ConsenSys to Build Global Trade Platform for Agribusiness Giants By Cointelegraph



Covantis, a blockchain initiative backed by global agribusiness giants like Cargill, has selected major Ethereum-focused firm ConsenSys as a technology partner.

Within the partnership, ConsenSys will build an Ethereum-based blockchain platform to digitize the post-trade finance industry and bring efficiencies and cost savings to the international agribusiness supply chain, Covantis said in a Jan. 23 press release.

Continue Reading on Coin Telegraph

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Global LNG Poised for Terrible Year as New Supply Floods Market By Bloomberg



(Bloomberg) — Liquefied prices are poised to test record lows this year thanks to an onslaught of new supply and warmer winter temperatures curbing consumption.

The startup of new export projects from Australia to the U.S. has flooded the market, while brimming stockpiles in Europe and an expected slowdown in Chinese demand have dumped cold water on consumption prospects. LNG for spot delivery to North Asia is on track to hit an all-time low this summer, while gas prices in Europe and the U.S. are trading at the weakest seasonal levels since 1999.

“The global oversupply of LNG has been building and building and building,” said Ron Ozer, founder of gas-focused hedge fund Statar Capital LLC in New York. “The gas market can’t stomach the oversupply and warm weather, and it’s getting both.”

This is what the rock-bottom prices mean for the industry:

American Halt

U.S. gas exports have surged amid the nation’s shale boom, but plummeting prices may now throttle back shipments or encourage sustained maintenance while firms weather the storm. Producers and companies with offtake agreements may decide not to load cargoes because prices are too low to earn a profit after accounting for shipping costs.

With cargoes from the Gulf of Mexico currently priced around $2.65 per million Btu, cash margins are positive only because of weak U.S. benchmark prices, according to Robert Sims, an analyst at Wood Mackenzie Ltd. There’s a chance that production could be reduced if the spread between benchmark Henry Hub and U.S. Gulf LNG narrows 25 cents, he said. Torbjorn Tornqvist, chief executive officer of Gunvor Group Ltd., the biggest independent LNG trader, sees the market about 50 cents away from shut downs.

“I think we can see even lower prices in the next few months,” Tornqvist said in an interview this week in Davos. “The supply and demand balance doesn’t look good.”

Contract Scrutiny

Buyers may demand revisions to long-term supply contracts, such as better pricing or the removal of restrictions on reselling cargoes. Japan’s Osaka Gas Co. has already taken action, moving an Exxon Mobil Corp (NYSE:).-led LNG joint-venture to arbitration in a bid to get lower rates.

Qatar, one of the world’s biggest suppliers and traditionally the strictest when it comes to pricing, may be showing some flexibility. The supplier has started offering more competitive price links, with the lowest seen to Korea Gas at 10.8% the price of oil, according to FGE, an energy consultant. That compares to 2008, when Qatar signed contracts with Chinese firms in the 16% range.

Investment Delays

After four years of belt-tightening, the amount of investments last year in new production capacity set a record. Companies including Qatar Petroleum, Novatek PJSC and Venture Global LNG Inc. sanctioned new plants from the U.S. to Russia.

But the current wave of additional supply and persistent weak global prices is challenging new projects seeking final investment decisions, according to Morgan Stanley (NYSE:). The bank reduced its outlook for the number of projects reaching FID and revised lower its new supply outlook for the middle of the decade. The low price environment will also likely force Qatar to stagger or postpone its planned 64% capacity expansion, currently scheduled by 2027, according to FGE.

Profit Pain

Weak prices mean more pain for global energy majors including Total SA (PA:) and Eni SpA, who have seen profits from gas-related businesses dwindle. Some European utilities — who face mounting criticism for their use of fossil fuels — may decide to follow peers that are ditching LNG altogether. Denmark’s Orsted A/S cited loss-making LNG operations for its decision to sell the business to Glencore (LON:) Plc at the end of last year, while Spain’s Iberdrola (MC:) SA completed its exit this month.

The Sunnier Side

Royal Dutch Shell (LON:) Plc, the biggest trader of the fuel, has been able to stave off losses on LNG through contracts linked to oil, while leveraging the weak spot market. Most long-term LNG contracts are linked to the price of crude, which puts them about twice as expensive as prompt cargoes sourced on the spot market.

The world’s biggest importers of LNG, Japan’s Jera Co. and Korea Gas Corp., will benefit from lower prices and may be encouraged to shift more of their procurement to the spot market. Jera gets about 20% on spot or via short-term contracts, which run four years of less. That compares with an average of 32% across global LNG trade. Korea Gas bought about one-quarter of its imports on a spot basis in 2018. Still, the firms’ upside is limited as they will source most of the remainder through oil-linked contracts.

India’s transition toward gas may get a boost, as the nation’s price-sensitive buyers are poised to pick up more cargoes from the spot market, Morgan Stanley analysts said in a Jan. 16 note. Beneficiaries of the transition are gas aggregators like Gail India Ltd and Petronet LNG Ltd and city gas distributors, according to the bank.



Global stocks steady as caution on China virus continues; euro hits seven-week low after ECB By Reuters


© Reuters. An investor uses his mobile phone in front of a stock quotation board at a brokerage office in Beijing

By Tomo Uetake

TOKYO (Reuters) – Stocks made a barely positive start in early Asian trade on Friday after the world’s health body called it a little too early to declare a coronavirus outbreak a global emergency.

But worries over rapid spread of the deadly virus kept investors on guard as millions of Chinese travel during the Lunar New Year holiday period.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose a marginal 0.1%, while Japan’s stood flat and Australian stocks added 0.4%.

Trade in Asia is already slowing down for the Lunar New Year holiday, with financial markets in China, Taiwan and South Korea closed on Friday.

Key indices on Wall Street bounced from lows after the World Health Organisation (WHO) said the latest coronavirus did not yet constitute a global public health emergency.

The rose 0.2% to a record closing high, while the added 0.1% and the eased 0.1%.

The WHO called a new coronavirus that has killed 18 people in China and infected around 650 globally “an emergency in China” on Thursday, but stopped short of declaring the epidemic of international concern.

“Investors are worried that the outbreak of coronavirus will dampen consumption in China when the Chinese economy has been already cooling down,” said Yasuo Sakuma, chief investment officer at Libra Investments.

In the currency market, the concerns about the virus supported the yen.

The Japanese currency traded at 109.53 yen per dollar, having risen to a two-week high of 109.26 on Thursday.

The euro fell to a seven-week low versus the dollar of $1.1036 overnight after the European Central Bank left its policy rates unchanged but President Christine Lagarde struck a slightly dovish tone than some had expected.

Coronavirus fears continued to weigh on commodity prices.

U.S. West Texas Intermediate (WTI) crude futures were up a marginal 0.05% at $55.61 a barrel, after hitting $54.77 in the previous session, the lowest level since Nov. 20.

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ILO sees end to falling global unemployment rate By Reuters



GENEVA (Reuters) – The global unemployment rate has stabilized after declining for nine years since the crisis, the International Labour Organization (ILO) said on Monday, and it could edge up next year as the world economy slows.

The rate stood unchanged at 5.4% in 2019, or 188 million people, and is expected to remain there in 2020 and rise to 5.5% in 2021, the ILO said in its annual report.

“This means that the gradual decline of the unemployment rate observed between 2009 and 2018 appears to have come to a halt,” it said, citing a world economic slowdown, especially in manufacturing.

Even for those with jobs, it is becoming harder for many to live better lives, or exit poverty, a trend Director-General Guy Ryder described as “extremely worrying” with “very profound and worrying implications for social cohesion”.

“Persisting and substantial work-related inequalities and exclusion have prevented them (millions of people) from finding decent work and better futures,” Ryder told journalists.

The ILO said that about 470 million people in total have insufficient paid work, a new data set which includes not only the unemployed but also the under-employed and those lacking access to the labor market.

The report noted the difficulties faced by young people in getting jobs, with 22% of those aged 15-24 not in employment, education or training.

It also noted the rate of female participation in the workforce remained at just 47%, 27 percentage points below the male rate. “We are not going where we want to go,” said Ryder, referring to a commitment by G20 leaders in 2014 to reduce the gender gap in the workforce.

The global working poverty is declining, the report said, but that masked limited progress in low-income countries, especially in sub-Saharan Africa, the report said.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



BOJ to hold fire on receding pessimism over global outlook By Reuters



By Leika Kihara

TOKYO (Reuters) – The Bank of Japan is set to keep monetary policy steady and signal its cautious optimism over the global outlook on Tuesday, reinforcing market expectations that the rising cost of prolonged easing will keep the hurdle for further stimulus high.

Easing Sino-U.S. trade tensions and receding pessimism over the global economy could shift the focus of debate within the BOJ towards the strains imposed on the country’s banking system by negative interest rates, some analysts say.

A majority of economists recently polled by Reuters said the BOJ’s negative rate policy has had little positive impact on the economy, and that its next move would be to taper its massive stimulus as early as next year.

The view suggests that criticism over the controversial policy is spreading beyond Europe, where countries such as Switzerland are under pressure to adjust ultra-loose monetary settings to address the downside of negative rates.

Markets will scrutinize BOJ Governor Haruhiko Kuroda’s post-meeting briefing for clues on how his views on the pros and cons of his stimulus could affect policy decisions this year.

While Kuroda may offer a slightly upbeat view on global prospects than last month, he is seen reiterating the BOJ’s resolve to keep policy ultra-loose to support a fragile recovery, analysts say.

“Even if inflation isn’t accelerating, the BOJ will probably conclude there’s no need to ease policy since it can revise up its growth forecast and sees little risk of a yen spike,” said Hiroshi Ugai, chief economist at JPMorgan (NYSE:) Securities Japan.

At the two-day rate review that ends on Tuesday, the BOJ is set to keep its short-term interest rate target at -0.1% and a pledge to guide 10-year government bond yields around 0%.

It is also seen maintaining a guidance that commits to keeping rates at current low levels, or even to cut them, until risks keeping it from achieving its 2% inflation goal subside.

At a quarterly review of its projections, the BOJ is likely to slightly revise up its economic growth forecast for the fiscal year beginning in April thanks to an expected boost from the government’s spending package.

Japan’s economy ground to a near halt in July-September and is likely to have contracted in the final quarter of last year as the U.S.-China trade war knocked exports.

BOJ officials hope the government’s $122 billion fiscal package and robust capital expenditure will offset the hit from soft global demand and supply chain disruptions from last year’s typhoons that continue to weigh on factory output.

Analysts and policymakers are also watching to see the impact on global growth from last week’s preliminary trade deal signed between China and the United States to defuse their bitter tariff war.

Pessimists in the BOJ, however, fret that weak global auto demand and the drag on consumption from October’s sales tax hike to 10% from 8% may mean only a modest rebound in January-March growth.

As tame inflation forces the BOJ to keep policy ultra-loose, its nine-member board is divided between those who see room to ramp up stimulus and others concerned of the hit to financial institutions’ profits from years of near-zero rates.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



CME Bitcoin Futures See Open Interest Surge as Global Volume Hits $25B By Cointelegraph



(BTC) derivatives trading looks set to reach record levels this month as volume spikes and open interest hovers near all-time highs.

Data from CME Group (NASDAQ:) shows that as of Jan. 16, open interest for its futures products alone totaled 5,328 contracts — or 26,640 BTC ($237 million).

Continue Reading on Coin Telegraph

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



EU says will assess if U.S.-China deal meets global trade rules By Reuters



LONDON (Reuters) – The European Union’s trade chief said on Thursday that the bloc would check to see if a major trade deal struck by the United States and China is compliant with global rules.

“The devil is in the detail,” EU Trade Commissioner Phil Hogan told a conference in London, speaking by video link from Washington where he is meeting U.S. officials this week. “We will have to assess whether it is WTO compliant.”

Washington and Beijing on Wednesday scaled back their 18-month trade row that has hit global economic growth by signing an initial deal under which China will boost purchases of U.S. goods and services by $200 billion over two years in exchange for the rolling back of some U.S. tariffs.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Sunrise’s CEO Swantee, Chairman Kurer quit after failed Liberty Global deal By Reuters



By John Miller and Edward Taylor

ZURICH/FRANKFURT (Reuters) – Sunrise Communications (S:) chief executive Olaf Swantee has quit and Chairman Peter Kurer said he will not run for re-election after a shareholder uprising blocked the group’s $6.3 billion bid for Liberty Global’s (O:) Swiss cable unit.

Sunrise said its Chief Financial Officer Andre Krause, a German national, will immediately succeed Swantee as the new CEO, a step which was welcomed by Freenet (DE:), the telecom firm’s largest shareholder.

Freenet, a German telecommunications company which holds a 24.56% Sunrise stake, was a vocal opponent of the UPC deal.

Freenet said it did not want to pre-empt strategic decisions by Krause but said they had received assurances from the incoming CEO that he sees a stand-alone future for Sunrise. Krause had previously backed the UPC combination.

“In the past weeks Freenet has spoken with him about potential changes, and he made it clear that he sees a successful future for Sunrise as a stand-alone company. This convinced us,” Freenet said of Krause.

“We believe in the future and the potential of the company. The attractive dividend, a great team and a very well-managed company are guarantees for a high shareholder return,” Freenet said. “There is no reason for us to change our position.”

Krause declined a request from Reuters for an interview, with a spokeswoman saying he first wants to talk to employees and customers before going public in his new role.

“Management and the board — with the exception of the Freenet representative — were firmly convinced that the takeover of UPC was the best plan, but that does not mean Sunrise cannot be successful on its own, too,” the spokeswoman said.

“Sunrise will continue its path as an independent company and Andre Krause, as new CEO, will further strengthen this successful direction.”

DISPUTED DEAL

Sunrise shares, which dropped 12% in 2019 during the takeover battle, were up 0.5% by 1210 GMT.

In the months-long UPC fight, Swantee and Kurer had become the public faces of the deal, arguing it would have created a more powerful rival to state-owned market leader Swisscom (S:).

Freenet had accused Swantee and Kurer of pursuing a transaction that would have saddled Sunrise with “inferior technology” at an inflated price and terms favorable to Liberty Global, but negative for the Swiss company’s own shareholders.

Krause has been at Sunrise since 2011 after a six-year stint as CFO of Telefonica (MC:) O2 Germany, and “has been instrumental in its transformation”, the group said in its statement.

“As CFO, he drove the company through its successful IPO in 2015, and the subsequent sale of its tower assets. Andre has deep telecom industry expertise.”

Sunrise said Vice Chairman Peter Schoepfer would also leave. Like Kurer he declined to stand for another term after the deal for Liberty’s UPC Switzerland unit failed in October.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China’s RRR still relatively high by global standards, can be adjusted further: PBOC official By Reuters


China’s RRR still relatively high by global standards, can be adjusted further: PBOC official

SHANGHAI/BEIJING (Reuters) – The proportion of money that Chinese banks must set aside as reserves is still relatively high by global standards, and can be adjusted in future to help provide long-term, stable liquidity to the economy, a senior central banker said.

China on Wednesday announced it will cut the reserve requirement ratio (RRR) from Jan. 6 to spur more lending and lower financing costs. It has cut the ratio eight times since early 2018 as it looks to avert a sharper economic slowdown, but growth has still cooled to a near 30-year low.

“From an international perspective, China’s current required reserve ratio (RRR) is still relatively high and has relatively big room to adjust,” Ruan Jianhong, head of the Statistics and Analysis Department at the People’s Bank of China (PBOC), said in an article.

The article was first published in the December edition of China Bond, and released via the magazine’s official Wechat account late on Thursday.

Along with other monetary policy tools, RRR adjustments “can provide long-term, stable liquidity to the real economy,” she said.

The 50 basis point cut announced on New Year’s Day released around 800 billion yuan ($114.91 billion) in funds. It brought the ratio for big banks down to 12.5%, compared with 17% at the start of 2018.

RRRs for China’s commercial banks range between 7.5%-13%. Most deposits in the United States are subject to RRR of 0%or 3%, while the European Central Bank imposes RRRs of 0%-1%, according to the article.

While rolling out a series of growth boosting measures in the last two years, China’s policymakers have pledged they will not embark on massive stimulus schemes like those launched in past downturns, which left a mountain of debt that is still weighing on the financial system.

Echoing that cautious tone, Ruan said that the RRR adjustments don’t represent changes in China’s monetary policy stance, and are aimed at reducing the cost of funding and improving overall liquidity, as the size of China’s monetary base shrank in 2019.

“In recent years, PBOC has been reducing RRRs successively. But this doesn’t mean PBOC is shifting toward a looser monetary policy. Rather, the moves are aimed at supplementing liquidity to the overall economy in an efficient, low-cost manner,” according to the article.

To improve liquidity, RRR adjustments are a more appropriate option than expanding PBOC’s balance sheet, because PBOC, with about $5.42 trillion of assets at the end of 2018, is already the world’s biggest central bank by assets, she said.

Further expanding its balance sheet would hurt credibility of China’s monetary policies, the article said.

(This story corrects reference to “she said” in paragraphs 5 and 11.)

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



China Bucks Global Research Cuts as Analyst Count Hits Record By Bloomberg


© Reuters. China Bucks Global Research Cuts as Analyst Count Hits Record

(Bloomberg) — China’s brokerages have a record number of analysts on the rolls after a fourth straight year of hiring, bucking a global trend of investment banks scaling back on research.

Analysts registered with the Securities Association of China climbed to 3,225 as of Dec. 26, an increase of 8% from 2018. By comparison, headcount at 12 major global banks shrank 8% to 3,500, on pace for the sharpest annual decrease since research firm Coalition Development started collating the numbers in 2012.

The divergence underscores seismic shifts in China’s $21 trillion capital markets. Rising foreign fund inflows as well as an uptick in stock and bond issuance have boosted demand for analysis on everything from the macro economy and industries to fixed-income and commodities. Policy makers are also pushing local brokerages to become more competitive in preparation for a build-up by Wall Street giants including Goldman Sachs Group Inc (NYSE:). and JPMorgan Chase (NYSE:) & Co.

Research is becoming a core offering with even smaller firms building teams, said Liu Yuanrui, president of Changjiang Securities Co., a mid-size brokerage based in central China, which had over 90 analysts. “Every company realizes it needs one.”

Globally, research has been buffeted by changes in technology and the demands of the marketplace with the rise of automation and passive funds — trends that have been slower to catch on in China.

European rules known as MiFID II spurred the most recent wave of job cuts by forcing research costs to be separated from trading fees. Chinese firms focus on the vast domestic retail market and are largely shielded from MiFID II, which only applies to banks and brokerages that interact with European asset managers.

That’s not to say analysts in China has been insulated from bad news. Compensation structures at local brokerages rely heavily on commission income from funds, something that’s been falling away since the market rout of 2015.

Salary Cuts

The dwindling commission pool has pressured salaries lower. About 45% of respondents to a recent New Fortune magazine survey of over 1,000 analysts reported a salary cut over the past year, with almost a fifth saying their compensation declined by over 20%.

Analysts have been forced to focus on professional rankings to signal their abilities and boost earnings. While run-of-the-mill analysts with five years of experience make the equivalent of about $75,000 a year in China, someone on the New Fortune rankings, a hyper-competitive version of the Institutional Investor poll and China’s biggest analyst contest, could easily take home $1 million or more.

The ploy came under regulatory fire last year amid rising questions about how analysts behaved in order to secure votes for the competition. New Fortune suspended last year’s contest before resuming it in October with much less fanfare.

Despite the questions around commissions and compensation, new research departments are popping up at smaller brokerages such as Kaiyuan Securities Co. with China’s financial liberalization building optimism about new lines of business.

The Nasdaq-style STAR market launched to much fanfare earlier this year and brokers are looking for increased demand from newcomers to the asset management space, including banks’ wealth management units and foreign institutional investors.

Still, Changjiang’s Liu doesn’t expect a significant pick up in income unless brokerages change their business models.

“Firms have to rethink the function of research teams because more profits cannot be derived from the current model,” he said.

To contact Bloomberg News staff for this story: Lucille Liu in Beijing at xliu621@bloomberg.net

To contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, Jun Luo

©2019 Bloomberg L.P.