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UK tax cut sends stocks, sterling rebound – Reuters

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© Reuters. FILE PHOTO: People walk past an electrical panel showing the average share of Japan’s Nikkei index in Tokyo, Japan, September 14, 2022. REUTERS/Issei Kato

Written by Tom Westbrook

SYDNEY (Reuters) – Asian stocks rebounded on Tuesday after Britain scrapped parts of a controversial tax cut plan, which initially improved global market sentiment and lifted bonds and the pound.

Adding to this relief in the markets, the Reserve Bank of Australia surprised investors by raising interest rates by 25 basis points less than expected, saying they had already risen significantly..

That pulled the dollar down 3.6% and spurred benchmark 3-year notes on their best day in 13 years.

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In trade weakened by holidays in China and Hong Kong, MSCI’s broadest index of Asia Pacific shares outside Japan rose 1.7%, led by gains in Australia.

British stocks looked poised for a rebound, with futures up 0.8%.

“In the short term it looks a bit oversold,” said Jeff Wilson, chief investment officer at Wilson Asset Management in Sydney.

“Is this the bottom? It’s almost impossible to pick the bottom, but I don’t think so,” he said, generally referring to the markets.

It rose by 2.8%. Sterling drifted to an almost two-week high of $1.1343, now rebounding nearly 10% from last week’s record low after plans for unfunded tax cuts unleashed havoc on British assets.

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“The shift … will not have a significant impact on the overall financial situation in the UK in our view,” said John Briggs, Head of Economics and Markets Strategy at NatWest Markets.

“(But) investors took this as a sign that the UK government can and is at least partially willing to back down from its intentions that have turbulent markets over the past week.”

Investors also drew enthusiasm from the stability at the long end of the gold market, although emergency purchases from the Bank of England were relatively modest.

S&P 500 futures () rose 1%, after the index rebounded 2.6% overnight. [.N]

British Chancellor of the Exchequer Kwasi Quarting issued a statement reflecting the planned tax cuts for high-income earners. It makes up just 2 billion of the £45 billion in unfunded tax cuts that sent the gold market crashing last week.

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South Korea’s Kospi rebounded 2.5%, moving away from last week’s two-year low, despite North Korea firing a missile over Japan for the first time in five years. ()

Stirling Bounce

Sterling’s recovery has settled some nerves in the currency market, although the continued strength of the dollar still holds many major currencies near their lows and authorities across Asia are on edge.

The Japanese yen hit 145 to the dollar on Monday – a level that prompted the official intervention last week – and was last at 144.71. The euro was at $0.9838, about three cents stronger from last week’s 20-year low. [FRX/]

Chinese authorities have embarked on maneuvers to support the yuan, ranging from unusually strong market signals to administrative measures that raise the cost of short selling.

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“More volatility is almost guaranteed as currency markets refocus on US recession risks, which continue to grow,” said Miles Workman, chief economist at ANZ, with US jobs data on Friday the next major data point on the horizon.

The Australian dollar fell to $0.6451 after the central bank meeting. The Reserve Bank of New Zealand meets on Wednesday and is holding it just above $0.57. [AUD/]

Treasuries rose in sympathy with UK Treasuries overnight and the benchmark 10-year yield fell by 15 basis points. It was flat in Asia at 3.62%, after rising briefly above 4% last week.

Other indicators of market pressure abound. Still high and above 30. Credit Suisse stocks and bonds hit record lows on Monday as concern swept the markets over the bank’s restructuring plans.

Overnight, oil held on to gains on news of potential production cuts, and futures contracts last rose 43 cents to $89.29 a barrel.

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A top aide to Ukrainian President Zelensky accuses BP of profiting from the war with a stake in the Russian oil company.

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Basic [hotlink ignore=true]energy[/hotlink] The company that pledged to sell its stake in Russia has yet to do so, and a senior Ukrainian official has accused it of siphoning off millions from the war.

British Petroleum is one of the largest oil and gas companies in the world announce Last February, it said it would sell its 19.75% stake in Russian energy company Rosneft in the aftermath of Vladimir Putin’s invasion of Ukraine.

But after nine months, [hotlink]BP[/hotlink] It has not yet emptied its stake, and one of the closest advisers to Ukrainian President Volodymyr Zelensky is demanding that the company cut ties immediately.

Zelensky’s chief economic adviser, Oleg Ustinko, wrote a letter – it’s been seen before BBC And the The guardian— to Bernard Looney, CEO of BP, urging the company to keep its pledge from the early days of the war, while accusing BP of complicity with Russia in violating international law and its abuses in Ukraine by holding on to its stake in Rosneft.

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“After nine months of Russian aggression, war crimes, and bombing of civilian infrastructure, all financed and supplied by Russian oil, gas, and coal, BP remains a Rosneft shareholder,” Ustenko wrote.

A BP spokesman said luck The difficulties in selling BP’s stake in Rosneft stem from complications related to Western sanctions against Russian companies.

Ustinko also accused BP of continuing to receive payments from Rosneft in the form of dividends, citing its latest Analytics From the NGO Global Witness. The analysis claimed that by failing to sell its stake in Rosneft, BP “continues to receive dividends to shareholders, known as dividends” from the Russian company.

Based on a Pay compensation to Rosneft shareholders Last month, Global Witness estimated that BP took in around £580 million (about $713 million) in the first nine months of 2022.

A BP spokesperson said that the company has not received any dividends from Rosneft shares since February, and does not expect to receive any dividends in the future, adding that the decision to sell Rosneft shares resulted in $24 billion in damage.

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They added that any payments made by a Russian company to “unfriendly countries” abroad would be strictly monitored by the Russian government.

But Ustinko claimed in his letter that BP’s inability to sell its stake still made it complicit with Rosneft. Huge profits This year, which supported the Russian war effort in Ukraine.

“BP will receive this money in a restricted Russian bank account, which is a clear indication of the historical error your company has made – but nevertheless, BP will receive the dividend,” Ostenko wrote.

No accounting mechanisms or data from BP will change this fact. This is blood money pure and simple.”

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Ustinko accused BP of “waiting out the storm, and going back to business as usual when the war is over”.

A BP spokesperson denied the accusation, saying the company had “absolutely no intention of going back to ‘business as usual’”.

Throughout the war, Russia resorted to using energy as a weapon against the West, especially Europe, which was dependent on Russia for energy Most of its supplies are oil and natural gas. Despite the sanctions, Russia managed to continue selling energy abroad this year. You win big From the very high oil and gas prices during the first few months of the war.

Russia’s fossil fuel exports earned Russian energy companies 158 billion euros ($166 billion) during the first six months of the war, according to study by the Clean Air and Energy Research Center. The study found that energy revenues have contributed about 43 billion euros ($45 billion) to the Russian federal budget since the start of the war, helping to fund the war in Ukraine.

This story originally appeared on Fortune.com

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The former US head of FTX is reportedly seeking $6 million in funding to launch Cointelegraph

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Just a month after the controversial fallout Sam Bankman FriedFTX’s FTX stock exchange and 130 affiliates, and a former high-profile CEO is reportedly looking for investors to launch a crypto company.

Former FTX US President Brett Harrison is looking for $6 million in funding to launch a startup that will build cryptocurrency trading software for major investors, depending to the information. Harrison’s funding round will be for $60 million.