting and rewarranting. Sign up here. https://www.reuters.com/markets/commodities/lme-plans-consult-tackling-warehouse-gridlock-2025-01-22/
2025-01-23 06:58
BANGKOK, Jan 23 (Reuters) - Thailand's exports rose for a sixth straight month and more than expected in December, with the commerce ministry saying on Thursday that shipments would increase further in January but that uncertainty over U.S. trade policies posed a challenge. Exports (THCEX=ECI) , opens new tab, a key driver of Southeast Asia's second-largest economy, grew 8.7% in December from a year earlier, beating a forecast for an 8.15% rise in a Reuters poll and up from November's 8.2% increase. The ministry is maintaining an export growth target of 2%-3% for 2025, after last year's 5.4% rise to a record $301 billion. According to preliminary data, the ministry expects exports to rise again in January, while it is monitoring the impact of U.S. President Donald Trump's trade policies, Poonpong Naiyanapakorn, head of the Trade Policy and Strategy Office, told a news conference. "We have to wait and see ... his policies are being gradually released, with both positive and negative impacts on Thailand and neighbouring Southeast Asian countries," he said. The commerce minister is planning to travel to the United States next month to discuss trade and tariffs with U.S. officials, he said. The ministry said there were challenges to growing Thai exports from uncertain U.S. trade policies, prolonged geopolitical tensions and fluctuations in exchange rates. In December, exports to the United States, Thailand's biggest market, rose 17.5% year-on-year. For all of 2024, exports to the U.S. were up 13.7% and accounted for an 18.3% share of Thailand's total exports. Shipments to China rose 15% in December from a year earlier, while shipments of computers and components increased 44%. Exports of cars and car parts, however, fell 7%. Rice exports were also down in December, falling 7.1% from a year earlier, although rising 13.4% for the full year to 9.95 million metric tons. Thailand, the world's second-biggest rice exporter, expects rice shipments to drop to 7.5 million tons in 2025 due to more competition from biggest exporter India and less demand from Indonesia, according to the Thai Rice Exporters Association. Imports (THCIM=ECI) , opens new tab rose 14.9% in December from a year earlier, above a forecast rise of 13.7%. That resulted in a trade deficit (THCTR=ECI) , opens new tab of $10.6 million in December, compared with a forecast surplus of $290 million. In 2024, imports rose 6.3% from 2023, yielding a trade deficit of $6.3 billion. Sign up here. https://www.reuters.com/markets/asia/thai-dec-exports-rise-87-yy-above-forecast-2025-01-23/
