HONG KONG, Oct 25 (Reuters) – Shares in China Evergrande Group’s electric vehicles (EV) unit <0708.HK> rose on Monday as the embattled property developer moved to prioritise the growth of its nascent EV business over its troubled core real estate operations.

Evergrande (3333.HK) , reeling under more than $300 billion in liabilities, averted a costly default last week with a last-minute bond coupon payment, buying it more time to head off a looming debt crunch with its next major payment deadline on Friday. read more

An announcement by its chairman, Hui Ka Yan, reported by state media on Friday, that it would make its new electric vehicle venture its primary business, instead of property, within 10 years, cheered investors on Monday.

Evergrande rose as much as 6% during the session before closing down 0.7%. China Evergrande New Energy Vehicle Group Ltd (0708.HK)rose 11.4%. The benchmark Heng Seng Index (.HSI) was flat.

Raymond Cheng, CGS-CIMB Securities’ head of China research, said the business shift makes sense given Beijing’s growing support for EVs and its increased tightening of the frothy real estate sector. “This is the best outcome, if it just focuses on existing developments and maintains the operation,” Cheng said.

While the move would help Evergrande deleverage by gradually scaling down its massive undeveloped land holdings, Cheng said it was unclear how it would affect the company’s planned disposals including stakes in the EV unit.

Evergrande’s new vehicle business, founded in 2019, has yet to reveal a production model or sell a single vehicle. Last month, the unit warned it was still seeking new investors and asset sales, and that without either it might struggle to pay salaries and cover other expenses.

Hui expects property sales will slow to about 200 billion yuan ($31.31 billion) per year within the 10-year period, compared to more than 700 billion yuan last year, China’s Securities Times reported on Friday.

Reporting by Clare Jim and Donny Kwok in Hong Kong, Andrew Galbraith in Shanghai, Jing Xu in Beijing; editing by Richard, Pullin, Sam Holmes and Christian Schmollinger

NEW YORK, (Reuters) – The first U.S. bitcoin futures-based exchange-traded fund began trading on Tuesday, sending bitcoin to a six-month high and just off its all-time peak, as traders bet the ETF could boost investment flows into cryptocurrencies.

The ProShares Bitcoin Strategy ETF closed up 2.59% at $41.94 in its first day of trading, with around $1 billion worth of shares trading hands on Intercontinental Exchange Inc’s (ICE.N) NYSE Arca exchange under the ticker BITO.

The greenlighting of the ETF by the U.S. Securities and Exchange Commission was seen as a watershed moment for cryptocurrencies and helped push the price of bitcoin as high as $64,367.14, its highest level since mid-April and near its record of $64,895.22.

Bitcoin, the world’s largest cryptocurrency, is notoriously volatile, and has risen around 45% this month on hopes that the advent of U.S. bitcoin ETFs – several of which are in the works – will spur billions of dollars managed by pension funds and other large investors to flow into the sector.

On Tuesday, there were very few block trades in BITO, suggesting that smaller investors and high-frequency trading firms dominated trading, said Dave Nadig, chief investment officer and director of research at ETF Trends.

“I think what we saw today was retail, HFT algo trading trying to find the arbitrage, and a whole lot of institutions sitting on the sidelines and watching,” he said.

Similar products were set to come to market, with Nasdaq Inc (NDAQ.O) having approved the listing of the Valkyrie Bitcoin Strategy ETF on Friday, while Grayscale, the world’s largest digital currency manager, said it plans to convert its Grayscale Bitcoin Trust (GBTC.PK) into a spot bitcoin ETF. read more

Crypto ETFs have launched this year in Canada and Europe amid surging interest in digital assets. VanEck and Valkyrie are among fund managers pursuing U.S.-listed ETF products, although Invesco on Monday dropped its plans for a futures-based ETF.

The SEC has yet to approve a spot bitcoin ETF.

Bitcoin futures have been overseen by the Commodity Futures Trading Commission for four years and ETFs are regulated by the SEC, offering some level of investor protection, the SEC’s chair, Gary Gensler, said on Tuesday.

“Yet it’s still a highly speculative asset class and investors should understand that underneath, there is the same volatility and speculation,” he told CNBC.

Bitcoin futures were up 4.85% at $64,640.

Reporting by John McCrank in New York and Tom Wilson in London Additional reporting by Tom Westbrook in Singapore and Katanga Johnson in Washington Editing by Andrea Ricci and Matthew Lewis

Oct 15 (Reuters) – Goldman Sachs Group Inc (GS.N) on Friday reported a 66% surge in third-quarter profit that smashed expectations, as Wall Street’s biggest investment bank rode a record wave of M&A activity and initial public offerings.

The bank posted profits of $5.28 billion up from $3.23 billion a year ago, capping a stellar quarter for Wall Street lenders, which have benefited from a rebounding U.S. economy, soaring equity markets and a global deal-making bonanza. Shares of Goldman Sachs were up 2% in mid-morning trading.

Global M&A volumes have shattered all-time records, with deals worth over $1.5 trillion inked by the world’s biggest investment banks in the third quarter, according to Refinitiv data. Goldman comfortably held its top ranking as the world’s leading bank in M&A advisory, according to the Refinitiv data.

Those surging M&A fees drove Goldman Sachs’ overall financial advisory revenue up 225% to $1.65 billion, while underwriting revenue, which has been boosted by a rush of private companies looking to go public, surged 33% to $1.90 billion.

All told, Goldman’s investment bank boasted its second-best quarter ever, with total revenue of $3.70 billion, and executives said they expect revenues to continue to be strong. “I remain optimistic about (opportunities),” Goldman Sachs Chief Executive Officer David Solomon said on a call with analysts. “Activity levels remain high particularly in investment banking.”

Earnings per share were $14.93 from $8.98 a year earlier, outstripping the $10.18 per share analysts had predicted, according to the IBES estimate from Refinitiv. Goldman’s global markets trading business, which accounts for roughly 41% of overall revenue, reported revenue of $5.61 billion, up 23%.

The bank has been steadily expanding its prime brokerage business, where it handles trades for hedge funds, picking up clients and assets as other banks have trimmed their prime divisions. Additionally, it has gained market share when it comes to financing clients’ equity investing, according to its quarterly report.

Those gains in prime brokerage and equity financing helped Goldman roughly double its equity trading revenue this quarter to $3.1 billion from $2.1a year ago. That was higher than rival Morgan Stanley, which reported trading revenue of $2.87 billion and is typically number one in this line of business.

Morgan Stanley (MS.N) said on Thursday that its third-quarter profit rose 38%, while JPMorgan Chase & Co (JPM.N) reported a 24% rise. read more Citigroup Inc. (C.N) and Bank of America Corp (BAC.N), which were likewise buoyed by deal fees and equities trading, increased profits by 48% and 64%, respectively. All the banks handily beat estimates.

“Clearly, upside was anticipated given what we’d seen from peers, but not this much upside,” Credit Suisse analyst Susan Roth Katzke wrote in a note to investors on Friday. “The beat was broad-based.”

Reporting by Noor Zainab Hussain, Anirban Sen, Elizabeth Dilts and Matt Scuffham; Editing by Arun Koyyur and Nick Zieminski

NEW YORK (Reuters) – Investors are primed for another period of strong U.S. profit growth as third-quarter reports from Corporate America flow in starting next week. But as business continues to emerge from the coronavirus pandemic, new problems are arising that are taking center stage for Wall Street, including supply-chain snags and inflationary pressures.

In the run-up to earnings season, a number of companies have issued downbeat outlooks. FedEx Corp said labor shortages drove up wage rates and overtime spending, while Nike Inc blamed a supply-chain crunch and soaring freight costs as it lowered its fiscal 2022 sales estimate and warned of holiday-season delays.

“The pace of growth is decelerating, but still it’s at a meaningful level,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. With the product and labor shortages and inflationary pressures, “we’ll be looking to see to what extent demand is there, and what does it mean for the important holiday spending period.”

Analysts see a 29.6% year-over-year increase in earnings for S&P 500 companies in the third quarter, according to IBES data from Refinitiv as of Friday, down from 96.3% growth in the second quarter. The third-quarter forecast is down a touch from several weeks ago, a reversal of the recent trend for estimates.

Third-quarter earnings growth was always expected to be much lower than the blowout gain of the second quarter, when companies had much easier year-ago comparisons because of the pandemic.

“We were going up at such a high clip. The positive revision momentum has lapsed,” said Nick Raich, CEO of independent research firm The Earnings Scout. Earnings season is kicking off this week with the big banks including JPMorgan Chase.

Investors are weighing the impact of sharply higher energy costs on businesses and consumers after a recent surge in oil and natural gas prices. While higher energy prices should be a boon for energy producers, they are an inflationary risk for many other companies like airlines and other industrials and cut into consumer spending.

U.S. companies have so far this year kept profit margins at record levels because they have cut costs and passed along high prices to customers. Some investors are anxious to see how long that can go on.

Third-quarter earnings arrive with the market still wobbly after a weak and volatile September. The S&P 500 in September registered its biggest monthly percentage drop since the onset of the pandemic in March 2020. It was also the index’s first monthly decline since January.

“COVID-related supply chain issues have spread beyond consumer goods. And longer-term signs of global friction are easy to find,” Savita Subramanian, head of U.S. equity & quantitative strategy at BofA Securities, wrote in a note on Friday. But she said these issues are far from being fully priced into stocks.

Morgan Stanley’s analysts say that consensus earnings expectations also have not fully priced in the supply-chain constraints facing companies, making it much harder for companies to surpass estimates at the same rate as in recent quarters.

“Consumer Discretionary companies of all kinds are right in the cross hairs of the supply shortages, higher logistics costs and higher labor costs,” they wrote. Those strategists see the equity market set for a bigger pullback, and say third-quarter earnings could determine how deeply the stock market dips.

Reporting by Caroline Valetkevitch in New York; Editing by Megan Davies and Matthew Lewis

HONG KONG, Oct 6 (Reuters) – Asian shares dropped on Wednesday, reversing early gains, after an overnight rebound in U.S. and European stocks as investors shrugged off worries about a potential U.S. government debt default, while oil paused near new multi-year highs.

The gains in oil are driven by concerns about energy supply, and come two days after the OPEC+ group of producers stuck to its planned output increase rather than raising it further.

U.S. crude rose to its highest level since 2014 on Wednesday but pared gains and was last off 0.09% to $78.87 a barrel. Brent crude lost 0.08% to $82.49 per barrel, having hit a three-year high in the previous session.

“OPEC’s outlook suggests further reductions in global oil stockpiles. That’s a problem given that oil inventories are already low,” wrote analysts at CBA in a note.

Rising prices could threaten the global economic recovery as global oil demand growth was picking up as economies re‑opened on the back of rising vaccination rates, they added.

In equity markets, MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) fell 0.6%, reversing early gains, while Japan’s Nikkei (.N225) lost 0.78%.

Traders say markets are jittery due to worries about China’s real estate market as well as approaching higher interest rates around the world.

There were falls in Hong Kong (.HSI) off 1%, Korea (.KS11) down 0.9% and Australia down 0.45%. U.S. stock futures, the S&P 500 e-minis shed 0.44%.

Chinese markets remained closed for a public holiday, and shares of cash-strapped Chinese developer China Evergrande (3333.HK) were suspended having stopped trading on Monday pending an announcement of a significant transaction.

Uncertainty about Evergrande’s fate roiled Chinese property developers’ bonds and Hong Kong-listed shares and bonds on Tuesday following fresh credit rating downgrades. read more

Elsewhere, New Zealand’s central bank raised interest rates by 25 basis points but reaction was muted as the move to increase the cash rate to 0.50% was widely expected. The announcement caused the New Zealand dollar to rise about 0.1%, before falling 0.34%.

Overnight the Dow Jones Industrial Average (.DJI) rose 0.92%, the S&P 500 (.SPX) gained 1.05% and the Nasdaq Composite (.IXIC) climbed 1.25%, despite worries that the United States will default on its debt.

The Senate will vote on Wednesday on a Democratic-backed measure to suspend the U.S. debt ceiling, a key lawmaker said on Tuesday, as partisan brinkmanship in Congress risks an economically crippling federal credit default.

These fears, however, did help push the dollar back towards its 12-month highs and benchmark treasury yields to near their highest level since mid June.

In Asian trading, the dollar hovered close to its highs for the year against a basket of its peers , while the euro EUR=EBS stayed near its 14-month low struck last week. The safe-haven yen JPY=EBS fell about 0.5%, reflecting a positive mood in equity markets.

The yield on benchmark 10-year Treasury notes rose to 1.5466%, nearing a four-month high of 1.5670% hit in late September. Spot gold shed 0.15% to $1757.3 an ounce, with the non-interest bearing asset hurt by higher yields.

Editing by Stephen Coates

Oct 03, 2021 (Investing.com) – The dollar was down on Monday morning in Asia, but remained near the highs hit during the previous week, thanks to renewed concerns about China Evergrande Group’s (HK:3333) debt woes and the latest U.S. jobs report, due later in the week.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched down 0.04% to 94.052 by 11:39 PM ET (3:39 AM GMT).The USD/JPY pair inched up 0.01% to 111.06. The AUD/USD pair inched up 0.02% to 0.7258 while the NZD/USD pair edged down 0.13% to 0.6934. The USD/CNY pair was steady at 6.4467 with Chinese markets closed for a holiday. The GBP/USD pair inched down 0.07% to 1.3536.

Shares in developer China Evergrande Group were halted in Hong Kong earlier in the day. No reason was given for the suspension, which re-triggered fears about global contagion from the developer’s debt woes.

“There’s a bit of nervousness,” even if most traders still think China Evergrande’s systemic risk can be contained, Bank of Singapore currency analyst Moh Siong Sim told Reuters.

“It’s part of the wall of worry,” which the market could eventually “climb” if the COVID-19 backdrop improves, growth stabilizes and inflation concerns subside, but which for now is keeping investor sentiment fairly dour, he added.

Meanwhile, the Reserve Bank of Australia will hand down its policy decision on Tuesday, with the Reserve Bank of New Zealand following a day later and the Reserve Bank of India will hand down its decision on Friday.

The U.S. will also release its latest jobs report, including non-farm payrolls, on Friday, and is likely to be good enough for the U.S. Federal Reserve to begin asset tapering before the end of 2021.

“The question is whether there is a number that alters the Fed’s view on tapering its bond purchases in November, and what a really weak or hot number means amid the backdrop of rising stagflation fears,” Pepperstone head of research, Chris Weston told Reuters.

“If U.S. treasuries find further buyers this week into non-farm payrolls, the dollar may go on sale this week.”

By Gina Lee

LONDON (Reuters) – OPEC and its allies meet on Monday to debate how much oil to release into the red hot market, where supply disruptions and recovering demand from the coronavirus pandemic have pushed oil above $80 per barrel.

The oil price rally to a three-year high is exacerbated by an even bigger increase in gas prices, which have spiked 300% and have come to trade close to an equivalent of $200 per barrel due to supply shortages and low production of other fuels.

The Organization of the Petroleum Exporting Countries and allies led by Russia, known as OPEC+, agreed in July to boost output by 400,000 barrels per day every month until at least April 2022 to phase out 5.8 million bpd of existing cuts.

Four OPEC+ sources told Reuters last week producers were considering adding more than that deal envisaged, but none gave details on how much more, or when supply would increase.

The nearest month any increase could occur is November since OPEC+’s last meeting decided the October volumes.

Rising oil, gas, coal and power prices are feeding inflationary pressures worldwide and slowing the recovery.

A senior aide to U.S. President Joe Biden met Saudi Crown Prince Mohammed bin Salman in Saudi Arabia last week to discuss the war in Yemen but said oil was also “of concern”.

Russian oil and gas condensate output rose to 10.72 million bpd in September, the highest level since the 11.34 million bpd pumped in April 2020, data showed on Saturday.