27/08/2025

BIZ & FINANCE WEDNESDAY | AUG 27, 2025

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Mercedes-Benz said to have sold Nissan stake for ¥47.8 billion TOKYO: The pension trust of German automaker Mercedes-Benz has sold its stake in Japan’s Nissan Motor for ¥47.83 billion (RM1.36 billion), a source with direct knowledge of the matter said yesterday. Shares of the Japanese automaker held on to their losses of about 6% from earlier in the session, following Mercedes-Benz’s announcement on Monday that it would sell its 3.8% stake. The stock was headed for its worst day since July. The slide in Nissan shares since the news highlights investor scepticism over the company’s turnaround prospects as it battles tariffs and falling sales in its key markets, the United States and China. The firm booked a US$535 million loss for the three months ended June. Mercedes-Benz sold its Nissan shares at ¥ 341.3 apiece, a 5.98% discount to Nissan’s Monday close of ¥ 363, according to the source. The shares were offered at a price range of ¥ 337.5 to ¥ 341, a term sheet seen by Reuters showed. Demand outstripped the number of shares placed for sale, the source said on condition of anonymity as the information was confidential. The top ten investors in the deal were allocated about 70% of the shares sold, the source added. On Monday, a spokesperson for the German automaker had said the Nissan stake, which was transferred to its pension assets in 2016, was not of strategic importance and described the sale as cleaning out its portfolio. Nissan CEO Ivan Espinosa has unveiled a turnaround plan to restore profitability, which includes measures such as cutting global production capacity to 2.5 million vehicles from 3.5 million. – Reuters Iron ore giant Fortescue reports profit plunge SYDNEY: Australian iron ore mining giant Fortescue reported yesterday a plunge in annual net profits at a time of slumping prices for the country’s biggest export commodity. The company, run by billionaire Andrew Forrest, said sales and profits fell despite record volumes of iron ore shipments in the year to June 30. Revenue dropped 14.7% to US$15.5 billion (RM65 billion) in the year, it said, as average income per tonne for its hematite iron ore fell 18%. Net profit dived 40.6% to US$3.4 billion. Most of Australia’s iron ore exports head to China to feed steel production, making the commodity’s price highly sensitive to any slowdown in Chinese economic activity. Australian mining group BHP last week said it, too, was hit by falling iron ore prices but it still managed to lift yearly profits helped by China’s appetite for copper. Despite the drop in sales and profit, Fortescue’s metals and operations chief Dino Otranto said it had delivered “another strong set of results”, citing record iron ore shipments and low costs. – AFP

The German share price index DAX graph is pictured at the stock exchange in Frankfurt. – REUTERSPIC

Stocks down after Trump fires Fed governor

was Trump’s Monday announcement that he was removing Federal Reserve governor Lisa Cook, citing allegations of false statements on her mortgage agreements. The highly unusual step – which will likely face a legal challenge – comes as worries grow about the independence of the central bank, fuelled by Trump’s repeated public demands to Powell to lower interest rates. The dollar fell following the news, then mostly recovered after Cook issued a statement vowing to continue in her role. Gold – widely perceived as a safe storage of wealth – advanced.

but be in no doubt that we are witnessing a regime shift like we have not seen in decades,” he added, referring to an upcoming Fed gathering at which officials will make a decision on rates. Trump also vowed on Monday to impose “substantial additional tariffs” on shipments from countries that do not cancel digital taxes and regulations, which he said were “designed to harm” US technology. He added a threat to introduce export restrictions on “highly protected (US) technology and chips”, without offering further details.

o President also threatens tariffs on countries seen targeting US tech firms

HONG KONG: Global stocks retreated yesterday after a series of market-rattling announcements by US President Donald Trump, including an unusual move to fire a central bank official and threats to impose new export controls and tariffs. Traders had been riding a wave of confidence since Friday’s speech by US Federal Reserve Chairman Jerome Powell, which suggested coming interest rate cuts in the world’s largest economy. But the upward flurry appeared to die out on Wall Street on Monday as attention turned to this week’s earnings report from AI chip giant Nvidia – a bellwether for the industry TOKYO: Japan’s Finance Ministry is planning to request a record ¥32.4 trillion (RM927 billion) for debt-servicing costs in next financial year’s budget as the world’s No. 4 economy faces rising interest rates, according to a draft document seen by Reuters. The ballooning debt costs highlight Japan’s struggle to rein in spending, when it can no longer rely on ultra-low borrowing costs and on the Bank of Japan to effectively bankroll debt as the central bank shifts away from its decade-long stimulus programme. The debt-servicing costs for interest payments and debt

as concerns over a tech bubble mount. Asian markets notched mostly moderate losses yesterday, tracking drops made the previous day in New York and Europe. Hong Kong’s main index recorded one of the more pronounced slides, finishing 1.2% lower. Tokyo, Shanghai, Seoul and Sydney were also down. Taipei was up slightly.

Morning trading in Europe saw declines in London and Frankfurt, while Paris plummeted more than 2% on fears of a French political crisis ahead of a crucial confidence vote next month. Also weighing on investors’ minds Japan ministry to request record sum for debt-servicing costs Eyes are now turning toward a US GDP report tomorrow and a key inflation gauge coming on Friday for clues on how far interest rates might fall – or not – in the coming months. Oil prices crept down yesterday, walking back increases made in recent days amid speculation about a peace deal to end the war in Ukraine. – AFP Trump’s announcement “shows how increasingly politicised the central bank is becoming”, Neil Wilson, UK investor strategist at Saxo Markets, wrote in a note. “The question for markets right now is about the September meeting

debt-servicing costs, Finance Minister Katsunobu Kato said yesterday that he was aware of bond market concerns about the country’s fiscal policy. “I’m aware of bond market views that the recent market movements reflect various concerns about fiscal policy ahead,” Kato said. “We’ll carry out appropriate debt management and work to improve fiscal health to maintain market confidence.” Japan, saddled with the industrial world’s heaviest debt at more than twice the size of its economy, hopes to deliver a primary budget surplus in the next financial year for the first time in decades. – Reuters

as concerns mounted about the government’s debt levels and deficit spending, sending the benchmark 10-year JGB yield above 1.6% to its highest since October 2008. The ruling coalition’s major electoral defeat in July also adds to pressure for fiscal hawk Prime Minister Shigeru Ishiba to respond to calls from the opposition for tax cuts and larger subsidies. The coalition has agreed with the opposition to abolish a decades-old gasoline surcharge tax “at the soonest this year,“ a step that could result in a loss of tax revenue of ¥1.5 trillion. Asked about rising interest rates and

redemption for the year starting in April would total ¥32.4 trillion, exceeding ¥28.2 trillion allocated for the current financial year, the draft showed. The assumed interest rate would increase to 2.6% for the next financial year from the current year’s final budget assumed rate of 2%, hitting the highest level in 17 years, according to sources familiar with the matter. The assumed rate factors in 1.1 percentage point of leeway in the event of yield surges driven by emergency situations. Japanese government bonds (JGBs) have plunged in recent months