2024-01-08 11:16

PARIS, Jan 8 (Reuters) - The head of France's biggest supermarket chain E. Leclerc said on Monday it was still selling Pepsi after rival Carrefour (CARR.PA) ditched PepsiCo (PEP.O) products in the latest tug-of-war between retailers and global food giants over prices. Michel Edouard Leclerc also told BFM TV he was optimistic that food inflation in France would return to a range of 2.5% to 3% this year as consumer goods companies had become "more reasonable". Commenting on annual price negotiations with suppliers due to end on Jan. 31, Leclerc said he had asked French food giant Danone (DANO.PA) for price cuts that he hoped would become effective in February-March. "All the big industrial groups are playing for time. They are in no hurry to sign before Jan 31. Prices for the year are being decided now," he said. "I want to be the most affordable (retailer) in France...I will ask Danone for deflation," he added, without citing a figure. Danone said in a statement that it was holding weekly meetings and talks with all its clients on all its product categories. "The coming weeks will be key for finding with our partners the right balance between protecting the French purchasing power and suporting a fair, lasting and responsible (business) model," it said. France has been gripped by a debate over the price of staples, with retailers claiming that producers' price increases are unjustified. The government has demanded retailers and suppliers finish annual price negotiations in January, two months earlier than usual, as it seeks to lower inflation. Asked if Leclerc would, like Carrefour, withdraw Pepsico or any other products from its shelves because of high prices, he said: "I continue to sell Pepsi." "We can tell suppliers: see with lower prices you can build up revenue and I think this argument will prevail over a show of strength," he said. Carrefour said last week its stores in France, Belgium, Italy, Spain, and Poland would no longer stock products including Pepsi, Lay's Crisps, Cheetos, and 7up because of "unacceptable price hikes". https://www.reuters.com/business/retail-consumer/frances-leclerc-says-still-selling-pepsi-after-carrefour-dropped-pepsico-2024-01-08/

2024-01-08 11:16

PRAGUE, Jan 8 (Reuters) - Most of Czech steel maker Liberty Ostrava's 6,000 workers will remain at home for at least a week longer than previously planned with production idled amid a dispute with its on-site energy supplier. Liberty had intended to restart operations, which were halted last month, on Tuesday but workers will stay at home until at least Jan. 15, a Liberty spokesperson said on Monday. Energy supplier TAMEH Czech halted supplies of electricity, heat and industrial gases to Liberty on Dec. 21 and declared insolvency, claiming non-payment from Liberty. "In line with our restructuring plan, renewal of operations depends on reaching an agreement with TAMEH Czech," Liberty said in an email. The company, which operates in the eastern city of Ostrava and has an annual capacity of 3.6 million metric tons of steel, is part of the Liberty Steel group owned by commodities tycoon Sanjeev Gupta. Its last operating blast furnace was shut in a hot state in October amid a decline in the European steel market. Liberty took over the steel mill in 2019 from ArcelorMittal, which had to divest assets under a regulatory ruling. However, ArcelorMittal retains a 50% stake in TAMEH Czech through Poland-based TAMEH Holding. Poland's Tauron (TPE.WA) holds the other 50%. ArcelorMittal last week denied it had bought Tauron's stake. A regional court in Ostrava on Dec. 21 declared a three-month moratorium on all Liberty Ostrava debt repayments and appointed a restructuring trustee. The decision was based on preventative restructuring and a petition by the company itself. https://www.reuters.com/markets/commodities/liberty-ostravas-czech-steel-workers-remain-home-amid-energy-supply-feud-2024-01-08/

2024-01-08 11:13

A look at the day ahead in U.S. and global markets from Mike Dolan With U.S. government shutdown angst resurfacing, this weekend's Taiwan election in view, fourth-quarter earnings looming again and Boeing grounding aircraft after a mid-air blowout, Wall St's dour new year looks set to fail a hoary old five-day test. Old investment almanacs posit that if the first five trading days of the S&P500's new year are net positive or negative, it predicts a gain or loss for the full 12 months. Hocus pocus or not, the 'five-day rule' has proven correct for five years running - despite unforeseen curve balls from 2020's pandemic and 2022's Ukraine invasion. And unless the index rallies more than 1.5% later on Monday, those first five days will be in the red for 2024. Those who dismiss such old 'rules' point out its fallibility - it missed marginally in four of the five years prior to 2019 - and lampoon the ease with which it works due to the fact Wall St has typically ended higher more often than not over the years. Nevertheless, it has held true for 80% of the 64 years to 2014 - so not a great portent for 2024 for the superstitious. Even though the S&P500 had its first daily gain of the year on Friday, futures are in the red again ahead of Monday's bell - with the latest robust U.S. jobs report doing little to reverse a dominant new year theme of caution on interest rate cut bets. Another forecast-beating payrolls gain in December showed few signs of the sort of labor market cooling that might prompt the Federal Reserve to rush into easing credit this year. Futures show less than a two-thirds chance the 135 basis points of rate cuts priced for 2024 will now start as soon as March and 10-year Treasury yields , though lower, remain above 4%. Dallas Fed boss Lorie Logan on Saturday underlined that caution, warning rates could even be lifted again to offset any easier conditions in financial markets. "If we don't maintain sufficiently tight financial conditions, there is a risk that inflation will pick back up and reverse the progress we've made," she said. "In light of the easing in financial conditions in recent months, we shouldn't take the possibility of another rate increase off the table just yet." There were slivers of optimism, however, with Logan supporting moves to consider parameters that might see slowing of the Fed's balance sheet rundown as excess liquidity parked at the central banks's daily reverse repurchase facility tails off. And despite tense geopolitics and Middle East strife since late last year, the New York Fed's global supply chain pressure index fell back into negative territory last month. But there are other reasons to be anxious. Government shutdown jitters hove back into view as Congress reconvenes. Even though weekend agreements been top Democrats and Republicans on a $1.59 trillion spending deal offered some optimism, it set up a race for divided lawmakers to pass the bills to appropriate the money before government operations are forced to shut later this month. They face a Jan. 19 deadline for the first set of bills to move through Congress and a Feb. 2 deadline for the remainder. The fourth-quarter U.S. corporate earnings season gets underway later this week too, with the big banks kicking in on Friday. The sector's expected annual profit growth of 8.4% is forecast to outpace an overall 5.2% gain for S&P500 firms. Blue chips got an unexpected jolt at the weekend, however. Boeing shares listed in Frankfurt fell as much as 8% on Monday after the U.S. Federal Aviation Administration ordered the temporary grounding of some Boeing 737 MAX 9 jets fitted with a panel that blew off a jet in midair on Friday. But perhaps the most anxious backdrop surrounds the upcoming Taiwan elections. China's blue-chip index (.CSI300) fell almost 1% to its lowest level in nearly five years, while Hong Kong stocks shed roughly 2% amid rising geopolitical tensions and domestic economic worries that saw tech shares there take a new battering. China will conduct live firing drills in the East China Sea on Monday and Tuesday, according to the China maritime safety administration. Taiwan's defence ministry, meantime, said it detected three more Chinese balloons flying over the Taiwan Strait on Sunday, accusing China of threatening aviation safety and waging psychological warfare days before the elections. China's foreign ministry said the country will sanction five U.S. military manufacturers in response to the latest round of U.S. arms sales to Taiwan. In more positive news, U.S. chipmaker Nvidia (NVDA.O) said it plans to begin mass production in the second quarter of 2024 of an artificial intelligence chip it designed for China to comply with U.S. export rules. Key diary items that may provide direction to U.S. markets later on Monday: * U.S. Dec employment trends, U.S. Nov consumer credit * Atlanta Federal Reserve President Raphael Bostic speaks * U.S. Treasury auctions 3-, 6-month bills https://www.reuters.com/markets/us/global-markets-view-usa-2024-01-08/

2024-01-08 11:11

SARAJEVO, Jan 8 (Reuters) - Slovenian rescuers on Monday evacuated five people trapped deep inside a flooded underground cave since Saturday, the head of the rescue mission said, and they were all safe and well. Maks Merela, who leads the Cave Search and Rescue Unit, said the five were transported by boat through some sections of the 8.2 km network of underground lakes and walked through others. "They are now in a warm place, everybody is okay, all of them are positive and the rescue mission was successfully competed," Merela told Reuters by phone. The five, a family of three adults and two guides, had taken shelter more than 2 km from the entrance to the Križna Jama cave in southwestern Slovenia, which can only be visited by boat. Over the past two days, divers managed to take them food, water, medicines and a heated tent, but the high water level had made their evacuation impossible. Merela said that this was the first time people had been trapped in Križna Jama, a chain of lakes with emerald green water, the fourth largest known cave ecosystem in the world in terms of biodiversity. "There was a disastrous situation with flooding in Slovenia last year," he said. "The land has not absorbed all the water yet." Last August, Slovenia was stuck by the worst floods on record that killed six people and swept away homes. https://www.reuters.com/world/europe/rescue-begins-five-trapped-deep-inside-flooded-slovenian-cave-2024-01-08/

2024-01-08 11:04

WASHINGTON, Jan 8 (Reuters) - The U.S. economy ended last year with the labor scars from the COVID-19 pandemic effectively healed and a quandary for Federal Reserve policymakers so far waiting in vain for wage and job growth to cool to a sustainable level. The addition of 216,000 jobs to U.S. payrolls in December and wage growth of 4.1% both beat expectations, leaving the central bank still looking for clear signs of a slowing labor market and prompting traders in contracts tied to the benchmark federal funds rate to trim expectations the Fed will start cutting rates at its March meeting. Monthly job growth of around 100,000 and annual wage growth of around 3% are the Fed's rough benchmarks for growth in each that would be considered consistent with the Fed's 2% inflation target. "Workers still have the upper hand in the current environment, with strong wage growth and plenty of job opportunities," wrote Nationwide Senior Economist Ben Ayers. Wage growth remaining above 4% adds to concern that inflation in labor-intensive services industries may be hard to quell and represents "another blow to the odds that Fed will cut rates early this spring." The Fed held the benchmark interest rate steady at its December meeting in the current range of from 5.25% to 5.5%. But the language in the policy statement issued after the Dec. 12-13 session was changed to allow the possibility that no further rate increases will be needed, while new projections showed a majority of policymakers expect rate cuts of three quarters of a percentage point will be appropriate by the end of the year. Minutes of that meeting reflected an increased sense among officials that they may be approaching a point where the risks to jobs and economic growth posed by the current level of interest rates are more serious than those posed by inflation that has fallen faster than expected of late and which by some measures is near the Fed's 2% target already. Yet the job market remains a puzzle. Payroll employment has grown by 14 million over the past three years, a historic run that not only replaced the positions lost when parts of the economy were shut down at the start of the pandemic, but are now slightly beyond the level that would have been reached under the Fed's benchmark for sustainable job growth. The unemployment rate has been below 4% since February of 2022. But while those headline numbers speak to continued strength in employment, there are also undercurrents that point to slowing. Revisions to prior months lopped 71,000 jobs from the estimated payroll additions in October and November. On a three-month average basis monthly payroll growth is now below the average of around 183,000 seen in the decade before the pandemic. Other aspects of the job market are also easing back to normal, including time lost to sickness and measures of labor churn like the worker quits rate, both of which are at or near pre-pandemic levels. The ratio of job openings to the number of unemployed jobseekers has also been approaching its pre-pandemic norm. Minutes of the Fed's December meeting said that "a number" of Fed officials had begun questioning how much longer tight monetary policy would be needed, and "pointed to the downside risks to the economy that would be associated with an overly restrictive stance." "A few" went further and said the Fed may soon face explicit tradeoffs between maintaining a healthy job market and continued progress on inflation. The Fed under Chair Jerome Powell has so far avoided that difficult choice, with inflation continuing to fall even alongside job and wage gains. That could reflect changes in how the economy works. Fed officials currently estimate that an unemployment rate of around 4.1% is consistent with inflation remaining stable at the 2% target, but improvements in job matching, for example, or in worker productivity could have pulled that lower at least in the short term. Or it could just be a delayed reckoning, something worker advocates said the Fed should stay ahead of. "Job growth has visibly slowed," said Skanda Amarnath, executive director of Employ America, pointing to both the revisions in prior months' payroll numbers based on a survey of businesses and the weaker employment levels reflected in a separate survey of households. "The Fed should be rebalancing their focus away from yesterday's inflation challenges to the potential downside risks the labor market faces in 2024." https://www.reuters.com/markets/us/pandemic-jobs-hole-closes-fed-finds-labor-market-easing-elusive-2024-01-08/

2024-01-08 10:53

JAKARTA, Jan 8 (Reuters) - Indonesia temporarily grounded three Boeing (BA.N) 737 MAX 9 planes on Jan. 6, operated by Lion Air, despite different configurations from the plane that had to make an emergency landing in the U.S. last week, the transport ministry said on Monday. The U.S. Federal Aviation Administration (FAA) ordered the temporary grounding of 171 Boeing jets installed with the same panel that tore off an eight-week-old Alaska Airlines (ALK.N) jet on Friday, forcing an emergency landing with a gap in the fuselage. The door plug blew off the left side of the Alaska Airlines jet following takeoff from Portland, Oregon, en route to Ontario, California, forcing pilots to turn back and land safely with all 171 passengers and six crew on board. Three Boeing 737 MAX 9 planes, the only ones Indonesia had, were grounded starting from January 6 until further notice, said Adita Irawati, a transport ministry spokesperson. The Lion Air planes had a "mid cabin emergency exit door type II" whereas the Alaska Airlines plane had a "mid exit door plug," Adita said. "This means the system in the mid-section of emergency doors were functional and could be used for evacuation," Adita added. The ministry will coordinate with the FAA, Boeing and Lion Air to monitor the situation, adding that "operational safety will be our priority." A Lion Air spokesperson said the airline is conducting further inspection of the planes to ensure the emergency door mechanism works normally. https://www.reuters.com/world/asia-pacific/indonesia-temporarily-grounds-three-boeing-737-max-9-planes-transport-ministry-2024-01-08/