FILE PHOTO: A man looks at an electronic board showing the Nikkei stock index outside a brokerage in Tokyo, Japan, January 7, 2019. REUTERS/Kim Kyung-Hoon
April 25, 2019
By Tom Wilson
LONDON (Reuters) – World equity markets slipped on Thursday amid worries on global growth and as investors digested European earnings, while the Swedish crown slumped to its lowest in 17 years and the euro suffered after German data.
The Euro STOXX 600 lost 0.3 percent in early trading, with concern over prospects for global growth underscored by weak economic data from South Korea.
Energy stocks and a 10 percent drop in Finnish telecoms equipment maker Nokia dragged down European shares, with a varied bag of earnings for the region’s banks.
The MSCI world equity index, which tracks shares in 47 countries, also fell 0.3 percent.
Asian markets had fallen earlier in the day, losing 0.5 percent as South Korea’s economy unexpectedly contracted in the first quarter, giving a sharp reminder of the fragility of the world economy beyond the United States.
Shanghai’s bourse also fell sharply late in the day, losing more than 2 percent as other Chinese markets lost ground after attempts by the central bank to temper expectations for further easing of monetary policy.
Chinese officials also warned of protracted pressure on economic growth, casting a shadow over hopes for a sustained recovery in the world’s second biggest economy.
Those worries on growth also played out closer to home for European investors, with fears lingering over the state of the German economy after a survey on Wednesday showed German business morale falling.
Amid that weakness, central banks across the world have maintained ultra-loose monetary policy. The Bank of Japan on Thursday pledged to keep interest rates very low at least until early 2020, even as it retained main policy targets.
Japan’s benchmark Nikkei gave a muted response, while the Japanese yen also reacted little. The yen was last up about a third of a percent, at 111.80 yen per dollar.
“You certainly have a common response (from central banks) to a global growth slowdown in terms of monetary policy,” said Peter Schaffrik, head of European rates strategy at RBC Capital Markets.
“We haven’t generally seen outright reduction, but it is easing relative to what was previously communicated to, and implied in, the markets.”
There were signs of growing strength in the U.S. dollar, which analysts said was partly a symptom of the world’s largest economy maintaining relative strength and others, such as China, faring worse.
The dollar index, which measures the greenback versus a basket of six major peers, stood at around at 98.001, near its highest since May 2017 hit on Wednesday.
“The Fed isn’t keen to hike rates, but they are the strongest of the bunch so money will gravitate toward the U.S. dollar,” said David Madden, an analyst at CMC Markets in London.
CROWN AND LIRA
The Swedish crown slumped to its lowest since August 2002, after the central bank said weak inflationary pressures meant a forecast rate hike would come slighter later than planned, holding benchmark borrowing costs unchanged.
The crown sank 1.2 percent against the euro to 10.65 – on course for its biggest daily drop in more than six months.
Monetary policy also loomed for emerging markets currencies.
Turkey’s lira weakened against the dollar, losing 0.2 percent hours before a central bank policy decision that could test its willingness to maintain tight monetary policy and support the currency in the face of recession. The rate decision is due at 1100 GMT.
The euro suffered its worst day in over six weeks, falling 0.6 percent to a 22-month following the further signs of flagging growth in Germany. It was last at $1.1141.
Also on the agenda for the single currency were Spanish elections on Sunday and economic concerns out of Italy.
Brent crude oil on Thursday rose above $75 per barrel for the first time in 2019 in the wake of tightening sanctions on Iran, while gains in U.S. prices were crimped by a surge in U.S. supply.
For Reuters Live Markets blog on European and UK stock markets, please click on: [LIVE/]
(Reporting by Tom Wilson in London; Editing by Janet Lawrence)
FILE PHOTO: An oil pump is seen operating in the Permian Basin near Midland, Texas, U.S. on May 3, 2017. REUTERS/Ernest Scheyder
April 25, 2019
By Henning Gloystein
SINGAPORE (Reuters) – Brent crude oil on Thursday rose above $75 per barrel for the first time in 2019 in the wake of tightening sanctions on Iran, while gains in U.S. prices were crimped by a surge in U.S. supply.
Brent crude futures rose to a 2019 high of $75.01 per barrel on Thursday and were at $74.90 per barrel at 0705 GMT, up 33 cents, or 0.4 percent, from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at $65.94 per barrel, up 5 cents from their previous settlement.
Traders said Brent was receiving support on Thursday from a halt of Russian oil exports to Poland and Germany via a pipeline due to quality concerns.
The United States this week said it would end all exemptions for sanctions against Iran, demanding countries halt oil imports from Tehran from May or face punitive action from Washington.
“Following the U.S. decision to toughen its sanctions on Iran … we have revised up our end-year forecast for Brent crude from $50 to $60 per barrel,” analysts at Capital Economics said in a note.
The U.S. decision to try and bring down Iran oil exports to zero comes amid supply cuts led by producer Organization of the Petroleum Exporting Countries (OPEC) since the start of the year aimed at propping up prices.
As a result, Brent prices have risen by almost 40 percent since January.
Still, Brian Hook, U.S. Special Representative for Iran and Senior Policy Advisor to the Secretary of State, said on Thursday “there is plenty of supply in the market to ease that transition and maintain stable prices”.
Consultancy Rystad Energy said Saudi Arabia and its main allies could replace lost Iranian oil.
“Saudi Arabia and several of its allies have more replacement barrels than what would be lost from Iranian exports,” said Rystad’s head of oil research Bjoernar Tonhaugen.
“Since October 2018, Saudi Arabia, Russia, the UAE, and Iraq have cut 1.3 million bpd, which is more than enough to compensate for the additional loss,” he added.
Capital Economics said it expected “oil prices to fall this year as sluggish global growth weighs on oil demand, U.S. shale output grows strongly and investor aversion to risk assets like commodities increases”.
South Korea’s economy unexpectedly shrank in the first quarter, the Bank of Korea said on Thursday, marking its worst performance since the global financial crisis.
China’s Premier Li Keqiang said on Wednesday that his nation’s economy “still faces downward pressure”.
On the supply side, U.S. crude oil production has risen by more than 2 million barrels per day (bpd) since early 2018 to a record of 12.2 million bpd currently, making the United States the world’s biggest oil producer ahead of Russia and Saudi Arabia.
In part because of soaring domestic production, U.S. commercial crude oil inventories last week hit a October 2017 high of 460.63 million barrels, the Energy Information Administration said on Wednesday. That was a rise of 1.3 million barrels.
(GRAPHIC: U.S. oil drilling, production & storage levels link: https://tmsnrt.rs/2DxgF8W).
(Reporting by Henning Gloystein; Editing by Kenneth Maxwell and Tom Hogue)
Russia’s President Vladimir Putin shakes hands with North Korea leader Kim Jong Un at the Far Eastern Federal University campus at Russky Island in the far eastern city of Vladivostok, Russia April 25, 2019. REUTERS/Shamil Zhumatov
April 25, 2019
SEOUL (Reuters) – North Korean leader Kim Jong Un said on Thursday that his summit with President Vladimir Putin will help jointly assess the Korean peninsula issues and coordinate their stances.
Kim and Putin met for their unprecedented summit in the Russian city of Vladivostok, where Kim is likely to seek support from the Russian leader as nuclear talks between North Korea and the United States are hanging in limbo.
Putin told Kim he welcomed North Korea’s efforts to improve ties with the United States.
(Reporting by Hyonhee Shin and Joyce Lee; Editing by Simon Cameron-Moore)
North Korea employs a fleet of ghost ships sailing around the globe to evade sanctions and buy and sell goods such as coal and oil, according to an in-depth report.
The Washington Post published a lengthy look Wednesday evening about North Korea’s actions, which involve meeting other ships in the middle of the ocean to transfer cargo, carrying and transmitting false ship identification numbers, and conducting backroom deals.
“It’s anarchy,” Hugh Griffiths, the outgoing coordinator of United Nations sanctions monitors, told the Post. “These massive gaps in maritime and financial governance will provide Chairman Kim [Jong Un] with an economic lifeline for months, if not years, to come.”
North Korea has resorted to the illicit actions because sanctions from the UN and the United States have crippled its ability to conduct international trade. Kim will meet with Russian President Vladimir Putin on Thursday.
The Post report provided several examples of how Kim’s regime gets around sanctions. In many cases, ships that do business with North Korean ships are registered in countries that do not conduct full oversight, such as Panama, Togo, and Dominica — called a “flag of convenience,” according to the Post.
The UN monitors work near the UN headquarters in New York City and keep tabs on North Korean ships via photos and satellite images.
Source: NewsMax Politics
FILE PHOTO: Brian Hook, U.S. special representative for Iran, in Washington, U.S., November 29, 2018. REUTERS/Al Drago
April 25, 2019
By Florence Tan
SINGAPORE (Reuters) – U.S. sanctions against Iran have denied its government more than $10 billion in oil revenue since President Donald Trump first announced the move last May, a U.S. official said on Thursday.
Brian Hook, U.S. Special Representative for Iran and Senior Policy Advisor to the Secretary of State, made the comment during a call with reporters days after Washington said it would end all exemptions to the sanctions. The United States demanded importers halt purchases from Tehran from May 1 or face punitive action.
“Before sanctions…Iran generated as much as $50 billion annually in oil revenue. We estimate that our sanctions have already denied the regime more than $10 billion since May (2018),” Hook said.
The United States re-imposed sanctions against Iran’s oil exports last November after Trump last spring unilaterally pulled out of a 2015 accord between Iran and six world powers to curb Tehran’s nuclear program. But Washington initially allowed the eight biggest buyers of Iranian oil limited imports for another half-year.
Iran’s biggest oil buyers are China, India, South Korea, Japan and Turkey. Taiwan, Greece and Italy stopped imports despite being given waivers.
China is the biggest buyer, and Beijing has criticized the move to re-impose sanctions.
U.S. officials speaking during Thursday’s call that they were confident China would be able to find alternative supplies to Iran.
Before the reimposition of sanctions, Iran was one of the top five producers among the Organization of the Petroleum Exporting Countries (OPEC) at close to 4 million barrels per day (bpd). Iran’s oil exports have now dropped to about 1 million barrels per day (bpd).
The tightening of U.S. sanctions announced this week pushed crude oil prices to their highest levels this year. [O/R]
South Korea is heavily reliant on Iran supplies as its petrochemical facilities are designed to use Iranian condensate, a super-light form of crude oil.
The U.S. officials said the U.S. government was working closely with South Korea to ensure supply for its petrochemical facilities.
(Reporting by Florence Tan; Writing by Henning Gloystein; Editing by Kenneth Maxwell)
North Korean leader Kim Jong Un’s most trusted policy adviser apparently has been removed from one of his posts, a South Korean lawmaker said Wednesday, a possible personnel reshuffle in the wake of the breakdown of the North Korea-U.S. summit in February.
The head of the South Korean parliament’s intelligence committee, Lee Hye-hoon, cited South Korea’s main spy agency as saying that Kim Yong Chol lost his Workers’ Party post in charge of relations with South Korea earlier this month. He was replaced by the little-known Jang Kum Chol as the director of the party’s United Front Department, Lee said.
Lee said she obtained the information at a private briefing from the National Intelligence Service.
Kim Yong Chol has been North Korea’s top nuclear negotiator and counterpart of U.S. Secretary of State Mike Pompeo since Kim Jong Un entered nuclear talks with the U.S. early last year. He traveled to Washington and met President Donald Trump twice before Kim’s two summits with Trump.
His rise had baffled many North Korea watchers because he handled South Korea ties, not international or U.S. relations. Previously, he was a military intelligence chief believed to be behind a slew of provocations, including two deadly attacks in 2010 that killed 50 South Koreans and an alleged 2014 cyberattack on Sony Pictures. Both Seoul and Washington imposed sanctions on him in recent years.
The NIS and the Unification Ministry, a Seoul agency responsible for North Korea ties, said they could not immediately confirm the information on Kim Yong Chol.
The NIS has a spotty record in confirming developments in North Korea. But if confirmed, Kim Yong Chol’s replacement would add to speculation that he is being sidelined from nuclear diplomacy to take the responsibility for the failure of the February summit in Hanoi.
Kim Jong Un, who is desperate to revive his country’s moribund economy, returned home empty-handed from Hanoi after Trump rejected his calls for easing U.S.-led sanctions in return for dismantling a key nuclear complex, a limited denuclearization step.
Kim Yong Chol wasn’t among a list of officials accompanying Kim Jong Un on his current visit to Russia, which began earlier Wednesday. Many experts in South Korea said North Korean Foreign Minister Ri Yong Ho and First Vice Foreign Minister Choe Son Hui would take the lead in the nuclear diplomacy.
“(Pyongyang’s) significantly diminished reliance on Kim Yong Chol is a very positive sign for the denuclearization negotiations between North Korea and the United States,” said Cheong Seong-Chang, an analyst at South Korea’s Sejong Institute. He called Kim Yong Chol “most responsible” for the second summit’s failure due to his hard-line stance.
While the NIS believes the personnel change possibly indicates that the department takes a back seat in the nuclear negotiations with Washington going forward, the spy agency also said it wasn’t immediately clear whether Kim Yong Chol would be removed from the talks entirely or immediately, Lee said.
Kim still maintains several other prominent titles, including vice chairman of the Workers Party’s Central Committee and a member of the powerful State Affairs Commission.
Source: NewsMax America
FILE PHOTO: Uber’s logo is displayed on a mobile phone in London, Britain, September 14, 2018. REUTERS/Hannah Mckay
April 24, 2019
BENGALURU (Reuters) – Uber Technologies Inc said on Wednesday the head of its Asia-Pacific operations will leave the company at the end of next month, and will be replaced by Pierre-Dimitri Gore-Coty.
Amit Jain had joined the app-based ride-hailing company as its India operations chief in 2015 and had taken over as head of Uber’s Asia-Pacific business last year.
The company, which recently unveiled its IPO plans, said https://ubr.to/2vjtq22 Gore-Coty, who heads its EMEA rides business, will also take charge of the Asia-Pacific business.
He will work to “unlock opportunity markets such as Japan and South Korea, and continue our strong momentum in markets such as India and Australia,” Chief Operating Officer Barney Harford said in a statement.
San Francisco-based Uber counts India as one of its major growth markets and has been locked in a fierce battle with homegrown rival Ola for years.
(Reporting by Derek Francis in Bengaluru; Editing by Shreejay Sinha)
FILE PHOTO: The logo of Samsung Electronics is seen at its office building in Seoul, South Korea, March 23, 2018. REUTERS/Kim Hong-Ji
April 24, 2019
SEOUL (Reuters) – Samsung Electronics said on Wednesday that it would invest 11 trillion won ($9.57 billion) annually through 2030 in logic chip businesses, including its foundry business.
The investment until 2030, worth 133 trillion won in total, comes as the world’s top memory chip maker strengthens non-memory semiconductor businesses such as contract chip manufacturing, known as foundry, and mobile processors.
“The investment plan is expected to help the company to reach its goal of becoming the world leader in not only memory semiconductors but also logic chips by 2030,” Samsung said.
(Reporting by Ju-min Park and Heekyong Yang; Editing by Himani Sarkar)
FILE PHOTO: A Spanish National Police car is seen outside the North Korea’s embassy in Madrid, Spain February 28, 2019. REUTERS/Sergio Perez/File Photo
April 24, 2019
By Alex Dobuzinskis
LOS ANGELES (Reuters) – A former U.S. Marine accused of stealing electronics from the North Korean embassy in Madrid in a robbery of the diplomatic compound was ordered by a federal judge in Los Angeles on Tuesday to remain in U.S. custody pending possible extradition to Spain.
The judge also ordered the unsealing of U.S. court documents in the case against Christopher Philip Ahn, 38, who was arrested by federal agents in Los Angeles on Thursday.
Spanish authorities have sought Ahn’s extradition from the United States. He is charged there with being among a group of seven intruders who stormed the North Korean mission on Feb. 22, restrained and physically beat some embassy personnel, held them hostage for hours and then fled.
Spanish investigators identified the intruders as self-professed members of a group that calls itself Cheollima Civil Defense and seeks the overthrow of North Korean leader Kim Jong Un. According to U.S. court documents, the raiders removed computers, computer drives and a mobile phone from the embassy before the alleged ringleader, Adrian Hong, traveled to the United States and met with the FBI.
Hong, a Mexican citizen and U.S. resident, was an activist who co-founded the non-profit human rights group Liberty in North Korea but later left that organization. His whereabouts remain unknown.
The anti-Kim group, which also calls itself Free Joseon, has denied attacking the embassy, insisting its members were invited inside.
RAID COINCIDED WITH SUMMIT
Ahn is charged in Spain with breaking and entering, illegal restraint, making threats, robbery with violence and intimidation, causing injuries and criminal organization, U.S. court documents say. He could face more than 10 years in prison if convicted there.
The incident at the embassy came at a sensitive time, just days ahead of a second summit between U.S. President Donald Trump and Kim that abruptly collapsed without the two leaders reaching a deal on North Korea’s nuclear weapons program.
North Korea’s foreign ministry denounced the incident as a “grave terrorist attack” and cited rumors that the FBI was partially behind the raid. The U.S. State Department has said Washington had nothing to do with it.
Ahn arrived in Madrid on the morning on Feb. 22 and left shortly after the raid, Assistant U.S. Attorney John Lulejian told the judge on Tuesday. He was photographed outside the embassy wearing black and carrying a backpack that may have contained weapons, Lulejian said.
The FBI received the stolen material and returned it to the Spanish court investigating the raid, and Spanish authorities have returned the items to Pyongyang’s mission, according to a Spanish judicial source.
In U.S. court on Tuesday, Ahn’s public defender, Callie Steele, asked Magistrate Judge Jean Rosenbluth to keep records in the case sealed to protect her client, saying North Korea’s leader had ordered assassinations in the past and that credible death threats had been made against Ahn.
She also asked that Ahn be placed under home detention so he could care for his ill mother and blind grandmother at their house in Chino, California. The judge denied the request, ordering he remain in federal custody ahead of his next court appearance, set for July 18.
Ahn was arrested at Hong’s apartment in Los Angeles last week while dropping something off there, Steele told the judge.
He was armed at the time with a handgun, which he legally owned to protect himself, after the FBI informed him of threats on his life, she said in court.
Ahn was born and raised in Southern California and later obtained a masters degree in business administration from the University of Virginia, Steele said. He was honorably discharged after service in the U.S. military, she said.
(Additional reporting by Mark Hosenball in Washington and Brendan O’Brien in Milwaukee; Editing by Steve Gorman and Sandra Maler)
FILE PHOTO: Cho Eun-hye (R) and her one-and-a-half-year-old Korean Jindo dog Hari, both wearing masks, go for a walk on a poor air quality day in Incheon, South Korea, March 15, 2019. Picture taken on March 15, 2019. REUTERS/Hyun Young Yi
April 24, 2019
By Joori Roh and Cynthia Kim
SEJONG, South Korea (Reuters) – South Korea announced a proposed 6.7 trillion won ($5.87 billion) supplementary budget on Wednesday to tackle unprecedented air pollution levels and to boost exports bruised by weak external demand amid the Sino-U.S. trade war.
The planned stimulus package allocates 2.2 trillion won to battle air pollution, including subsidies for replacing old diesel-powered cars as well as for buying air purifiers and using renewable energy technologies, the finance ministry said.
Another 4.5 trillion won will be used to increase export credit financing and to create jobs.
“(The extra budget is) to resolve national predicament caused by fine dust and to support the public economy through pre-emptive economic measures,” the ministry said in a statement.
It sees the extra budget lifting Asia’s fourth-largest economy’s growth by 0.1 percentage point this year and adding at least 73,000 jobs, Finance Minister Hong Nam-ki told a briefing.
In March, parliament approved a bill designating the air pollution problem a “social disaster”, paving the way for President Moon Jae-in’s government to draft a fiscal stimulus program to combat it.
Also in March, exports contracted for a fourth month in a row.
Last week, the central bank cut its 2019 growth forecast to a seven-year low of 2.5 percent, underlining worries that weak external demand and trade frictions could stunt economic recovery.
A loss of jobs is also a worry.
South Korea’s unemployment rate jumped to a nine-year high in January, hurt by the government-led hikes in minimum wages and growth concerns among businesses.
Employment conditions improved slightly in March, but it is still in a difficult situation, according to the finance ministry.
To fund the proposed extra budget, the government plans to issue 3.6 trillion won of deficit-covering bonds, according to the ministry’s budget chief.
The remaining 3.1 trillion won will be financed from above-target tax revenue collected in 2018 and by funds that state-owned companies manage.
This year marks the fifth straight year for South Korea to propose an extra budget for stimulus, sparking sharp criticism that this no longer is an emergency measure.
When asked if the current economic situation warrants adjustments in fiscal spending, Finance Minister Hong said his team is making “pre-emptive responses” to boost growth, as is allowed South Korea’s economic stimulus law.
South Korea can draw up an extra budget when there is a war or large-scale disaster outbreaks, or when there are concerns over economic recessions and mass lay-offs, according to the national finance act.
Moon’s ruling Democratic Party likely faces a challenge winning parliamentary approval of the budget bill, as it only holds 43 percent of the National Assembly’s 300 seats. Moon will need to gain support from nearly 30 opposition lawmakers.
The ministry sees South Korea’s economy growing 2.6 percent this year if the extra budget bill is approved and executed in a timely manner. It plans to submit the bill on Thursday.
(Reporting by Joori Roh and Cynthia Kim; Editing by Richard Borsuk)