Category: Economy and Policy

BEIJING, Feb 1 (Reuters) – An executive at China’s state-owned Sinochem Group will head the China operations of global seed and agrichemicals firm Syngenta, owned by China National Chemical Corp (ChemChina) which has been reportedly in merger talks with Sinochem.

The current president of Sinochem Agriculture, Qin Hengde, will be “retained” to oversee Syngenta’s China business, said Andrew McConville, a Syngenta spokesman based in Basel, Switzerland.

Qin will replace Syngenta’s Regional Director for China Andrew Guthrie who is retiring at the end of March, said McConville.

The move was announced internally on Jan. 24, he said.

Reuters has reported since 2016 that Sinochem and ChemChina have been discussing a merger which would be worth well over $100 billion though company executives have denied it. Last July, Chinese financial publication Caixin reported that the companies would merge though a Sinochem spokesman at the time declined to comment.

Sinochem’s Chairman Ning Gaoning was recently appointed Chairman of Chemchina, which bought Syngenta in 2017. Former ChemChina chairman and architect of the $43 billion Syngenta acquisition Ren Jianxin retired last year.

A spokesman with Sinochem’s agriculture division declined to comment on the matter, but said there is a special task force within Sinochem working on personnel changes.

“There’s no change in ownership of operations of Syngenta in China,” said McConville. (Reporting by Dominique Patton in BEIJING and Chen Aizhu in SINGAPORE; editing by Christian Schmollinger)

JAKARTA (Reuters) – Indonesian ride-hailing firm Go-Jek has raised around $1 billion in a funding round, led by Alphabet Inc’s Google, JD.com Inc and Tencent Holdings, sources familiar with the matter said on Friday.

Google, Tencent and JD.com have invested in Go-Jek earlier.

The company said in a statement on Friday it had finalised the first close of its series F funding round, with Mitsubishi Corp and Provident Capital joining as investors.

While Go-Jek declined to comment on the amount raised or its valuation, sources say that the company is valued at $9 billion to 10 billion.

Reuters reported in September that Go-Jek was seeking to raise $2 billion from its current investors, as it challenges Singapore-based rival Grab for a larger share of the region.

Launched in 2011 in Jakarta, Go-Jek – a play on the local word for motorbike taxis – has evolved from a ride-hailing service to a one-stop app through which its customers can make online payments and order everything from food and groceries to massages.

LONDON (Reuters) – Global shares crept lower from their highest levels in two months on Friday as data showing shrinking factory activity in China dampened a rally that took them to their best January on record.

Stocks have benefited this week from the U.S. Federal Reserve, which all but abandoned plans for further rate hikes, and on optimism that a U.S.-China trade deal might be on the cards.

But the Caixin/Markit index of Chinese manufacturing fell to its lowest since February 2016, adding to a growing list of economic readings indicating slowing global growth.

(For an interactive version of the below chart, click tmsnrt.rs/2Tr5cgO)

MSCI’s All Country World Index, which tracks stock markets in 47 countries, came off its highest level since Dec. 4 after its best January gain on record – up 7.79 percent on the month.

The weak Chinese data also took MSCI’s broadest index of Asia-Pacific shares outside Japan down 0.2 percent, though that followed a 7.2 percent gain in January.

The Australian dollar, a liquid barometer of investor sentiment towards China, skidded half a percent.

The mood was slightly better in Europe, as strong earnings helped offset the Chinese survey. The pan-European STOXX 600 index was up 0.2 percent, with most European bourses slightly positive.

Purchasing managers indexes in manufacturing for Italy and Switzerland came in below expectations, although those for Germany, France and the euro zone were in line with forecasts.

Equity markets have been relieved by a change of heart at the U.S. Federal Reserve, which signaled this week that its three-year drive to tighten monetary policy may be at an end amid a suddenly cloudy outlook for the U.S. economy.

As it held interest rates steady, the U.S. central bank also discarded its promises of “further gradual increases” in interest rates and said it would be “patient” before making any further moves.

“The Fed (Federal Reserve) decision should not only be supportive of risk markets, but also the weaker dollar backdrop could be extended, which should support EM assets, especially at a time when China is attempting to stimulate growth,” said Mohammed Kazmi, portfolio manager at UBP.

“The market will now turn its attention to the outcome of U.S.-China trade talks as well as the U.S. data.”

Jobs data from the United States is due at 1330 GMT.

Stocks had also gained after U.S. President Donald Trump said he would meet Chinese President Xi Jinping soon to try to seal a comprehensive trade deal as the top U.S. negotiator reported “substantial progress” in the talks.

Beijing’s trade delegation said the talks made “important progress”, China’s official Xinhua news agency reported.

The previously upbeat mood was also chilled somewhat by White House insistence that March 1 was a hard deadline for a deal, a failure of which would lead to an increase in U.S. tariffs on Chinese goods.

“Analysts mostly remain deeply skeptical that a genuine trade deal can be done on this time frame,” economists from Commonwealth Bank of Australia said in a note.

“We are less pessimistic since these negotiations are being conducted by senior politicians, not by trade bureaucrats,” they added. “Both sides also have an incentive, and arguably a growing incentive, to get a meaningful deal done.”

The optimism supported Wall Street with the S&P 500 ending Thursday with a gain of 0.86 percent. The Nasdaq jumped 1.37 percent on the back of a near 11 percent rise in Facebook Inc. The Dow slipped 0.06 percent.

Over January, the S&P 500 rose 7.9 percent, its best monthly performance since late 2015 and its strongest start to a year since 1987. The Nasdaq gained 9.7 percent in the month and the Dow rose 7.2 percent.

Against a basket of currencies, the dollar was flat at 95.581 thanks in part to a pullback in the euro to $1.1453.

The single currency had taken a knock when Bundesbank President Jens Weidmann painted an unusually bleak picture of the German economy, saying the slump will last longer than initially thought.

Gold prices hovered just short of nine-month highs supported by the fall in bond yields and expectations for a softer dollar.

Spot gold stood at $1,318.41 per ounce, having touched a top of $1,326.30.

Oil prices were subdued as the China data offset signs major exporters were reducing output in line with a pact to cut supply.

U.S. crude futures fell 0.4 percent to $53.56 per barrel, while Brent fell 0.3 percent to $60.65.

* Indian stocks set for over 4-month closing peak on budget proposal

* Soft PMI data weighs on China, Russia

* Russian rouble drops away from over three-month highs

By Aaron Saldanha and Agamoni Ghosh

Feb 1 (Reuters) – Emerging market shares hit a new five month high on Friday, helped by optimism around U.S.-China trade talks, while developing world currencies were on track to post a weekly gain.

U.S. President Donald Trump said on Thursday he will meet Chinese President Xi Jinping soon to try to seal a comprehensive trade deal, as he cited progress during two days of high-level talks. That comes about a day after dovish signals from the U.S. Federal Reserve on future rate hikes gave broad support to emerging markets.

MSCI’s emerging market index for stocks was up 0.1 percent on Friday, on track to post its sixth straight weekly gain, while its index of developing world currencies dipped on the day but was set to add 0.8 percent for the week.

“A decisively dovish Fed has provided a fresh source of impetus for a bounce in EM as longer dated US real yields can fall,” JPMorgan’s Saad Siddiqui wrote in a note to clients.

JPMorgan raised its exposure to emerging market local bonds and currencies after the Fed’s shift to a more dovish stance.

“The Fed, dropping any bias towards hiking rates and softening the rhetoric on balance sheet policy is significant for EM assets and paves the way for an extended bounce,” wrote Siddiqui.

Benchmark Chinese shares logged their best day in two weeks, as optimism on trade outweighed data from a private survey showing factory activity in China shrank by the most in almost three years in January.

Indian equities were up around half a percent on the proposal of the last union budget before the world’s biggest democracy goes to the polls.

Russia’s rouble dropped from a three-month high seen on Thursday as the central bank bought more foreign currency, while local stocks eked out a 0.1 percent gain.

Factories in Russia in January shed staff for the first time since August, pressured from weaker growth in output and new orders, data showed.

Commodity giant South Africa’s rand was 0.2 percent softer, giving up some of the ground it gained after a Fed-inspired surge to a six month peak, with China’s weak economic data dampening risk sentiment.

Turkey’s lira dropped half a percent, but was on track to end the week about 1.5 percent higher.

Fund managers on Friday told Reuters JPMorgan has kept dollar-bonds of Venezuelan state-oil firm PDVSA in its emerging market bond indexes in a monthly rebalancing.

Trading volumes of those bonds had dived following U.S. sanctions, prompting speculation that their low liquidity would result in their ejection from the widely followed indexes.

For TOP NEWS across emerging markets

For CENTRAL EUROPE market report, see

For TURKISH market report, see

For RUSSIAN market report, see (Reporting by Aaron Saldanha and Agamoni Ghosh in Bengaluru, Karin Strohecker in London Editing by Keith Weir)

MOSCOW, Feb 1 (Reuters) – Domestic gas supplies from Sakhalin-1 project, led by ExxonMobil have been suspended due to the stoppage of a compressor facility, the Russian energy ministry said on Friday.

It said the gas supplies have been halted from the Chaivo field to the Okha – Komsomolsk-on-Amur pipeline on Feb. 1 at 0145 local time. (Reporting by Vladimir Soldatkin. Editing by Jane Merriman)

(Repeats JAN 31 story, no change to text)

* Scottish fishermen to catch less to avoid no-deal border chaos

* Industry would seek compensation for losses

* UK fishermen backed Brexit because of EU fisheries regime

By Elisabeth O’Leary

EDINBURGH, Jan 31 (Reuters) – Fewer Scottish langoustines, scallops and salmon will reach the plates of gourmands in the European Union if there is a no-deal Brexit because border delays could mean they rot before they can be delivered, fishing officials said.

Scottish fishermen plan to reduce their catches if Britain exits the European Union on March 29 without a transition deal, in order to avoid potential losses, industry officials said.

Scotland accounts for most of the fish caught in the United Kingdom, which is the second-biggest provider of fish from the EU after Spain.

While some businesses are stockpiling to prepare for any disruption, that is not an option with fresh fish.

People in the industry are worried about how Scottish mackerel and prawns will get to key markets in France, the Netherlands and Spain if there are transport jams at the border.

Some firms could go bust, according to Jimmy Buchan, chief executive of processors’ group the Scottish Seafood Association.

Scotland’s fishing sector vociferously backed the Brexit campaign ahead of the referendum in 2016. Fishermen say EU membership weakened the industry over decades by giving quotas to trawlers from other EU countries with smaller fishing stocks.

But they have concerns about what a no-deal Brexit could mean for the United Kingdom’s fish exports which, including processed fish, are worth around 1.9 billion pounds ($1.3 billion) a year.

Britain exports 75 percent of the fish it catches, and 75 percent of that goes to the EU.

“My market for posh prawns is not the UK,” said Buchan, who is worried about routes to the French market.

“I do feel that at this late stage we don’t know enough about planning. Unless someone puts on a ferry route or guarantees the French will not impede the free flow of traffic, what are we supposed to do?”

To ease potential logjams, the government has contracted additional freight capacity at ports in southern England to ease the burden on main hub Dover and is building lorry parks along motorways nearby.

“When I ask government about transport issues, I do not get the reassurances I need,” Buchan said.

TEMPORARY PROBLEM

The Scottish Fishermen’s Federation (SFF) said temporary disruption is worth it if it means Britain can quickly rid itself of EU fishing rules.

“We are less scared than other industries,” said Bertie Armstrong, the SFF’s chief executive.

“The first solution is to temporarily fish less. You don’t want to land it ashore for it to rot or not go anywhere,” he said.

“Secondly there are some smaller outfits running small boats in remote places which may indeed need some (financial) help to survive that period before new markets are opened.”

The scale of such support from the public coffers is likely to depend on the duration of any hit to the industry.

Scotland’s government estimates that transport disruption after a no-deal Brexit could last three to six months, Armstrong said.

Plans are also being made to cut back on the supply of salmon, Britain’s biggest food export by value.

Scottish salmon farms — which are not subject to the same EU rules as fish caught at sea— expect to slow their harvesting in the days after March 29, but such a move would not address any longer-term logistics problems, an industry source said.

“A negotiated outcome between the UK and the EU is preferable to a no-deal scenario,” Julie Hesketh-Laird, CEO of the Scottish Salmon Producers Organisation, said.

“Exiting the EU without a deal would almost certainly place fresh barriers in the way of the export of farmed salmon to the continent.” (Reporting by Elisabeth O’Leary Editing by William Schomberg)

LONDON, Feb 1 (Reuters) – The CME Group has reinstated approved status for warranting aluminium produced by United Company Rusal after U.S. sanctions were lifted against the company on Sunday.

“Aluminium of a Rusal Brand and warrants issued for aluminium of a Rusal Brand shall be deliverable under the Exchange’s Aluminium Futures contract,” CME said in a notice on its website dated Jan. 31.

CME had revoked the approved status on April 10 after sanctions were imposed on April 6.

The London Metal Exchange, the world’s largest, lifted its temporary suspension of Rusal’s metal on Monday. (Reporting by Zandi Shabalala. Editing by Jane Merriman)

LONDON, Feb 1 (Reuters) – JPMorgan has retained dollar-denominated debt issued by Venezuela’s state-run oil firm PDVSA in a key emerging market bond index in its monthly rebalancing, two fund managers said on Friday.

“They kept them in, there are no changes on PDVSA, and we are very happy about that,” said one asset manager who declined to be named. “(A change) would have come too quick, the situation is still evolving.”

Investors have been concerned that JPMorgan could exclude PDVSA from the EMBI Global benchmarks of sovereign and sub-sovereign emerging hard-currency debt after Washington imposed sweeping sanctions on the firm on Monday.

JPMorgan communicates any changes of index constituents to its clients on the last trading day of the month, according to fund managers. JPMorgan did not immediately comment. (Reporting by Karin Strohecker, editing by Sujata Rao)

LONDON (Reuters) – European shares edged up on Friday as a fresh batch of earnings for the fourth quarter and signs the China/U.S. trade talks were successful helped keep investors risk-on despite a dismal survey on Chinese factory activity.

At 0824 GMT, the STOXX 600 was up 0.2 percent with most European bourses just slightly positive and most sectors also in the black.

Electrolux was the clear top performer in early trading with forecast-beating profits sending shares in the home appliance maker up 8.6 percent.

JCDecaux revenues also cheered investors, boosting the French company’s shares about 7 percent.

There were mixed feelings about results in the banking sector, particularly in Spain with Caixabank falling 5.4 percent on its 2018 results while fellow Spanish lenders Banco Sabadell and BBVA and were down 3.5 percent and flat respectively.

In Germany Deutsche Bank lost another 2.8 percent after its results, failing to recover after sinking during the last session on speculation of a possible merger with rival Commerzbank.

On a more optimistic note, Danske Bank, under investigation for suspicious payments through its Estonian branch, rose close to 4 percent as it unveiled new efforts to step up anti-money laundering efforts via investments of up to 2 billion euros ($2.29 billion).

PARIS (Reuters) – France’s agriculture minister sought to reassure households that food shopping bills would not jump dramatically as a rise in minimum food prices aimed at raising farmers’ incomes came into effect on Friday.

The government had postponed introducing the measure in December as France reeled from nationwide unrest and sometimes violent “yellow vest” protests over high living costs and the squeeze felt on household budgets.

Didier Guillaume said prices would increase on only 5 percent of products sold in supermarkets, including the chocolate spread Nutella, Coca-Cola and granola – items retailers often sell at a discount to draw consumers in.

The “field-to-fork” bill was a campaign promise of President Emmanuel Macron to win support among farmers, an important voter constituency in France, who have long complained of being hit by low margins and ending up the victims of retail price wars.

“Households will only end up paying more if their trolley is full of Nutella and Coca-cola. The price of loss-leader goods will increase, while the price of meat, fish, cheese, vegetables will not,” Guillaume told CNews.

The new legislation includes a 10 percent increase in the price floor for food products and curbs promotional offers so that retailers cannot discount products by more than 34 percent of their value.

Guillaume said the average household shopping bill would increase by just 50 cents to 3 euros a month.

Supermarket retailers like Carrefour, Casino and privately-held Leclerc typically made a margin of 30-40 percent on farmers’ products, the minister said, adding: “I ask them to stop doing that.”

Michel-Edouard Leclerc, chief executive of supermarket chain Leclerc, France’s largest food retailer by market share, has branded the food price measures a “scam” and said farmers would not see higher prices.

Separately, Guillaume confirmed that a Polish abattoir had sold nearly 800 kilograms of rotten beef to nine French companies.

Polish authorities acknowledged on Thursday that 2.7 tonnes of suspect beef had been exported across the European Union.

“It’s an awful fraud,” Guillaume said.

The trial of two former managers of French meat-processing firm Spanghero and two Dutch meat traders accused of passing off cheap horse meat as beef in ready-made meals and burgers brought food safety standards into focus in France in January.