WORLDWIDE : HEADLINES
Japan’s August consumer prices fall at fastest pace in four years
TOKYO – Japan’s core consumer prices fell at their fastest pace in almost four years in August, underscoring deflation risks and difficulties the country’s new prime minister faces in restoring growth in the world’s third-largest economy.
The weak consumer prices came after Bank of Japan governor Haruhiko Kuroda said on Thursday it would monitor not just price trends but jobs growth in guiding policy, signalling a readiness to ramp up stimulus if job losses heighten the risk of deflation.
Japan’s new premier Yoshihide Suga on Wednesday pledged to contain COVID-19 and retain his former boss’s “Abenomics” growth policies while pushing reforms such as deregulation and digitalisation.
The core consumer price index (CPI), which includes oil products but excludes volatile fresh food prices, fell 0.4% in August from a year earlier, government data showed on Friday.
That compared with the median market forecast for a 0.4% decline and a flat reading in July and matched the level seen in November in 2016.
Full coverage: REUTERS
Unity sells shares in $1.3 billion U.S. IPO above target range
Unity Software Inc U.N on Thursday sold shares in its New York initial public offering (IPO) above its target range to raise $1.3 billion, the company said.
It is the second $1 billion-plus U.S. software IPO this week to price above its targeted range after data warehouse company Snowflake Inc SNOW.N raised more than $3 billion in the largest U.S. listing of the year so far.
Snowflake’s shares more than doubled in their New York Stock Exchange debut the following day.
Unity, which develops software used to design video games, sold 25 million shares at $52 apiece, the company said, confirming an earlier Reuters report.
This was above the $44-$48 per share price range which the company on Monday revised upwards from its initial target of $34-$42 per share.
The IPO values Unity at $13.7 billion. Unity is due to begin trading on the New York Stock Exchange on Friday under the symbol “U”.
Full coverage: REUTERS
Resurging coronavirus biggest threat to euro zone economy: economists
BENGALURU – The resurgence in coronavirus cases is the biggest threat to the recovering euro zone economy, according to a Reuters poll of economists, who say growth and inflation are more likely to create negative surprises over the coming year than positive ones.
Around 30 million people have been infected by the virus globally, and more than 900,000 have died, triggering some of the deepest recessions on record and breaking up supply chains around the world. COVID-19 global tracker here
While a strong euro zone rebound is underway as lockdown restrictions have been eased and businesses reopened, France and Spain among others in the 19-member bloc are grappling with a virus resurgence.
That is raising the possibility of renewed restrictions and lockdowns.
“A flaring in the number of COVID-19 infections over the summer months has made it very clear that if there is no effective vaccine, growth will be handicapped,” said Peter Vanden Houte, chief economist at ING.
“There is also the fear of negative second-round effects once the current recession starts to be reflected in a swelling number of unemployed…(and) we cannot exclude higher precautionary savings dampening consumption.”
Full coverage: REUTERS
WORLDWIDE: FINANCE / MARKET
Asian stocks set for higher open on central bank support
NEW YORK – Asian shares looked set to rise on Friday following pledges by central bankers globally to do whatever it takes to support the economic recovery while oil perked up as OPEC threatened to clamp down on member states that did not cut output.
Australian S&P/ASX 200 futures rose 0.29% in early trading. Japan’s Nikkei 225 futures added 0.09%, while Hong Kong’s Hang Seng index futures rose 0.37%.
E-mini futures for the S&P 500 rose 0.04%.
The Bank of England said on Thursday it was considering negative interest rates as the UK economy faces rising COVID-19 cases, higher unemployment and a possible new Brexit shock. It also kept its main stimulus programs on hold, citing a faster-than-expected economic recovery from pandemic lows.
“Delivering net economic stimulus this way absolutely can be done,” said Sharon Zollner, chief economist at ANZ, said of negative interest rates, which New Zealand’s central bank is also considering.
Full coverage: REUTERS
Wall Street falls as tech sells off again, jobless claims still high
U.S. stocks fell on Thursday as technology-related shares slid for a second day and as government data showed high levels of weekly jobless claims.
Amazon.com Inc AMZN.O dropped 2.3% and Apple Inc AAPL.O fell 1.6%, making them the biggest drags on the S&P 500 and Nasdaq. Last week, the Nasdaq’s losses put the index down 10% from its closing record, confirming a correction began on Sept. 2.
From the March market lows, “this has been an amazing recovery represented by a few good tech names,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.
“They had an incredible last week of August, and I think this is a rational profit-taking scenario at the moment.”
Full coverage: REUTERS
