AFP

Fast Retailing, the operator of Japanese casualwear giant Uniqlo, revised its annual net profit forecast upwards on Thursday even as business in China is hit by fresh lockdowns.

China is a key market for Uniqlo, but consumer spending has been hampered by tough lockdowns imposed on cities like Shanghai under the country’s zero-Covid policy.

Uniqlo operations in mainland China saw “a decrease in revenue and a large decline in profit” for the six months to February, Fast Retailing said, attributing the falls to curbs on movement.

In a news conference, Fast Retailing president Tadashi Yanai described the effect of China’s zero-Covid policy on profits as “very troubling”.

But elsewhere in Asia, business was brisk — buoyed by a strong performance in countries including Malaysia, where virus restrictions were eased.

In North America, strengthened branding efforts helped boost sales, the company said, unveiling plans to increase its stores in the traditionally money-losing region from 57 to 200 within five years.

Overall, the group reported that net profit for the first half jumped 38.7 percent on-year to 146.8 billion yen ($1.2 billion).

Operating profit was up 12.7 percent on-year “even after stripping out the impact of yen depreciation”, the company said.

The cheap-chic Japanese clothing group — which rivals Zara, Gap and H&M — revised its full-year net profit forecast from the previous 175 billion yen to 190 billion yen.

Despite pandemic restrictions, Fast Retailing has aggressively expanded in China, where it aims to open 100 new stores each year.

But it has suspended sales in Russia and now expects a loss for the second half of the fiscal year, after a U-turn on an initial decision to stay open despite Moscow’s invasion of Ukraine.

Yanai came under fire for his original plan to keep Uniqlo stores open, and he touched only broadly on the conflict on Thursday, saying he remains “strongly opposed to all kinds of war”.

“The ongoing war must be stopped immediately, and we must think in earnest how we can solve serious conflicts between nations, create a peaceful world and ensure people around the world will live happy lives,” he added.

Asian and eurozone stocks rose Thursday after a recovery on Wall Street, but investors remained cautious about the ongoing impact of skyrocketing inflation and the war in Ukraine.

Prices were already soaring in major economies when Russia’s invasion of Ukraine sent shockwaves through the global energy, food and commodity markets.

Despite lingering concerns about the US Federal Reserve’s next moves to contain prices, Wall Street enjoyed a buoyant session — especially the tech-rich Nasdaq, which surged 2.0 percent.

Asia was in a similar mood Thursday as Tokyo closed 1.2 percent higher, while Hong Kong and Shanghai also ended in positive territory.

Sydney rose 0.6 percent as Australia posted its lowest unemployment rate — a smidge under four percent — in 48 years.

Seoul was flat, meanwhile, as South Korea’s central bank raised its key interest rate to the highest level since August 2019 to tame rising inflation.

Analysts had warned overnight that the uncertainty was far from over.

“With a thicker fog of war starting to roll in and engulf the global markets again, it is another worrying setup amid the widespread bearish sentiment out there,” Stephen Innes of SPI Asset Management said in a note.

Frankfurt and Paris opened higher as eyes turned to the European Central Bank policymakers meeting on Thursday, with the outlook for the eurozone economy still murky.

Elsewhere, London’s FTSE 100 index dropped at the open.

– ‘Countervailing forces’ –

Data this week from the United States — the world’s biggest economy — and Britain showed inflation at levels not seen in decades.

The grim outlook was reflected in the latest earnings report from JP Morgan Chase, the largest American bank by assets.

“There’s this very strong underlying economy,” its chief executive Jamie Dimon said.

But he pointed to “countervailing forces”, including rising interest rates, inflation and the war in Ukraine.

“And those things are going to collide at one point, probably sometime next year,” he said in a conference call with reporters.

“I’m not predicting a recession… But is it possible? Absolutely.”

Analysts said, however, that markets had welcomed an indication that US inflation may be approaching its peak.

Both main oil contracts stayed above the $100 per barrel mark, with fears swirling about global supply constraints over the invasion of Ukraine by Russia — a major producer of oil and gas.

“The oil complex is heavily fixated on the short-term,” Vandana Hari of Singapore-based Vanda Insights told Bloomberg News.

“The prospect of an EU ban on Russian oil will keep the market on edge as long as Ukraine festers.”

– Key figures around 0810 GMT –

Tokyo – Nikkei 225: UP 1.2 percent at 27,172.00 (close)

Hong Kong – Hang Seng: UP 0.7 percent at 21,518.08 (close)

Shanghai – Composite: UP 1.2 percent at 3,225.64 (close)

London – FTSE 100: DOWN 0.3 percent at 7,561.35

Euro/dollar: UP at 1.0911 from $1.0894 at 2100 GMT

Pound/dollar: UP at $1.3136 from $1.3109

Euro/pound: UP at 83.07 pence from 83.03 pence

Dollar/yen: DOWN at 125.35 from 125.59

Oil – Brent: DOWN 1.1 percent at 107.63 per barrel

Oil – WTI: DOWN 1.2 percent at 102.98 per barrel

New York – Dow: UP 1.0 percent at 34,564.59 (close)

— Bloomberg News contributed to this story —

Fast Retailing, the operator of Japanese casualwear giant Uniqlo, revised its annual net profit forecast upwards on Thursday even as business in China is hit by fresh lockdowns.

China is a key market for Uniqlo, but consumer spending has been hampered as coronavirus cases surge in cities such as Shanghai, prompting authorities to impose tough lockdowns under the country’s zero-Covid policy.

Uniqlo operations in mainland China saw “a decrease in revenue and a large decline in profit” for the six months to February, Fast Retailing said, attributing the falls to curbs on movement.

But elsewhere in Asia, business was brisk, buoyed by strong performance in countries such as Malaysia where virus restrictions were eased.

In North America, too, strengthened branding efforts helped boost sales, the company said.

These factors, coupled with what the group described as a “greater diversification” of its revenue streams, led to net profit for the first half jumping 38.7 percent on-year to 146.8 billion yen ($1.2 billion).

“Operating profit reached a record high, even after stripping out the impact of yen depreciation,” the company said as it logged 189.2 billion yen in operating profit in the first half, up 12.7 percent on-year.

The cheap-chic Japanese clothing group, which rivals Zara, Gap and H&M, revised its full-year net profit forecast from the previous 175 billion yen to 190 billion yen.

Pandemic restrictions have not stopped Fast Retailing from aggressively expanding in Greater China, where it aims to open 100 new stores each year.

The war in Ukraine has also forced the company to strike a delicate balance between politics and profitability.

Moscow’s invasion has prompted the temporary closure of Uniqlo operations in Russia, where Fast Retailing now expects to “report a loss in the second half of fiscal 2022”.

This suspension was announced in March, in a U-turn from the Japanese firm’s earlier decision to stay open in Russia.

“Clothing is a necessity of life. The people of Russia have the same right to live as we do,” Fast Retailing president Tadashi Yanai initially said in comments that prompted calls for a boycott.

A San Francisco judge on Wednesday slashed the $137 million in damages Tesla was told to pay a former employee in a racial discrimination case down to $15 million but upheld the verdict.

In his ruling, US District Court Judge William Orrick said “the weight of the evidence amply supports the jury’s liability findings” but the damages ordered were “excessive,” citing constitutional limitations on punitive damages set by the Supreme Court.

Tesla was ordered in October to pay Black former employee Owen Diaz $137 million in damages for turning a blind eye to racism the man encountered at the firm’s Silicon Valley auto plant.

Rejecting Tesla’s request for a retrial, Orrick said “Tesla’s indifference to Diaz’s complaints is striking.”

He said the evidence presented to the jurors was “disturbing.”

“The jury heard that the Tesla factory was saturated with racism. Diaz faced frequent racial abuse, including the N-word and other slurs,” the judge wrote.

“His supervisors, and Tesla’s broader management structure, did little or nothing to respond. 

“And supervisors even joined in on the abuse, one going so far as to threaten Diaz and draw a racist caricature near his workstation.”

The original award comprised $130 million in punitive damages and $6.9 million for emotional distress, which Orrick cut to $13.5 million in punitive damages and $1.5 million for emotional harm, “the maximum amount supportable by proof.”

Hired through a staffing agency, Diaz had worked as an elevator operator between June 2015 and July 2016 at the Fremont plant, where he was subjected to racist abuse and a hostile work environment, according to the court filing.

In his lawsuit filed in 2017, Diaz said African-American employees at the factory, where his son also worked, were regularly subjected to racist epithets and derogatory imagery.

Diaz also said that, despite complaints to supervisors, Tesla took no action over the regular racist abuse.

Following the October verdict, Tesla released a blog post by human resources vice president Valerie Capers Workman, which downplayed the allegations of racist abuse in the lawsuit but acknowledged that at the time Diaz worked there, Tesla “was not perfect.”

Workman said Tesla had responded to Diaz’s complaints, firing two contractors and suspending a third.

In February, the California Department of Fair Employment and Housing, which enforces the state’s civil rights laws, sued Tesla over discrimination and harassment against Black workers at the same factory, which the complaint called a “racially segregated workplace.”

The agency said it had received hundreds of complaints from workers at the Fremont plant.

Asian stock markets rose Thursday after a recovery on Wall Street, but investors remained cautious about the ongoing impact of skyrocketing inflation and the war in Ukraine.

Prices were already soaring in major economies when Russia’s invasion of Ukraine sent shockwaves through the global energy, food and commodity markets.

Despite lingering concerns about the US Federal Reserve’s next moves to contain prices, Wall Street enjoyed a buoyant session — especially the tech-rich Nasdaq, which surged 2.0 percent.

Asia was in a similar mood Thursday as Tokyo closed 1.2 percent higher. Hong Kong and Shanghai were also in positive territory.

Sydney rose 0.6 percent as Australia posted its lowest unemployment rate — a smidge under four percent — in 48 years.

Seoul was flat, meanwhile, as South Korea’s central bank raised its key interest rate to the highest level since August 2019 to tame rising inflation.

Analysts had warned overnight that the uncertainty was far from over.

“With a thicker fog of war starting to roll in and engulf the global markets again, it is another worrying setup amid the widespread bearish sentiment out there,” Stephen Innes of SPI Asset Management said in a note.

– ‘Countervailing forces’ –

Data this week from the United States — the world’s biggest economy — and Britain showed inflation at levels not seen in decades.

The grim outlook was reflected in the latest earnings report from JP Morgan Chase, the largest American bank by assets.

“There’s this very strong underlying economy,” its chief executive Jamie Dimon said.

But he pointed to “countervailing forces”, including rising interest rates, inflation and the war in Ukraine.

“And those things are going to collide at one point, probably sometime next year,” he said in a conference call with reporters.

“I’m not predicting a recession… But is it possible? Absolutely.”

Analysts said, however, that markets had welcomed an indication that US inflation may be approaching its peak.

Eyes are also on the European Central Bank as its policy makers meet Thursday, with the outlook for the eurozone economy still murky.

Both main oil contracts stayed above the $100 per barrel mark, with fears swirling about global supply constraints over the invasion of Ukraine by Russia — a major producer of oil and gas.

“The oil complex is heavily fixated on the short-term,” Vandana Hari of Singapore-based Vanda Insights told Bloomberg News.

“The prospect of an EU ban on Russian oil will keep the market on edge as long as Ukraine festers.”

– Key figures around 0630 GMT –

Tokyo – Nikkei 225: UP 1.2 percent at 27,172.00 (close)

Hong Kong – Hang Seng: UP 0.9 percent at 21,555.85

Shanghai – Composite: UP 1.5 percent at 3,233.78

Euro/dollar: UP at 1.0915 from $1.0894 at 2100 GMT

Pound/dollar: UP at $1.3138 from $1.3109

Euro/pound: UP at 83.08 pence from 83.03 pence

Dollar/yen: DOWN at 125.41 from 125.59

Oil – Brent: DOWN 0.6 percent at 108.17 per barrel

Oil – WTI: DOWN 1.0 percent at 103.21 per barrel

New York – Dow: UP 1.0 percent at 34,564.59 (close)

London – FTSE 100: UP 0.1 percent at 7,580.80 (close)

— Bloomberg News contributed to this story —

Asian stock markets mostly rose in early trade Thursday after a recovery on Wall Street, but investors remained cautious about the ongoing impact of skyrocketing inflation and the war in Ukraine.

Prices were already soaring in major economies when Russia’s invasion of Ukraine sent shockwaves through the global energy, food and commodity markets.

Despite lingering concerns about the US Federal Reserve’s next moves to contain prices, Wall Street enjoyed a buoyant session — especially the tech-rich Nasdaq, which surged 2.0 percent.

Asia was in a similar mood Thursday as Tokyo soared 1.3 percent and Hong Kong put on 0.8 percent. Sydney, Shanghai and Taipei were also in positive territory, but Seoul dipped.

South Korea’s central bank on Thursday raised its key interest rate to the highest level since August 2019 to tame rising inflation.

Analysts warned overnight that the uncertainty is far from over.

“With a thicker fog of war starting to roll in and engulf the global markets again, it is another worrying setup amid the widespread bearish sentiment out there,” Stephen Innes of SPI Asset Management said in a note.

Data this week from the United States — the world’s biggest economy — and Britain showed inflation at levels not seen in decades.

Analysts said, however, that markets had welcomed an indication that US inflation may be approaching its peak.

– ‘Countervailing forces’ –

The grim outlook was reflected in the latest earnings report from JP Morgan Chase, the largest American bank by assets.

“There’s this very strong underlying economy,” its chief executive Jamie Dimon said.

But he pointed to “countervailing forces”, including rising interest rates, inflation and the war in Ukraine.

“And those things are going to collide at one point, probably sometime next year,” he said in a conference call with reporters.

“I’m not predicting a recession… But is it possible? Absolutely.”

Both main oil contracts hovered above the $100 per barrel mark, with fears swirling about global supply constraints over the invasion of Ukraine by Russia — a major producer of oil and gas.

“The oil complex is heavily fixated on the short-term,” Vandana Hari of Singapore-based Vanda Insights told Bloomberg News.

“The prospect of an EU ban on Russian oil will keep the market on edge as long as Ukraine festers.”

– Key figures around 0230 GMT –

Tokyo – Nikkei 225: UP 1.3 percent at 27,182.50

Hong Kong – Hang Seng: UP 0.8 percent at 21,535.37

Shanghai – Composite: UP 0.6 percent at 3,203.94

Euro/dollar: DOWN at 1.0888 from $1.0894 at 2100 GMT

Pound/dollar: UP at $1.3117 from $1.3109

Euro/pound: DOWN at 83.01 pence from 83.03 pence

Dollar/yen: UP at 125.62 from 125.59

Oil – Brent: DOWN 0.7 percent at 108.05 per barrel

Oil – WTI: DOWN 0.8 percent at 103.41 per barrel

New York – Dow: UP 1.0 percent at 34,564.59 (close)

London – FTSE 100: UP 0.1 percent at 7,580.80 (close)

— Bloomberg News contributed to this story —