Colt said on Friday the deal with privately-owned chemicals group Synthesia would help to secure its supply chain and expansion into larger calibres

International News via Reuters:

Czech-based firearms maker Colt CZ Group SE has agreed to buy a majority stake and potentially all of the shares in Synthesia Nitrocellulose, in a deal valuing the Czech gunpowder ingredient maker at 22 billion crowns ($1.05 billion).

Colt, which also has operations in the United States, Canada, Sweden, Switzerland and Hungary, said on Friday the deal with privately-owned chemicals group Synthesia would help to secure its supply chain and expansion into larger calibres, which are in high demand amid Europe’s rearmament drive.

Energetic nitrocellulose is a raw material needed for ammunition production, especially for gunpowder. Colt does not produce it itself at this point but may aim to step into the business in future, the company said.

“The acquisition … fits into our strategy of expanding the group’s activities into medium and large-calibre ammunition while strengthening our position in a critical element of our supply chain,” Colt Chairman Jan Drahota said in a statement.

“We intend to continue the vertical integration of ammunition manufacturing, thereby contributing to the strategic independence and self-sufficiency of the Czech Republic and NATO countries in defence supplies.”

Synthesia Nitrocellulose is among the top three energetic nitrocellulose producers in Europe and North America, with a 6,000 metric ton capacity and an expansion to 7,000 tons underway, Colt said.

The transaction gives Synthesia Nitrocellulose an enterprise value of 22 billion crowns, or about 8.2 times expected 2025 core profit, Colt said.

In the first stage, Colt will take a 51% stake in a cash-and-shares deal, pending regulatory approvals expected by the end of the first quarter of 2026, it said.

The initial cash payment will be 5.5 billion crowns, with stock accounting for about 40% of the first stage of the deal. This will make Synthesia owner Kaprain the third largest shareholder in Colt with between 5% and 10%, Colt said.

Colt and Kaprain have options to buy and sell the remaining 49% stake, respectively.

Colt said it may issue bonds in the fourth quarter to help finance the deal, which also includes Synthesia’s power production business.

Colt shares were up 0.14% at 1000 GMT, against a 0.4% drop in the Prague PX index.

($1 = 20.9570 Czech crowns)

Reporting by Jan Lopatka. Editing by David Goodman and Mark Potter

The company prioritized fulfilling AI server orders over maintaining margins

International News via Reuters:

Shares of Dell Technologies dropped nearly 6% in premarket trading on Friday, as a dour quarterly profit forecast and weaker-than-expected second-quarter margin rate overshadowed upbeat full-year estimates.

Rising demand for servers capable of handling computational needs of AI workloads is benefiting companies such as Dell, Hewlett Packard Enterprise and Super Micro Computer, but the high cost of producing them and tough competition have pressured margins.

The company prioritized fulfilling AI server orders over maintaining margins, as supply chain disruptions and expedited shipping costs added to the profit squeeze from competitive pricing strategies aimed at landing large customer contracts, J.P. Morgan analysts wrote in a note.

Adjusted gross margin rate for the second quarter fell to 18.7% from a year earlier and missed estimates of 19.6%.

The company forecast third-quarter adjusted profit of $2.45 per share, falling short of analysts’ estimates of $2.55 according to data compiled by LSEG.

Dell expects third-quarter revenue to be in the range of $26.5 billion to $27.5 billion, compared with estimates of $26.05 billion.

Separately, Dell raised its annual revenue forecast to between $105 billion and $109 billion from its earlier expectations of $101 billion to $105 billion, buoyed by demand for its AI-optimized servers

It also raised its adjusted earnings per share guidance to $9.55 from its prior projection of $9.40.

Shares were last down 5.8% at $126.3, having rallied more than 16% so far this year as of last close.

Dell’s shares trade at 13.2 times profit expectations, higher than HPE’s 10.8, but far lower than 22.3 for the S&P 500 index. Rival Super Micro trades at around 16.3 forward earnings.

Reporting by Shashwat Chauhan and Akash Sriram in Bengaluru; Editing by Krishna Chandra Eluri

Germany has been struggling with a persistently weak economy

International News via Reuters:

The number of unemployed people in Germany has topped three million for the first time in a decade, labour office figures showed on Friday, raising the stakes for the government’s huge investment plans to deliver quick results.

A total of 3.02 million people were unemployed in August in seasonally unadjusted terms, with an increase of 46,000 in the number of people out of work from the previous month.

“The labor market is still shaped by the economic slump of recent years,” said labour office head Andrea Nahles.

Germany has been struggling with a persistently weak economy, and U.S. President Donald Trump’s import tariffs could lead to a third year without growth for the first time.

The seasonally adjusted jobless rate remained stable at 6.3%, in line with analysts’ forecast in a Reuters poll.

But labour demand is slowing. There were 631,000 job openings in August, 68,000 fewer than a year ago.

“The global economic uncertainties and Russia’s war of aggression against Ukraine are still leading to economic weakness,” Labour Minister Baerbel Bas said. “The cyclical headwinds continue to leave their mark on the labour market and require countermeasures.”

Bas said the government was providing a big investment boost for the economy, including a 500-billion euro ($585 billion) special fund for infrastructure, after loosening fiscal rules.

But economists and business associations say it will take years for the spending to fully take effect, and extra measures are needed to address the deep-rooted structural problems in Europe’s biggest economy.

“Three million unemployed is a damning indictment of the refusal to reform in recent years,” said Rainer Dulger, president of the BDA employers’ association. “Germany needs a genuine ‘autumn of reforms.'”

LESS SHOPPING

Many households are saving more because they are worried about the future and this will increase with bad news from the labour market, even if the rise in unemployment is not very large and no surprise, Ifo president Clemens Fuest said.

German retail sales fell much more than expected in July, separate data showed on Friday, clouding the outlook for consumption in the third quarter.

Retail sales fell 1.5% from June. Analysts polled by Reuters had predicted a 0.4% decrease.

Some analysts had been hoping that, with U.S. tariffs cooling foreign demand, domestic consumers would pick up the slack.

“However, these hopes were disappointed in July,” said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank.

IMPORT PRICES DOWN

German import prices fell 1.4% year-on-year in July, the statistics office said on Friday. Analysts polled by Reuters had predicted a 1.2% decrease.

Since Germany buys many primary products and raw materials from abroad, higher import prices are reflected in inflation data with a time lag.

Inflation rose in four of the biggest German states in August, preliminary data showed on Friday, suggesting national inflation could also increase this month, in line with analysts’ forecasts for a rise to 2.0% from 1.8% in July.

($1 = 0.8542 euros)

Additional reporting by Rene Wagner, Emanuele Berro, Maria Rugamer and Simon Ferdinand Eibach. Editing by Aidan Lewis and Mark Potter

The euro was flat at $1.1677 while sterling slipped 0.2% to $1.3474

International News via Reuters:

The dollar was steady on Friday but poised for a 2% drop in August against major currencies on rising bets that the Federal Reserve will cut interest rates next month, while worries about the threats to the U.S. central bank’s independence linger.

The euro was flat at $1.1677 while sterling slipped 0.2% to $1.3474. Both currencies are on course to end up over 2% against the dollar this month.

Against the Japanese yen, the dollar was steady at 146.975 yen.

President Donald Trump’s campaign to exert more influence over monetary policy, including this week’s attempt to fire Lisa Cook, one of the Fed’s governors, has weighed on the dollar.

Cook filed a lawsuit claiming Trump has no power to remove her from office and also filed a motion for a temporary restraining order, the hearing for which is scheduled on Friday.

The legal battle is the latest chapter in Trump’s attempts to reshape the central bank after repeatedly criticising the Fed and its Chair Jerome Powell for not cutting interest rates.

Still, market reaction to the battle between Trump and Cook has been relatively muted, with slight dollar selling and curve steepening with investors keeping their near-term focus on the prospects of rate cuts by the U.S. central bank.

Money markets are currently pricing in an 86% chance of a rate cut in September, up from 63% a month earlier, CME FedWatch showed.

“While markets remain reluctant to speculate on this Fed story and continue to focus on data-driven short-term developments, the downside risks for the dollar have undoubtedly grown,” Francesco Pesole, an FX strategist at ING, said in a note.

Fed Governor Christopher Waller said on Thursday he wants to start cutting rates next month and “fully expects” more rate cuts to follow to bring the central bank’s policy rate closer to a neutral setting.

Investors will parse through the PCE price index report, the Fed’s preferred inflation measure, later on Friday. On a year-over-year basis, headline PCE inflation is estimated at 2.6%, after rising at the same rate in June.

While a reading of 3% or higher will raise eyebrows after the Fed’s dovish pivot, the key data remains next Friday’s labour market report ahead of the September FOMC meeting, said Tony Sycamore, market analyst at IG.

Elsewhere, euro zone consumers kept their inflation expectations mostly stable at or above the European Central Bank’s 2% target in July, according to an ECB poll released on Friday.

Data released on Friday also showed that French consumer prices rose slightly less than anticipated in August while Spain’s European Union-harmonised 12-month inflation rate was steady at 2.7%.

“We don’t think there will be much in the data to convince markets to materially reprice ECB rate expectations just yet,” Pesole said.

Among other currencies, the New Zealand dollar, was slightly stronger after Reserve Bank of New Zealand Chairman Neil Quigley tendered his resignation, citing the fallout over the handling of the sudden resignation of the central bank’s governor earlier this year.

China’s yuan hit its strongest level in 10 months against the dollar as steady central bank fixings and a hot domestic stock market drive the currency higher, while the Indian rupee dropped to a record low, weighed down by worries about the economic impact of steep U.S. tariffs on Indian imports.

Microsoft said the terminations followed serious breaches of company policies

International News via Reuters:

Microsoft has fired four employees who participated in protests on company premises against the firm’s ties to Israel as it wages war in Gaza, including two who took part in a sit-in this week at the office of the company’s president.

Anna Hattle and Riki Fameli received voicemails informing them that they were fired, the protest group No Azure for Apartheid said in a statement on Wednesday.

It added on Thursday that two more workers, Nisreen Jaradat and Julius Shan, were fired. They were among protesters who had recently set up encampments at Microsoft headquarters.

Microsoft said the terminations followed serious breaches of company policies. In its Thursday statement, it said recent on-site demonstrations had “created significant safety concerns.”

No Azure for Apartheid, whose name references Microsoft’s Azure software, has demanded that the company cut its ties to Israel and pay reparations to Palestinians.

“We are here because Microsoft continues to provide Israel with the tools it needs to commit genocide while gaslighting and misdirecting its own workers about this reality,” Hattle said in a statement.

Hattle and Fameli were among seven protesters who were arrested on Tuesday after occupying the office of company President Brad Smith. The other five were former Microsoft workers and people outside the company.

Smith has said Microsoft respected “freedom of expression that everyone in this country enjoys as long as they do it lawfully.”

A joint media investigation published this month found that an Israeli military surveillance agency was making use of Microsoft’s Azure software to store countless recordings of mobile phone calls made by Palestinians living in the Israeli-occupied West Bank and Gaza.

The investigation, conducted by the Guardian, Israeli-Palestinian publication +972 Magazine and Hebrew-language outlet Local Call, said Israel relied on Microsoft cloud for expansive surveillance of Palestinians.

In response, Microsoft said it was turning to law firm Covington & Burling LLP to conduct a review.

Other Microsoft workers have also protested the company’s ties to Israel.

In April, Microsoft AI CEO Mustafa Suleyman’s remarks were interrupted by a pro-Palestinian protesting employee during the technology company’s 50th anniversary celebration over the firm’s ties with Israel. That employee and another protesting employee were also subsequently fired.

Firms and educational institutions have faced protests over ties with Israel as the humanitarian crisis in Gaza from Israel’s military assault has mounted, and images of starving Palestinians, including children, have sparked global outrage.

The latest bloodshed in the decades-old Israeli-Palestinian conflict was triggered in October 2023 when Hamas militants attacked Israel, killing 1,200 people and taking about 250 hostages, Israeli tallies show.

Israel’s subsequent assault on Gaza has killed tens of thousands of Palestinians, caused a hunger crisis, internally displaced Gaza’s entire population and prompted accusations of genocide and war crimes at international courts that Israel denies.

Reporting by Kanishka Singh in Washington; Editing by Edwina Gibbs

Some 284,400 were reported missing by the end of last year, up from 169,500 in 2019

International News via Reuters:

The number of people reported missing to the Red Cross has risen by about 70% in five years, driven by rising conflicts and mass migration, the Geneva-based organisation said Friday, calling for a recommitment to the rules of war.

“…The surging number of missing persons provides a stark reminder that conflict parties and those who support them are failing to protect people during war,” said Pierre Krähenbühl, Director General of the International Committee of the Red Cross.

Some 284,400 were reported missing by the end of last year, up from 169,500 in 2019, with conflicts in Sudan, Gaza and Ukraine among the factors driving the increase, the ICRC said.

The real number is thought to be many times higher.

The Geneva Conventions – a series of international treaties agreed in 1949 after World War Two – should help prevent separations but respect for such rules was fading, the ICRC statement said.

“With stronger measures to prevent separation, protect those in detention and properly manage the dead, countless families could be spared a lifetime of anguish,” Krähenbühl added.

The ICRC, together with Red Cross and Red Crescent National Societies around the world, works to search for missing persons and reconnect families through the Family Links Network.

Some of the teams of its Central Tracing Agency are in an old Geneva manor house, making calls and trawling through documents to find people – a task the ICRC has been doing since the Franco-Prussian war of 1870.

Sometimes, there are happy endings and last year 16,000 missing people were located, the ICRC said.

Reporting by Emma Farge; Editing by Alex Richardson