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China and the United States have lowered the temperature in their spiralling trade war, bringing a precarious end to months of back-and-forth measures between the economic and technological powerhouses.The detente — reached at last week’s meeting between presidents Donald Trump and Xi Jinping in South Korea — marks a new phase in a fierce standoff that has rumbled since 2018.Here are the main issues and where they now stand:- Tariffs -Trump imposed tariffs on China during his first presidential term, decrying intellectual property theft and other “unfair” trade practices.His successor, Joe Biden, largely maintained those duties and added to them in strategic technological sectors including electric vehicles and semiconductors.At last week’s meeting with Xi, Trump agreed to cut blanket tariffs on all Chinese goods by 10 percent from November 10 and approve separate one-year exemptions for certain products.Making the deal official, China said Wednesday it will extend a suspension of its own additional 24 percent tariff on US goods for one year, while also scrapping levies of up to 15 percent on various farm products from the country.A 10 percent Chinese tariff on all US goods will remain in place, Beijing’s finance ministry said.The new arrangement brings total US tariffs on Chinese goods down to an average of about 45 percent — still a hefty impediment to trade between the world’s two largest economies.- Fentanyl -China is the primary origin of precursor chemicals used to make fentanyl, the highly potent opioid underpinning a deadly drug epidemic in the United States.Beijing says it cracks down on illicit shipments, but trans-Pacific flows of the chemicals into the United States — especially through Mexico — have continued.The 10 percent reduction in US tariffs, formalised Tuesday in an executive order, is an easing of the 20 percent fentanyl-related penalty imposed by Trump since March.Trump previously said Xi assured him China will “work very hard to stop the flow”.- Rare earths -The presidents reached a tentative agreement for securing supplies of rare earths — critical for the defence, automotive and consumer electronics sectors.Their mining and processing are dominated by China.Beijing’s tightening control over their export this year has snarled supply chains and halted production in factories globally.More sweeping measures introduced last month — including restrictions on related technologies — provoked a furious response from Trump, who threatened blanket 100 percent tariffs on China in retaliation.That move was averted, however.After last week’s meeting, the White House said China will issue export licences for rare earths, as well as gallium, germanium, antimony and graphite.Confrontation over rare earths this year has spurred Washington and allies including Japan and Australia to shore up domestic production — but experts say it could take years to reduce reliance on China.- Export controls -Washington has agreed to suspend for one year its latest expansion of “Entity List” export restrictions on Chinese firms, originally imposed citing national security concerns.But the United States has steadily expanded other export controls in recent years, particularly in advanced chips and digital infrastructure.US officials remain concerned over the use of American technology by Chinese firms as competition heats up — the rivalry likely to continue through coming years.”The announced outcomes do little to resolve underlying structural issues that are at the heart of (the) bilateral economic tensions,” said Wendy Cutler, senior vice president at the Asia Society Policy Institute, in a statement following the leaders’ meeting.- Soybeans -Beijing has retaliated against the US tariffs with levies on American agricultural products, including soybeans, hurting a key source of Trump’s political support: farmers.More than half of US soybean exports went to China last year, but Beijing halted all orders as the trade dispute deepened.The White House said China agreed to purchase at least 12 million metric tons of American soybeans in the last two months of 2025As expected following the meeting between Trump and Xi, Beijing announced Wednesday that it would suspend retaliatory tariffs on various US agricultural products, including soybeans.But it remains to be seen if US farmers can regain lost market share.- TikTok -Washington has sought to wrest TikTok’s US operations from Chinese parent company ByteDance, citing national security concerns.The two sides said recently that they agreed to a framework of a deal for the popular social media app’s US operations to be transferred to American ownership.After the Trump-Xi meeting, US Treasury Secretary Scott Bessent said the deal was expected to “go forward in the coming weeks”.China has not offered details, but its commerce ministry expressed willingness to “work with the United States to properly resolve” the TikTok issue.

Tech companies led a sell-off across Asia on Wednesday as investors grow increasingly worried about an AI bubble following a rally this year that has seen valuations hit record highs.Global markets have soared this year as an eye-watering flood of cash piled into companies linked to artificial intelligence, including US titans Nvidia, Amazon and Apple as well as Asian firms Samsung and Alibaba.But despite strong earnings releases in recent quarters, traders have started questioning the wisdom of chasing ever-higher prices, with cash mostly funnelled into a handful of big-name companies.The gains have also been helped by an easing of US trade tensions and expectations that the Federal Reserve will continue to cut interest rates into the new year.However, last week’s warning from the US central bank that another reduction in December was not a foregone conclusion jolted sentiment.After an uncertain start to the week Monday, Wall Street tumbled on Tuesday, with the tech-rich Nasdaq down more than two percent and the S&P 500 off more than one percent.US software firm Palantir slumped 8.0 percent despite reporting a 63 percent surge in revenue and profit. Traders were also spooked by a slump in New York-listed Super Micro Computer in after-hours business and disappointing forecasts from Advanced Micro Devices. Asia took up the baton in the morning, with Seoul and Tokyo the hardest hit, having just hit record highs.However many markets recovered as the day wore on and pared many of the losses.Seoul tanked six percent at one point — with chip giants Samsung and SK hynix taking a beating — but ended the day down 2.9 percent.”I view today’s decline as a correction to cool off an overheated market — a phase of adjustment,” Chung Hae-chang, analyst at Daishin Securities, told AFP.”The recent rally was extremely steep, so this is the counterbalance.”He also warned Seoul’s Kospi index could decline five percent further and that “SK hynix and Samsung may also see corrections proportional to their earlier gains”.Tokyo finished 2.5 percent off, having dived more than four percent. Still tech investment giant SoftBank still lost 10 percent and Sony more than one percent.Nintendo, however, finished up more than six percent a day after the gaming firm hiked forecasts for its Switch 2 console and annual profits.- ‘Sea of red’ -Taipei was off more than one percent as market heavyweight and chip-maker TSMC gave up three percent.Hong Kong, Singapore, Sydney, Manila, Bangkok and Jakarta also fell but Shanghai and Wellington edged up.London, Paris and Frankfurt opened lower.”In the lead-up to the session, traders had been rotating out of the lower-quality end of the market and into the higher-quality plays, and this dynamic resulted in poor breadth within the US equity indices,” said Chris Weston at Pepperstone.He added that dynamic had changed and traders were “cutting back on their winners and locking in performance, with the Magnificent Seven (leading tech stocks) basket and AI plays driving equity risk lower.”And Mike Gitlin, president and chief executive officer of Capital Group, said that while earnings are strong “what’s challenging are valuations”, according to Bloomberg.His comments came at a financial summit organised by the Hong Kong Monetary Authority on Tuesday, where other business leaders including Morgan Stanley boss Ted Pick and Goldman Sachs’ David Solomon warned of a big correction.Saxo Markets’ Charu Chanana said two questions were echoing across portfolios.”Those who’ve ridden the rally from early 2023 are sitting on substantial gains and wondering if it’s time to lock in profits (and) those still on the sidelines are feeling the pull of (fear of missing out, questioning if they’ve missed the best entry point.”Both are fair concerns. The AI boom has pushed the ‘Magnificent’ names to new highs, but under the surface, their stories have begun to diverge between companies monetising AI today and those still investing for tomorrow.”The uncertainty across markets was also felt in the crypto universe, where bitcoin briefly fell below $100,000 for the first time since June, a month after topping out at a record high above $126,000.- Key figures at around 0815 GMT -Tokyo – Nikkei 225: DOWN 2.5 percent at 50,212.27 (close)Hong Kong – Hang Seng Index: DOWN 0.1 percent at 25,935.41 (close)Shanghai – Composite: UP 0.2 percent at 3,969.25 (close)London – FTSE 100: DOWN 0.2 percent at 9,693.95Euro/dollar: UP at $1.1494 from $1.1479 on TuesdayPound/dollar: UP at $1.3038 from $1.3019Dollar/yen: DOWN at 153.57 yen from 153.66 yenEuro/pound: DOWN at 88.16 pence from 88.17 penceWest Texas Intermediate: FLAT at $60.57 per barrelBrent North Sea Crude: FLAT at $64.45 per barrelNew York – Dow: DOWN 0.5 percent at 47,085.24 (close)

Japanese auto giant Toyota on Wednesday hiked its operating income and net profit forecasts for the current fiscal year despite the impact of US tariffs.The firm’s share price fell by as much as five percent in Tokyo however as the new guidance fell short of market estimates.”Despite the impact of US tariffs, we have continued to build upon our improvement efforts such as increasing sales volume, improving costs, and expanding value chain profits,” Toyota said.”We are steadily translating comprehensive future investments into improved productivity and increased returns, with a strong focus on improving the breakeven volume,” Toyota said in a statement.For the year ending in March 2026, Toyota now expects operating income of 3.4 trillion yen ($22.1 billion), up from its previous forecast of 3.2 trillion yen. This is below the market consensus forecast of 3.86 trillion yen, according to Bloomberg News.Net profit was seen hitting 2.9 trillion yen, against its previous estimate of 2.7 trillion yen, Toyota said.It added that it now expected sales this year of 49.0 trillion yen, up from its August forecast of 48.5 trillion yen.Trade officials in July reached a deal that saw the United States lower tariffs on Japanese goods to 15 percent from a threatened 25 percent.Japanese cars were taxed at a higher rate of 27.5 percent and the reduction to 15 percent did not take effect until mid-September.Japan’s US-bound car exports slumped 24 percent year-on-year in value in September, a major blow for an automotive sector that accounts for around eight percent of jobs in the Asian nation.Toyota’s chief financial officer Kenta Kon told reporters that the estimated impact from US tariffs this year would be around 1.45 trillion yen.”We are not taking hasty measures to immediately catch up with this, such as raising vehicle prices in a way that goes against market conditions,” Kon said.”Instead, we are carefully adjusting prices for each vehicle and each region, taking into account the market and competitive conditions,” he said.The world’s biggest carmaker by unit sales had cut its guidance in August, blaming the impact of US tariffs and other factors.It had lowered its operating income projection to 3.2 trillion yen from 3.8 trillion, and for net income to 2.7 trillion yen from 3.1 trillion.The firm said Wednesday that net income in the first half fell 7.0 percent to 1.8 trillion yen while operating income plunged 18.6 percent to 2.0 trillion. Sales were off 5.8 percent at 24.6 trillion yen.In late trade Toyota shares were down 4.05 percent at 3,027 yen, having fallen as much as five percent.

When Sri Lanka’s economy collapsed in 2022, politicians and officials were accused of brazenly stealing the island’s assets.Three years later, the tide appears to be turning against the once-untouchable elite, with several members of the former ruling Rajapaksa family and other powerful figures jailed or appearing in court.The government is pursuing some of the country’s most powerful individuals — with a former president, several ex-ministers and the heads of the police, prisons and immigration all appearing in court.Ranga Dissanayake, director-general of the Commission to Investigate Allegations of Bribery or Corruption (CIABOC), was granted sweeping powers in May to recover stolen assets — even without criminal convictions.There is no official data of state corruption losses, but activists estimate it to be billions of dollars over several decades. Sri Lanka’s GDP per capita income stood at $4,515 in 2024.”Corruption is the main reason for this economic crisis,” Dissanayake, who took up the post in January, told AFP.The International Monetary Fund calls for the “prioritising” of anti-graft measures, and says recruitment to CIABOC “should be accelerated”.- ‘Crossing the Rubicon’ -Tackling entrenched corruption was a key pledge of leftist President Anura Kumara Dissanayake, who is not related to the CIABOC chief.”How can a file in the Criminal Investigation Department move up and down, or remain stuck for seven or eight years in a cupboard?” he asked during a speech marking anti-corruption day.CIABOC faces a backlog of tens of thousands of cases.”Power is meant to uphold justice,” the president added. “But instead, it is often used for injustice, personal gain and the accumulation of wealth.”Public anger over crippling shortages of food, fuel, and medicine sparked months of protests in 2022, toppling then-president Gotabaya Rajapaksa.Gotabaya denies corruption allegations, but the Supreme Court in 2023 said he and his politician brothers “demonstrably contributed to the economic crisis”, and “violated the public trust reposed in them”.Gotabaya was replaced by Ranil Wickremesinghe, who secured a $2.9 billion IMF bailout to steady the economy.But Wickremesinghe was arrested in August on charges of using state funds for personal travel.”There are certain moments in politics or governance which are the moments of ‘crossing the Rubicon’ — that point of no return,” Saliya Pieris, former head of the Bar Association, wrote on Facebook.Sri Lanka ranked 121 out of 180 countries in Transparency International’s 2024 Global Corruption Index — a stark reminder of the scale of the problem.”The politicians robbed the country,” said businessman Tissa Gamini, 68, adding there had been some change but not enough.”Ministers, members of parliament, they’re all the same — and government servants too.”Ishani Menaka, 37, said she struggled to feed and educate their five children during the crisis, while her husband quit the state railways after 20 years, and left for Romania, joining an exodus of Sri Lankans.”We could not manage,” Menaka said. “So he gave up his job and went abroad.”- ‘Economy collapsed’ -Sri Lanka’s police chief, accused of running a criminal network, was arrested and sacked earlier this year, while the prison commissioner was jailed for releasing convicts in exchange for cash.The immigration controller was sentenced to two years for contempt of court, and faces trial for an alleged multimillion-dollar visa fraud.The Rajapaksa clan is under pressure too.Former ministers Mahindananda Aluthgamage and Nalin Fernando received 20- and 25-year prison sentences respectively for misusing government funds to support ex-president Mahinda Rajapaksa’s failed election bid.In August, Mahinda’s nephew Shashindra Rajapaksa was arrested for fraudulently claiming riot damage compensation.Money laundering investigations have also been revived against Mahinda’s sons, lawmaker Namal and ex-navy officer Yoshitha — who claims he was given a bag of gems by an aunt. Both deny wrongdoing.Television executive Weerasinghe Jayasundara, 57, recalled how “lives went back a few years” in 2022, when inflation hit nearly 70 percent.”We’re unable to get anything done — there was no transport, gas prices went up sharply, the economy collapsed,” Jayasundara said. “The main cause is corruption.”

Global stocks mostly fell Tuesday as investors weighed the recent tech rally on Wall Street against growing fears of an AI bubble and concerns over the US interest-rate outlook.A flood of multibillion-dollar investment into artificial intelligence has been a key driver of the surge in mostly technology equities across the globe this year, sending valuations to record highs.But there is increasing speculation that tech-led gains may have gone too far and a painful correction could be on the way.”Wall Street CEOs have also put investors on notice for a correction in the next 1-2 years,” said Kathleen Brooks, research director at trading group XTB.”It seems like the investment community has taken heed of this message,” she added.Shares of Palantir slumped 8.0 percent despite the company reporting a 63 percent surge in revenues to $1.2 billion, enabling profits of more than three times the year-ago level.”We have very high expectations with respect to what the future has in store for AI stocks,” said Adam Sarhan of 50 Park Investments.”The second big concern is the fact that there’s lack of (momentum) in other areas in the market” besides AI, he said.US chipmaker Nvidia and Deutsche Telekom, meanwhile, said a one-billion-euro ($1.1 billion) industrial artificial intelligence hub would soon be launched in Germany, Europe’s latest bid to catch up in the global AI race.This came a day after ChatGPT-maker OpenAI signed a $38 billion deal with Amazon’s AWS cloud computing arm.Wall Street’s main indices retreated on Tuesday, with the tech-heavy Nasdaq Composite finishing down more than two percent.In Europe, the Paris and Frankfurt stock markets ended lower.The British pound retreated against the dollar after finance minister Rachel Reeves hinted at tax rises in a pre-budget speech.That helped London’s FTSE 100 index that includes many multinationals whose earnings are inflated by a weak pound, and which finished the day slightly higher. The weakness in North America and Europe tracked a lackluster day in Asia, with Tokyo, Hong Kong and Shanghai stocks falling.Cautious remarks from US Federal Reserve officials did little to provide support for further buying after the central bank’s chief, Jerome Powell, indicated last week that a third rate cut this year was not definite.Data on Monday indicated some further weakness in the US economy, with a key gauge of activity in the manufacturing sector contracting more than expected and for an eighth straight month in October as demand and output weakened.In company news, shares in British energy giant BP were flat after a drop in oil prices on Tuesday overshadowed its strong earnings report.Crude prices shed over half a percent as the market anticipated oversupply.”The oil price slid amid ongoing concerns about oversupply despite OPEC+’s decision to pause output increases early next year,” said analyst Axel Rudolph at IG trading platform.Shares of biotech company Metsera soared more than 20 percent after it disclosed that it received a fresh takeover bid from Novo Nordisk of about $10 billion that topped a raised bid from Pfizer to about $8.1 billion. Pfizer shed 1.4 percent.- Key figures at around 2120 GMT -New York – Dow: DOWN 0.5 percent at 47,085.24 (close)New York – S&P 500: DOWN 1.2 percent at 6,771.55 (close)New York – Nasdaq Composite: DOWN 2.0 percent at 23,348.64 (close)London – FTSE 100: UP 0.1 percent at 9,714.96 (close) Paris – CAC 40: DOWN 0.5 percent at 8,067.53 (close)Frankfurt – DAX: DOWN 0.8 percent at 23,949.11 (close)Tokyo – Nikkei 225: DOWN 1.7 percent at 51,497.20 (close)Hong Kong – Hang Seng Index: DOWN 0.8 percent at 25,952.40 (close)Shanghai – Composite: DOWN 0.4 percent at 3,960.19 (close)Euro/dollar: DOWN at $1.1479 from $1.1520 on MondayPound/dollar: DOWN at $1.3019 from $1.3140Dollar/yen: DOWN at 153.66 yen from 154.22 yenEuro/pound: UP at 88.17 pence from 87.66 penceWest Texas Intermediate: DOWN 0.8 percent at $60.56 per barrelBrent North Sea Crude: DOWN 0.7 percent at $64.44 per barrelburs-jmb/md

Stock markets fell Tuesday as investors weighed the recent tech rally on Wall Street against growing fears of an AI bubble and concerns over the US interest-rate outlook.A flood of multibillion-dollar investment into artificial intelligence has been a key driver of the surge in mostly technology equities across the globe this year, sending valuations to record highs.But there is increasing speculation that tech-led gains may have gone too far and a painful correction could be on the way.”Wall Street CEOs have also put investors on notice for a correction in the next 1-2 years,” said Kathleen Brooks, research director at trading group XTB.”It seems like the investment community has taken heed of this message,” she added.Briefing.com analyst Patrick O’Hare pointed to the more than seven percent drop in Palantir shares despite the US software firm beating expectations for its third quarter earnings and future guidance.”Palantir, trading at close to 100 times sales, has been a poster child for valuation concerns,” he said. “Accordingly, the weak price action after yet another terrific earnings report has taken some wind out of the market’s sails, acting as a sign to some that this stock and the market-cap-weighted market have gotten ahead of themselves,” he said.In the latest deals, Palantir launched a joint venture with the Dubai government’s investment arm on Tuesday.US chipmaker Nvidia and Deutsche Telekom, meanwhile, said a one-billion-euro ($1.1 billion) industrial artificial intelligence hub would soon be launched in Germany, Europe’s latest bid to catch up in the global AI race.This came a day after ChatGPT-maker OpenAI signed a $38 billion deal with Amazon’s AWS cloud computing arm.Wall Street’s main indices retreated on Tuesday, with the tech-heavy Nasdaq Composite down 1.2 percent in late morning trading.All the “Magnificent 7″ stocks — Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla — slid as trading got underway in New York, though Apple subsequently moved higher during morning trading.In Europe, the Paris and Frankfurt stock markets ended lower.The British pound retreated against the dollar after finance minister Rachel Reeves hinted at tax rises in a pre-budget speech.That helped London’s FTSE 100 index that includes many multinationals whose earnings are inflated by a weak pound, and which finished the day slightly higher. The weakness in North America and Europe tracked a weak day in Asia, with Tokyo, Hong Kong and Shanghai stocks falling.Cautious remarks from US Federal Reserve officials did little to provide support for further buying after the central bank’s chief, Jerome Powell, indicated last week that a third rate cut this year was not definite.Data on Monday indicated some further weakness in the US economy, with a key gauge of activity in the manufacturing sector contracting more than expected and for an eighth straight month in October as demand and output weakened.In company news, shares in British energy giant BP were flat after a drop in oil prices on Tuesday overshadowed its strong earnings report.Crude prices shed around half a percent as the market anticipated oversupply.”The oil price slid amid ongoing concerns about oversupply despite OPEC+’s decision to pause output increases early next year,” said analyst Axel Rudolph at IG trading platform.- Key figures at around 1630 GMT -New York – Dow: DOWN 0.4 percent at 47,171.57 pointsNew York – S&P 500: DOWN 0.7 percent at 6,801.32New York – Nasdaq Composite: DOWN 1.2 percent at 23,540.75London – FTSE 100: UP 0.1 percent at 9,714.96 (close) Paris – CAC 40: DOWN 0.5 percent at 8,067.53 (close)Frankfurt – DAX: DOWN 0.8 percent at 23,949.11 (close)Tokyo – Nikkei 225: DOWN 1.7 percent at 51,497.20 (close)Hong Kong – Hang Seng Index: DOWN 0.8 percent at 25,952.40 (close)Shanghai – Composite: DOWN 0.4 percent at 3,960.19 (close)Euro/dollar: DOWN at $1.1496 from $1.1518 on MondayPound/dollar: DOWN at $1.3045 from $1.3138Dollar/yen: DOWN at 153.43 yen from 154.20 yenEuro/pound: UP at 88.11 pence from 87.67 penceWest Texas Intermediate: DOWN 0.5 percent at $60.77 per barrelBrent North Sea Crude: DOWN 0.4 percent at $64.61 per barrelburs-rl/js

Wealth inequality is a global emergency that threatens democracy and social cohesion, experts warned Tuesday, urging G20 leaders meeting in South Africa this month to establish a panel to tackle the crisis.The “inequality emergency” is leaving billions hungry and could worsen under the Trump administration’s “law of the jungle” approach to trade, a committee led by Nobel Prize-winning economist Joseph Stiglitz said in a new report.The proposed panel on inequality was inspired by the UN’s expert Intergovernmental Panel on Climate Change (IPCC), which analyses the risks of global warming and proposes solutions.”Inequality is a choice. It is something we can do something about,” Stiglitz said at a briefing where he handed the report to President Cyril Ramaphosa.Representing 85 percent of global GDP, the Group of 20 (G20) leading economies is “very influential in setting the international rules of the game” that could tackle the problem, the professor said. South Africa — ranked by the World Bank as the most unequal country in the world — hosts G20 leaders on November 22 and 23 as it wraps up its year as president, a first for an African nation.”With this report, we have clear actions that we can take … to reduce inequality,” Ramaphosa said. “It is now up to us and as leaders of the G20 and the leaders of the world to demonstrate the necessary will and commitment,” he said.- Undermining cohesion -The report “correctly asserts that inequality is in many ways a betrayal of the dignity of people. It is an impediment to inclusive growth and a threat democracy itself”, the South African president said.The findings included that between 2000 and 2024, one percent of the world’s population captured 41 percent of all new wealth, of which just one percent went to the poorest 50 percent.”One in four people worldwide now regularly skip meals, whilst billionaire wealth has now hit the highest level in history,” according to the report.While income inequality between individuals declined in recent decades, largely due to economic development in China, there had been a major increase in inherited wealth, with $70 trillion expected to be handed down to heirs in the coming 10 years.”The world understands that we have a climate emergency; it’s time we recognise that we face an inequality emergency too,” Stiglitz said in a statement before the briefing.”It isn’t just unfair and undermining societal cohesion — it’s a problem for our economy and our politics too,” he said.The proposed International Panel on Inequality would analyse all aspects of inequality — from land ownership to tax avoidance — and inform policymaking.Measures to tackle the problem included fair taxation of multinational corporations and the very wealthy, breaking up monopolies, stabilising prices and restructuring the debt of highly indebted countries.- ‘Law of the jungle’ – The report warned that US policies, including the imposition of tariffs on trading partners, risked increasing inequality.”This new world, in which the powerful break rules with impunity and we move away from a rules-based international order towards a ‘law of the jungle’, could entrench unequal exchange, investment and technology patterns,” it said.”Inequality erodes trust in institutions, fuels political polarisation, can reduce participation among poorer citizens and residents, and creates social tensions of different kinds.”Stiglitz told reporters he did not expect Washington, the next G20 president, to back the proposal for an equality panel but “hopefully a majority of countries would eventually join in”.With relations between South Africa and the United States hitting new lows this year, Trump has indicated that he would not attend the Johannesburg summit.

Starbucks has announced it will sell a controlling stake in its Chinese retail operations as it seeks to revitalise performance in a fiercely competitive market it once dominated.Hong Kong-based investment firm Boyu Capital will hold up to 60 percent of a new joint venture operating 8,000 Starbucks stores across China, under a deal which values the business at around $4 billion.Seattle-based Starbucks said on Monday it will retain a 40-percent stake and continue to own the brand and intellectual property.The partnership marks a strategic shift for Starbucks after more than 26 years in China, where it has seen its market share fall to 14 percent in 2024 from a peak of 42 percent in 2017.China represents Starbucks’s second biggest market globally, though the company has faced increasing competition from local coffee chains like Luckin Coffee, which has won over customers with lower prices.Luckin, founded in 2017, has expanded rapidly to more than 26,000 stores by targeting young spendthrift consumers with aggressive discounts, a host of quirky drink flavours, and brand tie-ups with everything from anime to the traditional Chinese liquor baijiu.It opened its first US store in June.- ‘So much more’ -Dozens of other chains have emerged in China, many following Luckin’s model of handling orders through mobile apps and operating small stores with few staff and little or no seating, which helps to lower costs.Cotti Coffee, another competitor, targets smaller cities and towns with drinks starting at 9.9 yuan ($1.40), and already has more China stores than Starbucks despite being founded only three years ago.Starbucks has failed to meet customers’ rising demand for better value, said Yaling Jiang, founder of consultancy ApertureChina and author of a newsletter on Chinese consumers.”Consumers feel they can get so much more from domestic competitors,” she told AFP.Starbucks cut its prices in June, but its cheapest Americano still costs 27 yuan ($3.80).Luckin’s marketing, often focusing on viral online trends, has also given it an edge over Starbucks’ more traditional approach.Luckin also leverages its data-centric operation to analyse and anticipate trends for its product development, said Felipe Cabrera from Ad Astra Coffee Consulting, a specialist in the Chinese market.Boyu Capital will likely “manage the company in a very Chinese style, which will give some advantage to Starbucks China teams to react fast to trends in the local coffee industry”, he said, possibly even surpassing competitors in “creating ‘hot’ new” products.- Expansion -Starbucks reported last week that its latest quarterly same-store sales in China increased by two percent, fuelled by an increase in traffic, but added that average spending per ticket had dropped.The company said it expects the total value of its China retail business to exceed $13 billion, including proceeds from the sale, its retained interest, and future licensing fees over the next decade.”Boyu’s deep local knowledge and expertise will help accelerate our growth in China, especially as we expand into smaller cities and new regions,” said Starbucks CEO Brian Niccol.While local brands have embraced franchise models to expand rapidly, Starbucks continues to directly operate large traditional coffee stores concentrated mostly in large cities.Jiang said that “they need a new generation of local and young leaders to make changes, especially in terms of marketing”.”If they keep what they’re doing… Boyu is only going to waste their money,” she said.The companies said they aim to grow the store count to as many as 20,000 locations over time, with the business continuing to be headquartered in Shanghai.The deal is expected to close in the second quarter of fiscal year 2026, pending regulatory approvals.

Stock markets fell Tuesday as investors weighed the recent tech rally on Wall Street against growing fears of an AI bubble and concerns over the US interest-rate outlook.A flood of multi-billion-dollar investment into artificial intelligence has been a key driver of the surge in mostly technology equities across the globe this year, sending valuations to record highs.But there is increasing talk that tech-led gains may have gone too far and a painful correction could be on the way.”Wall Street CEOs have also put investors on notice for a correction in the next 1-2 years,” said Kathleen Brooks, research director at trading group XTB.”It seems like the investment community has taken heed of this message,” she added.Paris and Frankfurt stock markets shed more than one percent in midday trading Tuesday, while London slipped 0.7 percent.The British pound retreated against the dollar after finance minister Rachel Reeves hinted at tax rises in a pre-budget speech.That tracked a weak day in Asia, with Tokyo, Hong Kong and Shanghai stocks falling.Wall Street ended on a mixed note Monday, after tech stocks won a boost from ChatGPT-maker OpenAI signing a $38 billion deal with Amazon’s AWS cloud computing arm.”Some skeptics continued to raise their eyebrows, concerned by the circularity of these deals,” said Ipek Ozkardeskaya, senior analyst at Swissquote bank.Cautious remarks from US Federal Reserve officials did little to provide support for further buying after the central bank’s chief, Jerome Powell, indicated last week that a third rate cut this year was not definite.Data on Monday indicated some further weakness in the US economy, with a key gauge of activity in the manufacturing sector contracting more than expected and for an eighth straight month in October as demand and output weakened.On currency markets, India’s rupee rallied from close to a record low against the dollar after the Reserve Bank of India stepped in with support, according to Bloomberg News. The unit briefly jumped to 88.3925 against the greenback, after sitting close to its all-time low on Monday.India’s rupee has come under pressure of late owing to worries about exports as New Delhi struggles to strike a trade deal with the United States.In company news, shares in British energy giant BP were down 0.4 percent after a drop in oil prices on Tuesday overshadowed its strong earnings report.Crude prices shed around 1.5 percent as the market anticipated oversupply.- Key figures at around 1115 GMT -London – FTSE 100: DOWN 0.7 percent at 9,630.90 pointsParis – CAC 40: DOWN 1.2 percent at 8,009.26Frankfurt – DAX: DOWN 1.4 percent at 23,798.38Tokyo – Nikkei 225: DOWN 1.7 percent at 51,497.20 (close)Hong Kong – Hang Seng Index: DOWN 0.8 percent at 25,952.40 (close)Shanghai – Composite: DOWN 0.4 percent at 3,960.19 (close)New York – Dow: DOWN 0.5 percent at 47,336.68 (close)Euro/dollar: DOWN at $1.1504 from $1.1518 on MondayPound/dollar: DOWN at $1.3071 from $1.3138Dollar/yen: DOWN at 153.48 yen from 154.20 yenEuro/pound: UP at 88.02 pence from 87.67 penceWest Texas Intermediate: DOWN 1.6 percent at $60.07 per barrelBrent North Sea Crude: DOWN 1.4 percent at $64.00 per barrel

Asian e-commerce giant Shein Tuesday pledged to “cooperate fully” with French judicial authorities after an uproar over it selling childlike sex dolls, and said it was prepared to disclose the names of people who bought them.The controversy comes as the ultra-fast fashion giant is set to open its first bricks and mortar store in the world, in the prestigious BHV department store in central Paris on Wednesday.”We will cooperate fully with the judicial authorities,” Shein’s spokesman in France, Quentin Ruffat, told RMC radio, adding the company was prepared to share the names of those who have bought such dolls.”We will be completely transparent with the authorities,” he said.”We will put the necessary safeguards in place to ensure that this does not happen again,” Ruffat added.The Paris prosecutor’s office said it had opened investigations against Shein, and also rival online retailers AliExpress, Temu and Wish, over the sale of sex dolls.The probes were for distributing “messages that are violent, pornographic or improper, and accessible to minors”, the office told AFP.The investigations were launched after France’s anti-fraud unit reported on Saturday that Shein, a Singapore-based company which was originally founded in China, was selling childlike sex dolls.French media published a photo of one of the dolls sold on the platform, accompanied by an explicitly sexual caption.The pictured doll measured around 80 centimetres (30 inches) in height and held a teddy bear.Ruffat described what had happened as “serious, unacceptable, intolerable.”He chalked up the sale of the dolls to “a malfunction in our processes and governance”.- ‘Who can stop it?’ -On Monday, Shein announced it was imposing a “total ban on sex-doll-type products” and had deleted all listings and images linked to them.  Shein’s meteoric rise has been a bane for traditional retail fashion companies and, even before the uproar over the dolls, the arrival of Shein in the fashion capital had sparked a controversy.Critics fear that Shein will further hurt stores in France that have had to lay off staff or close.”Shein in France. Who can stop it?” left-leaning French daily Liberation said on its front page.Frederic Merlin, the 34-year-old director of the company that owns BHV, has been criticised for partnering up with Shein, which has been accused of unfair competition, environmental pollution and poor working conditions.Merlin admitted on Tuesday that he considered pulling the plug on the partnership with Shein after the latest uproar.”It’s despicable,” he told broadcaster RTL.”I find it sickening to know that we can freely sell this kind of stuff on the internet,” Merlin added.But he said he had reconsidered, saying Shein’s stance and readiness to cooperate with the French authorities “convinced me to continue”.He said he was confident about the Shein products that will be sold at the department store, and denounced a “general hypocrisy” surrounding Shein and its “25 million French customers”.He expressed hope that the Asian giant would help increase footfall at the department store.- ‘Shein has to pay’ -On Monday, France’s high commissioner for childhood, Sarah El Hairy, denounced the dolls which she called “paedophile objects that predators unfortunately sometimes use to practise before moving on to abusing children.”Ruffat said he and “the entire Shein brand” shared her concerns.”We will be delighted to discuss these issues with her, these issues of paedophile crime, which are too serious to be ignored,” he said.Finance Minister Roland Lescure had warned he would move to ban the company from the French market if the items returned online.On Monday, an association fighting to protect children from all forms of violence staged a protest in front of the department store.”Shame on Shein,” one of the signs read.”Shein has to pay, politically speaking,” said Arnaud Gallais, co-founder and president of the Mouv’Enfants association.