2025-07-28 10:08

FRANKFURT, July 28 (Reuters) - The dollar's early dominance of stablecoins gives the U.S. an advantage that could ultimately push up borrowing costs for Europe, reduce the ECB's autonomy and increase geopolitical dependency on the U.S., an ECB blog post argued on Monday. Stablecoins, crypto assets pegged to a currency such as the dollar, have gained popularity in recent years and got a big boost earlier this month when U.S. President Donald Trump signed a law to create a regulatory regime, aimed at cementing the dollar's status as the global reserve currency. Sign up here. "Such dominance of the U.S. dollar would provide the United States with strategic and economic advantages, allowing it to finance its debt more cheaply while exerting global influence," ECB adviser Jürgen Schaaf said in a post that does not necessarily reflect the ECB's own views. "For Europe, this would mean higher financing costs relative to the United States, reduced monetary policy autonomy and geopolitical dependency," he added. If dollar-based stablecoins become widely used in the euro area, for payments, savings or settlement, the ECB’s control over monetary conditions could be weakened, Schaaf argued. Dollar-pegged stablecoins issued by Tether and Circle (CRCL.N) , opens new tab have dominated the global market and the share of euro-denominated stablecoins remains marginal, with market capitalisation of less than 350 million euros, the blog post said. Europe should thus act quickly, creating the digital version of its euro currency, a project, that is being held up by legislative delays, and should foster the creation of more euro-based stablecoins. The EU should also foster the use of distributed ledger technology to speed up cheap cross-border payments, the blog argued. "Finally, stronger global coordination on stablecoin regulation is pivotal," the blog said. "If we forgo a common approach, we risk fuelling instability, regulatory arbitrage and global U.S. dollar dominance." https://www.reuters.com/business/dollar-stablecoins-threaten-europes-monetary-autonomy-ecb-blog-argues-2025-07-28/

2025-07-28 10:03

LONDON, July 28 (Reuters) - A downturn in British retail sales extended into its 10th month in July as rising prices weighed on consumers, although the pace of the fall was less severe than in June, a Confederation of British Industry survey showed on Monday. The CBI's monthly gauge of how retail sales compared with a year earlier stood at -34 this month, an improvement on June's -46 but still a sign of weakness in demand. Sign up here. A measure of expected sales for August rose to -31 from -49, the CBI said. "Firms reported that elevated price pressures – driven by rising labour costs – and economic uncertainty continue to weigh on household demand, which has contributed to sales volumes falling since October 2024," Martin Sartorius, principal economist at the CBI said. Employers groups have said finance minister Rachel Reeves' decision to increase the social security contributions they pay for their staff, as well as an increase in the minimum wage, is contributing to higher prices. Weak demand was mirrored across the distribution sector, with wholesale and motor trades also seeing declining sales, Sartorius said. Official data published last week showed British consumers shopped more in June after May's big fall with hot weather helping to increase sales of drinks, clothes and car fuel. However, in the three months to June, sales volumes rose by 0.2%, the weakest increase since the three months to February. Many households are feeling the squeeze again from an inflation rate that rose to 3.6% in June. While the CBI's overall sales gauge remained in negative territory, online sales volume rose for a third month in a row, albeit marginally. The data was collected between June 27 and July 15 and was based on responses from 56 retailers and 91 wholesalers. https://www.reuters.com/business/retail-consumer/uk-retail-downturn-stretches-into-10th-month-cbi-says-2025-07-28/

2025-07-28 09:23

LONDON, July 28 (Reuters) - Hedge funds fled technology stocks at the fastest pace in 12 months in the latest week, just as the S&P 500 (.SPX) , opens new tab reached all-time highs, a note to Goldman Sachs (GS.N) , opens new tab clients and seen by Reuters said. The S&P 500, which includes seven tech stocks in its top 10 largest constituents by market value, has surged roughly 28% since its 2025 low, while the Nasdaq Composite (.IXIC) , opens new tab has jumped 38% in that time. Sign up here. As of Friday, the S&P 500's forward price to earnings ratio, which reflects the value of a company's stock relative to its projected future earnings, was 23.11, around five-month highs, according to LSEG/Datastream. "U.S. equities valuations (such as price earnings ratios) are now 30% higher than their recent decade average, while 10-year yields remain stubbornly high and volatile. The future path of equities may depend partly on a decline in long-term rates; however, we do not seem to be there yet," Lombard Odier Investment Managers head of macro Florian Ielpo said in a note on Friday. Globally, hedge funds sold tech stocks, some of the most richly valued equities, more than any other sector last week, the Goldman Sachs note said. Rather than shorting the sector, hedge funds tended to ditch long bets and exit trades, the bank said. A short bet is designed to profit from a drop in an asset price. This week's exodus was the largest the bank had seen since July 2024, Goldman Sachs said. Hedge funds fleeing tech stocks centered on trading in North America and Europe. Every kind of tech stock was sold, including semiconductor chip companies, as well as those in software and IT services, the bank said. Meanwhile, shares in consumer staples - companies that sell items that people purchase regardless of economic conditions - were among the most net bought U.S. stock sectors this week, Goldman said. Hedge funds piled into these stocks for the fourth straight week and their trades were almost entirely long positions - those that will profit if the stock prices rise. The kind of companies whose shares hedge funds bought included those that sell food and beverages and personal care products. https://www.reuters.com/business/finance/hedge-flow-hedge-funds-ditch-tech-buy-essentials-goldman-sachs-says-2025-07-28/

2025-07-28 07:58

Euro down against most peers after initial, knee-jerk rise Fed, Bank of Japan expected to hold rates steady this week China and US negotiating ahead of August 12 deadline TOKYO/LONDON, July 28 (Reuters) - The dollar rose against major currencies on Monday after the U.S. and the EU struck a framework trade pact, the latest in a flurry of deals to avert a global trade war, with investors also looking to this week's U.S. and Japanese central bank meetings. Meeting in Scotland on Sunday, U.S. President Donald Trump and European Commission President Ursula von der Leyen said the deal provided for an import tariff of 15% on EU goods, half the rate Trump had threatened from August 1. Sign up here. That follows last week's U.S. agreement with Japan, while top U.S. and Chinese economic officials will resume talks in Stockholm on Monday aiming to extend a truce by three months and keep sharply higher tariffs at bay. The euro was last down 0.7% at $1.16530 , set for its biggest daily fall in 10 weeks, reversing an initial knee-jerk rise in Asia trade as investors' focus shifted to what an easing in global trade tensions meant for the dollar overall. "The mood music on U.S. trade negotiations has been a little brighter following agreements with Japan and the EU," said Paul Mackel, global head of FX research at HSBC. "If more ‘trade deals’ are reached, this could help to reduce this source of policy uncertainty that has weighed against the dollar, at least for now. It could also see other factors such as relative yields becoming more influential." The dollar tumbled sharply earlier this year, particularly against the euro, as fears that dramatically higher tariffs on trade with most of its major partners would hurt the U.S. economy caused investors to consider shifting out of U.S. assets. Normally the gap between yields on government bonds is a major factor for currency moves, but at present the euro is significantly higher than the gap between U.S. and euro zone yields would imply. The euro also fell against the yen and sterling, having hit a one-year high on the Japanese currency and a two-year high on the pound at the start of trade. , The dollar was stronger elsewhere, up 0.5% on the yen at 148.37, and strengthening against the pound, which was 0.24% lower at $1.3413. As concerns subside about the economic fallout from punishing tariffs, investor attention is shifting to corporate earnings and central bank meetings in the United States and Japan in the next few days. Both the Fed and the Bank of Japan are expected to hold rates steady at policy meetings this week, but traders will watch subsequent comments to gauge the timing of the next moves. Investors will also be watching to see Trump's reaction to the Fed's decision. The U.S. president has been putting the Fed under heavy pressure to make significant rate cuts, and Trump appeared close to trying to fire Powell last week, but backed off with a nod to the market disruption that would likely follow. In addition, quarterly results are due in coming days from Apple, Microsoft, Amazon and Facebook parent Meta Platforms META.O , opens new tab, four of the whose stocks heavily influence benchmark indexes. They matter for currency investors if strong results cause an acceleration of flows back into U.S. assets. The dollar also climbed against the safe-haven Swiss franc, up 0.74% at 0.8011 francs. https://www.reuters.com/world/middle-east/dollar-strengthens-after-us-eu-agree-tariff-deal-2025-07-28/

2025-07-28 07:26

HAMBURG, July 28 (Reuters) - Rain has raised water levels on the river Rhine in Germany, with much of the river around normal levels, allowing cargo vessels to sail with full loads, commodity traders said on Monday. Dry weather and a heatwave in June and July meant the river became too shallow for vessels to sail fully loaded. Ship operators imposed surcharges on freight rates to compensate for vessels sailing partly empty, increasing costs for cargo owners. Sign up here. Shallow water continues to hinder shipping on some northern river sections, including around Duisburg and Cologne. But the picture has improved and vessels are able to sail about 70% full in Cologne and 90% full in Duisburg. More rain is forecast in the coming days, which traders said could raise water levels enough to allow ships to sail fully loaded later this week. The impact of a recent heatwave had been stronger than expected, drying fields that drain into smaller streams and rivers feeding into the Rhine. The Rhine is an important shipping route for commodities such as grains, minerals, ores, chemicals, coal and oil products, including heating oil. German companies faced supply bottlenecks and production problems in summer 2022 after a drought led to unusually low water levels on the river. https://www.reuters.com/business/environment/most-rhine-river-back-normal-levels-after-rain-2025-07-28/

2025-07-28 07:16

July 28 (Reuters) - CK Hutchison (0001.HK) , opens new tab said on Monday it was in talks with a consortium pursuing its $22.8 billion ports business to add a Chinese "major strategic investor" to the bid, after Beijing flagged a probe into the deal amid heightened Sino-U.S. tension. The Hong Kong-based conglomerate made the comment the day after exclusive talks for a deal - which includes two ports along the Panama Canal - ended with the consortium, led by U.S. investment firm BlackRock (BLK.N) , opens new tab and Italian billionaire Gianluigi Aponte's family-run shipping company MSC. Sign up here. The canal's strategic value in global trade and U.S. President Donald Trump's call to end what he described as Chinese control over it has made the deal a flashpoint for U.S.-China trade tension, with media reporting , opens new tab that Beijing was unhappy , opens new tab with the deal and was reviewing it for security and antitrust issues. Owned by billionaire Li Ka-shing and founded and listed in Hong Kong, CK Hutchison has a global footprint with businesses in areas as varied as ports and telecommunications. Here is a look at its origins and current standing globally: ORIGINS Li Ka-shing established Cheung Kong Industries in 1950 at the age of 21. The tycoon acquired a controlling stake in Hutchison Whampoa nearly three decades later , opens new tab. Hutchison Whampoa traced its roots to a small dispensary firm in China's southern Guangzhou that was established in 1828 and a dock and repair yard operator founded on the Pearl River in 1863. Li Ka-shing carried out a major reorganisation of the business in 2015 by merging his two flagship companies, Hutchison Whampoa and Cheung Kong. This created CK Hutchison, one of Asia's largest conglomerates with a global presence. GLOBAL STANDING CK Hutchison has interests in every continent and operates in more than 50 countries, employing over 300,000 people as of June last year. About half its operating earnings come from its telecoms and infrastructure operations, with three-quarters derived from countries and territories outside mainland China. TELECOMMUNICATIONS The telecommunications business is the group's most profitable segment and brought in a quarter of its operating profit in 2024 , opens new tab. Its CK Hutchison Group Telecom unit handles European operations, while Indonesia, Vietnam and Sri Lanka are under Hutchison Asia Telecommunications. Italy and the UK are the top business contributors for the European unit, while Ireland and Sweden are the fastest-growing markets. Three, its telecom brand, operates in eight countries including Ireland, the UK, Austria and Sweden. Hutch in Sri Lanka and Vietnamobile in Vietnam are the prominent brands in Asia. INFRASTRUCTURE The group's infrastructure operations are anchored by CK Infrastructure (1038.HK) , opens new tab and contributed just under a quarter of its operating profit in 2024, making this segment the second-largest profit earner. CK Infrastructure manages assets across energy, transport, water infrastructure, waste management and other related businesses across the world. Its interests include UK Power Networks, Northern Gas Networks and Canadian Power. It is the largest foreign infrastructure investor in Australia, and also invests in toll roads and bridges in China, and infrastructure materials in Hong Kong. CKI holds the largest stake in Power Assets Holdings (0006.HK) , opens new tab which supplies electricity and gas to millions of consumers across continents. PORTS AND RELATED SERVICES The group's sprawling maritime empire , opens new tab extends across 24 countries, with interests in 53 ports and 295 berths. These include container terminals in five of the world's 10 busiest ports. CK Hutchison's busiest ports include Shenzhen's deep water Yantian port, Mingdong and Pudong terminals in Shanghai, Hong Kong's Kwai Tsing Port, container terminals in Belgium, Germany, and the Netherlands, and Westports Malaysia. The network of ports and terminals is at the centre of increasing geopolitical sensitivity surrounding critical trade infrastructure. The preliminary deal with the BlackRock-led group included the sale of 43 ports comprising 199 berths in 23 countries. CK Hutchison, meanwhile, would maintain stakes in three of the world's 10 busiest container ports. Ahead of the deal, the ports business contributed around 15% of the conglomerate's earnings before interest, tax, depreciation and amortisation (EBITA). RETAIL The conglomerate is a major player in the global health and beauty landscape with an expansive footprint of nearly 17,000 stores across 30 markets. Retail contributed 20% to the group's operating earnings in 2024. AS Watson, which owes its lineage to the old Guangzhou dispensary, has a diverse portfolio spanning personal care, health and beauty products, food and fine wine, and consumer electronics and electrical appliances. Its notable brands include health and beauty retailers Watsons, Rossmann and Superdrug, as well as the Hong Kong-based supermarket chain PARKnSHOP. FINANCE & INVESTMENTS, OTHERS The finance and investment portfolio serves as a strategic complement to CK Hutchinson's core operations, accounting for less than a fifth of its operating earnings. It manages substantial cash reserves and liquid investments while overseeing a number of partially owned enterprises spanning multiple sectors. https://www.reuters.com/business/ck-hutchison-global-conglomerate-caught-us-china-trade-spat-2025-03-20/