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Sony hikes net profit forecasts as weak yen boosts gaming

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Sony hikes net profit forecasts as weak yen boosts gaming

Sony upgraded its annual net profit forecasts on Thursday, saying it expects strong results in its key gaming sector as the weak yen inflates profits on products sold abroad.

The Japanese electronics and entertainment giant said net profit in the April-December period jumped five percent year-on-year to 809 billion yen ($6.3 billion).

This was partly thanks to strong sales in the game, music and imaging-and-sensors sectors in the third quarter, an important holiday shopping period, the company said.

In the 2022-23 financial year, Sony Group now expects a net profit of 870 billion yen, up from the previous estimate of 840 billion yen.

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Its operating profit forecast is now 1.18 trillion yen, up from 1.16 trillion, with income in the gaming division “expected to be higher than the November forecast mainly due to the positive impact of foreign exchange rates”, the company said.

The Japanese currency has gained ground against the greenback in recent months but the dollar still buys around 128 yen, compared with around 114 yen a year ago.

Sony sold 12.8 million PlayStation 5 units in the first nine months of the current financial year, with 7.1 million of those shifted in October-December.

This year’s figure is already more than the 11.5 million sold in 2021-22, when supply chain problems slowed production of the next-generation console.

“Based on this performance, the company has set its full-year sales forecast for the current fiscal year at 19 million (PS5) units, and will work to sell as many units as possible to meet strong demand by optimising its operations,” chief financial officer Hiroki Totoki told reporters.

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“I believe user engagement is on the road to recovery thanks to the popularity of the PS5, and hit titles” like “God of War Ragnarok”, he said.

Executive reshuffle

Game sales will have an important bearing on Sony’s annual results, Hideki Yasuda of Toyo Securities told AFP.

“Sony is expected to aim for higher hardware sales in the coming fiscal year. What is key is whether software sales will also increase to keep up with higher hardware sales,” Yasuda said.

The PS5 has some major titles in the pipeline, including the “highly anticipated” game “Final Fantasy XVI”, he noted.

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Sony’s gaming rival Microsoft has sparked an industry battle with its acquisition of “Call of Duty” maker Activision Blizzard — a huge $69 billion purchase that has yet to be finalised while it is examined by antitrust authorities.

A year ago, weeks after Microsoft unveiled its acquisition plan, Sony said it would buy US game studio Bungie, creator of hits like “Halo” and “Destiny”.

Sony also announced a reshuffle at the top of the company on Thursday, with chief financial officer Totoki to also become president and chief operating officer.

Current company president and chief executive officer Kenichiro Yoshida will become board chairman and remain CEO.

The yen’s fall was helped by the contrast between the US Federal Reserve’s interest rate hikes and the Bank of Japan’s longstanding monetary easing programme.

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“Sony has a wide range of businesses, so the impact of foreign exchange changes are unevenly felt in various areas,” Yasuda said.

The company said sales in its pictures division were expected to be lower than previously forecast, partly because of “the impact of foreign exchange rates” which make it more expensive to produce films abroad. 

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Dollar muted as traders await Fed rate decision

Dollar muted as traders await Fed rate decision

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Dollar muted as traders await Fed rate decision

The dollar was pinned near five-week lows on Wednesday ahead of the conclusion of the US Federal Reserve’s policy meeting, with investors awaiting clarity on the path the central bank is likely to take in the wake of global banking turmoil.

Investor attention is zeroed in on whether the Fed will stick to its hawkish path to fight sticky inflation or pause interest rate hikes given recent trouble among banks which has included bankruptcy and last-minute rescues.

The US dollar index, which measures the currency against six peers, was at 103.19, just above the five-week low of 102.99 touched overnight. The euro was at $1.0770, hovering around a five-week high of $1.0789 scaled overnight.

Markets are now pricing in about a 15% chance of the Fed not increasing rates, with a roughly 85% chance of a 25 basis point hike, showed the CME FedWatch tool. Just a month earlier, the market was pricing in a 24% chance of a 50 basis point hike.

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Investor sentiment remained fragile with worries over the outlook for the banking sector starting to ease after sharp volatility in the market in the past few weeks following high-profile U.S. banking failures earlier in the month and the rescue of lender Credit Suisse Group AG at the weekend.

“Markets are seemingly becoming more comfortable with the idea that authorities have probably done enough to prevent a systemic banking crisis,” said Rodrigo Catril, a senior currency strategist at National Australia Bank in Sydney.

“It might be early days, but the price action over the past 48 hours is certainly signalling a change in mood by investors.”

The Fed meeting concludes on Wednesday with the 2 pm EDT (1800 GMT) release of a policy statement followed half an hour later by a news conference by Chair Jerome Powell.

Catril said the Fed faces a difficult choice given a strong labour market alongside February inflation figures that were higher than many market watchers expected. Such circumstances would usually be ripe for a return to a 50 basis point hike were it not for worries over financial stability, he said.

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Christopher Wong, currency strategist at OCBC, said the focus will be on how the Fed communicates its forward guidance, in particular “the higher for longer” rhetoric.

“Ideally, we would like the Fed to go with a 25 basis point hike this meeting, tone down hawkish guidance and emphasize that policy decisions at subsequent meetings will continue to be data-dependent,” Wong said. “This wishlist should see dollar trade on the softer profile and risk proxies trade steadily.”

Meanwhile, the yen strengthened 0.04% to 132.47 per dollar, whereas sterling was last trading at $1.2233, up 0.16% on the day.

The Australian dollar rose 0.36% to $0.6694, while the New Zealand dollar gained 0.11% to $0.6199.

In cryptocurrencies, bitcoin last rose 0.44% to $28,276.58, but was below a nine-month peak it touched on Monday.

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Sui Northern to take special initiatives to ensure uninterrupted gas supply in Ramzan

Sui Northern to take special initiatives to ensure uninterrupted gas supply in Ramzan

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Sui Northern to take special initiatives to ensure uninterrupted gas supply in Ramzan

Sui Northern Gas has announced special initiatives to ensure uninterrupted gas supply to its consumers during the holy month of Ramzan.

The company will be undertaking immediate measures to ensure gas supply with full pressure. SNGPL spokesperson, in a statement, said that domestic consumers will be ensured gas supply with full pressure particularly between 2:30 to 6am and 4 to 9pm.

Spokesperson also stated that company will also ensure natural gas supply other than the mentioned timings. SNGPL has also constituted monitoring teams for immediate resolution of complaints regarding gas pressure.

Additionally monitoring room is being established for gas supply related complaints. SNGPL has requested consumers to consume natural gas wisely during the month of Ramzan.

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Bitcoin climbs to 9-month high as bank turmoil sparks rally

Bitcoin climbs to 9-month high as bank turmoil sparks rally

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Bitcoin climbs to 9-month high as bank turmoil sparks rally

 Bitcoin climbed to a nine-month high on Monday as turmoil in the banking sector drives some investors to turn to digital assets, as the cryptocurrency built on its best week in four years.

The biggest cryptocurrency rose as far as $28,567, its highest since mid-June, and was last up 0.9%, amid growing expectations that central banks would slow the pace of interest rate hikes.

Bitcoin rose 26% last week, its best weekly gain since April 2019, and has soared some 40% in 10 days as turmoil in the banking sector rippled around the globe – culminating, so far, in UBS Group’s takeover of rival Credit Suisse Group AG over the weekend.

Traditional assets such as banking stocks and bonds plummeted on Monday after UBS sealed its state-backed takeover of Credit Suisse, a deal orchestrated in an attempt to restore confidence in a battered sector.

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Top central banks, faced with the risk of a fast-moving loss of confidence in the stability of the financial system, moved on Sunday to bolster the flow of cash around the world. Such a global response has not seen since the height of the COVID-19 pandemic.

“Its stunning rally is the result of the banking crisis, and as the interest rate markets prices in rate cuts in the second half of 2023,” said Tony Sycamore, an analyst at IG Markets, predicting a move towards $32,000 should bitcoin hold above the key support level about $25,000.

Other market players predicted that bitcoin would benefit from central bank efforts to bolster liquidity in the global financial system. It rose to a record of $69,000 in November 2021 after central banks and governments launched unprecedented monetary and fiscal stimulus measures.

“The momentum is all driven by liquidity,” said Markus Thielson at digital asset firm Matrixport in Singapore.

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