2024-08-05 07:40

Aug 5 (Reuters) - Hugo Boss (BOSSn.DE) , opens new tab has sold its Russian business to wholesale partner Stockmann for an undisclosed fee, the German fashion house said on Monday, joining the ranks of Western brands to exit the Russian market over the war in Ukraine. The German fashion company suspended its retail business in Russia soon after Moscow invaded Ukraine in February 2022. It also paused its e-commerce activities in the Russian market and stopped advertising. "We can confirm that our Russian subsidiary has been sold to Stockmann JSC – a company belonging to one of Hugo Boss's long-standing wholesale partners in the country," Hugo Boss said. Neither party has disclosed financial terms of the deal, but Russia demands that foreign companies sell assets at discounts of at least 50%. Stockmann did not respond immediately to a request for comment. Russian corporate filings showed that the deal closed on Aug. 2 and that Stockmann JSC now owns 100% of Hugo Boss Rus with a nominal value of 40 million roubles ($470,588). Hugo Boss had come under pressure from organisations such as B4Ukraine for continuing to supply some goods to Russia. B4Ukraine is a coalition of civil society groups seeking to compel Western companies to sever ties with Russia. "In terms of our wholesale business, we were fulfilling the contractual obligations to our partners," Hugo Boss said in April. "In this context, Hugo Boss is and has been complying with existing EU sanctions at all times." Stockmann in Russia operates independently to its former Finnish owner, which sold its Russian business after Moscow's 2014 annexation of Crimea. ($1 = 85.0000 roubles) Sign up here. https://www.reuters.com/business/retail-consumer/hugo-boss-sells-russian-business-wholesale-partner-stockmann-2024-08-05/

2024-08-05 07:34

MUMBAI, Aug 5 (Reuters) - GooglePay, Walmart-backed PhonePe and AmazonPay are among five payment firms seeking to join the Indian central bank's digital currency pilot by offering transactions via the e-rupee, three sources directly involved in the discussions said. Indian fintech firms Cred and Mobikwik are the other two that have applied to join the pilot, the sources added. The Reserve Bank of India started a pilot for the e-rupee, a digital alternative to the physical currency, in December 2022. After an initial surge, e-rupee transactions have declined, reflecting the struggle central banks globally have faced in popularising digital currencies. Google Pay and Amazon Pay are payments applications offered by Alphabet Inc's (GOOGL.O) , opens new tab Google and Amazon.com (AMZN.O) , opens new tab, respectively, that facilitate retail payments over India's widely used Unified Payments Interface (UPI). Initially, the central bank had permitted only banks to offer e-rupee via their mobile applications, but in April it said payment firms could also offer e-rupee transactions via their platform once approved by the RBI. Payment firms are working closely with the RBI and National Payments Corporation of India (NPCI), the domestic payments authority, and are expected to roll out access to e-rupee over the next three-to-four months, the sources said. The sources declined to be identified because they are not authorised to speak to media. The RBI and NPCI did not respond to emails seeking comment while the five companies declined to comment. While transactions using the digital currency had risen to over 1 million a day late last year, they have since declined sharply to about 100,000-200,000 a day, one of the sources said. Allowing popular payment firms to offer e-rupee should help lift volumes by widening the user base, the second source said. Together these five payment firms account for over 85% of digital payments via UPI, which averages about 13 billion transactions each month. While continuing to try and popularise the e-rupee, the central bank has no immediate plans to do a full-scale launch of the digital currency, the second source said. "The e-rupee is likely to stay in the pilot stage for the next couple of years," the source added. Sign up here. https://www.reuters.com/business/finance/google-amazon-walmart-seek-join-indian-cenbanks-digital-currency-project-sources-2024-08-05/

2024-08-05 07:04

ZURICH, Aug 5 (Reuters) - The Swiss franc rose to its highest level against the euro in nearly a decade on Monday, as heavy losses in stock markets, concerns over U.S. and global growth and tensions in the Middle East drew investors to the safe-haven currency. The franc has risen some 3.5% against the euro since the U.S. Federal Reserve held interest rates last week. Early on Monday the franc rose as high as 1.0856 euros, its highest since January 2015, when the Swiss National Bank (SNB)scrapped a cap it had against the euro. A spokesperson for the SNB declined to comment on the franc's strength or on whether the central bank could intervene in the market to stem the currency's appreciation. The SNB has cut interest rates twice this year amid concerns among Swiss manufacturers that the strength of the currency was putting pressure on their key export business. UBS economist Maxime Botteron said at a time when the SNB is cutting interest rates, the franc's appreciation over the last few days could prompt foreign currency purchases by the bank. However, if policymakers are seriously concerned about the currency's strength, the bank still had scope to cut its benchmark rate below 1.25% at present, Botteron added. "If any, foreign currency purchases are therefore likely to be limited," he said. Sign up here. https://www.reuters.com/markets/currencies/snb-declines-comment-recent-swiss-franc-appreciation-2024-08-05/

2024-08-05 06:34

Aug 5 (Reuters) - Share markets around the world tumbled and bonds rallied on Monday as fears the United States could be heading for recession sent investors rushing from risk assets while wagering interest rates will have to fall rapidly to rescue growth. Japan's Nikkei (.N225) , opens new tab shed a staggering 12% to hit nine-month lows, entering bear market territory and marking its biggest one-day percentage drop since October, 1987. Europe's broad STOXX 600 index fell 3% (.STOXX) , opens new tab and bank shares slid just over 4.5%. U.S. stock futures were sharply lower in a sign that Wall Street shares were set for a fresh selloff. The yen hit a 7-month peak. QUOTES: SAMY CHAAR, CHIEF ECONOMIST, LOMBARD ODIER, GENEVA "There are two things impacting pricing, one is the recession risk and that's the main worry but on top of that there is a bit of anxiety around geopolitics and the expected retaliation from Iran and Hezbollah after the Israeli strikes." "On the first, it does feel that American economic conditions are still acceptable, we're not seeing a pick up in lay offs, in job cuts. OK the data Friday was poor, but we need to be open to the possibility next month we get job growth number around 150,000 170,000." "It's a game of ping pong. Positioning goes a bit far on one side and then reverses, and market moves have been extreme because positioning has been extreme. We're going a bit far to the extremes, 3.70% seems a bit far on the U.S. 10 year yield. It was a good buy at 4.50% it is a good sell at 3.70%." MOHIT KUMAR, CHIEF ECONOMIST FOR EUROPE, JEFFERIES, LONDON "First of all we would argue that positioning has been a big driver of recent market moves. U.S. equities, particularly the tech sector, was over owned and some froth needed to be cleared." "Our view on the U.S. employment picture has not changed. We have been on the camp of a modest weakening but not a disaster scenario." "We do not see the correction in risky assets as a start of a downturn. In our view, correction and clean up of positions does make sense." JIM REID, GLOBAL HEAD OF MACRO RESEARCH AND THEMATIC STRATEGY, DEUTSCHE BANK, LONDON "Markets were on edge before Friday but a weak payrolls has really escalated a profound move across the globe. However the reality is that although payrolls was disappointing it's hard to know how disappointing given the distortions from Hurricane Beryl. It's like the market has added up 2+2 and made 9. It's easily possible we'll get the additional 3 and 2 to make up the total but we're certainly not there yet. It's hard to believe such market moves would have occurred in any other month." BEN BENNETT, HEAD OF INVESTMENT STRATEGY FOR ASIA, LGIM, HONG KONG "Looks like a lot of trades that have done well in the first half of the year are unwinding, some more rapidly than others. I don't think the rate hike by the Bank of Japan or the US employment report on Friday justify such a big reaction, so I suspect we're seeing traders being stopped out of positions as volatility spikes." RICHARD KAYE, PORTFOLIO MANAGER, COMGEST, TOKYO "The sudden narrowing of the Japan-U.S. yield gap has provoked the partial normalization of the yen, and the mistaken foreign hot money flows to banks and yen plays are being rightly sold off, which is at the centre of today's and Friday's move. Domestic demands SMIDs - GMO Payment, Fast Retailing, are significantly outperforming, and up in absolute terms in dollars for the month, ahead of major global indices. "In short, not only the currency but the entire 'value' trade in Japan which had hijacked our market for two years is being unwound - and great news for serious investors who are most of the market participants, the silent majority eclipsed by recent hot money moves." KYLE RODDA, SENIOR FINANCIAL MARKET ANALYST, CAPITAL.COM, MELBOURNE "The markets are in meltdown and it's a sea of red across the world. The rapid move in the yen is putting downward pressure on Japanese equities, but it's also driving an unwind of a major carry trade - investors had leveraged up by borrowing in yen to buy other assets, chiefly U.S. tech stocks. We are basically seeing a mass deleveraging as investors sell assets to fund their losses. The rapidity of the move has caught a lot of investors off guard; there's a lot of panic selling now, which is what causes these non-linear reactions in asset prices to pretty straightforward fundamental dynamics." DANIEL TAN, PORTFOLIO MANAGER, GRASSHOPPER ASSET MANAGEMENT, SINGAPORE "In our view, five Fed rate cuts by the end of 2024 seem unlikely. More plausible are two cuts - one in September and one in November - with a total of up to 75 basis points by the end of the year. This suggests potential opportunities to increase duration in upcoming months. Overall, we believe emerging market bonds will perform well by the end of the year in a gradually declining interest rate environment. "There may still be room for the recent sell-off in equities to continue, given the significant rally in technology stocks earlier this year and investors seeking to sell assets to cover losses." GEORGE BOUBOURAS, HEAD OF RESEARCH, K2 ASSET MANAGEMENT, MELBOURNE "Markets are clearly concerned with the recent weaker economic data. However, extrapolating last Fridays Payrolls data appears an over-reaction as it is only one monthly reading. The rolling 3-month will be a better guide. It is clear the recent data momentum in the U.S. has slowed. Given the Fed is expected to begin rate cuts (Implied Futures) before the U.S. election (Nov. 5), that may be seen as problematic optically despite the rational that conditions warrant a rate cut. This may add to some pre-election volatility." RYOTA ABE, ECONOMIST, SMBC, SINGAPORE "I think USD/JPY will shift to 140-145 zone because of worse-than-expected NFP (U.S. non-farm payroll report) and the Middle East tensions. And the two reasons will likely weigh on Asian markets as market players will hesitate to take risks in this situation. "Stronger yen will also weigh on Nikkei index as corporate margins will fall, as many corporates did not expect such a sharp and sudden rise of the Japanese yen at all." MASAFUMI YAMAMOTO, CHIEF CURRENCY STRATEGIST, MIZUHO SECURITIES, TOKYO "There's a risk that dollar-yen will fall further. The near term at the support will be 144.50, where the 90-week moving average is. If that is, I think the next target will be 140. "But I would say that this the market pricing of a 50 basis rate cut by the Fed in the September meeting is too much. The U.S. economy is showing signs of slowdown, but it's not as bad as market is pricing in." CHARU CHANANA, MARKET STRATEGIST, SAXO MARKETS, SINGAPORE "U.S. economic data remains in the driving seat now and the more the U.S. soft landing assumption gets questioned, the further pullback we can see in equity and carry strategies where positioning has also been stretched. "However, markets have gone a bit too far expecting the Fed rate cuts and four rate cuts priced in for this year seems a stretch considering that the June dot plot showed only one cut and the structural inflation forces in play." Sign up here. https://www.reuters.com/markets/global-markets-selloff-quotes-2024-08-05/

2024-08-05 05:59

Traders see over 70% chance of 50 bp cut by Fed in Sept U.S. unemployment rate rises to 4.3% in July Palladium down over 3% at its lowest in 6 years Aug 5 (Reuters) - Gold prices dropped again in volatile trade on Monday as profit-taking countered support from increasing expectations for a rate cut from the Federal Reserve amid concerns over a U.S. recession, which led to a worldwide sell-off in financial markets. Spot gold fell 0.4% to $2,433.74 per ounce, as of 0721 GMT. Bullion had slipped 1% earlier in the session before rising as much as 0.7%. U.S. gold futures edged up 0.2% to $2,475.30. "There is some profit taking happening while traders try and gauge how aggressive the Fed may be come September with regards to the size of a rate cut," said Tim Waterer, chief market analyst at KCM Trade. "Markets are in a flux about the U.S. economic outlook and whether rate cuts will arrive quickly enough from the Fed." Data on Friday showed that U.S. job growth in July fell short of expectations, with the unemployment rate rising to 4.3%, pointing to possible weakness in the labour market and greater vulnerability to recession. Share markets tumbled and bonds rallied in Asia as U.S. recession fears sent investors rushing from risk assets. Traders are pricing a more than 70% chance of the U.S. central bank lowering rates by 50 basis points in September, compared with an 11.5% chance a week earlier, according to the CME FedWatch tool. Lower interest rates reduce the opportunity cost of holding a non-yielding bullion. Investors also kept a close eye on the Middle East conflict, with the Pentagon announcing that the U.S. military will deploy additional fighter jets and Navy warships to the Middle East to strengthen defence against threats from Iran and its allies, Hamas and Hezbollah. Spot silver was down 1.2% to $28.21 per ounce, platinum fell 2.8% to $931.05 and palladium declined nearly 4% to $855, hitting its lowest since August 2018. Sign up here. https://www.reuters.com/markets/commodities/gold-prices-flat-profit-taking-counters-us-rate-outlook-2024-08-05/

2024-08-05 05:37

Aug 5 (Reuters) - Europe's largest copper producer Aurubis (NAFG.DE) , opens new tab reported third-quarter earnings before tax (EBT) below expectations on Monday, weighed down by lower recycling profits and sulfuric acid prices. Aurubis faces fierce competition from Chinese metal recyclers. Outgoing CEO Roland Harings had called for a "level playing field" in the market during a second-quarter earnings call, though he said that protection was unnecessary. The group's quarterly EBT rose five-fold to 90 million euros ($98.4 million) compared to the same period last year, which was affected by a major metals theft in its smelting business. That missed expectations of 99 million euros in a company-provided poll. Compared to two years ago, the earnings were down 13%. Third-quarter EBT at its custom smelting and products business was 82 million euros, also down 13% from the fiscal 2021-22, the last comparable year after Aurubis revised down last year's results for the segment. Meanwhile, quarterly EBT at its multimetal recycling business, which extracts metals from scrap and whose results were not directly affected by the theft, fell 14% from last year to 34 million euros. Aurubis, which also sells sulfuric acid as a by-product of processing copper, however said the third-quarter result was the best in its history with a major shutdown, referring to the planned maintenance at its Hamburg plant that concluded in July. The company, which deals in metals such as gold and platinum in addition to copper, confirmed its guidance for the full year. ($1 = 0.9147 euros) Sign up here. https://www.reuters.com/markets/commodities/aurubis-q3-earnings-miss-expectations-recycling-revenue-falls-2024-08-05/