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WALL STREET: Asian Shares Edge Higher, Tracking Wall Street Rally



wall street

TOKYO, Japan — Asian stocks rose Friday, tracking a Wall Street rally fueled by reports that the economy and corporate profits may be doing better than expected.

In Tokyo, the core consumer price index rose 4.3%, slightly higher than the 4.2% expected and higher than the Bank of Japan’s 2% target.

“This seeks to challenge the central bank’s eventual policy shift, though the government’s energy subsidies next month could be used to delay any changes for the time being,” said Yeap Jun Rong, a market analyst at I.G., in a commentary.

The Nikkei 225 index in Japan rose nearly 0.1% in morning trading to 27,380.11. The S&P/ASX 200 index in Australia rose 0.5% to 7,503.50. The Kospi in South Korea rose 1.2% to 2,497.05. The Hang Seng Index in Hong Kong was unchanged at 22,571.58.

Shanghai’s markets remained closed for the Lunar New Year holiday.

Wall Street stocks went up to their highest level in almost eight weeks after the Commerce Department said that the U.S. economy grew at a 2.9% annual rate in the fourth quarter. This suggests that the economy will still be growing at the end of 2022, even though interest rates are going up and many people are worried about a recession. This exceeded economists’ expectations of a 2.3% increase.

wall street

Wall Street Getting A lot Of Earnings And Economic Reports

The S&P 500 rose 1.1% to 4,060.43, its highest finish since December 2. The Dow rose 0.6% to 33,949.41, while the Nasdaq rose 1.8% to 11,512.41.

Wall Street is getting a lot of earnings and economic reports, which could lead to more volatility. Markets have recently swung up and down as fears of a severe recession and a drop in profits compete with hopes that the economy can manage a soft landing and that the Federal Reserve will lower interest rates.

Other information On Thursday, factory orders for durable goods went up more than expected in December, and less people than expected applied for unemployment benefits the week before.

Strong data show that the economy can handle the Fed’s avalanche of rate hikes last year and at least one more expected next week without crashing into a deep recession. Higher interest rates are designed to slow the economy by making it more expensive to borrow money to buy a house, a car, or anything else on credit. They also cause stock and other investment prices to fall.

But if the economy is stronger than expected, especially in the job market, the Fed may have to keep rates high for longer to make sure inflation is really crushed. The Fed has repeatedly stated that it intends to do so until the end of the year, though many investors do not appear to believe it.

wall street

The Report Shows Good News

The 10-year Treasury yield, which helps set rates for mortgages and other important loans for the economy, increased to 3.49% from 3.45% late Wednesday. The two-year yield, which tends to track expectations for Fed interest rate actions more closely, increased to 4.18% from 4.13%.

At first glance, Thursday’s economic report seemed to be good news. However, it also showed some worrying signs of a slowdown. According to Megan Horneman, chief investment officer at Verdence Capital Advisors, it is also backward-looking.

“The first half of this year is going to be tough,” she predicted, citing recent weakness in the economy’s manufacturing and services sectors.

On the earnings front, news from some big tech companies gave people more reason to be optimistic a day after Microsoft’s forecasts made people worry.

Tesla went up 11% after the company that makes electric cars said that its profit for the last quarter was higher than expected. Seagate Technology rose 10.9% after reporting higher-than-expected revenue and earnings.

Steelmaker Nucor was also among the top-performing stocks in the S&P 500, rising 8.4% after exceeding profit and revenue forecasts by Wall Street.

wall street

Sherwin Williams Was On The Wrong Side Of Wall Street

Chevron rose 4.9% after raising its dividend and approving a stock repurchase program worth up to $75 billion. Both moves put money directly into shareholders’ pockets, which drew criticism from Washington. Instead, according to White House spokesman Abdullah Hasan, oil companies should “use their record profits to increase supply.”

Sherwin Williams was on the wrong side of Wall Street. It fell 8.9% after reporting lower-than-expected revenue for the most recent quarter. It also provided a profit forecast for the coming year that fell far short of analysts‘ expectations, as a weak housing market weighs on demand for paint.

Despite reporting profit and revenue that met Wall Street’s expectations, IBM fell 4.5%. Analysts pointed to some lower-than-expected numbers in terms of cash generation.

Southwest Airlines lost more money than expected in its most recent quarter, which was hurt by the fact that more than 16,700 flights had to be canceled last month. It also stated that it expects to lose money in the first three months of 2023.

On the New York Mercantile Exchange, benchmark U.S. crude rose 21 cents to $81.22 per barrel in electronic trading. On Thursday, it fell 14 cents to $81.01.

Brent crude, the international benchmark, rose 17 cents to $87.64 per barrel in London.

The U.S. dollar fell to 129.83 Japanese yen from 130.23 yen in currency trading. The euro is now worth $1.0877, down from $1.0890.



Kiara Grace is a staff writer at VORNews, a reputable online publication. Her writing focuses on technology trends, particularly in the realm of consumer electronics and software. With a keen eye for detail and a knack for breaking down complex topics, Kiara delivers insightful analyses that resonate with tech enthusiasts and casual readers alike. Her articles strike a balance between in-depth coverage and accessibility, making them a go-to resource for anyone seeking to stay informed about the latest innovations shaping our digital world.


Economist Warns Over Canada Slipping into a Cashless Society



Canada, cash
Carlos Castiblanco, an economist, says Canada needs to protect cash. - Image Haik Kazarian

Canadian economist Carlos Castiblanco believes that Canada should follow in the footsteps of other countries and enact legislation to protect the use of cash in the country.

Castiblanco, together with the group Option Consommateurs, is urging the Trudeau government to follow the lead of other jurisdictions in the United States and Europe in enacting legislation to slow the transition to a cash-less society.

He stated that barely 10% of transactions in Canada now use cash, and that Canada must defend cash now before more merchants begin to refuse it totally.

It is vital to act now, he told CBC Radio’s Ontario Today, before businesses begin removing all of the infrastructure required to handle and manage actual cash.

“They are already used to dealing with cash, so this is the moment for the Trudeau government to act, before it is more complicated.”

A recent online poll of almost 1,500 people commissioned by a different group, Payments Canada, discovered that the majority of respondents were concerned about the potential of cashless stores and preferred to keep the ability to use cash.

Bank fees in Canada

Above all, cash has no bank fees, is not vulnerable to privacy breaches, and may be utilized during internet outages.

The Payments Canada paper, “Social policy implications for a less-cash society,” suggests legislative action, saying that cash-based transactions have decreased from 54% in 2009 to 10% by 2021.

Aftab Ahmed, one of its writers, explained who would be most affected by a cashless future in a recent piece for Policy Options, the Institute for Research on Public Policy’s online magazine.

“For many Canadians, including Indigenous people, homeless people, aging citizens, and others who are vulnerable, cash is both a beacon of economic stability and a source of financial insecurity. “Cash is an emergency lifeline and a symbol of cultural traditions,” Ahmed explained.

“Canada must avoid sleepwalking into a cashless future and instead recognize the risk of exacerbating financial exclusion of those most vulnerable.”

Refusing to accept cash

The currency issue has already caught fire outside of Canada, according to Castiblanco, with some US states and territories beginning to pass legislation to preserve access to cash.

In 2019, Philadelphia became the first city in North America to prohibit “any person selling or offering for sale consumer goods or services at retail from refusing to accept cash as a form of payment.”

Other U.S. cities, including New York, Seattle, and Los Angeles, have since taken action on the issue.

In New York, the policy recommends fines of up to $1,500, with the Councillor who proposed the guidelines claiming that prohibiting cashless transactions preserves privacy, equity, and consumer choice.

European countries such as Norway, Spain, and Ireland have enacted similar legislation. In Ireland, the rule would mandate cash transactions at companies like as pharmacies and grocery stores that supply basic goods and services.

Source: CBC


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U.K News

UK National Debt Rises to the Highest in 62 Years



UK National Debt Rises to the Highest in 62 Years

UK national debt grew this month to its highest level as a share of the economy since 1961, according to figures released on Friday, adding to the financial issues that the new administration will face when it takes office following a general election in two weeks.

The UK national debt, excluding state-controlled banks, hit 2.742 trillion pounds ($3.47 trillion), or 99.8% of annual GDP, in May, up from 96.1% the previous year, according to the Office for National Statistics.

The increase came despite somewhat lower-than-expected government borrowing in May, which was 15.0 billion pounds, compared to experts’ median projection of 15.7 billion pounds in a Reuters survey.

Following an election on July 4, Britain appears to be on the verge of a change of government, with Keir Starmer’s Labour Party leading Prime Minister Rishi Sunak’s Conservatives in surveys.

During the COVID-19 epidemic, state debt in Britain skyrocketed, and the public finances have been hampered by poor growth and a 16-year high in Bank of England interest rates.

Western Nations Debt

Most other Western countries had significant rises in debt during the same period, although British debt levels are lower than those of the United States, France, and Italy.

A person enters the Treasury government building in London, Britain, on March 5, 2024. REUTERS/Toby Melville/File Purchase Licensing Rights opens a new tab.

Borrowing in the UK totaled 33.5 billion pounds in the first two months of the fiscal year, 0.4 billion more than the same period in 2023 but 1.5 billion pounds less than government budget estimates expected in March.

Capital Economics consultants warned that the lower-than-expected borrowing figures represented less public investment and would provide little comfort to Britain’s future finance minister.

“They do little to reduce the scale of the fiscal challenge that awaits them, in part because of the upward pressure on the debt interest bill from higher interest rates,” said Alex Kerr, an assistant economist at Capital Economics.

Labour and the Conservatives want to keep to existing budget rules that require official estimates – most recently updated in March – to indicate that debt as a proportion of GDP is dropping in the fifth year of the forecast.

Higher interest rates than projected in March’s budget left Britain’s next chancellor with only 8.5 billion pounds of freedom to meet these standards, down from the historically low 8.9 billion in March, Kerr noted.

Both Labour and the Conservatives have committed not to raise income tax, value-added tax, or other major levies, but government budget predictions in March revealed that tax as a percentage of GDP was on track to hit its highest level since 1948.

Source: Reuters

Canada’s Household Debt Nears $3 Trillion Under Trudeau

Canada’s Household Debt Nears $3 Trillion Under Trudeau

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U.K News

Bank of England Keeps Key Interest Rate at 5.25% Despite Inflation Falling



Bank of England

The Bank of England maintained its main interest rate at a 16-year high of 5.25% on Thursday, despite inflation falling to its target of 2%, with several policymakers warning that a premature decrease may spark another wave of price increases.

Seven of the nine members of the bank’s ruling Monetary Policy Committee voted against a rate drop for the second week in a row, while two supported one. Interest rates have been constant since August, following a series of rises.

The statement accompanying the vote made it plain that there was disagreement on the forecast for inflation, with some expressing concern about continued significant price increases in the services sector, the key driver of the British economy.

“It’s good news that inflation has returned to our 2% target,” said Bank of England Governor Andrew Bailey, who voted to maintain current policy. “We need to be sure that inflation will stay low and that’s why we’ve decided to hold rates at 5.25% for now.”

The decision will likely dismay the ruling Conservative Party ahead of the United Kingdom’s general election in two weeks. Prime Minister Rishi Sunak would have seen a cut as good economic news, especially if it came with a drop in mortgage rates.

Upcoming UK Election

The panel maintained that the upcoming election, which the main opposition Labour Party, led by Keir Starmer, is generally expected to win, did not influence its conclusion. It stated that the decision was, as always, based on meeting the 2% inflation objective “sustainably in the medium term.”

Economists anticipate a rate decrease is on the way, either at the bank’s next policy making meeting in August or the one following in September. They expect clear evidence by then that inflation will remain close to the target for the next year or two.

“We continue to believe that the MPC will ease restrictive policy beginning in the summer and deliver two rate cuts this year,” said Sanjay Raja, Deutsche Bank’s senior U.K. economist.

The reduction in the primary inflation measure to a near three-year low of 2% in the year to May does not imply that prices are falling; rather, they are rising at a slower rate than they have in recent years during a cost-of-living crisis that has resulted in reduced living standards for millions in Britain.

Central banks worldwide dramatically increased borrowing costs from the lows seen during the coronavirus pandemic, when prices began to rise, first due to supply chain issues accumulated during the pandemic and then due to Russia’s invasion of Ukraine, which pushed up energy costs.

Bank of England unduly cautious

Higher interest rates, which cool the economy by making borrowing more expensive, have helped to reduce inflation, but they have also weighed on the British economy, which has hardly expanded since the pandemic’s recovery.

Critics of the Bank of England argue that it is unduly cautious about inflation and that keeping interest rates too high for too long will put undue strain on the economy. It is an accusation that has also been leveled at the United States Federal Reserve, which has held interest rates constant in recent months.

“Given that the U.K. has moved onto a milder inflationary trajectory, rate setters remain overly cautious about the likelihood of loosening policy, risking impeding the U.K.‘s growth prospects,” said Suren Thiru, economics director at The Institute of Chartered Accountants in England and Wales.

Some central banks, like the European Central Bank, have begun to decrease interest rates as inflationary pressures have subsided. On Thursday, the Swiss National Bank cut its main interest rate by a quarter of a percentage point to 1.25%.

Source: The Associated Press

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