Blackstone-backed Candle Media acquires Faraway Road Productions

By Dawn Chmielewski

(Reuters) – Blackstone-backed Candle Media is buying Faraway Road Productions, the Israeli studio behind popular Netflix series “Fauda” and the upcoming feature film “Siege of Bethlehem,” continuing a media industry buying binge, Blackstone said on Tuesday.

Terms were not publicly disclosed. One person familiar with the matter said the acquisition was valued at under $50 million.

The deal is another big bet by private equity firm Blackstone in the streaming media industry and its voracious appetite for new content to attract new subscribers.

Faraway Road Productions is the latest in a series of acquisitions by the Blackstone-backed media company, which include taking a majority stake in Reese Witherspoon’s media company, Hello Sunshine, investing in Will and Jada Pinkett Smith’s production company, Westbrook, and acquiring children’s entertainment studio Moonbug.

Candle Media executives, Kevin Mayer and Tom Staggs, both former top Walt Disney Co executives, described the acquisition of the studio, founded by “Fauda” creators, Lior Raz and Avi Issacharoff, as another in a series of deals that invest in distinctive storytellers.

“Lior and Avi are world-class storytellers who produce exhilarating content that strikes a chord globally with audiences across cultures and languages,” Stags and Mayer said in a statement.

(Reporting by Dawn Chmielewski; editing by Kenneth Li and Howard Goller)

WHO body says COVID-19 vaccines may need to be updated for Omicron

By Mrinalika Roy and Emma Farge

GENEVA (Reuters) – A World Health Organization technical body said on Tuesday that current COVID-19 vaccines may need to be reworked to ensure they are effective against Omicron and future variants of the coronavirus.

The technical group, made up of independent experts, said it would consider a change in vaccination composition and stressed that shots needed to be more effective in protecting against infection.

“The composition of current COVID-19 vaccines may need to be updated to ensure that COVID-19 vaccines continue to provide WHO-recommended levels of protection against infection and disease by VOCs (variants of concern), including Omicron and future variants,” the technical body, tasked with making recommendations to the WHO, said in a statement.

“COVID-19 vaccines need to…elicit immune responses that are broad, strong, and long-lasting in order to reduce the need for successive booster doses,” it added.

“A vaccination strategy based on repeated booster doses of the original vaccine composition is unlikely to be appropriate or sustainable.”

However, the statement stopped short of advocating an Omicron-specific vaccine at this stage, saying more research was required and urging manufacturers to share data.

It said that an updated vaccine could be aimed specifically at the dominant variant, which is currently Omicron in many places, or be a “multivalent vaccine” designed to bust several variants at once. Further recommendations will be issued when more data is available, it added.

Some vaccine makers are already developing next-generation vaccines targeting Omicron, the highly contagious variant first detected in southern Africa and Hong Kong.

On Monday, Pfizer Chief Executive Albert Bourla said a redesigned COVID-19 vaccine that specifically targets the Omicron variant would probably be needed and his company could have one ready to launch by March.

Rival Moderna Inc is also working on a vaccine candidate tailored to Omicron, but it is unlikely to be available in the next two months.

A WHO official had previously said the issue of vaccine composition required “global coordination” and should not be left to manufacturers to decide alone.

(Reporting by Mrinalika Roy in Bangalore and Emma Farge, Editing by Alexandra Hudson and Mark Heinrich)

European jet fuel refining margins take off despite Omicron

By Rowena Edwards and Ron Bousso

LONDON (Reuters) – European jet fuel refining margins are back to pre-pandemic levels as supplies in the region tighten and global aviation activity recovers despite the spread of the Omicron coronavirus variant.

Profits for converting crude oil into jet fuel hit a two-year high this week, Refinitiv data shows.

Graphic: Taking off: https://graphics.reuters.com/EUROPE-JETFUEL/zgvomajrmvd/chart_eikon.jpg

Global demand for aviation fuel continued to recover in December, even after the rapid spread of the Omicron variant sparked a run of flight cancellations that month.

A seven-day moving average of global flight departures to Dec. 31 rose by 12% compared with the same week a year earlier, data from flight tracking website Flightradar24 indicated. However, the figure remains 13.2% below levels in pre-pandemic 2019.

Imports, meanwhile, are set to tighten because of strong jet fuel demand from Asia and the United States, which has weakened arbitrage economics into Europe, traders said.

Unplanned refinery outages in the Gulf of Mexico, including Exxon Mobil’s 560,500 barrel per day (bpd) Baytown refinery and relatively high amounts of planned maintenance in North America mean that the trend is likely to continue, traders said.

About 653,000 tonnes of jet fuel are scheduled to arrive in northwest Europe from Asia and the Middle East in January, down from a little more than 1 million tonnes in December, Refinitiv data show.

Stocks in the Amsterdam-Rotterdam-Antwerp (ARA) storage hub are low as a result. Recent jet fuel arrivals have also gone to the UK and to Le Havre, France, which feeds the Central European Pipeline System (CEPS).

Jet fuel stocks in the ARA region reached 896,000 tonnes on Jan. 1, down by 5% from a year earlier, data from Dutch consultancy Insights Global show.{}{ARA/]

Refineries in Europe have been prioritising diesel over jet fuel production. Some plants are now starting to make the switch given the strength in jet fuel, industry sources said.

Graphic: European jet fuel imports-https://graphics.reuters.com/EUROPE-JETFUEL/gkplgbjwevb/chart_eikon.jpg

(Reporting by Ron Bousso and Rowena Edwards; Editing by David Goodman)

Biden EPA advances efforts to curb toxic coal ash contamination

By Valerie Volcovici

WASHINGTON (Reuters) – The Environmental Protection Agency announced new steps on Tuesday to force utilities to strengthen safeguards for toxic coal ash pollution from power plants that had been delayed by the Trump administration.

Some utilities store coal ash, a byproduct of coal power plant combustion, which contain cancer-causing carcinogens like arsenic and neurotoxins such as lead and lithium, in unlined pits that can seep into nearby groundwater and harm drinking water supply without proper treatment.

The agency said it will start setting new deadlines for some plants that had asked for extensions to close unlined pits, put others on notice to begin complying with regulations and finalize a federal permitting program for coal ash disposal.

“For too long, communities already disproportionately impacted by high levels of pollution have been burdened by improper coal ash disposal. Today’s actions will help us protect communities and hold facilities accountable,” EPA Administrator Michael Regan said.

Coal ash is stored at hundreds of power plants throughout the country. Spills in Tennessee and North Carolina leached sludge containing toxic materials into rivers in those states over the last decade.

A 2019 report https://www.reuters.com/article/us-usa-coalash/coal-ash-contaminates-groundwater-near-most-u-s-coal-plants-study-idUSKCN1QL0CH by the Environmental Integrity Project and Earthjustice found that 241 of 265 coal plants, or 91%, that were subject to EPA monitoring requirement showed unsafe levels of one or more coal ash components in nearby groundwater compared to EPA standards.

The Obama administration’s 2015 coal and wastewater rules had established minimum national standards for the disposal of coal ash, forcing coal plants to shut down unlined pits in 2019 and recycle 100% of their system’s water, according to an EPA rule summary.

The Trump administration in 2020 delayed the deadlines set by the 2015 rule and reducing monitoring and storage requirements to save companies millions of dollars per year in regulatory.

It allowed utilities to continue pouring waste into around 500 unlined coal ash ponds until April 2021 and exempted some facilities from lining their basins with plastic if they meet certain criteria.

Prior to becoming EPA administrator, Regan had run the North Carolina Department of Environmental Quality since 2017 and has been part of the push to hold big companies like Duke Energy Corp accountable for pollution.

(Reporting by Valerie Volcovici; Editing by Nick Zieminski)

World Bank demands faster G20 debt relief as poor nations squeezed

By Karin Strohecker and Andrea Shalal

LONDON (Reuters) -Poorer developing nations need faster G20 debt relief, the World Bank said on Tuesday, redoubling its calls for China, the world’s largest creditor, and private sector creditors, to reverse course and participate fully in debt relief efforts.

The pandemic-induced recession in 2020 left around 60% of low-income countries in or at high risk of debt distress, and many emerging economies were struggling as well, World Bank President David Malpass told reporters as the bank unveiled its latest Global Economic Prospects https://www.reuters.com/markets/europe/world-bank-sees-sharp-world-growth-slowdown-hard-landing-risk-poorer-nations-2022-01-11 report.

Debt levels in emerging market and developing economies had risen at the fastest pace in three decades, the report said, and while growth in low income economies is projected to strengthen in 2022 to 4.9% and in 2023 to 5.9%, income per capita is forecast to remain below pre-pandemic levels this year in half of them.

In 2022 alone, the poorest countries faced $35 billion in debt service payments to official bilateral and private creditors, with over 40% of that due to China, after a freeze in debt payments ended last year, Malpass said, .

“Risks of disorderly default are growing; the tightening of monetary policy in advanced economies will have a ripple effect,” he said, repeating his call for reforms to the common framework launched by the Group of 20 major economies and the Paris Club of official creditors in November 2020.

The framework aims to provide debt relief chiefly through maturity extensions and interest rate reductions for countries eligible for repayment moratoriums under the Debt Service Suspension Initiative (DSSI), but progress has been sluggish.

“Deep debt relief is much needed for the poorer countries. If we wait too long, it will be too late,” Malpass said, calling for an end to non-disclosure agreements often demanded by China and other creditors, as well as clear rules for assessing and enforcing comparable treatment among all creditors.

QUICK ACTION NEEDED

Malpass said adding an aggregated collective action clause to all new official and private sector debt instruments could help rebalance the power between debtor and creditor countries.

He said quicker work was needed on debt restructurings, noting that Chad, the first country that requested treatment under the framework one year ago, was still waiting to complete the process. Only three countries have asked for debt restructuring so far, but others needed help.

Malpass said he was cautiously optimistic about progress on the debt issue under Indonesia’s leadership of the G20, recent conversations with Chinese officials, and great interest in investment in countries like Chad, Zambia and Sri Lanka, if their debt structure could be stabilized.

Debtor countries also needed to shore fiscal frameworks and increase debt transparency, the report said.

High and rising debt levels left markets and institutions increasingly vulnerable to financial stress, especially in countries where weak fiscal positions and high sovereign debt left much less scope for an effective response.

The World Bank highlighted China, where financial stress could trigger a disorderly deleveraging of the property sector https://www.reuters.com/markets/rates-bonds/chinas-shimao-says-it-has-no-deal-sell-shanghai-plaza-shares-slump-2022-01-11.

“A turbulent deleveraging episode could cause a prolonged downturn in the real estate sector, with significant economy-wide spillovers through lower house prices, reduced household wealth, and plummeting local government revenues,” it said.

(Reporting by Karin Strohecker; Editing by Alexander Smith and Emelia Sithole-Matarise)

Surging infections force Finland’s local authorities to prioritise

By Anne Kauranen

HELSINKI (Reuters) -Surging coronavirus infections are forcing local authorities in Finland to stray from the government’s COVID-19 strategy based on mass testing, tracking and isolation.

Helsinki and neighbouring cities recommend that people with a mild infection do not get an official test as the waiting time can now be days, city mayors and Helsinki hospital district said in a joint statement on Tuesday.

“The hospital district and cities have had to prioritise having workforce in hospital care and inoculation,” strategy director Pasi Pohjola from the health ministry told Reuters.

Finland’s minister in charge of the COVID response, Krista Kiuru, warned https://www.reuters.com/article/us-health-coronavirus-finland-long-covid-idUSKBN2JH14W on Friday that long COVID could become Finland’s largest chronic disease and that children were also at risk. [L1N2TN0X3]

She added she feared returning to school was not safe and called for local authorities to implement strict quarantines at schools in which one pupil’s COVID infection would result in quarantine for the entire exposed class.

But Sanna Isosomppi, Helsinki’s chief epidemiologist, told Reuters the capital region’s municipalities were not going to follow the minister’s advice.

“It would be disproportionate to implement large-scale quarantines at schools when they have not been a high-risk environment to begin with,” Isosomppi said.

“Mandating quarantines is no longer an effective way to control the epidemic,” Isosomppi said.

For more than a year, the government’s main strategy to counter the pandemic has been to test and trace infections throughout society, but this week local authorities began to openly rebel against the measures.

“Tracing infections has lost its effectiveness due to delays in testing and in contacting the patients,” they said in a statement.

Helsinki and 11 other municipalities in the capital region had already said on Monday that they were giving up on mandating quarantines on infected patients in most cases, focusing their efforts only at health care units and elderly care units.

Instead, authorities recommended anyone with symptoms, including children, to remain at home on voluntary basis.

Last week, Isosomppi and nine other leading Finnish infection specialists published an open letter against a plan proposed by Kiuru’s ministry to reintroduce school closures and going back to remote learning.

Finland’s government was not immediately available for comment.

(Reporting by Anne Kauranen; Additional reporting by Essi Lehto; Editing by Alison Williams and Ed Osmond)

Sterling steadies near 23-month high versus euro

By Joice Alves

LONDON (Reuters) -Sterling rose on Tuesday to touch a pre-pandemic high versus the euro, supported by expectations that the Bank of England will raise interest rates further.

The pound edged 0.1% higher versus the euro at 83.35 pence by 1600 GMT, after touching its highest level versus the single currency since February 2020.

Against the dollar, it rose 0.2% at $1.3611, hovering around its highest level since Nov. 4, when the pound slid 1.5% on the day after the BoE surprised the market by keeping interest rates unchanged.

Over the past weeks, investors have ramped up expectations that the BoE will raise interest rates as early as next month after a surprise hike in December by 15 basis points, to 0.25%.

You-Na Park-Heger, FX analyst at Commerzbank, said the prospect of interest rate hikes by the BoE is supporting sterling. But “quite a bit of it is likely to be priced in already so that the GBP rally could begin to run out of steam”, she added.

Jane Foley, head of FX Strategy at Rabobank in London, said sterling has also gained some support from signs of weakness in the U.S. dollar. Against a basket of currencies, it was trading on Tuesday well below the 16-month highs it touched in November despite rising bets this month that the Federal Reserve will raise interest rates sooner than initially expected.

“The market is already holding long USD positions and this is making it difficult for the greenback to react to continued speculation about Fed policy tightening. This may allow cable freedom to push higher in the coming weeks,” Foley said.

She expects the market to unwind some of the expectations for BoE rate hikes as pressure on real incomes in the UK will likely “become more obvious as the winter progresses”.  

(Reporting by Joice Alves, Editing by William Maclean, Andrea Ricci and Catherine Evans)

‘Bring your own booze’ lockdown party heaps pressure on UK PM Johnson

By Alistair Smout and William James

LONDON (Reuters) – Boris Johnson’s leadership faced its most serious threat yet on Tuesday after it emerged his private secretary invited over 100 people to a “bring your own booze” party at the British Prime Minister’s official residence during a coronavirus lockdown.

Johnson, who won a landslide election victory in 2019, has faced intense scrutiny over the past month after a video emerged showing his staff laughing and joking about a different party also held in Downing Street during a 2020 Christmas lockdown.

Revelations about a series of gatherings that took place in the heart of government have been widely criticised and prompted opposition Labour Party leader Keir Starmer to accuse Johnson of lacking the moral authority to lead the country.

The latest, if substantiated by an internal inquiry, would be the most damaging yet for Johnson’s future. His own lawmakers show signs of losing patience after a series of scandals, and polls show Johnson’s Conservative Party slipping behind Labour.

Johnson and his partner Carrie were among those who gathered with about 40 staff in the garden of Downing Street on May 20, 2020, after the PM’s Principal Private Secretary Martin Reynolds sent an invite by email using the pronoun “we”, ITV reported.

Johnson’s spokesman declined to comment on the report.

At the time, schools were shut to most pupils, and pubs and restaurants were closed, with strict controls on social mixing. Police prosecuted revellers, and people were prevented from bidding farewell in person to dying relatives.

“If the prime minister broke the law, he will resign won’t he?” Labour lawmaker Ben Bradshaw asked Paymaster General Michael Ellis who sat alone on the government’s front bench in parliament to answer in place of Johnson.

“The prime minister is going nowhere,” Ellis said, to Labour jeers. Ellis apologised unreservedly for the upset that the allegations had caused.

Only a smattering of Conservative lawmakers attended the debate, and few spoke in support of Johnson.

Labour’s Afzal Khan, asking if Johnson would apologise to bereaved families for holding such parties, related how his mother had died alone in hospital in 2020 while he sat in a car outside.

“Even burdened with our grief, my family obeyed the rules,” Khan said.

A snap poll by Savanta ComRes showed 66% thought Johnson should resign, up 12 percentage points from a poll taken in December after the reports of Christmas parties. It said 42% of those who voted for Johnson in 2019 thought he should quit, up 9 points. The pollster interviewed a weighted sample of 1,040 adults online on Tuesday.

A YouGov poll of 5,391 people showed a similar increase in those who thought Johnson should quit – rising to 56% on Tuesday from 48% on Nov. 22.

LOCKDOWN PARTIES

A senior government official, Sue Gray, is currently investigating allegations of at least five parties held in government departments last year during lockdown restrictions.

Asked about the claims of Downing Street parties, Johnson told parliament last month that all COVID-19 guidance had been followed, no rules had been broken and that there had been no party in Downing Street.

Opponents said that if Johnson had attended a party during a lockdown, his position would be in danger as such revelry would show disdain for the rules.

“Did the prime minister attend the event in the Downing Street garden on May 20, 2020?,” the opposition Labour Party’s deputy leader, Angela Rayner, asked. “If the prime minister was there, surely he knew?”

Over recent months, Johnson, 57, has faced criticism over his handling of a sleaze scandal, the awarding of lucrative COVID-19 contracts, the refurbishment of his Downing Street flat and a claim he intervened to ensure pets were evacuated during the Western withdrawal from Afghanistan in August.

London police, who previously declined to investigate the claims of government officials’ lockdown gatherings, said on Monday they were in contact with the Cabinet Office over the alleged breaches of health protection laws in Downing Street.

(Reporting by Alistair Smout and William James; Writing by Guy Faulconbridge; Editing by William Maclean, Catherine Evans and John Stonestreet)

German court to rule in row over funding for cruise shipbuilder MV Werften

BERLIN (Reuters) – A German court will rule next week in a case brought by Genting Group against a German regional government after a row over funding for cruise shipbuilder MV Werften, which filed for insolvency on Monday.

Genting, led by Malaysian tycoon Tan Sri Lim Kok Thay, bought MV Werften in 2016. The pandemic has hit the global travel industry, including cruise operators and led to production stops at shipyards that build cruise ships.

Genting’s subsidiary Genting Hong Kong said on Tuesday the German government and the German federal state of Mecklenburg-Vorpommern had withheld a total $336 million in funding it was promised.

Included in that was an $88 million backstop facility from Mecklenburg-Vorpommern that the Hong Kong group said it was due to draw down, but said that the German state imposed additional pre-conditions in December.

The German government has said Genting Hong Kong had turned down aid that was offered to it.

Genting’s court case was heard by the regional court in the northern German town of Schwerin on Tuesday. A spokesman for the court said a ruling would be made on Monday at 2 p.m. local time (1300 GMT).

Genting Hong Kong also said in a Hong Kong stock exchange filing on Tuesday that MV’s insolvency led to defaults under its “Global 1” credit facility, which would in turn lead to further defaults on financing arrangements worth a total of around $2.8 billion.

Shares in Genting Hong Kong have been suspended from trade since Friday. The company said they would continue to be suspended pending another announcement, which would include the outcome of legal proceedings.

MV Werften currently has around 2,000 workers in Germany’s northern state of Mecklenburg-Vorpommern.

(Reporting by Kirsti Knolle. Editing by Jane Merriman)

Citadel Securities valued at $22 billion after Sequoia, Paradigm take stake

(Reuters) – Citadel Securities said on Tuesday venture capital firm Sequoia Capital and crypto-focused investment company Paradigm had made a $1.15 billion minority investment in it, giving the market maker founded by billionaire Ken Griffin a valuation of nearly $22 billion.

The funding round was led by Sequoia. Alfred Lin, a partner at Sequoia, will join the board of Citadel Securities, the company said.

The two-decade old company provides trading services to asset managers, banks, broker-dealers and hedge funds. Its institutional business serves over 1,600 clients.

The Chicago-based company has benefited from a surge in trading activity, helped in part by retail investors flocking to popular mobile trading apps since the pandemic began.

Citadel Securities was subjected to a close scrutiny from U.S. lawmakers and regulators, after Robinhood Markets Inc and several other brokers restricted trading in shares of GameStop Corp in January last year.

The restrictions, which drew the ire of some retail investors, followed a stunning rally that sparked a “short squeeze”, leading to billions of dollars in losses for Wall Street hedge funds.

Citadel, the $43 billion hedge fund, had made a $2 billion investment in Melvin Capital at the time, after the latter, which had been short on GameStop since 2014, suffered massive losses.

Citadel Securities has denied any involvement in the decision made by the brokers.

The company has a presence in over 50 countries, and plans to use the latest capital to expand globally.

(This story corrects to say hedge fund Citadel invested in Melvin Capital, not Citadel Securities, in paragraph 7.)

(Reporting by Niket Nishant in Bengaluru; Editing by Krishna Chandra Eluri)

Exchanges and clients head for clash over UK market data shake up

By Huw Jones

LONDON (Reuters) – Britain signalled a shake-up in financial market data on Tuesday owing to concerns over “limited competition”, ratcheting up long-standing tensions between exchanges and their customers over fees for stock and bond trading information.

It is the latest move by Britain to ensure the City of London remains globally competitive for international investors after being largely cut off from the European Union since the Brexit transition period ended a year ago.

The Financial Conduct Authority said a first study, which will start this summer, will look into concerns that complex contracts for benchmarks and indices prevent switching to cheaper, better and more innovative alternative providers.

Benchmarks, such as the FTSE 100 blue chip index are widely used by asset managers and banks to track and compare valuations of their portfolios.

“By the end of the year, the FCA will launch a second market study to assess whether high charges for access to credit ratings data is adding costs to investors and limiting new market entrants,” the FCA said.

The sector is dominated by Moody’s, S&P and Fitch.

The FCA said users of credit rating services thought that the providers’ market power was leading to price increases ranging from 25% to 50% per year.

“We are in constant dialogue with our market data customers about their needs and we will continue to engage constructively with all our stakeholders,” a Moody’s spokesperson said.

S&P declined to comment.

‘LIMITED COMPETITION’

The FCA will also gather information to understand the extent to which there are “high data costs” and “complex licensing terms” on trading data exchanges sell to users like asset managers, with the findings due later this year.

“Concerns have been raised that limited competition may increase costs and have an impact on the types of assets that investment managers buy and sell,” the FCA said.

Market users say trading data is not offered under competitive conditions, while exchanges argue that the market is already “highly competitive”, the FCA said.

Tensions between the two sides were already seen in the EU’s push to create a “consolidated tape” or record of stock and bond prices to improve transparency. Britain’s finance ministry is considering a similar “tape” for its market.

“Any future changes or updated frameworks should ensure that market data works in the interest of investors, so they can access the best available prices, and drive a competitive UK marketplace,” said Conor Lawlor, managing director for capital markets and wholesale at UK Finance, which represents banks.

The London Stock Exchange declined to comment.

(Reporting by Huw Jones; Editing by Saikat Chatterjee, Kirsten Donovan and Tomasz Janowski)

Russia braces for ‘very intense’ rise in Omicron cases

MOSCOW (Reuters) -Russia warned on Tuesday it could face a “very intense” rise in cases of the Omicron coronavirus variant in the coming weeks and authorities preparing for a new wave of infections said they would make more hospital beds available in Moscow.

Speaking at a televised meeting of the government’s coronavirus task force, Anna Popova, a top consumer health official, said Russia had so far recorded 305 cases of Omicron across 13 of its regions.

“The risk of a very intense rise in (cases) of the disease is real,” she said.

Omicron has pushed COVID-19 case figures to record highs in parts of western Europe and the United States, while cases in Russia have generally been declining from a peak of 41,335 registered in early November.

Officials said they now feared the trend could rapidly reverse and Popova warned that daily infections could hit “six figures” if proper sanitary measures were not observed.

Moscow’s Mayor Sergei Sobyanin told Prime Minister Mikhail Mishustin at the televised meeting that the capital, which has a population of 12.7 million, was already seeing a significant increase in Omicron cases.

He said special measures would be taken to tackle the rise in cases, without elaborating.

“It’s necessary to mobilise more hospital beds, to mobilise the health system,” Sobyanin said.

Sources told Reuters last month that officials were bracing for another wave of COVID-19 in early 2022.

The Kremlin has frequently expressed frustration at the slow uptake of the domestically-made Sputnik V vaccine against COVID-19, with many citing distrust of the authorities and fear of new medical products.

(Reporting by Anton Zverev, Polina Devitt and Darya Korsunskaya; writing by Gabrielle Tétrault-Farber; Editing by Tom Balmforth and Catherine Evans)

Omicron dents Albertsons’ supply-chain recovery

(Reuters) – U.S. grocer Albertsons Cos Inc said on Tuesday the Omicron coronavirus variant had put a dent on the recovery of its supply chain, and expects the issues to remain for a longer duration.

Analysts and Corporate America had previously estimated supply-chain snafus to ease halfway through the year, but a full recovery could now be delayed because of Omicron-related issues, including labor shortages.

“For 2022, we expect supply pressures to likely linger for longer, perhaps until the second half of next year before gradually unwinding,” Deutsche Bank analysts wrote in a note on Tuesday.

Shares of Albertsons declined 8% in morning trade after the company also said it was witnessing cost inflation across its supply base, including in ingredients, packaging, transportation and labor.

Albertsons, which also owns Safeway, Vons and Jewel-Osco chains, cut its capital expenditures forecast for fiscal 2021 by $100 million at midpoint to $1.8 billion to $1.9 billion, citing “supply-related constraints.”

“There are more supply challenges, and we would expect more supply challenges over the next four to six weeks,” Chief Executive Officer Vivek Sankaran said on an earnings call.

Sankaran also said Albertsons had to deal with several product categories being out of stock for a few months.

The company, however, raised its forecast for fiscal 2021 profit after posting better-than-expected sales and earnings for the third quarter. It benefited from administering COVID-19 vaccines at its stores and strong demand for groceries.

(Reporting by Praveen Paramasivam in Bengaluru; Editing by Krishna Chandra Eluri)

Costa Rica hydro plant gets new lease on life from crypto mining

By Alvaro Murillo

SAN PEDRO DE POAS, Costa Rica (Reuters) – A small river in the middle of coffee plantations, sugar cane fields and a forest provides energy to a hydroelectric power plant in Costa Rica that feeds hundreds of computers wired up to the cryptocurrency mining business.

More than 650 machines from 150 customers operate non-stop from eight containers powered by the plant next to the Poas River, 35 kilometers (22 miles) from San Jose, the capital of a country that generates nearly all its energy from green sources.

The plant was forced to reinvent itself after 30 years because the government stopped buying electricity during the pandemic due to surplus power supply in the Central American country, where the state has a monopoly on energy distribution.

“We had to pause activity for nine months, and exactly one year ago I heard about Bitcoin, blockchain and digital mining,” said Eduardo Kooper, president of the family business that owns the 60-hectare farm Data Center CR and the plant.

“I was very skeptical at first, but we saw that this business consumes a lot of energy and we have a surplus.”

The hydroelectric company, with its three plants valued at $13.5 million and a three Megawatt capacity, invested $500,000 to venture into hosting digital mining computers.

Kooper said international cryptocurrency miners are looking for clean, cheap energy and a stable internet connection, which Costa Rica has plenty of. However, he said Costa Rica’s government should be more aggressive about trying to attract more crypto mining business, although he gave no specifics.

The government did not respond to a request for comment.

Costa Rica lacks specific regulation for cryptocurrencies, unlike El Salvador, which became the first country in the world to adopt Bitcoin as legal tender in September 2021.

Costa Rica’s central bank said it was providing space for technological innovation to allow a Fintech industry to take shape, and was constantly monitoring developments.

So far all Data Center CR customers are local, such as Mauricio Rodriguez, a 31-year-old computer security engineer who entered digital mining to earn extra money from home in 2021 with equipment valued at $7,000.

“Installing it in this place is much more profitable than at home,” at almost half the cost, he calculated, after connecting his computer to the network at the river-powered plant.

(Reporting by Alvaro Murillo; Writing by Valentine Hilaire; Editing by David Gregorio)

Poland to launch fresh tax cuts in anti-inflation drive

WARSAW (Reuters) – Poland will cut value added tax on gas, food and petrol as part of a second package of measures to soften the blow from surging inflation, the prime minister said on Tuesday.

Rapid price growth has eaten into household budgets, posing a headache for a government that has built its popularity to a large extent on raising living standards for ordinary Poles through generous social benefits.

“(The programme) is intended to leave as much money in Poles’ wallets as possible,” Mateusz Morawiecki told a news conference.

The measures, several of which had been previously announced, include a cut in VAT on basic food items and gas to zero, sharp reductions in VAT on fuel, heating and electricity.

Poland has been hit by Europe’s energy crisis, which started last year when the lifting of COVID-19 restrictions put huge demands on depleted stocks of natural gas. Rising fuel prices during winter have contributed to a cost-of-living squeeze across the region.

Morawiecki said the anti-inflation measures would cost the budget 15-20 billion zlotys ($3.74- 4.99 billion).

Morawiecki’s ruling nationalists Law and Justice (PiS) have faced a difficult start to the year, with businesses complaining about the soaring energy costs and mistakes in a flagship economic programme that was meant to lower taxes for most people but resulted in some workers, such as teachers, receiving lower paychecks in January.

Particularly damaging were reports that institutions such as schools and hospitals were facing gas bills many times higher than a year ago.

The latest package of anti-inflation measures contains a proposal to add those institutions to a tariff mechanism that protects households from surging gas prices.

“This (mechanism) meant that the increase in gas bills for households was still very big, but a 54% average increase for these customers compared to several hundred percent… for other entities, we must say that it was quite reasonable,” Deputy Prime Minister Jacek Sasin told public radio on Tuesday morning.

Economists have said that the government’s measures will cut the peak of inflation in the first half of 2022, but could serve to boost price growth later on.

On Monday, analysts from Credit Agricole said that a temporary cut on VAT on food to zero would actually lead to prices being higher than they would have been otherwise when taxes return to normal, citing the risk that companies partially absorb the tax break as profit.

($1 = 4.0090 zlotys)

(Reporting by Alan Charlish, Anna Koper, Anna Wlodarczak-Semczuk; Editing by Jan Harvey and Frank Jack Daniel)

French refurbished smartphone seller Back Market valued at $5.7 billion

PARIS (Reuters) – Back Market, the French marketplace dedicated to refurbished smartphones and electronic devices, said on Tuesday it had closed an investment round of $510 million, bringing its total valuation to $5.7 billion.

“The (…) funding cements Back Market’s position as a leading refurbished electronics marketplace, with more than six million customers worldwide,” the company said in a statement.

The latest investment round was led by London-based private equity firm Sprints Capital, together with France’s Eurazeo and Aglae Ventures, General Atlantic and Generation Investment Management.

Back Market said the additional funding would help it in its bid to make circular technology – or tech products that can be reused and are more sustainable – mainstream and tap into growing demand among consumers for such products.

(Reporting by Mathieu Rosemain, Writing by Benoit Van Overstraeten; Editing by Susan Fenton)

Scotland to begin easing Omicron restrictions – Sturgeon

LONDON (Reuters) – Scotland will start lifting coronavirus measures that were introduced late last year, starting with the removal of limits on crowds at large outdoor events like soccer and rugby matches, Scottish First Minister Nicola Sturgeon said on Tuesday.

In December, Scotland went further than Prime Minister Boris Johnson did in England to slow the spread of the Omicron variant. This included Scotland’s semi-autonomous government imposing restrictions on venues and large events.

Sturgeon said the public’s behaviour and the booster programme had helped avert the worst case projections given last month, when Scotland cancelled New Year’s Eve celebrations.

“From next week, we will begin to lift the measures introduced before Christmas, but we will do so in a phased and careful way, starting with the removal of attendance limits on live outdoor events from Monday,” Sturgeon told parliament.

Sturgeon also said that, while the situation was undoubtedly serious, the rate of increase in hospitalisations was starting to slow.

She also announced a change to the vaccine certification that is needed to get into some venues in Scotland.

Now it requires booster dose rather than just the initial two-dose vaccination needed previously, if the second dose was more than 4 months ago, although a negative lateral flow test can also be used, Sturgeon said.

(Reporting by Alistair Smout; editing by William James)

Fed’s Mester would back March rate hike to fight inflation

By Jonnelle Marte

(Reuters) -The Federal Reserve may need to raise interest rates at least three times this year and begin running down its balance sheet to respond to a tight labor market and inflation that is persistently high and more broad-based, Cleveland Fed President Loretta Mester said on Tuesday.

“If the economy in March looks like it does today and the outlook is similar … then I would support moving the funds rate up at that meeting and starting to move back from some of the extraordinary accommodation we needed earlier in the pandemic,” Mester said during an interview with Bloomberg TV.

Final decisions on monetary policy will depend on what is happening with the economy and be based on how the coronavirus pandemic plays out, Mester said. But Fed officials may need to recalibrate policy now to address inflation that is “well above” the U.S. central bank’s target, she said.

Mester said she expects more workers to return to the labor market and for the labor force participation rate to rise over time, but added that policymakers cannot ignore the “tightness” that is playing out in the short term.

Fed officials are expected to begin debating strategies for removing the accommodation provided during the pandemic when they gather for their next policy meeting in two weeks. That involves raising interest rates and creating a plan for reducing the central bank’s more than $8 trillion in bond holdings.

Mester said she thinks the Fed may be able to move more quickly when running down its balance sheet now than it has in the past because the economy is strong and its bond holdings are larger than they were previously.

“I’d like to … set a path for the balance sheet,” Mester said. “That will reduce accommodation and then we’ll use our policy tool, the Fed funds rate, as our active tool.”

(Reporting by Jonnelle MarteEditing by Paul Simao)

Abbott Labs CEO expects strong COVID-19 testing demand in near term

(Reuters) – Abbott Laboratories Chief Executive Officer Robert Ford said on Tuesday demand for COVID-19 testing has surged globally and that sales of its tests should stay strong in the near term.

“We’ve obviously you know, had a pretty, pretty strong last couple of months of testing and we expect that to continue here in the more immediate future,” Ford said at the annual J.P. Morgan Health care conference.

He added his company has the capacity to support demand.

While testing demand will eventually dwindle, there will be a portion that is sustained, Ford said.

(Reporting by Amruta Khandekar; Editing by Aditya Soni)

Russia holds live-fire military drills in regions near Ukraine – Ifax

MOSCOW (Reuters) – Three thousand Russian troops began live-fire exercises with hardware including tanks in western Russia on Tuesday, including in areas close to Ukraine, Interfax news agency quoted the military as saying.

Russia has perturbed the West by building up troops near Ukraine and demanded that Washington pledge not to ever let Ukraine join NATO or expand the military alliance eastward, a stipulation that the United States refuses to accept.

The announcement of the drills came a day after Russia and the United States held talks on Moscow’s security proposals. The Kremlin said on Tuesday they had given no cause for optimism about a potential breakthrough.

Interfax quoted the Western Military District as saying the exercises would take place in Smolensk region near the Belarusian border and in the Voronezh, Belgorod and Bryansk regions closer to Ukraine.

It said that 300 pieces of military hardware would be involved, including T-72B3 tanks, BMP-2 infantry fighting vehicles and regular firearms.

It said the exercises would practice firing from armoured vehicles and firearms, organising marches during active enemy sabotage and reconnaissance activity, and equipping strongholds.

“Each unit will complete the manoeuvres by conducting a training battle with a live firing stage during which… BMP-2 armoured vehicles and T-72B3 tanks will show their joint action skills and hit targets imitating the adversary’s vehicles and soldiers at ranges up to 1,200 metres,” the military was quoted as saying.

Washington has urged Moscow to reverse its build-up of an estimated 100,000 troops near the border with Ukraine, which has prompted Ukrainian and Western concerns about a possible new invasion, eight years after Russia seized Crimea from Ukraine.

Moscow has said it has no intention of attacking and has every right to move around its soldiers on its own territory and to carry out military drills as it sees fit.

(Reporting by Tom Balmforth; editing by Mark Trevelyan)