SYDNEY (Reuters) – Asian shares retreated from a record peak on Monday after a Reuters report the United States was preparing to impose sanctions on some Chinese officials highlighted geopolitical tensions, while oil prices fell on surging virus cases.
In a signal markets elsewhere would start weaker, eurostoxx 50 futures were 0.4% down, futures for Germany’s DAX eased 0.3% while those of London’s FTSE were flat. E-Mini futures for the S&P 500 slipped 0.2%.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.1% following four straight sessions of gains. The index hit a record high of 644.3 points early on Monday.
It is up about 16% so far this year, the best since a 33% jump in 2017.
China’s blue-chip index dropped 0.8%, largely ignoring strong export data, while Hong Kong’s Hang Seng was down 1.7%.
Japan’s Nikkei declined 0.46% while Australian shares were up 0.6%.
The sell-off began after Reuters exclusively reported, citing sources, that the United States was preparing sanctions on at least a dozen Chinese officials over their alleged role in Beijing’s disqualification of elected opposition legislators in Hong Kong.
The move comes as President Donald Trump’s administration keeps up pressure on Beijing in his final weeks in office.
“One thing that the market has been concerned about is that on his (way) out of office Trump would look for some retribution on China. So this news speaks to that fear,” said Kyle Rodda, market strategist at IG Markets in Melbourne.
“At the end of the day, the market knows he only has six weeks left. The broader focus is still on vaccine roll-outs and U.S. fiscal stimulus.”
Asian markets had initially started higher on hopes of a faster global recovery as coronavirus vaccines get rolled out, starting this week in Britain.
U.S. authorities will also this week discuss the programme before the expected first round of vaccinations this month.
Hopes the vaccines will help curb the pandemic, which has so far killed more than 1.5 million people globally, sent shares soaring in recent weeks.
On Wall Street, stock indexes reached fresh all-time highs on Friday with the Dow rising 0.8%, the S&P 500 gaining 0.9% and the Nasdaq adding 0.7%.
“The vaccine will break the link between mobility and infection rate, allowing for the strongest global GDP growth in more than two decades,” JPMorgan analysts wrote in a note, forecasting global growth of 4.7% in 2021.
Still, expectations of a U.S. stimulus aid package gathered pace after weak payrolls data last week, following months of deadlocked negotiations.
The U.S. economy added the fewest workers in six months in November, with nonfarm payrolls increasing by 245,000 jobs last month, much lower than expectations for a 469,000 increase.
A bipartisan group of Democrats and Republicans proposed a compromise $0.9 trillion package that leaders on both sides appear open to agreeing to.
In currencies, investor focus is on a last-ditch attempt by Britain and the European Union to strike a post-Brexit trade deal this week, with probably just days left for negotiators to avert a chaotic parting of ways at the end of the year.
If there is no deal, a five-year Brexit divorce will end messily just as Britain and its former EU partners grapple with the severe economic cost of the COVID-19 pandemic.
The pound was a shade weaker at $1.3419 while the single currency was up 0.1% at $1.2133, not too far from an April 2018 high of $1.2177.
The risk sensitive Australian dollar was up 0.1% at $0.7433.
That left the U.S. dollar down 0.1% at 90.702 against a basket of major currencies, after hitting a 2-1/2-year low last week.
In commodities, oil prices slipped from their highest levels since March as a continued surge in coronavirus cases globally forced a series of renewed lockdowns, including strict new measures in Southern California.
U.S. crude was off 24 cents at $46.02 per barrel and Brent was down 26 cents at $48.99. Brent has lost about a quarter of its value so far this year.
Spot gold, which hit a record high of $2,072.49 an ounce, was last at $1,838.9, still up a hefty 21% this year.
Editing by Lincoln Feast and Jacqueline Wong
Lufthansa sets 2024 goal, eyes capital increase
Germany’s flagship carrier Deutsche Lufthansa said it aims to boost its return on capital employed (ROCE) and laid out plans for a capital increase as it prepares for a business recovery amid an easing coronavirus pandemic.
The largest German airline aims to have an adjusted EBIT margin of at least 8% and an adjusted ROCE of at least 10% in 2024, it said late on Monday.
Adjusted ROCE was –16.7% in 2020 and 6.6% in 2019.
The group added it had mandated banks to prepare a possible capital increase, though size and timing have not yet been determined and the German state, which has bailed out the airline during the pandemic, has not yet given its approval.
(Reporting by Ludwig Burger; editing by Jonathan Oatis)
Virtual Law Firms Are on the Rise in Canada
Virtual law firms have been on the rise for a while. In a 2019 roundtable discussion conducted by the American Bar Association, several firm leaders met to discuss the growing presence of online legal services. The consensus was clear: virtual is the new reality.
That was 2019. In the intervening two years, the world was gripped by a global pandemic that forced most people to conduct their business indoors. As you might have guessed, demand for contactless, remote legal services has only ballooned since that roundtable discussion.
While the roundtable primarily focused on the legal industry in the US, you can witness similar trends here in Canada. Like the taxi industry and entertainment distribution industry before it, law is increasingly moving toward digital spaces.
This article explores what virtual law firms are, what benefits they present for Canadian clients, and what kind of clients are driving the virtual law boom.
Not a Change but an Addition
At its best, the shift from brick-and-mortar law firms to virtual isn’t an alteration of legal services as much as it is an addition.
The best virtual law firms do not compromise on service – they still offer traditional legal services with the expertise of real lawyers. The only difference is that they have added a new medium: a more accessible, transparent means of communication and billing.
Why Canadians Choose Online Law Firms
For some clients, the traditional brick-and-mortar firm was hard to give up. They viewed their lawyer like they viewed their doctor: a professional whose in-person expertise couldn’t be replicated in a digital space. Then, the pandemic hit. As millions more Canadians acclimatized to working online, they also habituated to the idea of doing business online.
The benefits were immediately apparent. Virtual law firms feature streamlined communication, available seven days a week. They eliminate the need to go to a physical office. They offer all the same legal expertise and services as a brick-and-mortar lawyer. And, crucially, they often leverage transparent pricing: flat, predetermined legal fees with no hidden costs. A client looking for affordable legal services in Mississauga or Toronto, for instance, can simply click a few buttons and hire a lawyer on the spot.
Who Is Using These New Services?
You might be wondering: do they wheel a computer into the courtroom when someone avails themselves of a virtual lawyer? No, that isn’t quite the case.
Clients tend to use virtual law firms for everyday legal services – not necessarily courtroom representation. A client looking to create a will or name a power of attorney might choose a virtual lawyer for the sake of simplicity. A homebuyer, looking to keep costs manageable might hire a virtual lawyer for closing since their prices are both more transparent and affordable. A couple seeking to draft a cohabitation agreement may find similar benefits in an online lawyer.
The fact is that virtual legal services are not only here to stay – they are on the rise. Fortunately, the future is friendly; online law firms offer the same legal expertise as their physically housed counterparts, with the added benefits of being accessible and affordable.
Tourmaline to expand in Montney with C$1.1 billion deal for Black Swan
Canada‘s Tourmaline Oil Corp said on Friday it would buy privately owned Black Swan Energy Ltd in a C$1.1 billion ($908.79 million) deal, as the oil and gas producer looks to expand in the Montney region, one of North America’s top shale plays.
Tourmaline said the deal represents a key part of its ongoing North Montney consolidation strategy and the company sees the area as a key sub-basin for supplying Canadian liquefied natural gas.
The company in April acquired 50% of Saguaro Resources Ltd’s assets in the Laprise-Conroy North Montney play for $205 million and entered into a joint-venture agreement to develop these assets.
Analysts at brokerage ATB Capital Markets called the Black Swan assets a “hand in glove” fit with its recent acquisitions.
Tourmaline stock rose 4.5% to C$32.1.
The deal value consists of 26 million Tourmaline shares and a net debt of up to $350 million, including deal costs.
Tourmaline will acquire an expected average production capacity of over 50,000 boepd when the deal closes, likely in the second half of July.
The company, which also raised its dividend by 1 Canadian cent per share, expects the Black Swan assets to generate free cash flow of $150 million to $200 million in 2022 and beyond.
The Canadian energy sector has seen a flurry of deals with companies expecting to benefit from the rebound in oil prices as global fuel demand picks up.
ARC Resources Ltd in April bought Seven Generations Energy Ltd for C$2.7 billion to create Montney’s largest oil and gas producer.
($1 = 1.2104 Canadian dollars)
(Reporting by Rithika Krishna in Bengaluru; Editing by Vinay Dwivedi)
Lufthansa sets 2024 goal, eyes capital increase
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