Singapore exports see strong growth of 13% on-year in June, but analysts warn of slowdown ahead
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
21 minutes ago
- Business Times
Couche-Tard's failed bid for Seven & i sparks debate over Japan
[TOKYO] Alimentation Couche-Tard's decision to walk away in frustration from an attempted acquisition of Seven & i Holdings set off a debate in Tokyo as to what lessons foreign companies with ambitions for M&A should draw. The bid was audacious from the start. 7-Eleven convenience stores have one of Japan's most recognisable brands and a takeover would have been the largest by a foreign entity in the country's history. Moreover, the founding Ito family members were so opposed to the deal that they turned to one of their archrivals to try and block it. Still, the government, which has been pushing for companies to take a more investor-friendly approach, did not raise strong political opposition, even though Seven & i had sought greater protection under a law that could have scuttled a deal. While Couche-Tard placed the blame squarely on intransigence from Seven & i's management, the failure of the deal runs counter to the broader trend in the investing landscape, according to Nicholas Smith, a strategist at CLSA. 'Seven & i is just an obstructive character in an ongoing success story,' said Smith. 'Activist trades and shareholder proposals are on fire. Private equity sees Japan as one of the most attractive markets in the world and is hiring aggressively. Management can't afford to relax one bit.' Stephen Dacus, the new chief executive officer of Seven & i, now has to prove that the Japanese retailer can grow and boost its efficiency on its own. The shares fell 9 per cent on Thursday (Jul 17) after Couche-Tard walked away from its bid. The company plans to sell its superstore business for US$5.4 billion, and is proposing a two trillion yen share buyback and a listing of its US business. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Seven & i's rejection of the deal is a sign of more aggressiveness in Japanese firms, according to Jesper Koll, expert director at Monex Group. 'The issue is not that this is old-style Japan protectionism, quite the opposite,' said Koll. 'This is actually an injection of energy and competitive spirits into a Japan-led management team that is actually very international.' The history of attempted takeovers of marquee Japanese companies by outsiders is mixed. KKR, CVC Capital Partners and Blackstone walked away from a buyout of Toshiba after meeting stiff resistance from management. Concerns about the valuation, complexity and political nature of the deal were all headwinds that eventually resulted in a consortium led by a domestic fund prevailing. Hon Hai Precision Industry, better known as Foxconn, pulled off a deal in 2016 to take a controlling stake in Japanese electronics maker Sharp for 389 billion yen. The Taiwanese electronics contract manufacturer had pursued the Japanese company for years. Foxconn founder Terry Gou had lobbied Japanese lawmakers, co-opted banks and sweetened its offer to outmanoeuvre a Japanese government-backed bidder. 'The implications of today's news will only be understood a year from now, and will hinge on whether management succeeds in accelerating group reforms and turning around the situation in both Japan and the US,' said Michael Jacobs, an investment analyst at T Rowe Price Japan on Thursday. Unsolicited offers have quite often met strong resistance regardless of where the prospective buyers come from. Japanese motor maker Nidec made an unsolicited bid for Makino Milling Machine, shocking many Japanese companies that had never imagined they could become a takeover target by a Japanese firm. Nidec, like Couche-Tard, withdrew the bid earlier this year due to strong opposition. In another closely watched case, Taiwan's Yageo made a takeover bid for Shibaura Electronics, prompting a counterbid from Japanese rival Mineba Mitsumi. Others argued that the failure of the Couche-Tard deal had nothing to do with the nationalities or cultures of the companies involved. The issue was simply money and Couche-Tard's 6.8 trillion yen (S$59 billion) bid simply was not enough. 'Seven & i did what any US company would do,' said Jamie Halse, CEO & CIO at Senjin Capital Pty. 'It was up to Couche- Tard to put in a knockout offer.' BLOOMBERG
CNA
an hour ago
- CNA
Dollar set for weekly gain as firm US data tempers Fed easing bets
TOKYO :The dollar headed for a second straight weekly gain against major peers, buoyed by some solid U.S. economic data that supported the view the Federal Reserve can afford to wait a while longer before cutting interest rates again. The yen remained on the back foot heading into upper house elections on Sunday in Japan, with polls suggesting the ruling coalition is at risk of losing its majority - a development that would stir policy uncertainty and complicate tariff negotiations with the U.S. Bitcoin hovered just below $120,000, after this week pushing to an all-time peak of $123,153.22, with Congress passing a bill to create the framework for dollar-pegged stablecoins. The dollar index, which measures the currency against six leading counterparts, held steady at 98.456 as of 0038 GMT, keeping it on track for a 0.64 per cent weekly advance and building on the previous week's 0.91 per cent rally. The dollar index climbed as high as 98.951 on Thursday for the first time since June 23 after U.S. data showed retail sales rebounded more than expected in June and first-time applications for unemployment benefits dropped to a three-month low last week. Earlier in the week, a report showed consumer prices increased by the most in five months in June, suggesting tariffs were starting to have an impact on inflation. Traders currently price about 45 basis points of rate cuts for the remainder of the year, down from closer to 50 basis points at the start of the week. At the same time, the dollar index remains 9.3 per cent lower over the course of this year, following a steep selloff in March and April when President Donald Trump's erratic trade policies undermined confidence in U.S. assets, sending the currency, Treasury bonds and Wall Street all lower. Clouds of uncertainty still hang over the dollar though, which has been shaken in recent days and weeks by fiscal worries from Trump's massive spending and tax cut bill, as well as the U.S. President's relentless criticism of Federal Reserve Chair Jerome Powell for not cutting rates. "The USD remains vulnerable to the downside if concerns about U.S. policymaking further undermine investor confidence in USD assets," Commonwealth Bank of Australia analysts wrote in a client note. The U.S. currency's drop earlier this week on speculation Trump was aiming to oust Powell "was a case in point," the analysts said. The dollar tumbled on Wednesday on a Bloomberg report that Trump was planning to fire Powell soon, before paring losses when Trump denied the news. Trump has said repeatedly that interest rates should be at 1 per cent or lower, compared with the current 4.25 per cent-4.5 per cent range. The dollar was steady at 148.60 yen, hovering not far from the 3-1/2-month high of 149.19 from Wednesday, as signs grew that Japan's coalition would fall short of retaining its majority, potentially giving more sway to opposition parties that back consumption tax cuts to ease the burden on voters from rising prices. For the week, the dollar has gained 0.73 per cent on the Japanese currency. Japan, which initially was touted by the White House as likely to be among the first to reach a trade deal, has been deadlocked with Washington over politically sensitive issues of car and agriculture tariffs. Japan's top trade negotiator, Ryosei Akazawa, held talks with U.S. Commerce Secretary Howard Lutnick on Thursday, as Tokyo races to avert a damaging 25 per cent levy that would become effective after the August 1 deadline. The euro rose 0.25 per cent to $1.1626, clawing its way off Thursday's three-week low of $1.1556. For the week, the euro is down 0.59 per cent. Sterling rose 0.13 per cent to $1.3436, slightly paring its weekly decline to 0.41 per cent. Bitcoin edged up 0.35 per cent to around $119,899 on the day.
CNA
an hour ago
- CNA
Asian shares track Wall Street higher, yen weak ahead of Japan vote
SYDNEY :Asian shares tracked Wall Street higher on Friday as still-strong U.S. economic data and robust corporate earnings offset tariff worries, while the yen headed toward a second successive week of loss ahead of Japan's upper house election. Overnight, the S&P 500 and the Nasdaq again closed at record highs as U.S. data including retail sales and jobless claims beat forecasts, indicating a modest improvement in the economy that should give the Federal Reserve time to gauge the inflation impact from higher U.S. tariffs. Streaming giant Netflix beat Wall Street's lofty expectations for second-quarter earnings in part due to a weaker U.S. dollar. Its share price, however, fell 1.8 per cent in after-hours trading, with analysts saying much of the growth had already been priced in. On Friday, MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.8 per cent to its highest since late 2021, bringing the weekly gain to 1.7 per cent. Japan's Nikkei, however, slipped 0.2 per cent, and the yen was at 148.54 per dollar, down about 0.7 per cent this week after polls showed Prime Minister Shigeru Ishiba's coalition was in danger of losing its majority in the election on Sunday. Data on Friday showed Japan's core inflation slowed in June due to temporary cuts in utility bills but stayed beyond the central bank's 2 per cent target. The rising cost of living, including the soaring price of rice, is among reasons for Ishiba's declining popularity. "If PM Ishiba decides to resign on an election loss, USDJPY could easily break above 149.7 as it would usher in an initial period of political turbulence," said Jayati Bharadwaj, head of FX strategy at TD Securities. "JPY could reverse the recent dramatic weakness if the ruling coalition wins and is able to make swift progress on a trade deal with Trump." Chinese blue-chips rose 0.3 per cent while Hong Kong's Hang Seng index gained 1.2 per cent. The Tapei-listed shares of TSMC, the world's main producer of advanced AI chips, rallied 2.2 per cent after posting record quarterly profit on Thursday, though it said future income might be affected by U.S. tariffs. In the foreign exchange market, U.S. the dollar was on the back foot again on Friday, having bounced 0.3 per cent overnight against major peers on the strong economic data. For the week, it is headed for a second successive gain of 0.6 per cent, bouncing further from a 3-1/2 year low hit over two weeks ago. Fed Governor Christopher Waller said on Thursday he continues to believe the central bank should cut interest rates at the end of this month, though most officials who have spoken publicly have signalled no desire to move. Fed funds futures imply next to no chance of a move on July 30, while a September rate cut is just about 62 per cent priced in. Treasury yields were slightly lower in Asia. Benchmark 10-year U.S. Treasury yields slipped 2 basis points to 4.445 per cent, having moved little overnight. Two-year yields also edged 2 bps lower to 3.8981. Oil prices were mostly steady on Friday, after gaining $1 overnight following a fourth day of drones strikes on Iraqi Kurdistan oil fields, pointing to continued risk in the region. U.S. crude inched up 0.2 per cent to $67.66 per barrel and Brent also rose 0.2 per cent to $69.68 a barrel. They, however, lost about 1 per cent for the week.
