A Wall Street sign is pictured outside the New York Stock Exchange in New York, October 28, 2013. REUTERS/Carlo Allegri/File Photo Acquire Licensing Rights
Sept 22 (Reuters) – Shares in real estate companies fell on Friday, adding to a massive sell-off the previous day, when bond yields jumped to their highest levels in 16 years after the Federal Reserve signaled that U.S. interest rates would stay high for longer.
The S&P 500 real estate index (.SPLRCR) lost 0.7% on Friday after falling 3.5% on Thursday, which was its biggest daily decline since March when the banking sector was in crisis.
The U.S. Treasury 10-year yield , fell slightly on Friday, after rising on Thursday to around 4.5%, its highest since 2007. This provided tempting returns for fixed-income assets, making the relatively high dividend payouts of Real Estate Investment Trusts (REITs) a little less tempting.
REITs also tend to borrow heavily so the prospect of higher rates for longer puts pressure on their profit outlook. While the Fed decided not to hike interest rates after its meeting on Wednesday, it indicated that rates could stay at elevated levels for longer than investors had expected.
“Not only are REIT’s bond substitutes but they also rely on borrowing so that just makes them doubly interest-rate-sensitive,” said Jack Ablin, chief investment officer of Cresset Capital who says that even though the sector seems cheap by some measures, he is not ready to step in right now.
The S&P 500 real estate index is the second weakest performer among the benchmark S&P 500’s 11 major sectors with a decline 6.5% so far this year, second only to utilities’ (.SPLRCU) 10.3% drop. This compares with year-to-date a gain of about 15% for the benchmark index.
But Gina Szymanksi, portfolio manager for REITs at AEW Capital Management, said she expects Treasury yields will peak around current levels, which will help REIT stocks that have “already baked in” 10-year Treasury yields in this range.
“The knee-jerk reaction is, as interest rates rise, you sell REITs. It’s not totally unrealistic. They are capital intensive businesses that require financing,” said Szymanski, adding that if 10-year yields rise sharply from here it would add pressure to REIT stocks.
But if the economy weakens, REITs often outperform.
“When the Fed tries to slow the economy, it’s usually successful. That usually results in declining earnings for companies in general and when that happens it’s the time for REITs to shine,” says Szymanksi who estimates a roughly 20% total return for real estate stocks in the next two years.
On Friday the biggest real estate loser was American Tower (AMT.N), which finished down 1.8% while the biggest gainer was Extra Space Storage (EXR.N), up 1.2%.
Alexandria Real Estate Equities (ARE.N) fell 1.6% on Friday, after losing 8% on Thursday and hitting its lowest level since 2016.
Reporting By Sinéad Carew, editing by Lance Tupper and David Gregorio
Our Standards: The Thomson Reuters Trust Principles.
BAMAKO, Sept 11 (Reuters) – Sky Mali, the only commercial airline flying to Timbuktu in Mali’s interior, has cancelled flights there due to insecurity, it said on Monday, deepening the isolation of the northern city which has been under a month-long Islamist blockade.
Timbuktu, a UNESCO World Heritage site and ancient trading centre on the edge of the Sahara desert, has been suffering from a shortage of food and aid supplies since a local affiliate of al Qaeda cut off access by road and river in mid-August.
Two residents told Reuters that they heard shell fire near the city’s airport on Monday morning.
Sky Mali later issued a statement saying it had suspended all flights to and from Timbuktu until further notice, citing a security alert.
“We heard several shell shots at Timbuktu airport. Flights are cancelled,” said resident Mohamed Ag Hamaleck.
“Now Timbuktu is completely closed. The access roads are cut, the boats no longer come,” he said by phone.
The city has been surrounded by violence ever since French forces liberated it from militants in 2013 after an uprising. The Islamists later regrouped and have spread from northern Mali to neighbouring Burkina Faso and Niger.
The European Union said last week that the blockade had extended to more localities in the Timbuktu region, including Rharous, Niafounké, Goundam, Diré, Tonka, Ber and Léré.
“Civilians do not have access to essential products and basic social services,” the EU’s humanitarian branch ECHO said in a note.
Insecurity in Mali has intensified over the past year after the West African country’s military leaders kicked out French troops, asked United Nations’ peacekeepers to leave, and teamed up with Russian private military contractors Wagner Group.
An al Qaeda-linked group claimed responsibility on Friday for a suicide attack on a military base in northeastern Mali, a day after authorities blamed the group for carrying out a dual assault on another military camp and on a boat that killed more than 60 people.
Reporting by Tiemoko Diallo; Additional reporting and writing by Nellie Peyton; Editing by Edward McAllister and Hugh Lawson
Our Standards: The Thomson Reuters Trust Principles.
LONDON, July 6 (Reuters) – Iran’s Revolutionary Guards “forcibly seized” a commercial ship in international waters in the Gulf on Thursday and the vessel was possibly involved in smuggling, a U.S. Navy spokesperson said.
The U.S. Navy had monitored the situation and decided not to make any further response, U.S. 5th Fleet spokesperson Commander Tim Hawkins said.
British maritime security company Ambrey said it was aware of an attempted seizure by Iranian forces of a small Tanzanian flagged tanker, around 59 nautical miles northeast of the Saudi Arabian port city of Dammam.
“Iran regularly intercepts smaller tankers it suspects of smuggling oil,” the company added in a note.
About a fifth of the world’s supply of seaborne crude oil and oil products passes through the Strait of Hormuz, a chokepoint between Iran and Oman, according to data from analytics firm Vortexa.
The U.S. Navy said on Wednesday that it had intervened to prevent Iran from seizing two commercial tankers in the Gulf of Oman, in the latest in a series of attacks on ships in the area since 2019. read more
“U.S. forces remain vigilant and ready to protect navigational rights of lawful maritime traffic in the Middle East’s critical waters,” Hawkins said.
Iran said on Thursday it had a court order to seize one of the tankers sailing in Gulf waters on Wednesday after it collided with an Iranian vessel. The vessel, the Bahamas-flagged Richmond Voyager, was managed by U.S. oil major Chevron (CVX.N). read more
Tehran seized two other tankers in May including the Marshall Islands flagged Advantage Sweet, which had been chartered by Chevron. read more
Since 2021, “Iran has harassed, attacked or seized nearly 20 internationally flagged merchant vessels”, the U.S. Navy said this week.
Reporting by Jonathan Saul; Editing by Hugh Lawson and Andrew Heavens
Our Standards: The Thomson Reuters Trust Principles.
[1/4]A still image obtained from a handout video which captured M/T Richmond Voyager being approached by an Iranian naval vessel during an attempt to unlawfully seize the commercial tanker, according to U.S. Navy, in the Gulf of Oman, provided by U.S. Navy on July 5, 2023. U.S. Naval Forces Central…
DUBAI, July 5 (Reuters) – The U.S. Navy said it had intervened to prevent Iran from seizing two commercial tankers in the Gulf of Oman on Wednesday, in the latest in a series of attacks on ships in the area since 2019.
In a statement, the U.S. Navy said that at 0100 local time (2100 GMT), an Iranian naval vessel had approached the Marshall Islands-flagged oil tanker TRF Moss in international waters in the Gulf of Oman.
“The Iranian vessel departed the scene when U.S. Navy guided-missile destroyer USS McFaul arrived on station,” the statement said, adding that the Navy had deployed surveillance assets including maritime patrol aircraft.
The Navy said that around three hours later it received a distress call from Bahamas-flagged oil tanker Richmond Voyager while the ship was more than 20 miles (32 km) off the coast of Muscat, Oman, and transiting international waters.
“Another Iranian naval vessel had closed within one mile of Richmond Voyager while hailing the commercial tanker to stop,” the Navy statement said, adding that the McFaul directed course towards the merchant ship at maximum speed.
“Prior to McFaul’s arrival on scene, Iranian personnel fired multiple, long bursts from both small arms and crew-served weapons,” the Navy said.
“Richmond Voyager sustained no casualties or significant damage. However, several rounds hit the ship’s hull near crew living spaces. The Iranian navy vessel departed when McFaul arrived.”
U.S. oil major Chevron (CVX.N) confirmed that it managed the Richmond Voyager, that crew onboard were safe and the vessel was operating normally.
The TRF Moss’ manager is listed in public database Equasis as Singapore-based Navig8 Chemicals Asia, but Navig8 told Reuters it was not connected with the tanker. The vessel’s manager could not be immediately located.
NO IRANIAN COMMENT
Iran’s state news agency IRNA said on Wednesday that Iranian authorities have not commented yet on the matter.
“The United States will respond to Iranian aggression together with our global allies and our partners in the Middle East region to ensure the freedom of navigation through the Strait of Hormuz and other vital waterways,” a spokesperson for the White House National Security Council said.
Vice Admiral Brad Cooper, commander of U.S. Naval Forces Central Command, cited “the exceptional effort by the McFaul crew for immediately responding and preventing another seizure”.
Since 2019, there has been a series of attacks on shipping in strategic Gulf waters at times of tension between the United States and Iran.
Iran seized two oil tankers in a week just over a month ago, the U.S. Navy said.
“Since 2021, Iran has harassed, attacked or seized nearly 20 internationally flagged merchant vessels, presenting a clear threat to regional maritime security and the global economy,” the Navy statement added.
About a fifth of the world’s supply of seaborne crude oil and oil products passes through the Strait of Hormuz, a chokepoint between Iran and Oman, according to data from analytics firm Vortexa.
Refinitiv ship-tracking data shows the Richmond Voyager previously docked in Ras Tannoura in eastern Saudi Arabia before Wednesday’s incident in the Gulf of Oman.
The Richmond Voyager was now leaving the Gulf with Singapore listed as its destination, Refinitiv ship tracking showed.
Top ship registries including the Marshall Islands and Greece have warned in recent weeks of the threat to commercial shipping in the Gulf including the Strait of Hormuz.
In another point of tension, the U.S. confiscated a cargo of Iranian oil aboard a tanker in April in a sanctions enforcement operation, sources told Reuters.
That vessel, the Marshall Islands-flagged Suez Rajan, is anchored outside the U.S. Gulf of Mexico terminal of Galveston waiting to discharge its cargo, according to Refinitiv ship tracking.
Reporting by Lisa Barrington and Jonathan Saul; Additional reporting by Dubai bureau and Rami Ayyub in Washington; Editing by Jason Neely, Mark Heinrich and David Holmes
Our Standards: The Thomson Reuters Trust Principles.
WASHINGTON, June 28 (Reuters) – The United States and China agreed to consider expanding commercial flights between the two countries to improve people-to-people contact, the top U.S. diplomat for East Asia, Daniel Kritenbrink, said on Wednesday.
He told a Center for Strategic and International Studies think tank event in Washington that the countries agreed “to look at increasing in a phased manner the number of commercial flights between the United States and China.”
There were about 350 flights a week between the U.S. and China prior to the coronavirus outbreak, compared to 24 a week currently, Kritenbrink said.
“I think we can do better,” he added.
He said the agreement was reached during Secretary of State Antony Blinken’s visit to China earlier this month. During the trip, Washington and Beijing failed to produce any major breakthrough in their rivalry but agreed to stabilize relations. Soon after Blinken’s trip, U.S. President Joe Biden referred to Chinese President Xi Jinping as a dictator.
After the start of the COVID-19 pandemic in 2020, the two countries restricted flights and travel to prevent the spread of the disease, and air service has not been fully restored.
Kritenbrink said he wanted to see an imbalance reversed in the number of Chinese students in the United States and American students in China, which he put at 300,000 Chinese students to 350 U.S. students.
During Wednesday’s event, Kritenbrink described China’s actions in the South China Sea as coercive.
Reporting by Kanishka Singh, David Brunnstrom and Michael Martina in Washington; Editing by Cynthia Osterman
Our Standards: The Thomson Reuters Trust Principles.
BEIJING, May 26 (Reuters) – China Eastern Airlines, the initial customer for the country’s homegrown narrow-body jet C919, will launch the plane’s first commercial flight on Sunday, the carrier’s app showed on Friday.
The C919 flight will take off as flight number MU9191 at 10:45 a.m. Beijing time (0245 GMT) from Shanghai Hongqiao International Airport and arrive in Beijing Capital Airport at 1:10 p.m.
The commercial operation of the C919 marks a milestone in the country’s hopes that the plane will break the longtime Airbus-Boeing duopoly in the world’s airline manufacturing industry.
Manufactured by Commercial Aviation Corp of China (COMAC) to rival the Airbus (AIR.PA) A320neo and Boeing (BA.N) 737 MAX single-aisle jet families, the C919 has made many flights without passengers.
China Eastern (600115.SS) said on Thursday that C919 would be put into operation “in near future” and the plane will operate commercially with Shanghai as its main base. The airline did not immediately respond to a request for comment on Friday.
On Tuesday the Shanghai Stamp Collecting Corporation said a promotional stamp would commemorate the first flight of C919 on Sunday.
China Eastern signed a contract for five C919s in March 2021 in the first commercial deal for the plane. The Shanghai-headquartered carrier received its first C919, numbered B-919A, in December and began 100 hours of empty aircraft verification test flights.
China’s Xinhua state news agency had said last year that the C919 would make its first commercial flight in the spring.
The 164-seat aircraft comes with a two-class cabin layout, consisting of business and economy seats.
Although the C919 is assembled in China, it relies heavily
on Western components, including engines and avionics, from
companies including GE (GE.N), Safran (SAF.PA) and Honeywell
International (HON.O).
Reporting by Albee Zhang, Sophie Yu and Brenda Goh; Editing by Jacqueline Wong and Gerry Doyle
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BERLIN, May 9 (Reuters) – Porsche (P911_p.DE) will incorporate automated assistance and navigation functions from Mobileye’s (MBLY.O) so-called “SuperVision” technology platform in future models, Mobileye said on Tuesday.
The agreement is the technology provider’s second large signing for the platform with a major automotive group after China’s Geely (GEELY.UL).
Volkswagen Commercial Vehicles, which was previously going to use technology from Pittsburgh-based self-driving startup, Argo AI for self-driving shuttles and vans, will also partner with Mobileye, a spokesperson said.
Volkswagen pulled out of its planned investment in Argo AI last October and said at the time its commercial vehicles unit would seek a new partnership.
Together with Mobileye, the unit will seek to implement so-called “Level 4” autonomous driving – considered fully autonomous, though humans can still request control – in its ID. Buzz by 2025.
Porsche, by contrast, will implement Mobileye’s “SuperVision” system, which allows drivers to take their hands off the wheel in certain road types and enables the car to follow navigation routes chosen by the driver, change lanes and overtake slower vehicles ahead.
Israel-based Mobileye, which went public last October, already cooperates with Volkswagen’s software unit Cariad.
The news of the expanded collaboration comes a day after Cariad overhauled its leadership team and said it would broaden its partnership base, as the unit attempts to get back on track after years of delays and overspending.
Reporting by Victoria Waldersee and Jan Schwartz, Editing by Rachel More
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HODEIDAH, Yemen, Feb 26 (Reuters) – A container ship carrying general commercial goods docked at Yemen’s main port of Hodeidah for the first time since at least 2016 on Saturday as parties in Yemen’s eight-year war are in talks to reinstate an expired U.N.-brokered truce deal.
The conflict, which pits a military coalition led by Saudi Arabia against the Iran-aligned Houthi group, has divided Yemen and caused a humanitarian crisis that has left 80% of the 30 million population needing help.
Goods arriving at Hodeidah have to be vetted by a U.N. body established to prevent arms shipments from entering Yemen. In the past seven years, Djibouti-based UNVIM has given approval only to ships carrying specific goods like foodstuffs, fuel and cooking oil.
An official in the internationally recognised Yemeni government told Reuters granting access to commercial ships was a trust-building step aimed at supporting Saudi-Houthi talks to reinstate the truce, which expired in October.
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Port officials said the SHEBELLE, which according to ship tracking data is an Ethiopian-flagged general cargo ship, was given clearance by United Nations inspection body, the Verification and Inspection Mechanism for Yemen (UNVIM).
“The mechanism previously only provided clearance for specific shipments but now UNVIM is granting clearances for all kinds of shipments to Hodeidah port,” said Muhammad Abu-Bakr bin Ishaq, head of Houthi-run Red Sea Ports Corporation.
He did not say what cargo the ship was carrying.
[1/2] Commercial ships are docked at the Houthi-held Red Sea port of Hodeidah, Yemen February 25, 2023. REUTERS/Khaled Abdullah
He told Reuters increased flow of goods into the western port would reduce transportation costs for products, given most were entering via government-held Aden port in the south.
UNVIM did not immediately respond to a Reuters request for comment. The spokesperson for the Saudi-led military coalition that patrols the waters off Yemen did not respond.
Reuters saw three container vessels docked on Saturday.
The military alliance intervened in Yemen in March 2015 after the Houthis ousted the Saudi-backed government from the capital, Sanaa.
Djibouti-based UNVIM, which began operations in May 2016, was set up as the coalition accused the Houthis, de facto authorities in North Yemen, of smuggling Iranian arms. The Houthis and Tehran deny the charges.
Direct talks between Saudi Arabia and the movement, facilitated by Oman, are parallel to U.N.-led efforts to restore the truce, which has largely held, establish a formal ceasefire and launch inclusive political negotiations.
The war has killed tens of thousands of people, destroyed Yemen’s economy and left millions hungry. The Houthis say they are fighting a corrupt system and foreign aggression.
Reporting by Khaled Abdullah and Adel Al-Khadher in Hodeidah and Mohammed Alghobari in Aden; Writing by Ghaida Ghantous;
Editing by Raissa Kasolowsky
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MUMBAI, Feb 14 (Reuters) – Two large companies within India’s embattled Adani Group are likely to repay their short-term commercial paper (CP) debt as they come due over the next few months, instead of rolling them over as is normal, two merchant bankers and a company official directly familiar with the matter said.
The two group companies have about 50 billion rupees ($605 million) worth of CP due to mature through March, data shows, while exchange data shows the flagship Adani Enterprises Ltd (ADEL.NS) has redeemed a total of 2.5 billion rupees of CP since Jan. 25.
That is a day after U.S. short-seller Hindenburg Research accused the group of improper use of offshore tax havens and stock manipulation – allegations the group has denied – that sparked about a $120 billion loss in the group’s market value on concerns including about its ability to refinance debt.
Adani Enterprises and Adani Ports and Special Economic Zone Ltd (APSE.NS) regularly raise funds by issuing CPs – short-term debt instruments issued to meet working capital requirements.
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“We will repay the CPs as and when they mature and are currently not looking to tap the short-term debt market,” an official with one of the companies said on condition of anonymity as they are not authorised to speak to the media.
The official said payments are being made as the securities mature and the company has not got any requests for early redemptions.
“All payments are being made as per schedule,” an Adani group spokesperson said in an e-mail, but did not respond to queries on whether investors are seeking early redemption.
Adani Ports has CPs worth 35 billion rupees due to mature through end March, data from information service provider Prime Database showed.
Adani Enterprises has CP worth close to 15 billion rupees due to mature over February-March and more than 2 billion rupees worth due for redemption from April through January 2024, the data showed.
The Adani Group is unlikely to roll over this debt as it comes due, two bankers said on condition of anonymity as they are not permitted to speak to the media.
“Market sentiment is such that people will be cautious to immediately roll over CPs, and would prefer to cash out. So, we may see them (Adani Group) staying away from the market for some time,” said one banker, who regularly arranges debt issuances for the group.
A second banker, who advises the conglomerate on local borrowings, added the group has not reached out to its bankers asking for a rollover.
“The Adani group generally gets in touch with bankers some days prior to the maturing CPs but has stopped any sort of intimation, hinting that they may look to repay the existing CP holders,” this person said.
Apart from short-term borrowings, Adani Enterprises has not moved forward with plans to launch its debut retail bond issue of up to 10 billion rupees, while Adani Green Energy Ltd (ADNA.NS) has also stayed put on a planned 1.5-billion rupee, 10-year bond offering, according to bankers, including the two mentioned earlier.
“There’s been no communication from the companies on previously proposed bond issuances,” said a merchant banker with a brokerage firm and directly involved in the arrangement.
The Adani Group spokesperson denied media reports that these bond issues have been scrapped, saying this is “speculation” and “not true” in a reply to Reuters’ mail.
($1 = 82.6390 Indian rupees)
Reporting by Bhakti Tambe; Editing by Savio D’Souza
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Jan 31 (Reuters) – Japanese trading firm Marubeni Corp (8002.T) started commercial operation based on the feed-in tariff program for renewable energy at Akita Port offshore wind farm on Tuesday, it said in a statement.
Japan’s offshore wind power market, part of the country’s goal to be carbon neutral by 2050, is set to grow as the government eyes installing up to 10 gigawatts of offshore wind capacity by 2030, and up to 45 gigawatts by 2040.
Marubeni’s 100 billion yen ($768 million) project of two wind farms with 140 megawatt capacity at Akita Port and Noshiro Port in northern Akita prefecture is Japan’s first large-scale commercial offshore wind power project.
With its Noshiro Port offshore wind farm operating since late December last year, the launch of the Akita Port farm brings the project to the full-scale operation, Marubeni said.
Power from the two wind farms will be sold to Tohoku Electric Power for 20 years under a power purchase agreement based on the feed-in tariff program.
Marubeni’s 12 partners include Obayashi Corp, Tohoku Sustainable & Renewable Energy Co, Cosmo Eco Power Co, Kansai Electric Power Co and Chubu Electric Power Co.
($1 = 130.2900 yen)
Reporting by Katya Golubkova, Editing by Louise Heavens
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