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Customers browse produce during the grand opening of the Lidl Ltd. store in Virginia Beach, Virginia.

Benjamin Boshart | Bloomberg | Getty Images

Customers browse produce during the grand opening of the Lidl Ltd. store in Virginia Beach, Virginia.

World food prices declined in November to their lowest level in more than two years, led down by much weaker vegetable oil, dairy and cereal prices, the United Nations food agency said on Thursday.

The Food and Agriculture Organization’s (FAO) food price index, which measures monthly changes for a basket of cereals, oilseeds, dairy products, meat and sugar, averaged 160.8 points last month, down from a revised 162.9 in October, reaching its lowest level since May 2016.

The October figure was previously given as 163.5.

FAO said global cereals output in 2018/19 was seen at 2.595 billion tonnes, down marginally from the previous forecast and 2.4 percent below last year’s record high production.

FAO’s forecast for world wheat production in 2018/19 was 725.1 million tonnes, 2.8 million tonnes lower than the previous forecast.

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China’s Tencent Music raises nearly $1.1 billion in U.S. IPO

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The logos of QQ Music, Kugou and Kuwo are seen on the screen of an iPhone on June 12, 2018 in Paris, France. QQ Music, Kugou and Kuwo are the three streaming Chinese music services owned by Tencent. 

Chesnot | Getty Images

The logos of QQ Music, Kugou and Kuwo are seen on the screen of an iPhone on June 12, 2018 in Paris, France. QQ Music, Kugou and Kuwo are the three streaming Chinese music services owned by Tencent. 

China-based music streaming company Tencent Music Entertainment Group’s has raised close to $1.1 billion in its U.S. initial public offering (IPO) after pricing its American depositary shares (ADRs) at the low end of its indicated $13 to $15 per share range, a source said on Tuesday.

The IPO shows how companies are defying a bout of stock market volatility with flotations. It tops off a bumper year for U.S. listings by Chinese companies, with $7.9 billion raised prior to Tencent Music’s debut, Refinitiv data showed. That is the highest amount since 2014, the year of Alibaba Group Holding Ltd’s record $25 billion IPO.

Tencent Music’s U.S. IPO is the fourth largest among Chinese firms this year. Video streaming company iQiyi Inc leads with its $2.4 billion listing, followed by online group discounter Pinduoduo Inc at $1.6 billion and electric vehicle maker NIO Inc at $1.15 billion.

With streaming apps QQ Music, KuGou, Kuwo as well as karaoke app We Sing, Tencent Music is China’s largest online music platform boasting more than 800 million monthly active users. The firm is often compared with Spotify Technology SA, but offers more socially interactive services that make it profitable while its Swedish counterpart is not.

Tencent Music sold 41 million ADRs while existing shareholders sold a further 40.9 million, the source said, asking not to be identified ahead of an official announcement. The IPO gives the company a valuation of $21.3 billion.

Tencent Music declined to comment.

Tencent Music initially planned to launch the deal in October, but postponed because of a sell-off in global markets roiled by a U.S.-China trade war and fears of slowing global growth.

The final deal size is also smaller than the $3 billion to $4 billion that IFR, a Refinitiv capital markets publication, reported the firm had initially planned to raise in May. Tencent Music never confirmed fundraising figures.

One person close to the deal told Reuters the smaller figure was due to the company’s valuation falling as a result of market volatility.

Tencent Music reported a 244 percent profit jump for January-September to $394 million. By comparison, Spotify lost a net $520 million.

Bank of America, Deutsche Bank, Goldman Sachs, JPMorgan and Morgan Stanley are the lead sponsors of Tencent Music’s deal.

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Trade deal with China could be elusive until bitter end of negotiating period 

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The discussions followed a tense week between the two countries after the arrest in Canada of Meng Wanzhou, the chief financial officer of Chinese telecom giant Huawei and daughter of the founder. The U.S. sought the arrest on allegations that Wanzhou was circumventing sanctions against Iran, and the U.S. has had a long running concern about Huawei and cyber spying.

“We now have confirmation that there was a good faith effort to come to an agreement on trade and both are now making a concerted effort to show that trade talks are operating on a parallel track to the arrest of the Chinese business executive. The Chinese may do stuff that’s going to make the U.S. uncomfortable outside of trade,” said Clifton.

Clifton added the challenge would be whether both sides “stick to those parallels” and allow trade to progress. He pointed to the Chinese arrest of a former Canadian diplomat Michael Kovrig after China warned Canada about the arrest of Meng.

“The trade talks are extraordinarily complex,” said Clifton. “While we talk about tariffs, subsidies, soy beans, those are the headlines, but there is a significant discussion happening at the agency level with the Chinese on cyber security, artificial intelligence, intellectual property. Those are going to be tougher nuts to crack but those conversations are in place.”

The Washington Post reported Tuesday that the U.S. was going to call out China for cyber-espionage and hacking in a sweeping series of actions.

“It is a positive the sides are talking, but this is far from the initial plan to send Liu He with a team of 30 Chinese negotiators to DC this week. The next two weeks seem unlikely for DC talks given the Central Economic Work Conference next week and the big Reform and Opening meeting. Given these high profile upcoming Chinese domestic events, a lack of trade reform announcements would likely increase the likelihood for March 1 tariffs,” notes
Chris Krueger, policy strategist at Cowen.

Krueger said the auto tariff reductions and agriculture purchases by China are positives but not having face-to-face meetings in December was a negative,” Krueger said in a note. “Without ironclad agreement on a real path forward on this crucial front (*the* issue in the 301 Report), we take Ambassador Lighthizer at his word that March 1 is a hard deadline for more tariffs,” Krueger said in a note.

Harris said he expects the talks to succeed ultimately and the U.S. should avoid the next round of tariffs, though if they do go into affect it would be for a very limited time.

“Our baseline forecast is by March 1, they have converged enough towards a deal that the markets start to feel better about what’s happening. It may take a little longer to get a deal, but at least you’ll be moving in the right direction. I think the progress on this is going to be very slow,” said Harris. Harris said the next round of tariffs, where the U.S. could target all Chinese imports would slow China’s growth to about 6 percent. Currently, he expects Chinese growth to pick up in the second half of next year.

Many U.S. economists have factored a full blown trade war into their outlook for next year, and if there is no resolution to the trade issues, growth is expected to slow to below 2 percent in the second half.

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Gunshots near Strasbourg Christmas market leave at least one dead, fire department says

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A file photo showing policemen at the Strasbourg police headquarters, on November 23, 2018.

Sebastien Bozon | AFP | Getty Images

A file photo showing policemen at the Strasbourg police headquarters, on November 23, 2018.

Gunshots in the centre of the French city of Strasbourg on the German border on Tuesday left one dead and three injured, the local fire department told Reuters.

The killing took place near Strasbourg’s Christmas market, which draws millions of tourists every year, a source at French security forces said.

France remains on high alert after suffering a wave of attacks commissioned or inspired by Islamic State militants in 2015 and 2016, which killed more than 200 people.

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