The latest Market Talks covering Financial Services. Exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

1213 ET - June rents in Canada declined from a year ago, marking the ninth-consecutive month of softer rents. The trend reflects two key factors: Canada limiting the entry of immigrants, in particular temporary-visa holders; and a boost in the number of apartment and condominium units becoming available, following years of construction that started in a low-rate environment. Data collected by Toronto-based Urbanation indicate rents fell 2.7% in June to C$2,125, following a 3.3% drop in the previous month. Urbanation notes, however, average rents remain 4.1% higher from two years earlier and about 12% higher than three years earlier. Housing affordability has improved in Canada in recent quarters but remains at historically expensive levels. (Paul.Vieira@wsj.com; @paulvieira)

1037 ET - America's housing shortage grew to an all-time high of 4.7 million units, according to Zillow. This deepening housing deficit remains the prime driver of the nation's housing affordability crisis. Construction boomed in response to high demand and price growth during the early years of the pandemic. But that hasn't been enough to keep up with the growing population, let alone undo nearly two decades of underbuilding. In 2023, 3.4 million homes sat vacant and available for rent or for sale, according to U.S. Census data. Meanwhile, 8.1 million families shared their homes with people who weren't related to them. "While some people choose to live with roommates, most of these families would probably prefer their own place if one were available that they could afford," Zillow says. (chris.wack@wsj.com)

0931 ET - There is opportunity to make profits from buying shares in companies targeted by UniCredit, Roemer Capital says in a note to clients. "We believe that the significant performance gap between the shares of UniCredit and its targets will continue to widen, providing arbitrage opportunities for the patient investor," the analysts write. The Italian bank is attempting to take over domestic peer Banco BPM, and has moved to become the top shareholder in Germany's Commerzbank and Greece's Alpha Bank. The targets continue to look cheap based on multiples and have seen their share prices rally massively, outperforming UniCredit's stock, they note. "If recent history is a guide, a long-short combination appears to be a reasonable market-neutral idea, offering a highly attractive risk-reward," they add. (elena.vardon@wsj.com)

0554 ET - U.S. motor insurance is expected to be the sector hardest hit by tariffs, according to a report by the Swiss Re Institute. While tariffs will affect the insurance sector across different geographies in a manageable way, the U.S. will be the most affected. "The main direct transmission mechanism is likely to be in claims severity, as import costs increase, most notably in U.S. motor and construction lines," the report says. Tariffs will increase the price of auto parts used for repairs and vehicle replacement, which will bump up the cost for U.S. motor repair and replacement by 3.8% in 2025. Yet, this remains lower than the 14% increase seen in 2021 and 13% in 2022 due to the inflationary impact of the coronavirus pandemic. (elena.vardon@wsj.com)

0542 ET - UBS closed its long position in 10-year U.S. Treasurys at 4.40%, but it will re-enter the trade when yields rise further, its strategists say in a note. UBS opened the trade at the end of May when 10-year yields were at 4.51%, but then tightened the stop to 4.40% ahead of last week's jobs report. "We think that we could see better levels to go long U.S. duration again but the market has to get a better sense of U.S. labor market dynamics, the impact of the Big Beautiful Bill and a higher tariff regime without U.S. dollar strength," it says. The 10-year Treasury yield falls nearly 2 basis points to last trade at 4.399%, according to Tradeweb. (emese.bartha@wsj.com)

0537 ET - Insurers around the world are bound to experience decelerating premium growth due to the current unstable policy environment and competitive pressures, according to a report from Swiss Re Institute. The softening of global economic growth--partly due to U.S. tariffs--will also hit insurers, which are set to see total premiums growth slow to 2% this year from 5.2% in 2024 before picking up marginally to 2.3% in 2026, it says. Though insurers' profitability outlook is still benefiting from rising investment income, slowing growth will weigh on insurance demand, Swiss Re's Chief Economist Jerome Haegeli writes. "In the long term, U.S. tariff policy is another move towards more market fragmentation, which would reduce the affordability and availability of insurance, and so diminish global risk resilience," he says. (elena.vardon@wsj.com)

0501 ET - Despite the heightened rhetoric on the latest U.S. tariff actions, the market's reaction remains measured, Kudotrade's Konstantinos Chrysikos says in a note. "Investors appeared to discount the immediacy of the threats, focusing instead on the broader trajectory of U.S. monetary policy," he says. President Trump on Tuesday announced tariffs on several countries as well as a 50% tariff on copper imports. Focus for Treasurys has shifted, however, to the release of Federal Reserve minutes later Wednesday for further clarity on how the central bank interprets evolving trade dynamics, he says. The 10-year Treasury yield falls 2.2 basis points to last trade at 4.395%, according to Tradeweb. (emese.bartha@wsj.com)

0405 ET - By consolidating its stake in Commerzbank through the conversions of derivatives into equity, UniCredit hopes to maintain flexibility in its negotiating position, Equita Sim says in a research note. The Italian bank's move makes it the top shareholder in its German peer, doubling its equity stake to 20%. This represents an extra contribution to UniCredit's bottom line of more than 600 million euro with a positive impact on its adjusted earnings per share for 2026 of more than 6%, analyst Andrea Lisi writes. UniCredit is solidifying its position in Commerzbank at a time when the German government opposes a tie-up but the European Central Bank supports consolidation processes across the continent's banking sector. In parallel, the lender is also taking a long-term view on its investment in its German peer. (elena.vardon@wsj.com)By Yuma Ikeshita / Yomiuri Shimbun Staff Writer David Semaya, executive chairman of Sumitomo Mitsui Trust Asset Management Co. (SuMi Trust AM), assured that the Japanese stock market will remain strong for the next five years during an interview with The Yomiuri Shimbun.

The asset management company is a subsidiary of Sumitomo Mitsui Trust Group Inc. Semaya approved the efforts of Japanese companies -- which are his company's target for investment -- for placing greater emphasis on corporate governance, which led to greater recognition of the value of assets that companies have.

The following are excerpts from his interview.

The Yomiuri Shimbun: How do you regard the Japanese market?

David Semaya: The most important factor in Japan losing its competitiveness pre-bubble bursting is the corporate governance. The inability to focus on shareholders. A shift (is necessary) from only focusing on stakeholders -- meaning employees, and the company itself and maybe customers -- to focusing more on better corporate governance and returning capital to shareholders when the company doesn't have a good strategy, or using capital to grow even in a difficult demographic environment.

We then have the cross-shareholding. In Japan, where relationships are viewed as extremely important and very, very long-term, this cross-shareholding system is sort of the foundation for so many relationships in big business. That's one of the many things that had to change. I returned to Japan in 2014. (At the time, then) Prime Minister (Shinzo) Abe was a driver for change. Japan went through two iterations of the corporate governance code. Lots of changes were made and that was a very positive thing.

Things are changing in Japan very quickly. There is what I call a lot of "sleeping assets" in Japan. Because of the changes of corporate governance, those sleeping assets are becoming obvious now. That's where we're seeing value created in many Japanese companies. Some of the Japanese companies don't like it because activists come in and they point it out. But I think for the next four, five or six years we're going to see continued strength of the Japanese equity market. There's plenty of value that can be unlocked from Japanese companies.

Yomiuri: What is the appeal of the Japanese equity market?

Semaya: I say, don't forget about Japanese equities, because dividend yield is very high, very nice, and Japanese companies are doing well. We need more Japanese people to invest in Japanese equities.

We see investors who are extremely strategic in long term and want to hold positions in Japan for a very, very long time. Corporate governance changes mean value is being unlocked. We also see pools of capital that are extremely long-term, and (people) believe that Japan will have positive inflation, positive interest rates, and they want to reset their exposure.

And there are groups who are specifically looking for real estate opportunities rather than equities. A lot of interest continues looking at Japan.

Yomiuri: In Japan, it is difficult for startups to grow. What do you think about it?

Semaya: Taking risk is not natural here in Japan. In fact, taking risk is negative culturally for most people. I think education is so important. My children went to international schools, and I observed, very different from the Japanese school, in math, when you have a test question, you have to write out your reasoning, and then you come to the answer. In Japan, they look at the answer, and (with a) red pen, (make a) circle or x. My children, they write out how they got to it, and rather than a check, it's a plus. In Japan, it's never a plus, it's always a minus if you get it wrong. But in the West, in America, here's the answer and let's say it's three points. My child would write, and the teacher would point out plus two. Not full points, but plus two. Your thinking is right, except for here. So, at a young age, we're preparing the students for critical thinking and to actually take risk. This is a part of the culture of taking risk.

Japan really needs to think about how to encourage young people to think a little differently, to take risk. That failing is a learning experience. Building the venture capital startup ecosystem is extremely important for Japan to be able to move quicker. But how do we get there? We have to start with accepting different opinions, diversity of opinions.

Yomiuri: In the United States, there is a growing backlash against environmental, social and governance $(ESG)$ efforts. What do you think about it?

Semaya: The American political system reelects a leader every four years. There is never a straight road.

State by state, there are certain states that continue to move forward, other states not so much, but I don't think the world is taking a massive step back. So, in the short term, not great, but in a longer term, I'm not as concerned as others personally.

Yomiuri: What is needed to accelerate innovation in the financial industry?

Semaya: Even if we, as an asset manager, step up, if our clients here have no need, or they don't want to try something more innovative, we're never going to sell the product. At a previous investment firm (I worked at), the most innovative investment strategies actually came from the clients' needs. If end users don't feel they have the problem, don't demand changes, then asset managers are not going to change. So we need push and pull. We need push from the asset owners, from the individuals.

Yomiuri: Japan has many areas where structural reforms are lagging. What are the areas that need to be prioritized for change?

Semaya: I think there are some obvious answers. One is a more diverse and liquid workforce. We know that the labor population is declining, people are getting married later and later, and they are having fewer children. So, why not provide the ability for childcare, more time off for parents and better integration of women in the workforce? The numbers have improved, but many women in many situations are still in roles that are not at the same level as men. We need to give women the opportunity to both have a career and to have more than two children because we have to have two or more children for the country to economically be sound and viable.

Labor liquidity also is quite low. People join a company for life, they say that's gone away, it hasn't gone away. For big companies, it's still here. I think we need to dial up more risk. If you want to take more risk and you can get a higher bonus and you perform better, that should be OK, especially in certain industries.

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This article is from The Yomiuri Shimbun. Neither Dow Jones Newswires, MarketWatch, Barron's nor The Wall Street Journal were involved in the creation of this content.

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0146 ET - The U.S. Treasury's issue sizes of notes with maturities between two and seven years is expected to be 15%-20% higher in 2027 and those further out to remain unchanged, Barclays's strategists say in a note. For Treasury Inflation-Protected Securities, or TIPS, they project further increases in auction sizes at the five- and 10-year tenors, while the 30-year tenor remains unchanged. The buyback program is likely to be scaled up later this year, while the weighted average maturity should drift lower toward the historical range, the strategists say. (emese.bartha@wsj.com)

0135 ET - Moshi Moshi Retail's same-store sales have been stronger than expected, says Thanachart Securities' Phannarai Tiyapittayarutk, as the brokerage raises its 2025-2027 earnings estimates for the Thai company by 2%-3%. Moshi Moshi Retail's organic same-store sales likely grew 6%-7% on year in 2Q, thanks to ongoing new product launches, store refurbishments and the low price points of its products, the analyst says in a note. The company is a low-priced product retailer with 90% unique in-house brands, which differentiates it clearly from rivals. The brokerage raises the stock's target price to THB52.00 from THB50.50 with an unchanged buy rating. Shares are 0.6% higher at ThB40.50. (ronnie.harui@wsj.com)

2121 ET - ASX's elevated expense profile looks set to keep weighing on the stock despite the Australian market operator's consistent underlying results, Morgans analyst Steven Sassine warns. He tells clients in a note that June was a good month for cash-markets activity on the Australian exchange, including a 35% on-year increase in total capital raised and 11 new listings. Average daily futures contract volumes for the 12 months through June were also up 19% on the prior fiscal year, he adds. However, risks around the company's ongoing technology overhaul prevents Sassine, and others, from becoming more positive. Morgans raises its target price 0.3% to A$72.20 and keeps a hold rating on the stock, which is up 0.1% at A$71.12. (stuart.condie@wsj.com)

(END) Dow Jones Newswires

July 09, 2025 12:20 ET (16:20 GMT)

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