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PARIS — Renault said on Tuesday that it was selling to Nissan part of the stake it owns in the Japanese automaker as the two companies rebalance their alliance.

The stake, equivalent to around five per cent of Nissan's equity capital, is valued at 765 million euros ($825 million) at the closing price of the shares on the Tokyo stock exchange on Tuesday.

The transfer at that price will result in a capital loss of up to 1.5 billion for Renault as it had valued the stake at a higher price in its books. 

The charge will affect the earnings of Renault, which posted a net profit of 2 billion euros in the first half of the year, but the automaker said it will not impact operating income and "would improve the net financial position of Renault Group Automotive segment".

Renault previously held a 43.4 per cent stake in Nissan but under a "rebalanced" alliance that the two automakers formally launched last month, the two are to move to holding 15 per cent cross-holdings.

Their partnership began in 1999, when Renault rescued Nissan from bankruptcy. 

Mitsubishi Motors joined in 2016, with Nissan taking a 34-per cent stake in its struggling Japanese rival.

But numerous tensions emerged within the group, including by the French state increasing its stake in Renault in 2015 and the 2018 arrest of its leader Carlos Ghosn in Japan on suspicion of financial misconduct and his subsequent flight from the country.

As part of the rebalanced alliance Nissan took a stake in Renault's new electric car division called Ampere.

FRANKFURT — With inflation dropping faster than expected and the economic outlook darkening, markets will be looking for clues about when eurozone borrowing costs might start to come down as rate-setters meet this week.

The European Central Bank (ECB) is expected to leave interest rates unchanged on Thursday for its second meeting in a row, as policymakers take a breather following a historic run of hikes to tame runaway prices.

But all eyes will be on whether the ECB gives any indications of when borrowing costs — the key deposit rate is currently sitting at a record high — will start to be reduced.

Speculation has intensified since eurozone inflation slowed faster than expected to 2.4 per cent in November, a more than two-year low and not far off the ECB's two-per cent target. 

Inflation in the 20 countries that use the euro peaked at about 10 per cent last year after prices were pushed up first by post-pandemic supply chain woes, and then an energy crisis triggered by Russia's invasion of Ukraine.

Thursday's meeting "looks likely to provide some idea of how soon and how fast policymakers are willing to start cutting interest rates", said Andrew Kenningham from Capital Economics.

He added that ECB president Christine Lagarde was likely to "concede that rate cuts may not be as distant as previously thought".

Markets and analysts have been bringing forward their predictions for when the ECB will start slashing rates — some now expect a first reduction in April, months earlier than previous forecasts.

Providing further ammunition to those arguing for a cut to come soon, the eurozone outlook has worsened.

The European Commission last month lowered its eurozone growth forecast for 2023 and 2024, and in its latest financial stability review, the ECB warned that a recession was a "possible scenario". 

Dovish shift? 

There have also been signs of a more dovish attitude at the ECB.

Isabel Schnabel — seen as among the ECB's more conservative members — said in an interview earlier this month that the November inflation reading was "quite remarkable", and it had made further rate hikes unlikely.

Still, there is uncertainty about the path forward, particularly as officials have warned inflation may tick up again in the coming months.

At the last ECB meeting in October, Lagarde dismissed any talk about cuts as "premature".

And last month, she insisted that it was "not time yet to start declaring victory".

The ECB's monetary policy decision will come a day after the US Federal Reserve's, with both central banks expected to remain on hold. 

Messaging about next steps will prove tricky for eurozone rate-setters as debate heats up about when to make the first cut, analysts say.

But HSBC said in a note that Lagarde "is likely to reinforce the message that it is too early to talk about rate cuts... We do not expect explicit guidance on the possible timing of the first cut." 

Key to charting a course forward could be the Frankfurt-based institution's latest forecasts for inflation and growth in the coming years, also due to be released Thursday.

Pressure is growing, particularly from more indebted eurozone economies, for cuts to come sooner rather than later.

As well as the impact of higher rates and a long period of elevated inflation, the single currency area faces problems ranging from a stuttering world economy to uncertainty about energy prices as the Israeli war on Gaza rages.

2023 had been "a challenging year for the EU economy, in which growth has slowed down more than expected", the bloc's economy commissioner, Paolo Gentiloni, said last month.

"Strong price pressures and the monetary tightening needed to contain them, as well as weak global demand, have taken their toll on households and businesses."

BELGRADE — A pipeline connector between Serbia and Bulgaria that will reduce Serbia's dependance on Russian gas by giving it access to Azerbaijan exports was inaugurated Sunday, Serbia's state-run RTS television reported.

"We will get another source of supply," Serbia's Energy Minister Dubravka Djedovic Handanovic said at an event near the southern town of Nis, RTS reported.

The 170 kilometre pipeline will allow Serbia to import up to 400 million cubic metres of natural gas from Azerbaijan, according to a deal signed in November between the Serbian and Azeri gas companies, Srbijagas and SOCAR.

Serbia's annual gas demand is around three billion cubic metres.

The opening ceremony was attended by Serbian President Aleksandar Vucic and his Bulgarian and Azeri counterparts, Rumen Radev and Ilham Aliyev. 

Handanovic said the pipeline would grant Serbia access to the liquified natural gas terminal in Alexandroupolis, Greece.

In recent decades, Serbia has relied almost exclusively on Russia for its gas supplies, building pipelines solely for Russian gas and selling a majority stake of its state-owned oil and gas company, NIS, to Russia's energy giant Gazprom.

Last year, Belgrade signed a long-term contract to continue importing Russian gas, drawing a rebuke from Brussels as the European Union tries to reduce its energy dependence on Russia.

While Serbia, which aspires to join the European Union, has condemned the Russian invasion of Ukraine, it has refused to take part in the Western sanctions against Moscow.

WASHINGTON — The United States saw its jobless rate dip in November while hiring rose more than expected, government data showed recently, fueling optimism that the world's biggest economy may achieve the elusive goal of avoiding recession, while also taming inflation.

The economy added 199,000 jobs, said the Department of Labour, and unemployment fell to 3.7 per cent.

Wage growth accelerated to 0.4 per cent from the prior month but held steady from year-ago levels.

Although employment appears to be heating up, analysts noted the underlying state of the labour market has been weakening. The figures could also be revised downwards.

The latest hiring uptick comes on the back of October figures that were temporarily bogged down due to strikes by auto workers and in Hollywood.

"Employment growth is below the average monthly gain of 240,000 over the prior 12 months but is in line with job growth in recent months," said the Labour Department.

The figures are closely watched by markets and the Federal Reserve as policymakers ponder how to handle interest rates in order to fight stubborn inflation.

The central bank is due to announce its next rate decision at the end of a policy meeting next week.

President Joe Biden, who is running for reelection next year, lauded the low unemployment and overall drop in inflation.

"But I know prices are still too high for too many Americans. So my top economic priority is to lower costs for hardworking Americans," he added in a statement.

Returning workers 

"Payroll gains were inflated by returning strikers in November, but the underlying pace of job growth has slowed in recent months," said Nancy Vanden Houten, lead US economist at Oxford Economics.

By some estimates, headline growth was boosted by about 30,000 on the return of auto workers.

Resilience in income gains is also expected to support consumption during the holiday season.

Rubeela Farooqi, chief US economist at High Frequency Economics, said she continues to expect a cooling in the labor market as the effect of higher interest rates flows through the economy.

She added that the latest data is unlikely to change the Fed's outlook and she expects the central bank to cut the benchmark lending rate, probably by mid-2024.

"Overall, the labour market remains strong, with job growth still robust and the unemployment rate at extraordinarily low levels," said Farooqi.

'Reality check' 

All key metrics in the November employment report exceeded expectations, said Nationwide chief economist Kathy Bostjancic.

While markets have rallied strongly in the past month on rising expectations that the Fed would start to cut rates in the first quarter, she added: "This delivers a reality check to financial markets."

But there appears to be optimism that the United States can cool the economy — and lower inflation — without tipping it into a recession.

Treasury Secretary Janet Yellen told reporters on the sidelines of a trip to Mexico this week: "I'm feeling very good about the economic outlook, and most economists are envisioning continued strength in the labour market."

On the balance between lowering inflation and growth, she added: "Economists who've said it's going to require very high unemployment to get this done are eating their words."

NEW YORK — US oil prices finished below $70 a barrel for the first time since July on Thursday on a mixed day for global equities, as traders pondered hopes for interest rate cuts from the European Central Bank and the US Federal Reserve.

West Texas Intermediate oil for delivery in January fell 4.1 percent to finish at $69.38 a barrel. The drop came as markets eyed signs of weakening demand amid skepticism that the OPEC + coalition's efforts will meaningfully restrain supply.

Analysts have begun to consider the possibility that Saudi Arabia could abruptly decide to open the spigots, recalling a move by the kingdom in 2014 to counter rising US production.

"There's increasing fears that the Saudis will just let loose with supply. They have a lot of spare capacity now because of how much they've cut back production wise," said John Kilduff of Again Capital. "So it's another bearish factor for the market."

Frankfurt's DAX stocks index hit a fresh record high, passing the 16,600 level for the first time, and in Paris the CAC 40 rose as sliding German factory orders added to hopes of an interest-rate reduction from the European Central Bank (ECB).

"Risk-on sentiment is driving price action this morning amid growing expectations that the European Central Bank could cut rates early next year," said Victoria Scholar, head of investment at trading firm Interactive Investor.

"Markets are pricing in an almost 90 per cent chance of a cut from the ECB in the first quarter of 2024."

Equity investors digested additional data pointing to a softening US labour market, rekindling hopes of a Fed rate reduction.

Following Tuesday's below-forecast job openings data, on Wednesday jobs data from payrolls firm ADP also came in softer than expected, and trade data showed a considerable drop in exports.

Markets rallied in November on growing hope that with inflation continuing to fall and other parts of the economy easing, the Fed will be able to slash rates in 2024, with some suggesting as soon as the first quarter.

But US markets had another downcast session on Wednesday, with all three major indices retreating.

Asia enjoyed some much-needed buying, with Tokyo up two percent and Sydney 1 per cent higher.

Hong Kong, Sydney, Singapore, Seoul, Bangkok, Mumbai, Wellington, Taipei and Jakarta were also on the rise.

Shanghai fell, with sentiment dented after Moody's on Tuesday warned it had downgraded its outlook for China's credit rating owing to the country's rising debt levels and concerns over its battered property sector.

SAN FRANCISCO — Google on Wednesday infused its Bard chatbot with a new-generation artificial intelligence model called Gemini, which it touts as being able to reason better than ChatGPT and other rivals.

The search engine juggernaut is aiming to take the generative AI lead from ChatGPT-maker OpenAI as that company deals with the aftermath of a boardroom coup that saw Chief Executive Sam Altman fired and then rehired within a matter of days.

Google has for years discreetly developed AI powers, but was caught off guard when OpenAI late last year released ChatGPT and teamed up with Microsoft to make its capabilities available to users worldwide.

"This is incredible momentum, and yet, we're only beginning to scratch the surface of what's possible," Google Chief Executive Sundar Pichai said in a release.

"This new era of models represents one of the biggest science and engineering efforts we've undertaken as a company."

It is the first AI model to outperform human experts in certain benchmarks involving problem solving, math, physics, history, law, medicine and ethics, Google DeepMind vice president of product Eli Collins said during a briefing.

A demonstration showed Gemini recognising what it was shown, from a person acting out a "Matrix" movie scene to someone drawing a duck and then holding up a rubber duck.

Gemini commented on what it was shown, making comparisons, drawing conclusions, and offering suggestions.

Performance of an "Ultra" version of Gemini "far exceeds" that of other state-of-the-art models in 30 benchmark tests measuring capabilities such as image understanding or mathematical reasoning, according to Collins.

A "Pro" version of Gemini built into Bard is designed to handle a wide range of tasks. A "Nano" version is tailored for smartphones, coming first to Google's top-of-the-line Pixel 8 handset.

Google raced out its own Bard chatbot earlier this year, continually updating the chatbot based on people's feedback, according to Bard vice president Sissie Hsiao.

"All of that rapid innovation is bringing us to what we see as a truly transformative moment," Hsiao said during the briefing.

"With Gemini, Bard is getting its biggest upgrade yet."

AI collaborator 

Bard will use Gemini for more advanced reasoning, planning, and understanding capabilities, a demonstration showed.

It will be available in English in more than 170 countries and territories, with more languages added soon, according to Hsiao.

Gemini-infused Bard will be expanded to be "multi-modal", meaning it will be able to work with auditory and visual input as well as text prompts, executives said.

"With Gemini we are one step closer to our vision of bringing you the best AI collaborator in the world," Hsiao said.

Gemini ramps up the quality of Bard's performance, whether in writing poetry or computer code to shopping queries or research projects, according to Hsiao.

The "Ultra" version of Gemini designed to handle highly complex tasks will be released early next year, Google said.

"I'm in awe of what it's capable of," Collins said of Gemini.

"This is the start of a new era for us at Google as we continue to rapidly innovate and advance the model's capabilities."

Google in September integrated Gmail, YouTube and other tools into its Bard chatbot as tech giants seek to persuade users that generative AI is useful and not dangerous or just a fad.

Those capabilities closely match offerings from Microsoft that infuse its Office 365 apps with AI powers, though those come at an extra cost to customers and are not available through the chatbot on its search engine Bing.

The staying power of generative AI chatbots, once the initial excitement has faded, is yet to be confirmed.

Moreover, integration of the OpenAI-based chatbot into Microsoft's search engine earlier this year failed to make an impact on Google's overwhelming dominance of search.

Governments and tech companies however insist that generative AI is technology's next big chapter and have ramped up spending on new products, research, and infrastructure.

HONG KONG — Stocks fell on Tuesday, extending the sell-off seen on Wall Street, with analysts warning November’s rally fuelled by bets on interest rate cuts may have gone too far, forcing traders to take a step back.

Markets surged last month as data pointing to slowing inflation and softer job markets combined with a dovish turn by Federal Reserve officials to stoke expectations they will next year begin loosening monetary policy.

Those hopes were boosted on Friday when Fed chief Jerome Powell said rates were “well into restrictive territory”.

More than one  percentage point of reductions through to next December have been priced in by futures traders, according to Bloomberg News.

But observers said the euphoria may have caused investors to get ahead of themselves and the next few weeks could be a little bumpy, while they remained broadly upbeat about the new year.

Morgan Stanley strategist Michael Wilson said in a note that this month could see “near-term volatility in both rates and equities” before positive seasonal trends and “January effect” provide a lift in January.

All three main indexes in New York ended in the red, with the S&P 500 coming off a nine percent November rally.

The selling continued on Tuesday. Hong Kong tumbled about 2 per cent while Tokyo and Sydney shed more than 1 per cent apiece.

Shanghai, Seoul, Singapore, Bangkok, Wellington, Taipei, Manila and Jakarta were also well down.

London and Paris dropped in the opening minutes while Frankfurt was flat.

“The biggest near-term risk for the markets could simply be that after a phenomenal one-month rally, a period of consolidation may be a necessary breather,” said UBS Global Wealth Management’s Jason Draho.

“A lot of good news is priced in, and investors seeing little imminent downside risk does make the markets vulnerable to even small disappointments.”

Goldman Sachs strategists said “markets are approaching the limits of what can plausibly be priced without attaching material odds of a recession in the near term”.

Traders are now awaiting the release later in the week of key US jobs data, with a miss to the downside of expectations likely to ramp up optimism for a rate cut in early 2024. However, a forecast-beating reading could jolt markets.

That is followed next week by the Fed’s policy meeting. Most watchers are tipping it to stand pat on rates, though its statement will be parsed for any clues about plans for the next few months.

After markets in Shanghai and Hong Kong closed, Moody’s said it had downgraded its outlook on China’s credit rating citing rising debt in the world’s second-largest economy.

Gold prices dropped after briefly striking a record high Monday on expectations for a rate cut, while bitcoin was also slightly lower, having the day before topped $42,000 for the first time since April last year.

The cryptocurrency has been boosted by hopes that firms including BlackRock will be given US approval to sell the first spot bitcoin exchange-traded funds.

HANOI — Vietnam has laid out a $15.5 billion dollar blueprint to transition away from coal power, but environmentalists warned on Sunday the plan fell far short of what was needed. 

The communist nation has committed to reaching net-zero carbon emissions by 2050, supported by the Just Energy Transition Partnership (JETP) programme, under which wealthier nations would help developing countries switch to clean energy faster.

On Friday Vietnamese Prime Minister Pham Minh Chinh announced the multibillion dollar Resource Mobilisation Plan (RMP) on the sidelines of the COP28 climate talks in Dubai.

"We commit to an open mechanism, good infrastructure, and smart management," he told delegates.

However, environmentalists told AFP that Vietnam's intention to use coal-fired plants until the end of their life operations, as well as shrinking civil society space, prompted concerns.

Vietnam's plan contained some "worrying" elements, chiefly the intention to use coal-fired plants "flexibly" rather than closing them early, said Leo Roberts, of environmental strategists EG3.

"What that means in practice is unclear, and is a slippery slope to using them extensively."

He added it sent a clear message the country was not transitioning as fast or at the scale it should, "and that discourages investment in renewables".

Speaking on the phone from the sidelines of COP28, Roberts told AFP that successful energy transitions required input from all sections of society.

"The lack of a clear, inclusive consultation process has limited the scale of ambition of the RMP," said Roberts.

Five environmentalists have been jailed for tax evasion in Vietnam since last year, with an independent UN expert accusing Hanoi last month of targetting rights defenders.

"The crackdown on civil society doesn't just undermine the content of the RMP, but also how easy it will be to actually deliver it," said Roberts.

Andri Prasetiyo, a researcher at the Senik Centre Asia in Indonesia, agreed with Roberts' concerns.

"The resource mobilisation plan is not realistic, it's not really progressive enough," he told AFP.

"The country is going to be giving a mixed signal towards renewable energy, which is definitely going to be dangerous."

After China and India, Vietnam has the world's third-largest pipeline of new coal power projects, remaining reliant on fossil fuel to power its fast-growing economy.