TOP NEWS
* Amazon.com Inc. will lock Australian shoppers out of its U.S. and other overseas sites due to a new goods and services tax, or GST, regime coming into effect in the country. Under the updated GST rules that begin July 1, consumers in Australia will be required to pay a 10% tax on all goods purchased and delivered from overseas, with imported items worth less than A$1,000 no longer exempt from the levy. The same day, Amazon will start redirecting Australian shoppers from its global e-commerce sites to amazon.com.au, which was launched in late 2017 and has service expansion plans in the works. An Amazon Australia spokesperson said in a statement emailed to S&P Global Market Intelligence that the company "had to assess the workability of the legislation as a global business with multiple international sites."
* Dollar General Corp. reported that fiscal first-quarter earnings increased 30.5% year over year but fell short of expectations as bad weather reduced customer traffic. The retailer said net income for the quarter ended May 4, rose to $364.9 million from $279.5 million in the period to May 5, 2017, missing a mean consensus of analysts' estimates of $379 million, according to S&P Capital IQ. Diluted EPS jumped 33.3% to $1.33 from $1.02 as net sales climbed 9% to $6.11 billion from $5.61 billion. However, same-store sales were ahead only 2.1%, due to "the effect of unseasonably cold and damp weather."
FOOD RETAIL AND DISTRIBUTION
* Walmart Inc. shareholders elected McDonald's Corp. CEO Stephen Easterbrook to the company's board, along with Sarah Friar, CFO of payment tool developer Square Inc., at the retailer's annual shareholder meeting held May 30. The shareholders also ratified the appointment of Ernst & Young LLP as the retailer's independent accountant but voted against two shareholder proposals to adopt an independent chairman policy and to request a report on pay gaps.
* Russian food retailer X5 Retail Group NV announced key changes to the organizational structure of its Pyaterochka chain, opting for a macroregional management model as it seeks to streamline operations, the company said in a news release. As part of the change, five macroregions concentrated on two to four former geographical divisions with 2,000 to 3,000 stores will be supervised by directors reporting to the chain's general director.
* Variety retailer B&M European Value Retail SA posted earnings for full year 2018 that reached expectations as it continues to see its physical stores "winning" in the areas of value and convenience retailing. For the year ended March 31, the Luxembourg-based company reported that adjusted diluted EPS grew 19.5% year over year to 17.8 pence from 14.9 pence a year earlier, meeting the S&P Capital IQ consensus estimate for normalized EPS. Revenue for the 53-week period increased 24.9% year over year to £3.03 billion from £2.43 billion in the 52 weeks of 2017, ahead of a mean consensus of analysts' estimates for revenue of £2.98 billion compiled by S&P Capital IQ.
* Kroger Co. will roll out beginning June 4 its new Boosted Products in Search marketing platform, a tool that will enable brands to target online grocery shoppers as they search for products on the Supermarket operator's digital properties. The platform, which is part of the company's Restock Kroger initiative and offered by the Ohio-based company's Kroger Precision Marketing unit, will leverage behavioral data and native product integration to place relevant products in high-visibility spots on the search platform for each customer.
*U.K. supermarket operator ASDA Group Ltd posted increased earnings for fiscal-year 2017 ahead of its combination with domestic rival J Sainsbury PLC. For the 52 weeks ended Dec. 31, 2017, the British unit of U.S. retail giant Walmart Inc. reported a profit of £666 million, up from £657.2 million recorded a year ago. Revenue for full year 2017 increased to £22.22 billion compared with £21.67 billion for the year ended Dec. 31, 2016.
BEVERAGES
* The African bottler of Coca-Cola Co. will allot $100 million to improve its Kenyan facilities and roll out new products in the country over the next five years, Reuters reported, citing Daryl Wilson, Coca-Cola Beverages Africa country managing director. Coca-Cola's distributor in the region reportedly also plans to launch 50 more products amid growing demand from Kenyans for new brands.
* Authorities from a small village in Spain are asking Coca-Cola to acknowledge any connection with Kola-coca, a product locked in a safe at Destilerías Ayelo, Spanish publication El País reported, citing José Luis Pinter, the mayor of Aielo de Malferit in Spain's Valencia province. He reportedly said the village is only seeking recognition for the recipe of the beverage giant's popular namesake product.
PACKAGED FOODS
* South Korean food manufacturer CJ Cheiljedang Corp. will open a 443-square-meter flagship store for its instant food business at the company's headquarters in Seoul on June 1 to meet the country's increasing demand for ready-to-eat products, Yonhap News Agency reported. CJ Olive Market, which will open a second outlet in Yeouido, western Seoul, in June, will include a restaurant and a grocery space.
* The Dannon Co. Inc., the U.S. subsidiary of French dairy product manufacturer Danone, settled its lawsuit with Federico Muyshondt, a former senior sales executive who allegedly stole confidential business strategies and employee data before joining rival Chobani LLC, Reuters reported. The settlement between the two parties is confidential, while Chobani was dismissed as a defendant in the case, the report said, citing court filings with the U.S. District Court in White Plains, N.Y.
INDUSTRY NEWS
* Cecafé, Brazil's coffee exporters association, has estimated that a nationwide truckers protest could cut coffee exports from Brazil by 900,000 60-kilogram bags, Reuters reported, citing a statement from the organization. The protest has reportedly hampered transport of coffee to ports, causing financial losses of approximately 560 million reais in lost export sales and additional port costs.
* Shop prices in May fell 1.1% year over year, a 61-month streak of plunging store prices as the British pound continues to fall and the retail environment remains challenging, according to a report by the British Retail Consortium. However, food inflation rose to 1.2% in the month compared with 1% in April as price inflation for shelf-stable food went up in May to 1.7% from 1.2% a month ago.
The day ahead
Early morning futures indicators pointed to a lower opening for the U.S. market.
In Asia, the Hang Seng was up 1.37% to 30,468.56, while the Nikkei 225 rose 0.83% to 22,201.82.
In Europe, around midday, the FTSE 100 rose 0.13% to 7,699.53, and the Euronext 100 gained 0.27% to 1,056.77.
On the macro front
The jobless claims report, the Bureau of Economic Analysis' personal income and outlays report, the Chicago PMI, the pending home sales index, the EIA natural gas report, the EIA petroleum status report, the Fed balance sheet and the money supply report are due out today.
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