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Seven & i North American business IPO will fund faster growth, according to CEO
Seven & i Holdings, a Japanese convenience store operator, said that the planned listing of their North American operations will allow them to borrow additional money for accelerated growth. Stephen Dacus, the CEO of the company, said that the listing is scheduled for the second half 2026. This will allow faster store openings in the U.S. as well as additional bolt-on M&As. After successfully repelling a hostile takeover attempt from Canadian competitor Alimentation Couche-Tard, the fate of the struggling operator of 7-Eleven rests on the ability to grow independently. Couche-Tard retracted its $46 billion bid last month citing a failure to engage with Seven & i. This precipitated a 9% drop in Seven & i’s share price, reflecting investor scepticism regarding Seven & i’s plans for standalone growth. Seven & i is facing stiff competition in Japan from its faster-growing competitors Family Mart and Lawson. In the U.S. analysts and investors claim that the lacklustre profits margins of the convenience store chain belie the potential it has to become the country's largest. Seven & i, as well as a number of activist investors have been putting pressure on the company to increase returns through asset sales and a focus on its core business. Seven announced in March a major restructuring that included the sale of its superstore division, a 2 trillion-yen ($13.55-billion) share buyback until 2030, and a commitment to list its North American unit in the second half 2026. ($1 = 147.5600yen) (Reporting and editing by Christopher Cushing, Muralikumar Aantharaman).
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Asian shares follow Wall Street lower as dollar rangebound
The dollar was weighed down by lower bond yields, as well as weak U.S. economic data, on Wednesday. Data released on Tuesday showed that the U.S. service sector activity was flat in July. Input costs and employment have risen by nearly three times in the last year, highlighting the impact of President Donald Trump’s tariff policy. The second-quarter results revealed the impact of Trump's tariffs. Taco Bell's parent company Yum Brands missed earnings expectations due to steep trade duties that dent consumer spending. Caterpillar also warned of tariffs costing it up $1.5 billion in the second quarter. The report paints a picture that a stagflationary trend is developing, although it's still a long way off. It raises the possibility of an explosive mix of joblessness and rising prices, as tariffs spread through the U.S. economic system, said Kyle Rodda. The broadest MSCI index of Asia-Pacific stocks outside Japan fell 0.2% while Japan's Nikkei managed a 0.2% gain. The Hang Seng Index in Hong Kong and the blue chips of China were both flat. Nasdaq Futures declined 0.3%, while S&P 500 Futures declined 0.1%. Trump said on Tuesday that he would announce tariffs for semiconductors and chips within the next few weeks. The U.S. will initially impose a'small tariff' on pharmaceutical imports, before it increases it significantly in a year or so. He said that the U.S. and China were close to a deal on trade, and that he planned to meet with his Chinese counterpart Xi Jinping by the end of the calendar year if a deal was reached. He threatened to increase tariffs on Indian goods over their Russian oil purchases. On the currency markets, after a disappointing jobs report last Friday that caused markets to price in an almost certain chance of a Federal Reserve rate cut in September, the dollar has stabilized. The dollar index (which measures the U.S. currencies against six counterparts) was flat this week at 98.821, and up by 0.1% after Friday's fall of 1.4%. FedWatch from the CME shows that Fed funds futures indicate a 94% probability of a rate reduction next month. At least two cuts are priced in this year. Investors await Trump's choice to fill the upcoming vacancy at the Federal Reserve Board of Governors. Trump announced that a decision would be made shortly, but ruled out Treasury Secretary Scott Bessent, who is currently the chief of the Federal Reserve, and whose tenure ends in 2026. Treasury yields rose overnight, but remained near their multi-month lows. This week, the market will see more supply with $42 billion of 10-year notes and $25 billion of 30-year bonds. The yield on the benchmark 10-year Treasury note rose 2 basis points to 4.2198% after staying steady overnight. Oil prices have been rising on commodity markets after four sessions of consecutive declines. U.S. crude oil rose 0.2%, to $65.3 a barrel. Brent crude was up 0.1%, at $67.78 a barrel. Trump said Tuesday that he would decide whether or not to sanction countries which purchase Russian oil following a scheduled meeting with Russian officials on Wednesday. The spot gold price was flat at $3.381 per ounce.
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US announces that it has begun seabed mineral negotiations with the Cook Islands
State Department announced on Tuesday that the U.S. and the Cook Islands have begun discussions on research regarding seabed mineral exploration and development. Cook Islands are a group of 15 islands, atolls and other small groups that lie between New Zealand (halfway) and Hawaii. In 2021, the country had a total population of 15,040. After Beijing signed deals in recent years with Pacific nations on trade, defense and finance, Western nations who traditionally dominated the Pacific Islands are becoming increasingly worried about China's plans for increasing its influence. A strategic partnership agreement was signed between China and Cook Islands earlier this year. The agreement covered a wide range of areas, from deep-sea mines to scholarships for education. However, it did not include security ties. The Statement Department stated in a press release that "The Government of the United States of America began discussions with the Government of the Cook Islands regarding the support of research needed to inform seabed exploring and responsible development within the Cook Islands Exclusive Economic Zone." It said that U.S.-linked companies "sit at forefront" in deep seabed mineral exploration and research on the Cook Islands. From 1901, the Cook Islands were part of New Zealand. In 1965 it became independent but still in free association with New Zealand. King Charles III is the head of state. Cook Islanders are New Zealand citizens and have New Zealand passports. Cook Islanders have the same rights and privileges as New Zealanders, including the right to work, attend school, and access the medical system. New Zealand cut off millions of dollars from budget funding for the Cook Islands in June as relations continued to deteriorate due to the island group's growing ties with China. Reporting by Kanishka Shakil and Ismail Shakil, Editing by Christopher Cushing, Lincoln Feast and Ross Colvin.
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Trump's threats against Russian crude buyers have boosted oil prices from a 5-week low.
On Wednesday, oil prices rose, recovering from a five week low the day before, amid concerns about supply disruptions following U.S. president Donald Trump's threat of tariffs against India for its Russian crude purchase. Brent crude futures increased 29 cents or 0.4% to $67.93 per barrel at 0119 GMT, while U.S. West Texas intermediate crude rose 28 cents or 0.4% to $65.44 per barrel. The two contracts both fell more than one dollar on Tuesday, settling at their lowest level in five weeks. This was the fourth session that they had lost money, due to concerns about oversupply from OPEC+’s planned September production increase. Investors are assessing if India will reduce their Russian crude purchases as a response to Trump's threat, which could tighten the supply. But it is yet to be seen whether this will happen, said Yuki Takashima. He said that if India's imports remained steady, WTI would likely stay in the $60-$70 price range for the remainder of the month. The Organization of the Petroleum Exporting Countries (OPEC+) and its allies agreed on Sunday to increase oil production by 547,000 barges per day in September. This will bring an end to the most recent cut in output earlier than expected. OPEC+ produces about half the oil in the world. For several years, the group had curtailed production to help the market. This year, the group has accelerated its output to regain some market share. The U.S. demand that India stop buying Russian crude oil in order to pressure Moscow to reach a peace agreement with Ukraine may disrupt supply as Indian refiners look for alternatives, and Russian crude will be redirected to another buyer. Trump threatened on Tuesday to increase tariffs on Indian products over the country's Russian-oil purchases in the next 24 hour. Trump said that falling energy prices may also pressure Russian President Vladimir Putin into ending the war in Ukraine. New Delhi branded Trump's threats "unjustified", and pledged to protect its own economic interests. This has exacerbated the trade dispute between India and the United States. Takashima, from Nomura, also cited industry data that showed crude inventories in America, the largest oil consumer in the world, as a positive for the oil markets. Sources citing American Petroleum Institute data said Tuesday that U.S. crude stocks fell by 4.2 millions barrels during the past week. This compares to a poll estimation of a 600,000.0 barrels draw in the week ending August 1. The U.S. Energy Information Administration will release its weekly inventories on Wednesday. (Reporting and editing by Yuka Obaashi; Christian Schmollinger).
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The monsoon season peaks in South China, causing landslides to occur and an increase in viral cases
Rescue crews in south China prepared for the final downpour of heavy rain on Wednesday. They raced between torrential downpours, clearing mudslides and draining waterlogged roads that submerged cars. The East Asian monsoon is at its peak. Forecasters warn of more thunderstorms a day after the skies over Hong Kong and high-tech cities in China's Pearl River Delta went black, unleashing the heaviest rainfall of August since 1884 to the Asian financial center. Videos show that Guangdong province in southern China has transformed its shopping streets into flooded waterways, which is worsening the outbreak of Chikungunya. The mosquitoes are flourishing in the stagnant floodwaters. Guangdong reported over 7,000 cases so far. Since early July, China has been hit by heavy downpours. The East Asian monsoon is stalling over the north and south of the country. This has caused weeks of chaos in the atmosphere. The shifting pattern is attributed to climate change by meteorologists. Flash floods are displacing thousands of people and threatening billions in economic losses. Beijing allocated more than 1 billion yuan (139.21 millions) to disaster relief efforts on Tuesday, including subsidies to repair damage to grain-growing fields. After causing at least five deaths in Guangdong, over the weekend, the extreme rain is expected to subside in the next few days. This was after a massive search and rescue operation that involved over 1,300 rescuers. State media reported that rescue crews rushed on Tuesday to open drains and remove water from urban areas in between showers. The deluge caused mudslides, which brought silt, trees, and debris onto highways. They also exposed cabling, embedded infrastructure, and washed away road foundations. The rains have pushed Guangdong's flood-preparation to the limit. According to Chinese state-run media, 16 rivers in the province are at levels where they could breach their banks. Water levels at two hydrology stations have reached their highest levels since 2017 and 2018. Officials from the Ministry of Emergency Management warned on Tuesday that even though the East Asian Monsoon is beginning to fade, the worst could still be ahead. Two to three typhoons are expected to hit in August.
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Disney's ESPN acquires NFL media assets as part of a major deal
The National Football League and Walt Disney's ESPN have reached a historic agreement to buy NFL Network from the NFL in exchange for a 10% stake in the network. The deal, in which ESPN claims it will enhance the content of its upcoming ESPN streaming services, is subjected to regulatory approval. The financial terms of the deal were not disclosed. ESPN will also acquire NFL Fantasy, an online offering, as well as the rights to distribute NFL RedZone to its cable television and satellite television subscribers. Disney CEO Robert Iger made a statement saying that the announcement today "paves the road for America's most popular sports brand, ESPN, to provide an even more compelling NFL experience in a manner only Disney and ESPN can deliver," he said. According to sources, The Athletic reported that the deal would be announced soon. ESPN declined to make any comment about the reported amount. Iger said that ESPN's streaming service could be launched as soon as this month. It will cost $29.99 a month. The service will give you access to ESPN's professional and college sports portfolio, including the NFL and the NBA, the WNBA and MLB, and the NCAA Women's Basketball Championship. It also includes studio shows like "SportsCenter" or "Pardon the Interruption". In a press release, ESPN Chairman Jimmy Pitaro stated that by combining NFL media assets and ESPN's reach with innovation, they would create a premier destination to football fans. In 2003, the NFL Network was launched to take advantage of the revenues generated by subscriptions to cable and satellite services. It gained some traction by introducing Thursday Night Football but never became a competitor to ESPN. ESPN will own and operate all TV and streaming rights for the NFL Network. The NFL Network will continue to broadcast seven games per year. Roger Goodell, NFL commissioner, said that the sale of the network to ESPN would build on its remarkable legacy and provide more NFL football in innovative ways for fans. RedZone allows NFL fans to view scoring opportunities in Sunday afternoon games. The NFL will continue to produce, own and operate NFL RedZone, while retaining the rights to digitally distribute it. The NFL will also retain ownership over certain media properties such as NFL Films and platforms like the NFL Podcast Network, NFL+, and NFL+. (Reporting and editing by Lisa Richwine, Dawn Chmielewski)
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Australia's Great Barrier Reef experiences record coral loss following mass bleaching
Research released on Wednesday revealed that Australia's Great Barrier Reef suffered the greatest decline in coral coverage in two of three of its regions in the past year. This was after a mass coral bleaching which was among the worst ever recorded. The Australian Institute of Marine Sciences reported that the reef experienced its largest annual decline of coral cover in the northern and southern areas since monitoring began in 1979. Coral cover dropped between a quarter to a third following several years of steady growth. Mike Emslie is the head of the institute's long-term monitoring programme. This is a phenomenon which has emerged in the last 15 to 20 years, and it indicates an ecosystem that is under stress. The world's largest ecosystem, the reef, extends for 2,400 km (1 500 miles) off of the coast of Queensland, in the north. Since 2016, there have been five summers with mass coral bleaching. This occurs when large sections of reef turn white from heat stress. They are then at greater risk of dying. Report: The 2024 event was the largest ever recorded event on the reef with extreme to high bleaching in all three of its regions. The Great Barrier Reef does not appear on the UNESCO list of endangered world heritage sites, but the UN has recommended that it be included. Australia has been lobbying for years to remove the reef from the endangered list as it could harm tourism. The reef contributes A$6.4billion ($4.2billion) to Australia's economy each year. (Reporting and editing by Lincoln Feast in Sydney, Alasdair pal in Sydney)
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Suncor Energy exceeds its quarterly profit forecasts on the back of higher production
Suncor Energy, a Canadian oil company, exceeded analyst expectations for the second quarter profit on Tuesday as increased output offset the impact from weak commodity prices. Canada's oil-sands industry remains resilient, despite the fact that oil price volatility has pushed the energy sector into a slump. The expansion of the Trans Mountain Pipeline has provided Canadian producers with access to international markets and reduced their reliance on U.S. pipe networks. It now accounts for about 9% of Canada’s total crude oil exports. Canada exports almost 4 million barrels per day (bpd). Suncor's quarterly upstream production increased to 808100 bpd, from 770600 bpd one year earlier. Refinery throughput increased 2.6%, to 442,000 barrels per day (bpd), during the third quarter. Refinery utilization also improved from 92% to 95%. Suncor's results are not comparable Imperial Oil Last week, the company said that weak oil prices and declines in refinery output impacted its second-quarter profits. The Canadian oil sector undergoes peak maintenance in the second quarter. This can cause production to be offline for several weeks or months. Suncor CEO Rich Kruger stated that the company's strong quarter performance was driven "by the outstanding execution of major downstream and upstream turnaround activities, which were completed safely and on time". The Canadian producer has also reduced its forecast for current-year capital expenditures, which are now expected to range between C$5.7 billion and C$5.9billion, as opposed to its previous forecast of C$6.1 to C$6.3billion. According to data compiled and analyzed by LSEG, the Calgary, Alberta based company reported an adjusted loss of 71 Canadian dollars per share ($0.5154), beating the average analyst estimate of 69 Canadian dollars per share.
Wall Street drops, and oil prices fall to 5-week lows
Wall Street indexes declined on Tuesday, as investors considered tariff concerns and weaker-than-expected U.S. data. Equities in Europe and Asia made gains. The U.S. service sector activity was flat in July, with no change in orders or employment and little improvement in the labor market. This is a sign of the uncertainty surrounding the tariff policy of President Donald Trump.
U.S. Treasury rates were mostly higher but lost some gains following data showing a slowdown in the services sector. The Dow Jones Industrial Average dropped 0.14% to 42,111.74. The S&P 500 lost 0.49% at 6,299.19. And the Nasdaq Composite fell 0.65% at 20,916.55.
Investors digested comments on tariffs made by several companies including Caterpillar, which warned that a $1.5 billion hit could be expected in 2025.
Investors increased their bets that the Federal Reserve will act to support the world's biggest economy. Gold prices rose, but oil prices fell on the back of rising OPEC+ supplies and concerns about weakening global demand.
U.S. stocks rallied Monday on the back of generally positive earnings and increased bets that the Fed will cut rates in September after last week's disappointing jobs report. The pan-European STOXX 600 Index edged up by 0.15%. Most regional bourses traded higher as well, echoing the strength in Asia, where MSCI’s broadest Asia-Pacific share index outside Japan closed at 0.77%. Diageo jumped 4.9% following its forecast of flat sales in 2026 despite U.S. Tariffs.
Amelie Derambure is a senior portfolio manager of Amundi. She said that the removal of uncertainty was one factor helping European markets. Even though the tariff rate may be higher than what European politicians or market participants would have expected.
The question is: Is bad news bad (economy slowing) or is it good (Fed reducing rates)? Mohit Kumar, a Jefferies strategist, said that the answer depends on whether or not bad data is being reported and what is priced in.
Trump stated that the United States will impose a "small" tariff on pharmaceutical imports, before increasing it to 150% in 18 months and then to 250% to increase domestic production. The dollar index (which measures the greenback versus a basket currencies, including the yen, the euro and others) rose by 0.15% to reach 98.78. The euro rose 0.02% to $1.1572.
CME Fedwatch says that the odds of a rate cut in September are now at 94%. This is up from 63% on July 28. The market participants expect at least two quarter point cuts before the end of the year. The yield on the 2-year bond, which moves typically in line with expectations of interest rates for the Federal Reserve (Fed), rose 3.9 basis point to 3.72% from 3.681% at late Monday. The news that Trump may fill a Fed governorship early has added to concerns about the politicization interest rate policy. Trump threatened again to increase tariffs on Indian goods above the 25% level announced by him last month because of its Russian oil purchases. New Delhi, however, called this attack "unjustified", and promised to protect its own economic interests.
The strategists of ING said that it is still unclear whether the primary goal of the secondary sanctions against India for its financing of Russia will be achieved. This move could be an increased U.S. pressure on India, to allow agricultural imports into its economy or to commit to buying U.S. Energy instead. The oil prices fell for the fourth consecutive day. Both benchmarks settled at their lowest levels in five weeks, as concerns about economic growth and oversupply grew.
Brent crude futures ended 1.63% lower at $67.64 per barrel while U.S. crude closed 1.7% lower at $65.16.
Investors are still waiting for results from Walt Disney and Caterpillar this week. The data released on Tuesday revealed that the eurozone's business activity grew slightly faster in July than it did in June but was still sluggish. Separate UK data showed that British companies recorded the largest decline in new orders for almost three years and cut staff by more than half in just six months. The data from Asia's largest economies shows resilience in the service sector. S&P Global's final services purchasing managers’ index (PMI), which measures the performance of the service sector in Japan, grew to 53.6 from 51.7 in the previous month. This was the largest increase since February. China's service sector expanded last month at the fastest rate in over a year. Gold prices in the spot market rose by 0.19%, to $3,379.12 per ounce. U.S. futures gold settled 0.2% higher, at $3,434.70.
(source: Reuters)