Afp Business Asia

When Donald Trump was elected, Indian garment exporter R.K. Sivasubramaniam thought the new US president would boost business and invested heavily in anticipation of a boom.But less than a year later, everything is “upside down”, he admits with a pained smile.Trump’s 50 percent tariffs on Indian goods, imposed in August, have upset the country’s $11 billion textile export industry and shaken confidence in the US market.Sivasubramaniam’s Raft Garments factory in southern India, normally frenetic with humming sewing machines, is quieter and work hours have been cut, hitting employees’ paypackets.If his US buyers turn to other suppliers, half his business could vanish.Meanwhile, half a million garments sit in towering stacks, ready for shipment but stalled over who will pay the new duties.Buyers are asking for a 16-20 percent discount.”We cannot give that much,” said Sivasubramaniam, whose desk carries crossed US and Indian flags. “It’s a very huge loss for us.”If Raft doesn’t shoulder part of the duties, it won’t be paid for garments already produced — leaving it unable to cover costs.”If it continues for another month… we cannot give work to our employees,” he warned.Trump’s anger at India’s purchases of Russian oil — which Washington says help finance Moscow’s war in Ukraine — has left New Delhi facing some of the world’s steepest tariffs.A trade deal that could ease that hinges partly on progress in peace talks.But the fallout is being felt in Tiruppur, in the southern state of Tamil Nadu.- ‘Worst possible situation’ -Dubbed India’s “knitwear capital”, and “Dollar City” for its export earnings, the small industrial town produced $5 billion in garments last fiscal year, two-fifths going to the United States. Its lanes are dotted with thousands of units including dyeing, embroidery and sewing workshops.Manufacturers paint a grim picture.”US orders have largely stopped, around 80 percent of the US business has reduced,” said Ramesh Jebaraj of Trinity Tex.In the same season last year, he produced 100,000 garments.Now he has barely a fifth of that — forcing him to seek buyers in Israel and the United Arab Emirates.”This is the situation across Tiruppur,” he told AFP. “Some of the bigger factories are on the verge of closing some of their units.”Alexander John of NC John Garments, which supplies Walt Disney, called the tariff standoff “the worst possible situation any business can be in”.With his US orders “completely at a standstill”, he has cut shifts and laid off workers.To stay afloat, he is looking to Europe and Britain but said “none of these markets can replace the US”.Tamil Nadu Chief Minister M.K. Stalin has warned that up to three million jobs could be at risk across the state’s textile belt, a grim prospect for a country struggling to provide well-paid work for its youth.Local industry associations say they have so far avoided widespread layoffs by agreeing to steep discounts on US shipments.”In the short term, we’re giving discounts to the customer ranging from 20 to 25 percent,” said N. Thirukkumaran, general secretary of the Tiruppur Exporters Association.But he admits it is not a long-term solution, and has pleaded for government support.- ‘We are helpless’ -Exporters describe the move as a calculated gamble, by selling at a loss to maintain US buyer relationships while awaiting a trade deal.At RRK Cotton’s facility in Palladam, 17 kilometres (10 miles) from Tiruppur, dimly lit production halls are quieter than normal.Owner R. Rajkumar, a former tailor who built his business over three decades, has closed two factories and furloughed some staff.”This is a situation nobody could have anticipated,” he said, adding that he was running three factories fulfilling European orders, and shipping some US orders after giving a discount.He fears the next ordering cycle could be disrupted if US buyers shift to rivals such as Vietnam or Bangladesh.All that depends on a trade deal.Meanwhile, anger and confusion run deep among workers and business owners.”My tailor… He doesn’t know what is a trade war, or why India is buying oil from Russia, and why it is affecting our lives, our bread,” said Kumar Duraiswamy, CEO of Eastern Global Clothing.”The problem is we are helpless,” he added.N. Karthick Raja, 38, employed at a small embroidery unit now running reduced shifts, fears for his livelihood.”If this job goes away, I don’t know what I will do next,” he said. “America has abandoned us, more or less.”

Wall Street stocks turned lower Tuesday and gold closed in on $4,000 per ounce as investors weighed the US government shutdown and political turmoil in France.Wall Street equities opened higher, but stumbled into negative territory soon thereafter, with some seeing signs of a fatigued market after a heady run.”The momentum is beginning to dry up,” said FHN Financial’s Chris Low. “It just feels to me like this is primarily profit-taking, we need another catalyst.”All three major indices finished the day lower, with the S&P 500 down 0.4 percent.In Europe, the Paris stock market edged back up after a sell-off, even as President Emmanuel Macron faced a call from his first prime minister, Edouard Philippe, to resign over a deepening political and budget crisis.London and Frankfurt also ended broadly stable, but the euro fell further against the dollar.Philippe, who aspires to become president, urged Macron to call for an early presidential election.Spot gold prices came within $10 of hitting $4,000 per ounce as futures markets topped the benchmark.”Gold has benefited from multiple catalysts this year, including tariff uncertainty, stubborn inflation, and a falling US dollar,” said analyst Bret Kenwell at eToro.”Uncertainty around the government shutdown and prospects of lower interest rates have only seemed to fan the flames of this year’s rally,” he added.The US government shutdown stretched into a seventh day, with Republicans and Democrats appearing no closer to an agreement.Bets on the Federal Reserve cutting interest rates this month and the political crisis in France are adding to the allure of gold, a safe-haven asset.In Asia, Tokyo eked out another record following the weekend election of a pro-stimulus advocate to lead Japan’s ruling party, before paring gains to close flat.The election of Sanae Takaichi — expected to become Japan’s prime minister this month — ramped up optimism that she will kick-start the economy through stimulus measures.Yields on 30-year Japanese bonds hit their highest level, reflecting fears the country’s already colossal debt will balloon further.Among individual companies, Tesla slid 4.5 percent after the company unveiled revamped versions at modestly lower price points. Analysts expressed disappointment that the pricing cut was not more significant in light of the demise of a federal tax credit.Ford tumbled 6.1 percent following a fire in an Oswego, New York, aluminum plant that is expected to reduce supplies to the auto giant for months. – Key figures at around 2015 GMT -New York – Dow: DOWN 0.2 percent at 46,602.98 (close)New York – S&P 500: DOWN 0.4 percent at 6,714.59 (close)New York – Nasdaq Composite: DOWN 0.7 percent at 22,785.97 (close)London – FTSE 100: UP less than 0.1 percent at 9,483.58 (close)Paris – CAC 40: UP less than 0.1 percent at 7,974.85 (close)Frankfurt – DAX: UP less than 0.1 percent at 24,385.78 (close)Tokyo – Nikkei 225: FLAT at 47,950.88 (close)Hong Kong – Hang Seng Index: Closed for a holidayShanghai – Composite: Closed for a holidayEuro/dollar: DOWN at $1.1652 from $1.1711 on MondayPound/dollar: DOWN at $1.3422 from $1.3485Dollar/yen: UP at 151.97 yen from 150.35 yenEuro/pound: DOWN at 86.83 pence from 86.85 penceBrent North Sea Crude: DOWN less than 0.1 percent at $65.45 per barrelWest Texas Intermediate: DOWN 0.1 percent at $61.73 per barrelburs-jmb/aha

AI-related goods and a surge in exports to the United States to beat President Donald Trump’s tariff hikes boosted global merchandise trade growth this year, the World Trade Organization said Tuesday.However, the picture is bleaker for 2026, the WTO warned, as the impact of those tariffs kicks in.The WTO raised its forecast for trade volume growth in 2025 to 2.4 percent — up from 0.9 percent in August — and slashed its 2026 outlook from 1.8 percent to 0.5 percent.”Global merchandise trade outpaced expectations in the first half of 2025, driven by increased spending on AI-related products, a surge in North American imports ahead of tariff hikes, and strong trade among the rest of the world,” the WTO said, as it published its updated global trade outlook.In an unusual move, the global trade body has revised its estimates several times this year due to uncertainties surrounding the new tariffs imposed by the Trump administration.Since returning to office in January, Trump has slapped several waves of new tariffs on imports entering the United States.His administration has imposed a basic tariff of 10 percent on all countries since April, with much higher rates for some economies.- Measured reaction to tariffs -“Countries’ measured response to tariff changes in general, the growth potential of AI, as well as increased trade among the rest of the world — particularly among emerging economies — helped ease trade setbacks in 2025,” WTO chief Ngozi Okonjo-Iweala said.The WTO said artificial intelligence-related goods — including semiconductors, servers, and telecommunications equipment — drove nearly half of the overall trade expansion in the first six months of the year, rising 20 percent year-on-year in value terms.Over those six months, “42 percent of global trade growth came from AI-related goods — far out of proportion to their 15 percent share in world trade”, Okonjo-Iweala told a press conference.But the former Nigerian finance minister said trade resilience this year should not fool countries into “complacency”.”Today’s disruptions to the global trade system are a call to action for nations to reimagine trade and together lay a stronger foundation that delivers greater prosperity for people everywhere,” she said.She noted that apart from a few countries, most WTO members have not imposed tit-for-tat tariffs on the United States “like it was in the 1930s” during the Great Depression, praising them for sticking to WTO rules.- ‘So much uncertainty’ -The report predicted that all regions will record weaker import performance in 2026 as higher tariff rates and heightened trade policy uncertainty bite.Okonjo-Iweala said that looking ahead to 2026, “the fact is there is so much uncertainty it is hard to be conclusive”.The WTO’s global GDP growth projection is 2.7 percent this year and 2.6 percent in 2026.Services export growth is now expected to slow from 6.8 percent last year to 4.6 in 2025, and further down to 4.4 percent next year.

Global stocks steadied Tuesday and gold hovered around a fresh high as investors retreated to safety amid a US government shutdown and French political upheaval. French shares edged back up while the euro held losses as President Emmanuel Macron called on outgoing Prime Minister Sebastien Lecornu to salvage his administration. Lecornu, who resigned Monday after under a month in the post, was tasked with gaining cross-party support for a cabinet lineup to pull France out of political deadlock.London and Frankfurt both rose in midday deals. Gold hit a fresh peak of $3,977.44 an ounce Tuesday, before slightly paring gains, as investors eyed the US government shutdown, with Republicans and Democrats appearing no closer to an agreement.Bets on the Federal Reserve cutting interest rates this month and the political crisis in France are adding to the allure of the safe-haven asset.”The rally in gold is part of the ‘debasement’ trade,” said Kathleen Brooks, research director at trading group XTB. “This trading theme is driving demand for alternative assets such as gold and crypto, as the dollar faces a long-term decline and fiscal concerns continue to rise around the world,” she added.In Asia, Tokyo eked out another record following the weekend election of a pro-stimulus advocate to lead Japan’s ruling party, before paring gains to close flat.Hong Kong and Shanghai were closed for holidays.The election of Sanae Takaichi — expected to become Japan’s prime minister this month — ramped up optimism that she will kick-start the economy through stimulus measures.That sent the Nikkei 225 soaring almost five percent Monday and hammered the yen as investors began questioning the likelihood that the Bank of Japan will continue its interest rate hikes.Takaichi’s victory “removes uncertainty about the country’s policy direction”, said Saxo Markets’ chief investment strategist, Charu Chanana.”Her agenda is expected to continue a blend of fiscal support and ultra-easy monetary policy,” she added.Yields on 30-year Japanese bonds hit their highest level, reflecting fears the country’s already colossal debt will balloon further.A series of AI-related deals has fuelled optimism for tech stocks, driving several global markets to fresh highs this year.The latest was an announcement on Monday by Advanced Micro Devices and OpenAI of a partnership to develop AI data centres, which led the S&P 500 and Nasdaq to surge to fresh records in New York.While there are growing worries that huge investments in AI by firms have gone too far, OpenAI’s Fidji Simo told AFP she did not consider it a bubble.”I see that as a new normal, and I think the world is going to really switch to realising that computing power is the most strategic resource,” said Simo, chief operating officer of OpenAI’s applications, including its flagship model ChatGPT.- Key figures at around 1045 GMT -London – FTSE 100: UP 0.1 percent at 9,486.53 pointsParis – CAC 40: UP 0.3 percent at 7,997.84Frankfurt – DAX: UP 0.2 percent at 24,423.68Tokyo – Nikkei 225: FLAT at 47,950.88 (close)Hong Kong – Hang Seng Index: Closed for a holidayShanghai – Composite: Closed for a holidayNew York – Dow: DOWN 0.1 percent at 46,694.97 (close)Euro/dollar: DOWN at $1.1674 from $1.1713 on MondayPound/dollar: DOWN at $1.3439 from $1.3485Dollar/yen: UP at 150.75 yen from 150.24 yenEuro/pound: UP at 86.87 pence from 86.86 penceBrent North Sea Crude: DOWN 0.2 percent at $65.38 per barrelWest Texas Intermediate: DOWN 0.2 percent at $61.60 per barrel

The dizzying investments in artificial intelligence infrastructure do not constitute a bubble but rather represent today’s “new normal” to meet skyrocketing user demand, Fidji Simo, OpenAI’s de facto number two, said on Monday.The French-born executive made her comments in an interview with AFP, her first since taking up her role as Chief Operating Officer of OpenAI’s applications, including its flagship model ChatGPT.In the past few weeks, her company, under the leadership of CEO Sam Altman, has made a series of huge investments in data centers and AI chips, despite no real signs that the fast-emerging AI business is close to breaking even.The answers were lightly edited for length and clarity.- Is the AI investment frenzy a bubble right now? -What I am seeing here is a massive investment in compute (or computing power), with us meeting that need for computing power so incredibly badly for a lot of use cases that people want. [Video AI generator] Sora is a great example right now — there’s much more demand than we can serve.From that perspective, I really do not see that as a bubble. I see that as a new normal, and I think the world is going to switch to realizing that computing power is the most strategic resource.- What do you say to those who fret over AI’s dangers? -I see my job as really making sure that the good side of this technology happens and we mitigate the bad side.Take mental health, for example. I’m hearing tons of users say that they go to ChatGPT for advice in tough moments where they may not have other people to talk to. Many people can’t afford to go to a therapist. I talk to a lot of parents who are telling me: God, I got this really awesome advice that helped me unlock a situation with my child. But at the same time, we need to make sure that the model behaves as expected.On mental health, we have announced a very robust roadmap. We started with parental controls. We have plans to launch age prediction: if we can predict that the user is a teenager, we give them a model that is less permissive than we would give to an adult.Jobs are also very much on my mind, and it’s a similar approach. AI is going to create a lot of jobs, like prompt engineering, that absolutely did not exist before. At the same time, there are some professions that are going to be directly impacted, and we see our role as helping with the transition.- What are the next steps toward intelligent AI? -I think the breakthroughs are about models understanding your goals and helping accomplish them proactively.Not just give you a good answer to a question, not just have a dialog, but actually tell you, ‘Oh, okay, you’re telling me that you want to spend more time with your wife. Well, there might be some weekend getaways that would be helpful, and I know it’s a lot to plan, so I’ve already done all the planning for you and I’ve already made some reservations. Just tap one button to approve and everything gets done.’We’re still very early, but we’re on that journey to capture that.- In San Francisco, you sometimes hear: ‘America innovates, China copies, Europe regulates’ -As a European, every time I hear this saying, my heart breaks a bit. I think there has certainly been a tendency in Europe to focus on regulation a little too much.On China, we continue to be extremely focused on continuing to have a lead, because we see China continuing to invest heavily in being competitive — whether in terms of innovation or in terms of computing — and so we think it’s incredibly important to continue investing across a democratic bloc to advance AI that has these [democratic] values.- Do you let your child use ChatGPT? -ChatGPT is not supposed to be for under 13, but my kid is 10 — I still let her use it under supervision. It’s magical to see what she’s able to create. Just this weekend, she was telling me about creating a new business. She was using ChatGPT to make banners for the new business, to create taglines.In our childhood, we couldn’t turn our imagination into something real that fast. And I see that really giving her superpowers, where she thinks anything is possible.

Torrential rains that triggered deadly landslides and floods in India’s Darjeeling region also destroyed swathes of premier tea estates, officials said Tuesday.The deluge wiped out around five percent of Darjeeling’s renowned tea gardens, delivering a heavy blow in a district that has become synonymous with the leaf itself.”The flood has dealt a massive blow to the tea gardens,” Rajkumar Mondal, chairman of the Indian Tea Association’s Dooars Chapter, told AFP.More than 950 hectares of tea plantations in Darjeeling’s hills, known for producing high-quality brews with a protected Geographical Indication, “suffered drastic losses due to flooding”, he said.Darjeeling produces around 10,000 tonnes of tea each year across 17,500 hectares, according to the Tea Board of India.The damage is another indication of how the intensity and unpredictability of rainfall in recent years reflect the worsening impact of climate change on Himalayan tea-growing regions.Mondal said Darjeeling received over 261 mm (10 inches) of rain on Saturday.”It’s unprecedented — I have never experienced such a disaster in my life”, he said, adding rains struck just ahead of a “new flush”, the harvest of the finest young leaf tips.”As the flood water receded, we have seen silt soil on the tea plants… it’s a costly affair to remove.”Monsoon downpours, which began on October 3, have eased.- Trail of devastation -But they left a trail of devastation, washing away roads and triggering landslides across West Bengal state.Regional Meteorological Centre (RMC) scientist Sourish Bandopadhyay said the sudden rains were caused by “an unexpected change in the trajectory of a low-pressure system”, bringing the intense rains.”It’s a sign of climate change in the region,” he said.Praween Prakash, superintendent of police for Darjeeling, said at least 36 people have died, up from an earlier toll of 28.Landslides destroyed more than 500 houses, forcing hundreds into temporary shelters, while tourists trapped by floodwaters were rescued by earthmovers, officials said.India’s tea industry is feeling the growing impact of climate change, with rising temperatures and unpredictable weather hurting both yields and quality, according to the Tea Board.Intense downpours cause waterlogging and soil erosion, while longer dry spells have forced tea estates to rely on irrigation to sustain crops, it says.Growers are also reporting new pests and diseases, with estates forced to use more fertilisers and pesticides to protect plants and maintain soil fertility.India’s tea industry employs more than one million workers directly, with another million in supporting jobs.The country is the world’s second-largest producer, and third-largest black tea exporter.It shipped nearly 255,000 metric tonnes abroad in 2024, earning about 71 billion rupees ($850 million), according to official data.

The dizzying investments in artificial intelligence infrastructure do not constitute a bubble but rather represent today’s “new normal” to meet skyrocketing user demand, Fidji Simo, OpenAI’s de facto number two, said on Monday.The French-born executive made her comments in an interview with AFP, her first since taking up her role as Chief Operating Officer of OpenAI’s applications, including its flagship model ChatGPT.In the past few weeks, her company, under the leadership of CEO Sam Altman, has made a series of huge investments in data centers and AI chips, despite no real signs that the fast-emerging AI business is close to breaking even.The answers were lightly edited for length and clarity.- Is the AI investment frenzy a bubble right now? -What I am seeing here is a massive investment in compute (or computing power), with us meeting that need for computing power so incredibly badly for a lot of use cases that people want. [Video AI generator] Sora is a great example right now — there’s much more demand than we can serve.From that perspective, I really do not see that as a bubble. I see that as a new normal, and I think the world is going to switch to realizing that computing power is the most strategic resource.- What do you say to those who fret over AI’s dangers? -I see my job as really making sure that the good side of this technology happens and we mitigate the bad side.Take mental health, for example. I’m hearing tons of users say that they go to ChatGPT for advice in tough moments where they may not have other people to talk to. Many people can’t afford to go to a therapist. I talk to a lot of parents who are telling me: God, I got this really awesome advice that helped me unlock a situation with my child. But at the same time, we need to make sure that the model behaves as expected.On mental health, we have announced a very robust roadmap. We started with parental controls. We have plans to launch age prediction: if we can predict that the user is a teenager, we give them a model that is less permissive than we would give to an adult.Jobs are also very much on my mind, and it’s a similar approach. AI is going to create a lot of jobs, like prompt engineering, that absolutely did not exist before. At the same time, there are some professions that are going to be directly impacted, and we see our role as helping with the transition.- What are the next steps toward intelligent AI? -I think the breakthroughs are about models understanding your goals and helping accomplish them proactively.Not just give you a good answer to a question, not just have a dialog, but actually tell you, ‘Oh, okay, you’re telling me that you want to spend more time with your wife. Well, there might be some weekend getaways that would be helpful, and I know it’s a lot to plan, so I’ve already done all the planning for you and I’ve already made some reservations. Just tap one button to approve and everything gets done.’We’re still very early, but we’re on that journey to capture that.- In San Francisco, you sometimes hear: ‘America innovates, China copies, Europe regulates’ -As a European, every time I hear this saying, my heart breaks a bit. I think there has certainly been a tendency in Europe to focus on regulation a little too much.On China, we continue to be extremely focused on continuing to have a lead, because we see China continuing to invest heavily in being competitive — whether in terms of innovation or in terms of computing — and so we think it’s incredibly important to continue investing across a democratic bloc to advance AI that has these [democratic] values.- Do you let your child use ChatGPT? -ChatGPT is not supposed to be for under 13, but my kid is 10 — I still let her use it under supervision. It’s magical to see what she’s able to create. Just this weekend, she was telling me about creating a new business. She was using ChatGPT to make banners for the new business, to create taglines.In our childhood, we couldn’t turn our imagination into something real that fast. And I see that really giving her superpowers, where she thinks anything is possible.

Brazilian President Luiz Inacio Lula da Silva urged US President Donald Trump to lift punitive trade tariffs in their first official talks Monday after months of animosity — with both suggesting an in-person meeting in the near future.The two leaders spoke for 30 minutes in a “friendly tone” and Lula raised the possibility of a meeting in Malaysia next month, the Brazilian presidency said in a statement.Lula “requested the removal” of tariffs imposed on his country’s products and sanctions against Brazilian officials.Trump hailed “a very good telephone call” in a post on Truth Social.”We will be having further discussions, and will get together in the not too distant future, both in Brazil and the United States,” he said, without adding details.Ties have soured between Washington and Brasilia in recent months, with Trump angered over the trial and conviction of his ally, the far-right former president Jair Bolsonaro.Trump has imposed a 50-percent tariff on Brazilian products and imposed sanctions against several top officials, including a top Supreme Court judge, to punish Brazil for what he termed a “witch hunt” against Bolsonaro. “We are very optimistic that we will move toward a win-win situation in this relationship,” said Brazil’s Vice President Geraldo Alckmin, who has been tasked with continuing negotiations with US Secretary of State Marco Rubio.He noted the call had gone “even better than we expected” and that the two presidents had exchanged personal phone numbers.- ‘Excellent chemistry’ -The phone call came after what first appeared to be a chance encounter on the sidelines of the UN General Assembly last month that led Trump to hail his “excellent chemistry” with Lula.However the Estadao news site reported the brief run-in, which included a hug, was actually the result of an intensive behind-the-scenes “diplomatic operation.”In a speech to the UN, Lula slammed an “unacceptable” attack on the independence of Brazil’s judiciary.Despite the political and economic pressure, Brazil’s Supreme Court sentenced Bolsonaro to 27 years in prison for his role in a botched coup bid after his 2022 election loss to Lula.Trump, meanwhile, used his UN speech to accuse Brazil of “censorship, repression” and “judicial corruption.”He later switched tack, and recounted his run-in with Lula, describing him as “a very nice man, actually.”The two men stand on polar opposite sides when it comes to issues such as multilateralism, international trade and the fight against climate change.The Brazilian presidency said that Lula had raised the possibility with Trump of an in-person meeting at the Association of Southeast Asian Nations (ASEAN) summit in Malaysia in October.He also re-iterated an invitation to Trump to attend the COP-30 climate conference in Brazil’s Amazon city of Belem in November, “and also expressed his willingness to travel to the United States.”- ‘No one to talk to’ -Lula has repeatedly stated that Brazil was “ready to negotiate” regarding tariffs, but lamented there was “no one to talk to” in Washington.A Brazilian government source told AFP the private sector played a key role behind the scenes in the rapprochement with Washington, citing a meeting between Trump and Brazil’s billionaire beef tycoon Joesley Batista at the White House.Batista’s “JBS played an important role, but it wasn’t the only one,” said the source. A European diplomat told AFP on condition of anonymity that Brazilian aircraft manufacturer Embraer had also put pressure on the White House.Trump’s tariffs mainly target major Brazilian exports beef, coffee and sugar.Brazilian trade data for September, released Monday, showed that exports to the United States fell 20.3 percent compared with last year, while imports from the US rose 14.3 percent.However, Brazil has other major markets, such as Asia, for its beef and coffee, and has been expanding to diversify its exports.Overall exports grew 7.2 percent in September, with major growth in China, India, Singapore, Argentina, Peru and Panama.

Stock markets were mixed Monday as a deepening political crisis in France sent Paris into a tailspin while a new Japanese ruling party leader boosted Tokyo and the AI investment boom lifted US stock indices to fresh heights.Gold pushed ever closer to $4,000 an ounce as the US government shutdown and expected interest cuts from the Federal Reserve boosted the precious metal’s lure.The euro fell against main rivals and French borrowing costs spiked as Sebastien Lecornu, who had been prime minister for less than a month, resigned just 14 hours after naming a largely unchanged cabinet.But in another twist, French President Emmanuel held new talks with Lecornu in the evening and gave him two days to reach a plan for the country’s “stability”, the president’s office said.Paris finished down 1.4 percent. Shares in French banks BNP Paribas, Societe Generale and Credit Agricole all shed more than three percent.London also dipped but Frankfurt’s stock exchange ended the day flat.On Wall Street, both the S&P 500 and tech-heavy Nasdaq Composite surged to fresh records, after Advanced Micro Devices announced a multi-year partnership with OpenAI to develop AI data centers, sending AMD shares up more than 23 percent.The OpenAI venture with AMD marks the latest massive deal for the fast-growing artificial intelligence startup that has left markets buzzing. “Very few questions are being asked about how OpenAI is actually going to pay for this commitment that they’re making to AMD,” said Steve Sosnick of Interactive Brokers.”This company has literally hundreds of billions of dollars in commitments, but still only has annualized revenues of about $12 billion,” Sosnick said of OpenAI. “The market is taking any piece of news as purely good news.”Tesla also had a good day, rising 5.5 percent on buzz over a possible product launch after Elon Musk’s company posted videos teasing a Tuesday announcement.In Asia, Tokyo surged almost five percent to a record high and the yen sank on bets the new leader of Japan’s ruling party will loosen monetary policy to kickstart the economy.Sanae Takaichi, likely to become Japan’s prime minister this month, has previously backed aggressive monetary easing and expanded government spending.Traders are “enthused by the new Japanese leader, who promises to reignite stimulus to light a fire under the Japanese economy,” said Chris Beauchamp, chief market analyst at trading platform IG.The yen weakened more than one percent against the dollar and hit a record low against the euro.Yields on 30-year Japanese bonds rose sharply reflecting fears the country’s already colossal debt will balloon further.After her victory Saturday, Takaichi pledged first to implement measures to address inflation and boost Japan’s economy, rural areas and primary industries.”She has said that the Bank of Japan should not raise interest rates, which is feeding demand for stocks and weighing on long term bond yield,” said Kathleen Brooks, research director at trading group XTB.”The decline in the yen is also a sign that the market is pricing out the prospect of BoJ rate hikes this year,” she added.- Key figures at around 2015 GMT -New York – Dow: DOWN 0.1 percent at 46,694.97 (close)New York – S&P 500: UP 0.4 percent at 6,740.28 (close)New York – Nasdaq Composite: UP 0.7 percent at 22,941.67 (close)London – FTSE 100: DOWN 0.1 percent at 9,479.14 (close)Paris – CAC 40: DOWN 1.4 percent at 7,971.78 (close)Frankfurt – DAX: FLAT at 24,378.29 (close)Tokyo – Nikkei 225: UP 4.8 percent at 47,944.76 (close)Hong Kong – Hang Seng Index: DOWN 0.7 percent at 26,957.77 (close)Shanghai – Composite: Closed for a holidayEuro/dollar: DOWN at $1.1713 from $1.1742 on FridayPound/dollar: UP at $1.3485 from $1.3480Dollar/yen: UP at 150.24 yen from 147.47 yenEuro/pound: DOWN at 86.86 pence from 87.10  penceWest Texas Intermediate: UP 1.3 percent at $61.69 per barrelBrent North Sea Crude: UP 1.5 percent at $65.47 per barrelburs-jmb/dw

Stock markets diverged Monday as a deepening political crisis in France sent Paris into a tailspin while a new Japanese ruling party leader buoyed shares in Tokyo.Gold pushed ever closer to $4,000 an ounce as the US government shutdown and expected interest cuts from the Federal Reserve boosted the precious metal’s attractiveness.The euro fell against main rivals and French borrowing costs spiked as Sebastien Lecornu, who had been prime minister for less than a month, resigned just 14 hours after naming a largely unchanged cabinet.France’s “fractured parliament is making it nearly impossible to pass a budget that reduces the fiscal deficit”, said Jack Allen-Reynolds, deputy chief eurozone economist at Capital Economics.”With government borrowing running at more than five percent of GDP and the debt ratio rising, the risk premium on French government bonds will continue to widen,” he added.Shares in French banks BNP Paribas, Societe Generale and Credit Agricole all shed more than three percent.London also dipped but Frankfurt’s stock exchange ended the day flat.On Wall Street, both the S&P 500 and tech-heavy Nasdaq Composite sat next to record highs as AI deals overshadowed concerns over a government shutdown that dragged into a second week.Shares in Advanced Micro Devices (AMD) jumped more than 33 percent after the chipmaker announced a multi-year partnership with OpenAI to develop AI data centres which should bring it tens of billions of dollars in new revenue over the next five years.In Asia, Tokyo surged almost five percent to a record high and the yen sank on bets the new leader of Japan’s ruling party will loosen monetary policy to kickstart the economy.Sanae Takaichi, likely to become Japan’s prime minister this month, has previously backed aggressive monetary easing and expanded government spending.Traders are “enthused by the new Japanese leader, who promises to reignite stimulus to light a fire under the Japanese economy,” said Chris Beauchamp, chief market analyst at trading platform IG.The yen weakened more than one percent against the dollar and hit a record low against the euro.Yields on 30-year Japanese bonds rose sharply reflecting fears the country’s already colossal debt will balloon further.After her victory Saturday, Takaichi pledged first to implement measures to address inflation and boost Japan’s economy, rural areas and primary industries.”She has said that the Bank of Japan should not raise interest rates, which is feeding demand for stocks and weighing on long term bond yield,” said Kathleen Brooks, research director at trading group XTB.”The decline in the yen is also a sign that the market is pricing out the prospect of BoJ rate hikes this year,” she added.Oil prices jumped nearly one percent after OPEC+ agreed at the weekend to boost supplies by 137,000 barrels a day — less than initially expected.”The limited supply adjustment was seen as a supportive move that would help offset a glut in the oil market while still signalling confidence in global demand levels,” said Trade Nation analyst David Morrison.- Key figures at around 1530 GMT -New York – Dow: DOWN 0.1 percent at 46,696.12 pointsNew York – S&P 500: UP 0.3 percent at 6,736.19 New York – Nasdaq Composite: UP 0.5 percent at 22,902.72London – FTSE 100: DOWN 0.2 percent at 9,479.14 (close)Paris – CAC 40: DOWN 1.4 percent at 7,971.78 (close)Frankfurt – DAX: FLAT at 24,378.29 (close)Tokyo – Nikkei 225: UP 4.8 percent at 47,944.76 (close)Hong Kong – Hang Seng Index: DOWN 0.7 percent at 26,957.77 (close)Shanghai – Composite: Closed for a holidayEuro/dollar: DOWN at $1.1711 from $1.1742 on FridayPound/dollar: DOWN at $1.3474 from $1.3482Dollar/yen: UP at 150.09 yen from 147.45 yenEuro/pound: DOWN at 86.92 pence from 87.09 penceWest Texas Intermediate: UP 1.3 percent at $61.64 per barrelBrent North Sea Crude: UP 1.4 percent at $65.41 per barrelburs-rl/ach