Oct 25 (Reuters) – Adidas AG (ADSGn.DE) is immediately terminating its partnership with Kanye West, the sporting goods maker said on Tuesday, reacting to a rash of offensive behaviour from the American rapper and designer.
The decision comes after Adidas put the tie-up, which has produced several hot-selling Yeezy branded sneakers, under review earlier this month following its efforts to privately resolve the issue.
“Adidas does not tolerate antisemitism and any other sort of hate speech,” the German company said.
“Ye’s recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company’s values of diversity and inclusion, mutual respect and fairness,” it said, referring to the rapper by his legal name.
A lawyer representing Ye did not respond to a request for comment.
Ending the partnership and the production of Yeezy branded products, as well as stopping all payments to Ye and his companies, will “have a short-term negative impact” of up to 250 million euros ($248.90 million)” on Adidas’ net income this year, the company said.
Ye has courted controversy in recent months by publicly ending major corporate tie-ups and due to outbursts on social media against other celebrities. His Twitter and Instagram accounts were restricted, with the social media platforms removing some of his online posts that users condemned as antisemitic.
In now-deleted Instagram posts from earlier this year, the multiple Grammy award-winning artist accused Adidas and U.S. apparel retailer Gap Inc (GPS.N) of failing to build contractually promised permanent stores for products from his Yeezy fashion line.
He also accused Adidas of stealing his designs for its own products.
[1/3] Singer Kanye West walks past models after presenting his Fall/Winter 2015 partnership line with Adidas at New York Fashion Week February 12, 2015. REUTERS/Lucas Jackson/File Photo
On Tuesday, Gap, which had ended its partnership with Ye in September, said it was taking immediate steps to remove Yeezy Gap products from its stores and that it had shut down YeezyGap.com.
“Antisemitism, racism and hate in any form are inexcusable and not tolerated in accordance with our values,” Gap said in a statement. The company was selling existing Yeezy Gap stocks until the sell-off period.
European fashion house Balenciaga has also cut ties with Ye, according to media reports.
“The saga of Ye … underlines the importance of vetting celebrities thoroughly and avoiding those who are overly controversial or unstable,” said Neil Saunders, managing director of GlobalData.
Adidas poached Ye from rival Nike Inc (NKE.N) in 2013 and agreed to a new long-term partnership in 2016 in what the company then called “the most significant partnership created between a non-athlete and a sports brand.”
The tie-up helped the German brand close the gap with Nike in the U.S. market.
Yeezy sneakers, which cost between $200 and $700, generate about 1.5 billion euros ($1.47 billion) in annual sales for Adidas, making up a little over 7% of its total revenue, according to estimates from Telsey Advisory Group.
Shares in Adidas, which cut its full-year forecast last week, closed down 3.2%. The group said it would provide more information as part of its upcoming Q3 earnings announcement on Nov. 9.
($1 = 1.0044 euros)
Reporting by Mrinmay Dey, Uday Sampath and Aishwarya Venugopal in Bengaluru; Editing by Tomasz Janowski, Sriraj Kalluvila, Bernadette Baum and Anil D’Silva
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Sept 28 (Reuters) – Some major advertisers including Dyson, Mazda, Forbes and PBS Kids have suspended their marketing campaigns or removed their ads from parts of Twitter because their promotions appeared alongside tweets soliciting child pornography, the companies told Reuters.
DIRECTV and Thoughtworks also told Reuters late on Wednesday they have paused their advertising on Twitter.
Brands ranging from Walt Disney Co (DIS.N), NBCUniversal (CMCSA.O) and Coca-Cola Co (KO.N) to a children’s hospital were among more than 30 advertisers that appeared on the profile pages of Twitter accounts peddling links to the exploitative material, according to a Reuters review of accounts identified in new research about child sex abuse online from cybersecurity group Ghost Data.
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Some of tweets include key words related to “rape” and “teens,” and appeared alongside promoted tweets from corporate advertisers, the Reuters review found. In one example, a promoted tweet for shoe and accessories brand Cole Haan appeared next to a tweet in which a user said they were “trading teen/child” content.
“We’re horrified,” David Maddocks, brand president at Cole Haan, told Reuters after being notified that the company’s ads appeared alongside such tweets. “Either Twitter is going to fix this, or we’ll fix it by any means we can, which includes not buying Twitter ads.”
In another example, a user tweeted searching for content of “Yung girls ONLY, NO Boys,” which was immediately followed by a promoted tweet for Texas-based Scottish Rite Children’s Hospital. Scottish Rite did not return multiple requests for comment.
In a statement, Twitter spokesperson Celeste Carswell said the company “has zero tolerance for child sexual exploitation” and is investing more resources dedicated to child safety, including hiring for new positions to write policy and implement solutions.
She added that Twitter is working closely with its advertising clients and partners to investigate and take steps to prevent the situation from happening again.
Twitter’s challenges in identifying child abuse content were first reported in an investigation by tech news site The Verge in late August. The emerging pushback from advertisers that are critical to Twitter’s revenue stream is reported here by Reuters for the first time.
Like all social media platforms, Twitter bans depictions of child sexual exploitation, which are illegal in most countries. But it permits adult content generally and is home to a thriving exchange of pornographic imagery, which comprises about 13% of all content on Twitter, according to an internal company document seen by Reuters.
Twitter declined to comment on the volume of adult content on the platform.
Ghost Data identified the more than 500 accounts that openly shared or requested child sexual abuse material over a 20-day period this month. Twitter failed to remove more than 70% of the accounts during the study period, according to the group, which shared the findings exclusively with Reuters.
Reuters could not independently confirm the accuracy of Ghost Data’s finding in full, but reviewed dozens of accounts that remained online and were soliciting materials for “13+” and “young looking nudes.”
After Reuters shared a sample of 20 accounts with Twitter last Thursday, the company removed about 300 additional accounts from the network, but more than 100 others still remained on the site the following day, according to Ghost Data and a Reuters review.
Reuters then on Monday shared the full list of more than 500 accounts after it was furnished by Ghost Data, which Twitter reviewed and permanently suspended for violating its rules, said Twitter’s Carswell on Tuesday.
In an email to advertisers on Wednesday morning, ahead of the publication of this story, Twitter said it “discovered that ads were running within Profiles that were involved with publicly selling or soliciting child sexual abuse material.”
Andrea Stroppa, the founder of Ghost Data, said the study was an attempt to assess Twitter’s ability to remove the material. He said he personally funded the research after receiving a tip about the topic.
Twitter’s transparency reports on its website show it suspended more than 1 million accounts last year for child sexual exploitation.
It made about 87,000 reports to the National Center for Missing and Exploited Children, a government-funded non-profit that facilitates information sharing with law enforcement, according to that organization’s annual report.
“Twitter needs to fix this problem ASAP, and until they do, we are going to cease any further paid activity on Twitter,” said a spokesperson for Forbes.
“There is no place for this type of content online,” a spokesperson for carmaker Mazda USA said in a statement to Reuters, adding that in response, the company is now prohibiting its ads from appearing on Twitter profile pages.
A Disney spokesperson called the content “reprehensible” and said they are “doubling-down on our efforts to ensure that the digital platforms on which we advertise, and the media buyers we use, strengthen their efforts to prevent such errors from recurring.”
A spokesperson for Coca-Cola, which had a promoted tweet appear on an account tracked by the researchers, said it did not condone the material being associated with its brand and said “any breach of these standards is unacceptable and taken very seriously.”
NBCUniversal said it has asked Twitter to remove the ads associated with the inappropriate content.
CODE WORDS
Twitter is hardly alone in grappling with moderation failures related to child safety online. Child welfare advocates say the number of known child sexual abuse images has soared from thousands to tens of millions in recent years, as predators have used social networks including Meta’s Facebook and Instagram to groom victims and exchange explicit images.
For the accounts identified by Ghost Data, nearly all the traders of child sexual abuse material marketed the materials on Twitter, then instructed buyers to reach them on messaging services such as Discord and Telegram in order to complete payment and receive the files, which were stored on cloud storage services like New Zealand-based Mega and U.S.-based Dropbox, according to the group’s report.
A Discord spokesperson said the company had banned one server and one user for violating its rules against sharing links or content that sexualize children.
Mega said a link referenced in the Ghost Data report was created in early August and soon after deleted by the user, which it declined to identify. Mega said it permanently closed the user’s account two days later.
Dropbox and Telegram said they use a variety of tools to moderate content but did not provide additional detail on how they would respond to the report.
Still the reaction from advertisers poses a risk to Twitter’s business, which earns more than 90% of its revenue by selling digital advertising placements to brands seeking to market products to the service’s 237 million daily active users.
Twitter is also battling in court Tesla CEO and billionaire Elon Musk, who is attempting to back out of a $44 billion deal to buy the social media company over complaints about the prevalence of spam accounts and its impact on the business.
A team of Twitter employees concluded in a report dated February 2021 that the company needed more investment to identify and remove child exploitation material at scale, noting the company had a backlog of cases to review for possible reporting to law enforcement.
“While the amount of (child sexual exploitation content) has grown exponentially, Twitter’s investment in technologies to detect and manage the growth has not,” according to the report, which was prepared by an internal team to provide an overview about the state of child exploitation material on Twitter and receive legal advice on the proposed strategies.
“Recent reports about Twitter provide an outdated, moment in time glance at just one aspect of our work in this space, and is not an accurate reflection of where we are today,” Carswell said.
The traffickers often use code words such as “cp” for child pornography and are “intentionally as vague as possible,” to avoid detection, according to the internal documents. The more that Twitter cracks down on certain keywords, the more that users are nudged to use obfuscated text, which “tend to be harder for (Twitter) to automate against,” the documents said.
Ghost Data’s Stroppa said that such tricks would complicate efforts to hunt down the materials, but noted that his small team of five researchers and no access to Twitter’s internal resources was able to find hundreds of accounts within 20 days.
Twitter did not respond to a request for further comment.
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Reporting by Sheila Dang in New York and Katie Paul in Palo Alto; Additional reporting by Dawn Chmielewski in Los Angeles; Editing by Kenneth Li and Edward Tobin
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Fed will keep tightening until inflation controlled – Powell
Core PCE increases 0.1% in July vs. 0.6% rise in June
Dell, Affirm tumble on weaker forecasts
Indexes down: Dow 3.03%, S&P 3.37%, Nasdaq 3.94%
Lower for the week: Dow 4.2%, S&P 4%, Nasdaq 4.4%
Aug 26 (Reuters) – Wall Street ended Friday with all three benchmarks more than 3% lower, as Federal Reserve Chief Jerome Powell’s signal that the central bank would keep hiking rates to tame inflation nixed nascent hopes for a more modest path among some investors.
The Nasdaq led declines among the three U.S. benchmarks, registering its worst daily performance since June 16, weighed by high-growth technology stocks which tumbled after rallying the previous day in anticipation of Powell’s scheduled speech to the Jackson Hole central banking conference in Wyoming.
The U.S. economy will need tight monetary policy “for some time” before inflation is under control, Powell said at the event. That means slower growth, a weaker job market and “some pain” for households and businesses, he added. read more
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Investors knew further rate rises were coming, and they have been divided between whether a 75-basis-point and a 50-basis-point hike by the Fed was coming next month.
However, recent data highlighting continued strength in the labor market, to offset two consecutive quarters of negative economic growth, had led to some speculating a more tempered pace of hikes could be forthcoming.
“The pushback is coming from the idea that it’s not about the pace of hikes going forward and how they tighten financial conditions, it’s about the duration of remaining at that restrictive policy stance,” said Garrett Melson, portfolio strategist at Natixis Investment Managers.
“That’s the nuance they are trying to push forward and Powell was, maybe, a bit more explicit in that today. But if you’ve listened to other Fed speakers in the last couple of weeks, it’s the same message.”
Reuters Graphics Reuters Graphics
With investors repositioning after absorbing the speech, the Cboe Volatility Index (.VIX) jumped 3.78 points to 25.56, its highest close in six weeks.
All the 11 major S&P 500 sectors were lower, led by declines of between 3.9% and 4.3% in the information technology (.SPLRCT), communication services (.SPLRCL) and consumer discretionary (.SPLRCD) indexes.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., August 15, 2022. REUTERS/Brendan McDermid/File Photo
The S&P 500 (.SPX) lost 141.46 points, or 3.37%, to end at 4,057.66 points, while the Nasdaq Composite (.IXIC) lost 497.56 points, or 3.94%, to 12,141.71. The Dow Jones Industrial Average (.DJI) fell 1,008.38 points, or 3.03%, to 32,283.40.
High-growth and technology stocks dropped. Nvidia Corp (NVDA.O) and Amazon.com Inc fell 9.2% and 4.8%, respectively, having led gainers in the previous session. Meanwhile, Google-parent Alphabet Inc (GOOGL.O), Meta Platforms Inc , and Block Inc (SQ.N) also dipped between 4.1% and 7.7%.
U.S. stock indexes have retreated since the turn of the year as investors priced in the expectation of aggressive interest rate hikes and a slowing economy.
But they have recovered strongly since June, with the S&P 500 recouping nearly half its losses for the year on stronger-than-expected quarterly earnings and hopes decades-high inflation has peaked.
However, Friday’s falls wiped out the modest August gains which all three benchmarks had previously carved out, and sent the trio to their second straight week of declines.
For the week, the Nasdaq slid 4.4%, the Dow lost 4.2%, and the S&P 500 fell 4%.
Data earlier showed consumer spending barely rose in July, but inflation eased considerably, which could give the Fed room to trim its aggressive interest rate increases. read more
Dell Technologies Inc (DELL.N) fell 13.5% as it joined rivals in predicting a slowdown as inflation and the darkening economic outlook prompt consumers and businesses to tighten their purse strings. read more
Affirm Holdings Inc (AFRM.O) tumbled 21.3% after the buy-now-pay-later lender forecast full-year revenue below Wall Street estimates, underscoring the broader downturn in the fortunes of the once high-flying fintech sector.
Volume on U.S. exchanges was 10.37 billion shares, compared with the 10.64 billion average for the full session over the last 20 trading days.
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Reporting by Bansari Mayur Kamdar, Devik Jain, Anisha Sircar and Sruthi Shankar in Bengaluru and David French in New York; Editing by Maju Samuel, Aditya Soni and Grant McCool
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PARIS, July 15 (Reuters) – American tourist Shawna Wilson says she has splashed out on four dresses at the high-end LVMH-owned department store La Samaritaine in Paris, tempted by the prices as the euro reached parity with the U.S. dollar.
The euro tumbled below $1 on Wednesday for the first time in two decades on fears that rising energy prices triggered by the Ukraine conflict could tip the European Union into a prolonged economic crisis. read more
“It’s like it’s on sale here,” said Wilson, 49, from Colorado, whose purchases included two dresses for her daughter. “Because the euro and the dollar are about the same, it definitely encourages us to spend.”
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The weak euro is big draw for tourists, particularly Americans – who are flagged as a key growth driver for the European luxury goods sector in the second quarter, according to analysts from Barclays.
The strong dollar versus the euro contributed to a four-fold rise in tourism spending in Europe in June compared with last year, with an acceleration in spending from Americans, analysts at UBS, citing data from VAT refund provider Planet, said.
The luxury sector has rebounded quickly from the pandemic as people rushed to spend money saved during lockdowns — buying themselves treats as socialising resumed.
But sales in China, the world’s largest luxury goods market, have plunged this year as a new wave of strict COVID-19 lockdowns shuttered shops, crimped demand and also meant fewer high-spending Chinese tourists in Europe. read more
So as Americans fill up transatlantic flights, their eagerness to cash in on the weak euro is helping to replace business lost as a result of the lack of Chinese visitors, who were the main source of luxury sales growth in Europe pre-pandemic.
Luxury goods companies Richemont (CFR.S) and Burberry on Friday reported higher sales in Europe, which helped to offset a drop of more than 30% in China. read more
France has benefited most from the tourists’ splurge.
Sales to tourists in France in June climbed to just 11.3% below 2019 levels, a positive sign for French luxury labels that have a big exposure to their home market, UBS analysts said.
The Dior logo is seen on a building under renovation of luxury brand Dior on the Champs-Elysees avenue in Paris, France, July 13, 2022. REUTERS/Rali Benallou NO RESALES. NO ARCHIVES
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American tourists were thronging Paris’s Avenue Montaigne this week, browsing in the luxury boutiques, which include designer names such as Louis Vuitton, Chanel and Gucci.
Cheryl Penn, 70, a realtor from Delray Beach, Florida, had already bought herself a skirt and stocked up on baby clothes for her granddaughter.
“We just got on the Avenue, so we just started our shopping spree,” said Penn.
“I like that the euro and the dollar are equal so I know exactly what I’m spending,” she said.
Jennifer Groner, a TikTok influencer, went on a shopping spree in Paris in April when the euro was under pressure versus the dollar.
“I’ve never seen anything like this in terms of the price savings,” she told Reuters, estimating that she snapped up a Birkin bag from Hermes in Paris for $4,000 less than it would have cost her in the United States, paying little over $9,000, thanks also to a VAT refund.
“You’re able to travel to Europe, take in the culture but at the same time buy a bag,” said Groner, who also bought handbags and accessories from Prada, Dior, Louis Vuitton and Chanel, for overall savings of $8,000 compared with U.S. prices, based on her calculations.
Monika Arora, founder of pursebop.com, a news and information website for luxury brands, said she believes the brands will eventually “harmonise” prices.
“They’ve done that many times before,” she said.
Chanel told Reuters in May it could implement further price increases in July to account for currency fluctuations – particularly the weakness of the euro – and inflation. read more
The pull of Paris remains strong for American shoppers even though New York’s high end shopping streets teem with luxury European designer brands.
“So many of my friends more than ever are taking little weekend trips to Paris and other places and they are shopping while they are there — because that’s what you do while you’re in Paris,” said Jennifer Tumpowski, outside Gucci’s flagship store on New York’s Fifth Avenue.
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Reporting by Lea Guedj, Doyinsola Oladipo, Gigi Zamora and Mimosa Spencer. Editing by Jane Merriman
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LOS ANGELES/WASHINGTON, June 7 (Reuters) – U.S. Vice President Kamala Harris has pooled $3.2 billion in corporate pledges aimed at addressing some of the economic factors driving migration from Central America, her office said on Tuesday, lending impetus to measures to be discussed at the Summit of the Americas this week.
The new commitments from companies, including Visa Inc (V.N) and the apparel company Gap Inc (GPS.N), exceed $1.9 billion, adding to $1.2 billion made in December. read more The latest round of corporate investments announced by Harris are intended to create jobs, expand access to the internet and bring more people into the formal banking system.
The pledges form a major part of President Joe Biden’s plan to address “root causes” of migration from Guatemala, Honduras and El Salvador, a region known as the Northern Triangle. Curbing irregular migration is a top priority for Biden at a time when record numbers of people are trying to enter the United States at the Mexican border.
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Biden, who travels to Los Angeles on Wednesday for the U.S.-hosted summit, will also promote a new economic plan for the Western Hemisphere building on existing trade agreements, U.S. officials said. read more
Even as he grapples with pressing concerns such as mass shootings, high inflation and the Ukraine war, the Democratic president wants to use the summit to repair Latin America relations damaged under his Republican predecessor, Donald Trump, and to counter China’s growing influence in the region.
But the administration’s decision to exclude Cuba, Venezuela and Nicaragua, which prompted Mexican President Andres Manuel Lopez Obrador to stay away, has threatened to overshadow Biden’s agenda. read more
However, U.S. efforts to stem migration from the Northern Triangle have been hampered by corruption, with projects likely worth millions shelved and some private sector engagement stalled. read more
Further complicating matters, the presidents of Guatemala and Honduras have signaled they will not attend the summit and will instead send other officials. It was unclear whether El Salvador’s President Nayib Bukele would attend, but the White House’s official guest list shows his foreign minister as head of the delegation.
Several thousand migrants, many from Venezuela, set off from southern Mexico on Monday on a journey to the United States timed to coincide with the summit. read more
U.S. Vice President Kamala Harris. REUTERS/Kevin Lamarque
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At least 6,000 people, according to Reuters witnesses, left the city of Tapachula, near Mexico’s border with Guatemala.
CORPORATE PLEDGES
The latest corporate pledges includes $270 million from Visa focused on bringing 6.5 million people into the formal banking system, and a $150 million pledge from Gap to increase materials sourced from the region.
The other firms span a variety of sectors, including auto-parts, agriculture, telecommunications and digital services.
A CEO summit running parallel to the leaders’ gathering could yield commitments for further investment in economically troubled Latin America, which has been hit hard by the COVID-19 pandemic and is struggling to recover.
Harris also announced an initiative with the private sector that aims to connect 1.4 million women to the financial system and train more than 500,000 women and girls in job skills.
Additionally, Harris unveiled a $50 million project called the Central American Service Corps designed to give young people in the Northern Triangle paid community service opportunities in areas such as education and violence prevention.
Despite friction over summit invitations, most leaders in the Americas plan to attend. White House officials insist the controversy will blow over and the event – the first hosted by the United States since the first such gathering in 1994 – will be a success.
But before heading to the summit, Mexican Foreign Minister Marcelo Ebrard, in a newspaper op-ed, accused the United States of being “inconsistent, if not contradictory” for refusing to invite Communist-ruled Cuba and leftist-led Venezuela and Nicaragua while engaging with non-democratic governments in other regions such as Southeast Asia. read more
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Reporting by Daina Solomon and Matt Spetalnick in Los Angeles and Ted Hesson in Washington; Additional reporting by Dave Graham in Los Angeles and Alexandra Valencia in Quito; Editing by Grant McCool
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May 20 (Reuters) – Wall Street ended mixed on Friday after a volatile session that saw Tesla slump and other growth stocks also lose ground.
The S&P 500 and the Nasdaq logged their seventh straight week of losses, their longest losing streak since the end of the dotcom bubble in 2001.
The Dow (.DJI) suffered its eighth consecutive weekly decline, its longest since 1932 during the Great Depression.
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Worries about surging inflation and rising interest rates have pummeled the U.S. stock market this year, with danger signals from Walmart Inc (WMT.N) and other retailers this week adding to fears about the economy.
The S&P 500 spent most of the session in negative territory and at one point was down just over 20% from its Jan. 3 record high close before ending down 18% from that level and flat for the day.
Closing down 20% from that record level would confirm the S&P 500 has been in a bear market since reaching that January high, according to a common definition.
The tech-heavy Nasdaq (.IXIC) was last down about 27% from its record close in November 2021.
S&P 500 bear markets
Weighing heavily on the S&P 500, Tesla (TSLA.O) tumbled 6.4% after Chief Executive Elon Musk denounced as “utterly untrue” claims in a news report that he sexually harassed a flight attendant on a private jet in 2016. read more
Other megacap stocks also fell, with Apple Google-owner Alphabet Inc (GOOGL.O) down 1.3% and Nvidia (NVDA.O) losing 2.5%.
Shares of Deere & Co (DE.N) dropped 14% after the heavy equipment maker posted downbeat quarterly revenue. read more
A trader works on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., May 19, 2022. REUTERS/Andrew Kelly
Pfizer (PFE.N) rose 3.6%, helping the S&P 500 avoid a loss for the day.
Recent disappointing forecasts from big retailers Walmart, Kohl’s Corp (KSS.N) and Target Inc (TGT.N) have rattled market sentiment, adding to evidence that rising prices have started to hurt the purchasing power of U.S. consumers.
On Friday, Ross Stores (ROST.O) plunged 22.5% after the discount apparel retailer cut its 2022 forecasts for sales and profit, while Vans brand owner VF Corp (VFC.N) gained 6.1% on strong 2023 revenue outlook.
Traders are pricing in 50-basis point rate hikes by the U.S. central bank in June and July.
The S&P 500 edged up 0.01% to end the session at 3,901.36 points.
The Nasdaq declined 0.30% to 11,354.62 points, while the Dow Jones Industrial Average rose 0.03% to 31,261.90 points.
S&P 500’s busiest trades
For the week, the S&P 500 fell 3.0%, the Dow lost 2.9% and the Nasdaq declined 3.8%.
About two thirds of S&P 500 stocks are down 20% or more from their 52-week highs.
Volume on U.S. exchanges was 13.0 billion shares, compared with a 13.5 billion average over the last 20 trading days.
Declining issues outnumbered advancing ones on the NYSE by a 1.16-to-1 ratio; on Nasdaq, a 1.24-to-1 ratio favored decliners.
The S&P 500 posted 1 new 52-week highs and 48 new lows; the Nasdaq Composite recorded 11 new highs and 353 new lows.
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Reporting by Amruta Khandekar and Devik Jain in Bengaluru, and by Noel Randewich in Oakland, Calif.; Editing by Shounak Dasgupta, Arun Koyyur and Grant McCool
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KPMG, PwC, EY, Deloitte all cut ties with local units
American Express calls Ukraine attack ‘unjustified’
March 7 (Reuters) – Uniqlo owner Fast Retailing (9983.T) will keep its stores in Russia open, joining a small group of international firms that are staying put even as dozens of big brands temporarily shutter operations or exit the country over its invasion of Ukraine.
Political pressure is building on companies to halt business in Russia, while operations have also been complicated by sweeping sanctions affecting everything from global payments systems to a range of high-tech products.
Large shippers have suspended container routes to and from Russia and many Western companies from Nike Inc and home furnishings giant Ikea to energy majors BP and Shell (SHEL.L) have closed shop or announced plans to exit the country.
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“Clothing is a necessity of life. The people of Russia have the same right to live as we do,” said Fast Retailing CEO Tadashi Yanai in remarks first reported by Nikkei, adding that every country should oppose war.
A spokesperson told Reuters the company had seen no noticeable impact on its supply chain or logistics in Russia, where Uniqlo has 49 stores.
In contrast, Levi Strauss & Co (LEVI.N) suspended its Russian operations, including any new investments.
The Big Four accounting firms KPMG, PwC, EY and Deloitte moved one by one to cut their ties with Russia, as did credit card company American Express (AXP.N).
Dairy cooperative Arla Foods, French yoghurt maker Danone (DANO.PA) and Belgian chemicals group Solvay (SOLB.BR) also suspended operations or investment in the country, while the RIA Novosti news agency cited carmaker Nissan as saying it would halt production at its factory in St Petersburg. read more
Nissan said last week it was suspending vehicle exports to Russia, joining peers like General Motors Co (GM.N) and Sweden’s Volvo Cars (VOLCARb.ST).
The sun sets behind the skyscrapers of the Moscow International Business Centre, also known as “Moskva-City”, in Moscow, Russia April 23, 2018. REUTERS/Anton Vaganov
Among companies continuing to operate in Russia were McDonald’s Corp (MCD.N) and PepsiCo Inc (PEP.O), prompting New York state’s pension fund – a shareholder in the pair – to urge them and others to consider pausing their operations there. read more
Russia announced new “humanitarian corridors” on Monday to transport Ukrainians trapped under its bombardment – to Russia itself and its ally Belarus, a move immediately denounced by Kyiv as an immoral stunt. read more
Russia calls the campaign it launched on Feb. 24 a “special military operation”. It denies attacking civilian areas and says it has no plans to occupy Ukraine.
After Russian President Vladimir Putin signed a new media law on Friday, Chinese-owned video app TikTok said it would suspend live-streaming and the uploading of videos to its platform in Russia. read more
“We have no choice but to suspend livestreaming and new content to our video service while we review the safety implications of this law,” it said in a series of Twitter posts on Sunday.
‘UNJUSTIFIED ATTACK’
Many companies have strongly condemned Russia’s actions as they suspended services in the country.
“In light of Russia’s ongoing, unjustified attack on the people of Ukraine, American Express is suspending all operations in Russia,” AMEX said on its website. read more
Netflix , which had already temporarily stopped future projects and acquisitions in Russia, suspended its service “given the situation on the ground”, a spokesperson said. read more
KPMG, PwC, EY and Deloitte all said they would sever links with their Russian operations, affecting thousands of staff. read more
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Reporting by Akriti Sharma in Bengaluru, Chris Gallagher in Washington, DC, Rocky Swift in Tokyo; Writing by Anna Driver and Sayantani Ghosh; editing by Diane Craft, Kirsten Donovan, Bernadette Baum and Susan Fenton
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Hermes ‘deeply concerned about situation in Europe’
Russians spend $9 bln/year on luxury goods -Jefferies
PARIS, March 4 (Reuters) – The world’s leading luxury brands said on Friday that they planned to temporarily close stores and pause business operations in Russia.
Birkin bag maker Hermes and Cartier owner Richemont were the first firms to announce such moves, followed by LVMH (LVMH.PA), Kering (PRTP.PA) and Chanel.
Doing business in Russia has become complex since Russia’s invasion of Ukraine, which prompted the United States, Britain and the Europe Union to impose sweeping sanctions.
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“Given our increasing concerns about the current situation, the growing uncertainty and the complexity to operate, Chanel decided to temporarily pause its business in Russia,” the French luxury fashion house said in a LinkedIn post.
Luxury giant LVMH, which owns such brands as Christian Dior, Givenchy, Kenzo, TAG Heuer and Bulgari among others, will close its 124 boutiques in Russia from Sunday but will continue to pay the salaries for its 3,500 employees in the country, a spokesperson told Reuters.
French multinational Kering, whose brands include brands as Gucci, Saint Laurent, Bottega Veneta and Boucheron among others, has two shops and 180 employees, which the company will continue to support.
While affluent Russians are keen consumers of luxury goods, analysts say the proportion of luxury sales generated from Russian nationals is small compared to the industry’s main growth engines, China and the United States.
Richemont, which also owns Dunhill, Jaeger-LeCoultre, Montblanc, Piaget, and Van Cleef & Arpels among other brands, has around a dozen directly operated stores, mostly in Moscow. It said in a statement it had suspended commercial activities in Russia on March 3 after stopping Ukraine operations on Feb. 24, the day Russia launched its invasion.
Hermes, which has three stores in Moscow, had planned to open an outlet in St. Petersburg later this year.
Investment bank Jefferies estimates that Russians account for around $9 billion in annual luxury sales, which is around 6% of Chinese spending and 14% of U.S spending on luxury goods.
Swiss watchmaker Swatch Group (UHR.S), which owns high end watches and jewellery labels including Harry Winston, said it would continue its operations in Russia, but was putting exports on hold “because of the overall difficult situation”.
L’Oreal (OREP.PA), LVMH (LVMH.PA) and Kering (PRTP.PA) have all pledged financial support to help Ukrainian refugees and Richemont said on Friday it was initiating a “significant donation” to Medecins Sans Frontieres.
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Reporting by Mimosa Spencer, Silvia Aloisi and Layli Foroudi; Editing by Tassilo Hummel, Jon Boyle, Susan Fenton, Alexander Smith and Sandra Maler
Our Standards: The Thomson Reuters Trust Principles.
March 3 (Reuters) – Sneaker maker Nike and home furnishings firm IKEA shut down stores in Russia on Thursday, as trade restrictions and supply shutdowns added to political pressure for companies to stop business in Russia because of its invasion of Ukraine.
French bank Societe Generale (SOGN.PA) said it was working to cut its risks in Russia, fearing a tit-for-tat response by Moscow to Western sanctions, as more companies from vodka maker Diageo (DGE.L) to IKEA suspended business in the country.
Globally known companies including Apple, Ford and Shell have condemned Russia’s attack, but some of the announcements on Thursday were more practical, focused on supplies and sanctions as shipping routes closes and governments banned exports to Russia.
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Boeing Chief Executive David Calhoun, in a note to staff, acknowledged the violence in Ukraine but avoided politics.
“Moving forward, Boeing will continue to follow the lead of the U.S. government and strictly adhere to the export controls and restrictions that have been announced governing work in Russia,” he said in the note seen by Reuters, which described suspension of work in Russia and Ukraine.
Brazilian plane-maker Embraer (EMBR3.SA) joined Airbus and Boeing in halting parts supplies to Russian airlines.
Home furnishings retailer IKEA (IKEA.UL) said it would close outlets in Russia and Russian ally Belarus, affecting 15,000 workers, and described its shutdowns in non-political terms.
“The war has both a huge human impact and is resulting in serious disruptions to supply chain and trading conditions, which is why the company groups have decided to temporarily pause IKEA operations in Russia,” IKEA said in a statement. read more
Nike Inc said it was “deeply troubled by the devastating crisis in Ukraine” and described its closing of stores in this way: “Given the rapidly evolving situation, and the increasing challenges of operating our business, Nike will be pausing operations in Russia.”
Some companies and investors added up the costs of their actions.
Norway’s $1.3 trillion wealth fund said its Russian assets, worth around $3 billion before the invasion, have now become effectively worthless. read more “They are pretty much written off,” CEO Nicolai Tangen told Reuters.
TJX Cos Inc (TJX.N) said on Thursday it would sell its 25% stake in Russian low-cost apparel retailer Familia, which cost it $225 million in 2019. Because of a decline in the rouble and TJX said it may take an impairment charge due to the sale.
SANCTIONS RISKS
A man wearing a protective face mask amid the outbreak of the coronavirus disease (COVID-19) walks past a Nike brand store in central Kyiv, Ukraine December 10, 2020. REUTERS/Valentyn Ogirenko
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Underscoring the challenges global companies are facing as they comply with sanctions against Russia, Societe Generale said on Thursday it could see an “extreme scenario” where Russia strips the bank of its local operations. The lender has a $20 billion exposure to Russia. read more
Citigroup Inc (C.N) said on Wednesday it could face billions of dollars in losses on its exposure to Russia and was looking to exit Russian assets. Bank shares have taken a drubbing in recent days amid fears of possible writedowns and weaker economies. read more
Western sanctions, including shutting out some Russian banks from the SWIFT global financial network, new export controls, and closure of air space, have led dozens of global companies to pause operations in the country, hammered the rouble and forced the central bank to jack up interest rates. read more
Spanish fashion retailer Mango said on Thursday that it was temporarily closing its shops and its online sale website in Russia, and Spirits company Diageo (DGE.L), the maker of Smirnoff vodka and Guinness, said it had paused exports to Ukraine and Russia. read more
Accenture said it was discontinuing its Russian business, which had nearly 2,300 employees. read more
Britain said on Thursday it will ban Russian companies from the London insurance market, the world’s largest commercial and specialty insurance centre. read more
Hundreds of Russian soldiers and Ukrainian civilians have been killed and more than one million people have fled Ukraine in the week since President Vladimir Putin ordered the attack. read more
Russia calls its actions in Ukraine a “special operation” that it says is not designed to occupy territory but to destroy its southern neighbour’s military capabilities and capture what it regards as dangerous nationalists.
SCRAMBLED SUPPLIES
With a shortage of components, more carmakers are halting production at their factories in Russia, including Russia’s biggest carmaker, Avtovaz (AVAZI_p.MM) – controlled by France’s Renault (RENA.PA) – which said it would close two plants on Saturday and from March 9 to 10 due to shortage of electronic components. read more
Nissan Motor Co <7201.T > said on Thursday it has suspended vehicle exports to Russia, while Japanese peer Toyota (7203.T) said it would halt production at its Russian factory from Friday and indefinitely stop vehicle exports to the country.
The world’s biggest shipping lines, MSC and Maersk (MAERSKb.CO) have suspended container shipping to and from Russia, with Maersk saying food and medical supplies to Russia risk being damaged or spoiled due to delays at ports and customs. read more
Japan Airlines (9201.T) and ANA Holdings (9202.T), which normally use Russian airspace for their Europe flights, said they would cancel all flights to and from Europe on Thursday, joining other carriers that have canceled or rerouted flights between Europe and north Asia. read more
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Reporting by Tassilo Hummel in Paris, Jamie Freed in Sydney, Gwladys Fouche in Oslo, Illona Wissenbach in Frankfurt, Anna Ringstrom in Stockholm, Richa Naidu in London
Additional reporting by Tim Hepher in Paris, Satoshi Sugiyama in Tokyo, Mehr Bedi, Chavi Mehta, Praveen Paramasivam, Uday Sampath in Bengaluru, Megan Davies in New York, and in Madrid by Emma Pinedo
Writing by Peter Henderson, Sayantani Ghosh and John Revill
Editing by Lincoln Feast, Simon Cameron-Moore, Tomasz Janowski, Frances Kerry and Nick Zieminski
Our Standards: The Thomson Reuters Trust Principles.
Customers enter a Zara shop in Nantes as non-essential business re-open after closing down for months, amid the coronavirus disease (COVID-19) outbreak in France, May 19, 2021. REUTERS/Stephane Mahe/File Photo
PARIS, July 1 (Reuters) – French prosecutors have opened an investigation into four fashion retailers suspected of concealing “crimes against humanity” in China’s Xinjiang region, a judicial source said on Thursday.
The procedure is linked to accusations against China over its treatment of minority Muslim Uyghurs in the region, including the use of forced labour, the source said.
China denies all accusations of abuse in the region.
The source told Reuters Uniqlo France, a unit of Japan’s Fast Retailing (9983.T), Zara owner Inditex (ITX.MC), France’s SMCP (SMCP.PA) and Skechers (SKX.N) were the subject of the investigation, confirming a report by French media website Mediapart.
“An investigation has been opened by the crimes against humanity unit within the antiterrorism prosecutor’s office following the filing of a complaint,” the source said.
France has a Central Office to Fight Crimes against Humanity, Genocide and War Crimes, founded in 2013.
Inditex said it rejected the claims in the legal complaint, adding that it conducted rigorous traceability controls and would fully cooperate with the French investigation.
“At Inditex, we have zero tolerance for all forms of forced labour and have established policies and procedures to ensure this practice does not take place in our supply chain,” the company said in a statement.
SMCP said it would cooperate with the French authorities to prove the allegations false.
“SMCP works with suppliers located all over the world and maintains that it does not have direct suppliers in the region mentioned in the press,” SMCP said, adding that it regularly audited its suppliers.
Fast Retailing said in a statement from Tokyo that it had not been contacted by French authorities and that none of its production partners are located in Xinjiang.
“If and when notified, we will cooperate fully with the investigation to reaffirm there is no forced labour in our supply chains,” it said.
The company lost an appeal with United States Customs in May after a shipment of Uniqlo men’s shirts were impounded because of suspected violations of a ban on Xinjiang cotton. read more
Skechers said it does not comment on pending litigation. It referred Reuters to a March 2021 statement in which it said it maintained a strict supplier code of conduct.
Two nongovernmental organisations (NGOs) filed a complaint in France in early April against multinationals for concealment of forced labour and crimes against humanity.
United Nations experts and rights groups estimate over a million people, mainly Uyghurs and other Muslim minorities, have been detained in recent years in a vast system of camps in China’s western Xinjiang region.
Many former inmates have said they were subject to ideological training and abuse. Rights groups say the camps have been used as a source of low-paid and coercive labour.
China initially denied the camps existed, but has since said they are vocational centres designed to combat extremism. In late 2019, China said all people in the camps had “graduated.”
Several Western brands including H&M (HMb.ST), Burberry (BRBY.L) and Nike (NKE.N) have been hit by consumer boycotts in China after raising concerns about reports of forced labour in Xinjiang. read more
In March, the United States, the European Union, Britain and Canada imposed sanctions on Chinese officials, citing human rights abuses in Xinjiang. Beijing retaliated immediately with its own punitive measures. read more
Human Rights Watch this year documented what it said could constitute crimes against humanity being committed in Xinjiang.
Reporting by Benoit Van Overstraeten in Paris
Additional reporting by Richard Lough in Paris, Jesus Aguado in Madrid and Rocky Swift in Tokyo.
Editing by Kirsten Donovan and Matthew Lewis
Our Standards: The Thomson Reuters Trust Principles.
