2024-05-23 22:03

FRANKFURT, May 23 (Reuters) - Thyssenkrupp (TKAG.DE) New Tab, opens new tab on Thursday said its supervisory board approved a planned sale of 20% of the conglomerate's steel division to Czech billionaire Daniel Kretinsky in the face of continued opposition from labour representatives. The German industrial group said that labour leaders, who hold half of the non-executive board's seats, voted against the deal. Board Chairman Siegfried Russwurm's vote was counted twice, which is allowed under German corporate governance laws to break a stalemate. Shop stewards warned last week they might oppose the deal unless there were written assurances regarding jobs and sites. Approval of the partial sale marked a key step in Thyssenkrupp's path to what it hopes will be a 50/50 steel joint venture with Kretinsky, whose energy holding EPCG would help lower electricity costs, a major factor in steelmaking. Earlier this month, Thyssenkrupp cut its 2024 guidance for the second time in three months, highlighting troubles in the steel business, which has been hit by lower demand and prices. Juergen Kerner of trade union IG Metall, who is deputy board chairman, said labour leaders in principle welcomed Kretinsky's willingness to invest in the business but the stake sale amounted to a rushed separation of the steel unit from the parent company. "This will be met with fierce opposition by us," said Kerner. Sign up here. https://www.reuters.com/markets/commodities/thyssenkrupp-board-approves-partial-sale-steel-unit-billionaire-kretinsky-2024-05-23/

2024-05-23 21:59

May 23 (Reuters) - The U.S. Securities and Exchange Commission (SEC) on Thursday approved applications from Nasdaq, CBOE and NYSE to list exchange-traded funds (ETFs) tied to the price of ether, potentially paving the way for the products to begin trading later this year. While the ETF issuers also have to get the green light before the products can launch, Thursday's approval is a major surprise win for those firms and the cryptocurrency industry, which until Monday had expected the SEC to reject the filings. Nine issuers including VanEck, ARK Investments/21Shares and BlackRock (BLK.N) New Tab, opens new tab hope to launch ETFs tied to the second-largest cryptocurrency after the SEC in January approved bitcoin ETFs in a watershed moment for the industry. “This is an exciting moment for the industry at large," said Andrew Jacobson, vice president and head of legal at 21Shares, noting it was "a significant step" towards getting the products trading. Thursday was the deadline for the SEC to decide on VanEck's filing. Market participants were bracing for the thumbs-down because the SEC had not engaged with them on the applications. But in a surprise move, SEC officials on Monday asked the exchanges to quickly fine-tune the filings, sending the industry scrambling to complete weeks of work in just days, sources said. Reuters could not ascertain why the SEC appeared to have a change of heart. “The introduction of spot bitcoin ETFs has already demonstrated significant benefits for the digital assets and ETF space, and we believe that spot ether ETFs will similarly provide safeguards for U.S. investors," said Rob Marrocco, global head of ETP listings at Cboe Global Markets. Nasdaq and NYSE declined to comment. When asked about the ether ETFs by reporters at an industry event earlier on Thursday, SEC Chair Gary Gensler - a crypto skeptic - declined to comment. An SEC spokesperson said in an email announcing the approval that the agency would not comment further. The exchange applications had sought SEC approval for a rule change required to list new products, but the issuers still need the SEC to approve ETF registration statements detailing investor disclosures before they can start trading. Unlike the exchange filings, there is no set time frame in which the SEC has to decide on those statements. Industry participants said it was unclear how long that would take. Two sources familiar with the process said many issuers are ready to launch, but the corporate finance division of the SEC has indicated it is likely to request changes and updates in the coming days and weeks. The SEC rejected spot bitcoin ETFs for more than a decade over market manipulation worries but was forced to approve them after Grayscale Investments won a court challenge last year. Sui Chung, CEO of CF Benchmarks, the index-provider for several of the bitcoin and ether ETFs, said ether is more complex than bitcoin and it could take months for the SEC to review the statements. But since the bitcoin ETFs offer an established template, "there's only so much slow rolling" the SEC can do, he said. An array of investors, including hedge funds, wealth advisors and retail investors, have poured more than $30 billion into the crypto ETFs. Thursday's decision is another tailwind for cryptocurrency industry efforts to push into mainstream finance. This week the UK regulator also approved listed cryptocurrency products while the U.S. House of Representatives passed a landmark bill seeking to provide regulatory clarity for cryptocurrencies. While that bill still needs to pass the Senate, its extensive bipartisan support marks a major endorsement for the industry. Sign up here. https://www.reuters.com/technology/us-sec-approves-exchange-applications-list-spot-ether-etfs-2024-05-23/

2024-05-23 21:53

NEW YORK, May 23 (Reuters) - Jeffrey Gundlach, the chief executive of investment management company DoubleLine Capital, expects a U.S. recession as soon as this year, he said on Thursday, as higher interest rates pressure U.S. consumers and companies. Signals of brewing trouble in the U.S. economy such as rising credit card delinquencies and softer retail sales data suggest the possibility of an economic contraction is more imminent than the risk of an inflationary rebound, he said. "There's a lot of recessionary signals out there," he said, speaking at a webinar hosted by David Rosenberg, founder and president of Rosenberg Research. "There's more of a recessionary feel than an inflationary feel," he added. The money manager, often dubbed 'the bond king', said he was staying away from the riskiest parts of the corporate debt market such as triple-C rated companies' bonds as well as private credit investments because he expects companies' debt defaults to surge. Specifically, regarding private credit, he said investors looking for higher returns in private markets than in public debt markets run the risk of remaining stuck with illiquid assets in case of a sharp economic slowdown. "There is no factor on which private credit looks better than public credit at the present moment. It's riskier, it doesn't have the same reward, it's the absolute worst," he said. On the other hand, DoubleLine is heavily exposed to U.S. government debt, he said, despite concerns over rising U.S. debt levels and soaring government interest debt payments caused by higher rates. "We have more Treasuries now in our strategies than we've ever had," said Gundlach. Over time, a growing debt burden could however lead to the need to restructure U.S. government debt, which would be unprecedented. "I've got this crazy idea that I want buy only the lowest coupon Treasuries ... because if I have a very low coupon Treasury I don't have to worry about being restructured," he said. "I worry that the federal government might be forced to restructure the Treasury debt." Sign up here. https://www.reuters.com/markets/us/doubleline-ceo-expects-imminent-us-recession-government-debt-surge-2024-05-23/

2024-05-23 21:46

May 24 (Reuters) - A look at the day ahead in Asian markets. A classic economic data case of 'good news is bad news' from the United States on Thursday looks set to weigh on Asian markets on Friday, as that eagerly awaited first U.S. interest rate cut gets pushed back further into the distance. A quarter point rate cut from the Fed is now fully priced only in December, after the presidential election. It's hard to believe now, but at the start of the year 150 basis points of easing was expected in 2024, starting in March. Coming on the heels of a similar tempering of UK rate cut expectations and more hawkish signaling from New Zealand's central bank New Tab, opens new tab this week, the prospect of tighter global policy in the coming months could be problematic for risk assets. Stocks fell and bond yields rose on Thursday after figures showed that U.S. business activity accelerated in May to the highest level in over two years, trumping yet another earnings 'beat' from AI and chipmaking giant Nvidia. This should fuel risk appetite, but the U.S. PMI report also showed price pressures rising rapidly. With many equity indexes historically high and volatility historically low, investors are choosing caution over adventure. There are signs that some of the froth is coming off other markets - after hitting record highs on Monday, U.S. copper prices are on track for a 5.5% decline this week, which would be the biggest fall since November 2022. That's the backdrop to the open in Asia on Friday. If markets close flat or lower, the MSCI Asia ex-Japan stock index will post its first weekly decline in five, China's blue chip CSI300 its first fall in six weeks, and Hong Kong's Hang Seng its biggest weekly loss since January. Japanese inflation tops Friday's economic data calendar, which also includes inflation from Malaysia, trade from New Zealand and industrial production from Singapore. Annual core inflation in Japan is expected to fall to 2.2% in April from 2.6%, closer to the Bank of Japan's 2% goal and perhaps enough to give policymakers some breathing room after Japanese Government Bond yields this week climbed to their highest in over a decade. In Italy, G7 finance chiefs get a two-day meeting under way on Friday, with the trade standoff between China and the West high on the agenda. And looking ahead to the weekend, South Korea hosts a two-day trilateral summit with China and Japan that starts on Sunday. From a markets perspective, it will be interesting to see if discussions touch on trade competitiveness, AI and the chips sector, and exchange rates, after Japan and South Korea last month signed a rare joint statement with the United States to "consult closely" on currencies. Here are key developments that could provide more direction to markets on Friday: - Japan CPI (April) - New Zealand trade (April) - G7 finance chiefs meet in Italy Sign up here. https://www.reuters.com/markets/asia/global-markets-view-asia-graphic-pix-2024-05-23/

2024-05-23 21:43

NEW YORK, May 23 (Reuters) - FTX's bankruptcy lawyers at Sullivan & Cromwell were not complicit in the fraud that caused the crypto company to collapse, a court-appointed examiner concluded on Thursday. Former FTX CEO Sam Bankman-Fried was convicted in November of stealing $8 billion from FTX customers. FTX creditors and investors had accused the company's lawyers at Sullivan & Cromwell of failing to stop the fraud while positioning themselves for a lucrative position as the company's primary bankruptcy counsel. An independent bankruptcy court investigation by former prosecutor Robert Cleary found no evidence that the law firm knew about the fraud or ignored any "red flags" when it performed pre-bankruptcy work, such as assisting FTX with regulatory filings and a failed buyout of crypto lender Voyager Digital. "Sullivan & Cromwell remains confident in our pre-petition work for FTX and the commencement of the Chapter 11 cases, and we welcome the examiner's findings to date rejecting various baseless allegations about our work for FTX," the law firm said in a statement. The U.S. Trustee, a Department of Justice bankruptcy watchdog, had demanded an independent investigation into fraud and mismanagement that occurred at FTX before its collapse, saying it was "too important" to leave to creditors and current management. The office of the U.S. Trustee declined to comment. Sullivan and Cromwell attorneys made false statements to outside parties while doing that work, but they did not know at the time that the statements were untrue, Cleary found. For example, Sullivan & Cromwell partner Andy Dietderich told Voyager Digital on Nov. 7 that FTX's finances were "rock solid" and that questions about FTX's ability to close the deal were just "silliness" based on rumors spread by a rival bidder, Binance. That same day, however, FTX's Bankman-Fried was desperately trying to raise emergency financing, and FTX went bankrupt four days later, according to Cleary's report. Some FTX creditors had unsuccessfully sought to block Sullivan & Cromwell from representing FTX in its bankruptcy, due to its previous ties to the company, including the fact that FTX's former U.S. general counsel, Ryne Miller, was a former partner at Sullivan & Cromwell. FTX investors have also sued the law firm, accusing it of abetting Bankman-Fried's fraud. The firm has charged more than $180 million for its work on FTX's Chapter 11 from November 2022 until January 2024, according to court documents. The bankruptcy judge overseeing FTX's case had initially rejected the U.S. Trustee's demand for an examiner as duplicative and costly, but was overruled on appeal. Sign up here. https://www.reuters.com/legal/ftx-bankruptcy-lawyers-were-not-complicit-fraud-report-finds-2024-05-23/

2024-05-23 21:20

LONDON, May 23 (Reuters) - Russian metals giant Nornickel (GMKN.MM) New Tab, opens new tab plans a joint project for construction of a platinum group metals (PGMs) refinery in Bahrain, a source familiar with the matter told Reuters on Thursday. Nornickel is the world's largest producer of palladium and a major producer of platinum, accounting for 41% and 12% of global mine output, respectively. Both metals are chiefly used in vehicle exhausts to neutralise harmful engine emissions, and platinum is also used in jewellery. The source did not provide the project's time frame or the refinery's production capacity. King Hamad bin Isa Al Khalifa of Bahrain held talks with Russian President Vladimir Putin in the Kremlin earlier on Thursday. In a comment to state TV after the talks, Russian Deputy Prime Minister Alexander Novak said that Nornickel plans to build "a platinum production plant" in Bahrain. Novak gave no additional details. Nornickel declined to comment. Nornickel has not been directly targeted by Western sanctions imposed on Moscow since Russia attacked Ukraine in 2022, but some of the Russian precious metals refineries, which also usually handle PGMs, were. Britain, for instance, imposed New Tab, opens new tab sanctions on Russia's largest, state-owned refinery Krastsvetmet in November as London targeted Russia's gold industry. Sanctions imposed on Moscow over the last two years damaged Nornickel's logistics, usual trade flows, money transfers and purchases of imported equipment. The company, which also produces nickel and copper, has been re-shuffling its production and sales strategy seeking ways to ease the damage. Sign up here. https://www.reuters.com/markets/commodities/russias-nornickel-plans-build-pgms-refinery-bahrain-source-says-2024-05-23/