2024-08-16 05:46

TOKYO, Aug 16 (Reuters) - Japan grounded hundreds of flights and urged tens of thousands of people to evacuate in the eastern parts of the country on Friday, as a strong typhoon caused power blackouts in the middle of a major summer holiday week. Typhoon Ampil, categorised as "very strong" by the Japan Meteorological Agency (JMA), was situated off the Pacific coast of Japan's main island at 3 p.m. (0600 GMT). The agency has two higher categories - "very strong" and "violent". The typhoon is expected to get close to the eastern region of Kanto, which includes the capital Tokyo, on Friday evening. Ampil has wind speeds of 45 metres per second with maximum gust of 60 metres per second (216 kph/134 mph), according to the JMA. "The Kanto region is expected to experience fierce winds that could cause injuries from flying debris or even overturn trucks in motion," the JMA warned on its website. Iwaki City in Fukushima Prefecture in northeastern Japan issued an evacuation order for about 323,000 residents, telling them to evacuate as the likelihood of heavy rain was increasing through Saturday morning. Mobara City in Chiba Prefecture east of Tokyo also placed an evacuation order for about 18,500 residents, while dozens of other cities opened special evacuation centres and advised voluntary evacuation. More than 2,500 households in the Kanto area were still experiencing blackouts in the afternoon, the Tokyo Electric Power Co (9501.T) , opens new tab said. ANA Holdings (9202.T) , opens new tab said it will cancel 281 domestic flights and 54 international flights slated to leave or arrive on Friday, affecting nearly 70,000 passengers. The airline later said it will cancel 32 domestic flights into or out of Tokyo's Haneda airport on Saturday, disrupting travel plans for about 2,300 passengers. Japan Airlines (9201.T) , opens new tab is planning to cancel 281 domestic and 38 international flights on Friday, affecting about 50,000 passengers. All the high speed "Shinkansen" bullet train services between Tokyo and Japan's industrial heartland of Nagoya are also cancelled. Restaurants, department stores and amusement parks were either closed or curtailed business hours. Tokyo Disneyland, operated by Oriental Land (4661.T) , opens new tab, moved up closing time to 3 p.m. from 9 p.m. local time on Friday. Sign up here. https://www.reuters.com/world/japan/tokyo-braces-typhoon-ampil-homes-evacuated-flights-cancelled-2024-08-16/

2024-08-16 05:24

Aug 16 (Reuters) - Global shares pushed higher on Friday, adding to weekly gains, after encouraging U.S. economic data helped soothe fears of a recession in the world's largest economy. On Wall Street, stocks extended their biggest weekly percentage gains of the year. The Dow Jones Industrial Average (.DJI) , opens new tab finished up about 0.25% - bringing its weekly gain to 2.7% - while the S&P 500 (.SPX) , opens new tab and Nasdaq Composite (.IXIC) , opens new tab both increased 0.2%; they were up about 3.7% and 5% on the week, respectively. MSCI's main world stock index (.MIWO00000PUS) , opens new tab rose 0.5%, adding to its recovery from market turmoil last week generated by U.S. recession fears and foreign exchange gyrations. The pan-European STOXX 600 index (.STOXX) , opens new tab rose 0.3% on the day, still hovering at its two-week high and logging its best week since May 6, up 2.4%. The VIX U.S. stock volatility index (.VIX) , opens new tab, broadly considered the market's fear gauge, sat at benign levels of about 15 after hitting a four-year high of 65 early last week. The sharp turnaround in market sentiment came after a batch of U.S. data this week showed inflation was moderating and retail spending was robust. That has helped the market narrative move away from recession concerns, sparked by a weak U.S. jobs report in early August, to confidence the economy can keep growing. Softer inflation data has also reinforced expectations of an interest rate cut by the U.S. Federal Reserve in September. On Friday, a survey showed that U.S. consumer sentiment rose in August, driven by developments in the U.S. presidential race, while inflation expectations remained unchanged over the next year and beyond. Scott Wren, a Wells Fargo Investment Institute strategist, said stocks were reacting to the likelihood that while the economy is slowing, the probability of a recession is low and earnings estimates have edged higher. "Modest growth with moderating inflation is a good environment for stocks and bonds," Wren said in an email. With central bankers from around the globe set to gather in Jackson Hole, Wyoming, next week, traders expect the Fed to lower borrowing costs from a 23-year high next month but have reduced their bets on an emergency 50-basis-point cut to 25%, down from 55% a week ago, the CME FedWatch tool showed. Invesco multi-asset fund manager David Aujla said the U.S. is unlikely to go into recession. But markets likely would be more volatile through to the end of this year, Aujla said, particularly around November's U.S. presidential election. Easier U.S. Treasury yields on Friday partly unwound the previous session's surges. The yield on the benchmark U.S. 10-year Treasury note declined 4 basis points to 3.883%. DOLLAR, OIL DECLINE In Asia, Japan's Nikkei share average climbed 3.6% on Friday and notched its best week in more than four years, while Hong Kong's Hang Seng Index rose 1.9%. Japanese stocks gained following heavy losses last week after a surprise Bank of Japan rate cut sent the yen soaring against the dollar, wrecking yen-funded stock trades. The dollar fell against the yen on Friday, and was softer against other major currencies after disappointing U.S. housing numbers. U.S. single-family homebuilding fell in July as higher mortgage rates and house prices kept prospective buyers on the sidelines, suggesting the market remained depressed at the start of the third quarter. The euro added 0.47% versus the dollar. Oil prices settled down nearly 2%, with global benchmark Brent crude below $80 a barrel, but were little changed on the week as investors tempered expectations of demand growth from top oil importer China. Brent fell $1.36, or 1.7%, to settle at $79.68 per barrel and U.S. crude dropped $1.51, or 1.9%, to $76.65. Spot gold prices soared to an all-time high, rising more than 2%. Sign up here. https://www.reuters.com/markets/global-markets-wrapup-1pix-2024-08-16/

2024-08-16 04:33

A look at the day ahead in European and global markets from Rae Wee Last week's market turmoil has quickly faded into a distant memory - at least for now - after a raft of U.S. economic data this week allayed fears of a deep downturn in the world's largest economy. Recession alarm bells have stopped ringing, and investors seem convinced that the Federal Reserve is no longer behind the curve in cutting rates. Market pricing now points to just a 25% chance of a 50-basis-point cut by the Fed next month, down from a 55% chance a week ago, according to the CME FedWatch tool, after July's U.S. inflation report pushed back against bets of an outsized move. In Asia, Japan's Nikkei (.N225) , opens new tab was a notable outperformer, with its 3% rise on Friday putting it on course for its best week since April 2020 as it tries to reclaim its record high. Whatever happened last week? The yen has, meanwhile, fallen nearly 5% from last week's seven-month peak and last stood near the 149 per dollar level . Even as it starts to look cheap once again, the currency's volatility is causing global investors to rethink the viability of yen-funded trades. Stock futures on Friday point to a firmer open in Europe and the U.S., with UK retail sales data due just as London wakes up. Expectations are for shoppers to have returned to the high street in July, after a sharper-than-expected fall in June. Bets remain for the Bank of England to ease rates at least once more this year, as inflation pressures subside and the outlook for Britain's economy for the remainder of 2024 turns less rosy. And as most central banks globally look towards lowering rates, Down Under, the Reserve Bank of Australia (RBA) is slowly becoming an outlier. RBA Governor Michele Bullock said on Friday it was premature to be thinking about rate cuts, adding underlying inflation was too high and that the board remained focused on potential upside risks to prices. Her remarks came after her Antipodean counterpart, the Reserve Bank of New Zealand, had earlier this week delivered its first rate cut in over four years. Key developments that could influence markets on Friday: - UK retail sales (July) - University of Michigan U.S. consumer sentiment preliminary reading (August) - Fed's Goolsbee speaks Sign up here. https://www.reuters.com/markets/europe/global-markets-view-europe-2024-08-16/

2024-08-16 03:52

WELLINGTON, Aug 16 (Reuters) - New Zealand’s central bank governor Adrian Orr on Friday raised the distinct prospect of cutting rates another 50 basis points by year-end, saying "I would love to be delivering that" in explicit comments setting the course for decisive policy easing. The Reserve Bank of New Zealand slashed its benchmark rate by a quarter percentage point on Wednesday for the first time since March 2020, taking some market players by surprise, and flagged more cuts over coming months as inflation was nearing its 1% to 3% target. In a speech to the Wellington Chamber of Commerce, Orr said he was confident that New Zealand had returned to an environment of low and stable inflation. “There's two more opportunities for two more cuts between now and Christmas and all things going accordingly with the data and what we're talking about, then I would love to be delivering that,” he said. The central bank chief added his preference was to continue making further cuts through 2025, backing economists expectations for a series of reductions over the next year. The RBNZ's own guidance saw the official cash rate at 3.85% by the end of 2025 from 5.25% now, while market pricing is betting on a 3.0% handle by then. A Reuters snap poll released on Thursday, found the majority of economists expect the central bank to cut rates by 50 basis points by the end of the year. New Zealand joins a global policy easing campaign, including the European Central Bank, Bank of Canada and the Bank of England, as major central banks roll back their hefty hikes made since 2022 to fight red-hot inflation. The U.S. Federal Reserve is widely expected to start cutting rates from next month. Assistant governor Karen Silk told Reuters in an interview that her decision to support Wednesday's cut had been prompted by multiple pieces of data. “We've got high frequency indicators that are a lot weaker, and it's not one. They've been mixed signals out of that previously but now it's all kind of pointing to weaker activity in the economy and weaker than we anticipated it,” Silk said. The RBNZ is forecasting a recession for New Zealand this year, leaving policymakers focused on stabilizing the economy amid weak domestic demand and a challenging global growth environment. Silk added that all possible rate decisions were “on the table” on Wednesday, including a larger cut, but with New Zealand's policy cycle at a turning point, "there's still some uncertainties that sit out there." Sign up here. https://www.reuters.com/markets/nz-central-bank-chief-flags-two-mores-cuts-by-christmas-more-2025-2024-08-16/

2024-08-16 00:56

Brent futures fall by $1.36/bbl, WTI drops $1.51 Benchmarks broadly unchanged on the week after volatile trade Data from China showed economy losing momentum, weak oil demand Gaza ceasefire talks paused, set to resume next week NEW YORK, Aug 16 (Reuters) - Oil prices settled down nearly 2% on Friday, little changed on the week with Brent crude below $80 a barrel, as investors tempered expectations of demand growth from top oil importer China. Brent crude futures fell $1.36, or 1.7%, to settle at $79.68 per barrel. U.S. West Texas Intermediate crude futures declined by $1.51, or 1.9%, to $76.65. Last week, Brent crude ended at $79.66 a barrel and WTI closed at $76.84. On Thursday, data from China showed its economy lost momentum in July, with new home prices falling at the fastest pace in nine years, industrial output slowing and unemployment rising. That has stoked worries among traders about a slump in demand from the top oil importer, where refineries sharply cut crude processing rates last month on tepid fuel demand. The Organization of the Petroleum Exporting Countries on Monday cut its forecast for this year's oil demand growth, citing softness in China. The Paris-based International Energy Agency also cited weak demand in China when it slashed its 2025 forecasts on Tuesday. "It has been a volatile week in oil markets: on one hand you had fears of supply disruptions from a wider Middle East war, but on the other, slowing growth in China forced revisions of demand forecasts," said Andrew Lipow, president of energy consultancy Lipow Oil Associates. Oil futures rallied at the start of the week as traders braced for retaliation by Iran against Israel over the slaying of a Hamas leader in Tehran last month. But some of that risk was priced out because Iran has not struck yet, analysts at Commerzbank Research wrote on Friday. "At least so far, supply disruptions have been more theoretical than actual," said Brett Friedman, contributor for market data provider OptionMetrics. "That allows the market to focus on the demand side," Friedman said. A fresh round of Gaza ceasefire talks began on Thursday in Qatar. It has been paused until next week, with involved parties sending mixed signals on progress. "Provided the situation in the Middle East does not escalate further, the oil price is likely to tread water," the Commerzbank analysts said. A string of data releases from the U.S. kept a floor under oil prices: retail sales beat analysts' expectations, and fewer Americans filed new jobless claims last week, sparking renewed optimism around economic growth in the biggest oil market. Oil prices could lack direction until the U.S. Federal Reserve decides whether to cut interest rates at its September meeting, independent oil analyst Gaurav Sharma said. Low liquidity likely fed price volatility this week as many European and North American investors were still on holiday, UBS analyst Giovanni Staunovo said. Sign up here. https://www.reuters.com/business/energy/oil-prices-set-weekly-gains-renewed-enthusiasm-around-us-economy-2024-08-16/

2024-08-16 00:45

NEW YORK, Aug 16 (Reuters) - The dollar fell against the yen on Friday, and was softer against other peers as traders took profits and investors sifted through economic data to gauge the Federal Reserve's appetite for interest-rate cuts. Disappointing U.S. housing numbers also kept pressure on the greenback, helping it shed some of the lift it got a day earlier from data showing inflation trending down and consumer resilience. U.S. single-family homebuilding fell in July as higher mortgage rates and house prices kept prospective buyers on the sidelines, suggesting the market remained depressed at the start of the third quarter. The dollar fell 1.04% against the Japanese yen to 147.75, having touched a two-week high of 149.40 in the prior session. Still, the yen looked on course for its biggest weekly decline since June after U.S. economic data eased fears of a recession and supported bets of gradual rate cuts. "The overall tone in the FX market today is best characterized as 'corrective'. After a big rally on the strong U.S. consumer data yesterday, the U.S. dollar is giving back some of its gains as traders take profits ahead of the weekend," said Matt Weller, head of market research at StoneX. "The yen is the strongest major currency today – though still the weakest on the week – as traders rein in expectations for interest-rate cuts among other major central banks." Risk-sensitive currencies such as sterling were firm as the improved economic outlook spurred a rally in equities. Data on Thursday showed the number of Americans filing new applications for unemployment benefits dropped to a one month-low last week while U.S. retail sales increased by the most in 1-1/2 years in July, dashing expectations that the Fed could cut interest rates by 50 basis points (bps) next month. Odds for such a move is now 25.5%, according to the CME Group's FedWatch Tool. The dollar index , which measures the greenback against six other major currencies, fell 0.48% to 102.54. Traders are now looking to Fed Chairman Jerome Powell's upcoming Jackson Hole speech, but Weller does not expect any pre-commitment to either a 25 bps or 50bps cut next month. YEN STILL WEAK, POUND A BRIGHT SPOT With losses of about 1%, the yen was on track for its biggest weekly drop in almost two months. The currency surged to as strong as 141.675 yen per dollar on Aug. 5 as the Bank of Japan's surprise rate hike, combined with the flare-up in U.S. recession worries, sparked an aggressive unwinding of yen-financed carry trades. Some calm was restored after influential BOJ deputy governor Shinichi Uchida said the central bank would not hike rates when markets are volatile, and there are signs traders have been rebuilding short positions. Official data shows plenty of flows are happening, and Japanese investors ploughed the most money into long-term overseas bonds in 12 weeks in the week to Aug. 10, while foreigners were net buyers of short-term Japanese debt after eight straight weeks of selling. Overseas investors also snapped up about $3.5 billion in Japanese shares, reversing three consecutive weeks of net selling. Sterling rose 0.6% to $1.2931 - its highest since July 25 - after data showed British retail sales edged up in July, boosted in part by extra spending during the men's Euros soccer championship after an unusually cool and wet June had kept shoppers away. The pound was on track for a 1.2% weekly rise, its best performance in more than a month. The euro added 0.36% to $1.1012. The common currency touched its highest level since Jan. 3 earlier this week, helped by drop in the dollar after soft data. "We would use any USD dips to add to longs heading into the fall," said Daniel Tobon, head of G10 FX strategy at Citi Research. "We would be looking to sell EURUSD on rallies through 1.10, especially as growth momentum in Europe could be stalling and the EUR could be vulnerable into U.S. elections on tariff risks." Sign up here. https://www.reuters.com/markets/currencies/dollar-firm-after-us-data-quells-recession-fears-2024-08-16/