WASHINGTON (Reuters) -Augusta National Golf Club, the U.S. Golf Association and PGA of America are included in the U.S. Justice Department’s antitrust investigation into professional golf, according to a Wall Street Journal report on Wednesday that cited people familiar with the matter.

A spokeswoman for the USGA, which is the national governing body for golf in the United States, confirmed to Reuters that the organization has been contacted by the Justice Department and is fully complying with all requests.

The PGA Tour confirmed in July it was part of the U.S. Justice Department’s probe into whether it broke antitrust law in fighting off the rival LIV Golf circuit that is being bankrolled by Saudi Arabia’s Public Investment Fund.

But the Justice Department’s probe is more expansive than previously known, the Journal reported. Augusta National, which hosts the Masters golf tournament in Georgia each spring, has produced documents for the Justice Department probe, these people said.

The Justice Department declined to comment while Augusta National and the PGA of America, which runs the PGA Championship, did not immediately respond to Reuters requests for comment.

Six-time major champion Phil Mickelson and 10 other golfers sued the PGA Tour in early August over its decision to suspend them for playing on the lucrative and controversial new Saudi Arabia-backed LIV Golf circuit.

LIV Golf has joined a handful of its players in their antitrust lawsuit against the PGA Tour, according to an amended complaint that showed a number of golfers have dropped out of the lawsuit.

(Reporting by Diane Bartz, Doina Chiacu and Frank Pingue; Editing by Mark Porter and Jonathan Oatis)

By Stephen Culp

NEW YORK (Reuters) – The S&P 500 ended a three-day winning streak on Wednesday, closing in negative territory as gloomy earnings guidance added to growing fears of a global economic slowdown.

But those fears, along with a smaller-than-expected interest rate hike from the Bank of Canada, continued to feed hopes that the Fed might consider easing the size of its rate hikes after its Nov. 1-2 policy meeting.

“Today the market is catching up with the move upward over the last week or so,” said Matthew Keator, managing partner in the Keator Group, a wealth management firm in Lenox, Massachusetts. “There are still two Fed meetings ahead of us this year.”

Paul Kim, Chief Executive Officer at Simplify ETFs in New York, agrees.

“Central banks are starting to blink,” Kim said. “It’s part of the larger trend and supports the pivot narrative.”

GRAPHIC: Central banks ramp up fight against inflation https://graphics.reuters.com/EUROZONE-MARKETS/movakmlgxva/chart.png

The S&P 500 and the Nasdaq ended in negative territory, dragged lower by market-leading tech and tech-adjacent companies following results from Microsoft and Alphabet. The blue-chip Dow eked out a nominal gain.

Microsoft and Alphabet shares tanked, falling 7.7% and 9.1%, respectively.

Those downbeat reports brought worries over an impending global economic downturn from simmer to boil, and spread to other high profile megacaps.

Sales of newly constructed U.S. homes plunged in September while mortgage rates hit their highest level in more than two decades, adding to the growing pile of data suggesting a softening economic landscape.

The Dow Jones Industrial Average rose 2.37 points, or 0.01%, to 31,839.11, the S&P 500 lost 28.51 points, or 0.74%, to 3,830.6 and the Nasdaq Composite dropped 228.12 points, or 2.04%, to 10,970.99.

Five of the 11 major sectors of the S&P 500 ended the session in the red, with communications services and tech were suffering the largest percentage losses.

Third quarter earnings season has shifted into high gear, with 170 of the companies in the S&P 500 having reported. Of those, 75% have delivered consensus-beating results, according to Refinitiv.

But they have a low bar to clear. Analysts see aggregate S&P 500 earnings growth of 2.3%, down from 4.5% at the beginning of the month, per Refinitiv.

“There have been pockets of promising corporate earnings announcements this quarter,” Keator added. “I don’t think it’s necessarily a fait accompli that we’re going to continue to see earnings misses across the board.”

Boeing Co reported a deeper than expected third quarter loss, sending its shares sliding 8.8%.

On the plus side, Visa Inc rose 4.6% in the wake of the consumer credit company’s profit beat.

Facebook parent Meta Inc shares fell more than 12% in after-hours trading after posting results.

Advancing issues outnumbered declining ones on the NYSE by a 1.71-to-1 ratio; on Nasdaq, a 1.41-to-1 ratio favored advancers.

The S&P 500 posted 25 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 113 new highs and 77 new lows.

Volume on U.S. exchanges was 12.26 billion shares, compared with the 11.60 billion average for the full session over the last 20 trading days.

(Reporting by Stephen Culp; Additional reporting by Amruta Khandekar and Shreyashi Sanyal in Bengaluru; editing by Grant McCool)

By Marcela Ayres

BRASILIA (Reuters) -Brazil’s central bank on Wednesday held interest rates at a nearly six-year high for the second policy meeting in a row, noting that economic growth seems to be slowing but inflation remains high.

The bank’s rate-setting committee, known as Copom, left its benchmark Selic interest rate at 13.75%, as expected by all 34 economists polled by Reuters.

Economists and traders have been watching for clues about when rates might start falling again. Policymakers paused an aggressive tightening cycle in September after 12 consecutive increases lifted rates from a 2.0% record low in March 2021.

The central bank again stressed on Wednesday that its strategy involves keeping the Selic rate at this level for a “sufficiently long period” to bring inflation back to “around its targets.”

In their statement of Wednesday’s rate decision, Copom said indicators since their September meeting suggested “more moderate” economic growth in Brazil, but consumer inflation remains “high.”

Rafaela Vitoria, chief economist at Banco Inter, said the statement seemed harsh in light of the recent improvement in inflation, with policymakers warning again that they may resume hikes if needed.

“The disinflation outlook is more positive, with a slowing economy and cheaper commodities. I think inflation will continue to fall faster than we expected,” she said, adding that expects a first rate cut as early as March.

Higher borrowing costs and energy tax cuts have contributed to three straight months of deflation through September. In the 12 months through mid-October, inflation fell to 6.85%.

While still above the 3.5% target for this year, inflation has eased sharply after running in double digits from September 2021 until July, fueled by surging commodity prices on the back of the Ukraine war.

In one of the few changes to the statement, the central bank indicated that 2023 and 2024 are now equally weighted on its policy horizon.

Policymakers held their inflation outlook for this year unchanged at 5.8%, but raised their forecast for next year to 4.8%, from 4.6% last month, compared to a 3.25% target.

For 2024, they raised the inflation forecast to 2.9%, from 2.8% last month, compared to a 3% target.

The outlook for government spending, which Copom again flagged as a potential upside risk for inflation, should be clearer after Sunday’s presidential election.

Polls show former leftist President Luiz Inacio Lula da Silva narrowly leading right-wing incumbent Jair Bolsonaro. Both have made expensive promises on the campaign trail, including the extension of more generous welfare payments, which would tweaking a constitutional spending cap.

After a law established the formal autonomy of the central bank last year, central bank chief Roberto Campos Neto is set to serve out his term through 2024, regardless of the election’s result.

(Reporting by Marcela AyresEditing by Brad Haynes and Josie Kao)

(Reuters) -Home goods retailer Bed Bath & Beyond Inc said on Wednesday that interim Chief Executive Sue Gove will keep the role permanently.

Gove, previously the head of the strategy committee and an independent director in the company, was named the interim CEO in June after it replaced Mark Tritton in a management shake-up to reverse a slump in its business.

The company said the appointment was unanimous and Gove will remain on its board.

Once considered a so-called “category killer” in home and bath goods, the big box retailer’s fortunes have dragged after attempts to sell more store-branded products flopped and led to the reshuffle of its management team.

Gove told Reuters one of her biggest long-term goals as CEO will be “regaining market share.”

The changes in the top management came just months after activist investor and billionaire Ryan Cohen had criticized the company for an “overly ambitious” strategy, overpaying top executives and failing to reverse market share losses.

Cohen was the company’s biggest investor until August when he sold out his 9.8% stake.

Late August, Bed Bath & Beyond inked deals for more than $500 million in new financing and said that it would close 150 stores, cut jobs and overhaul its merchandising strategy to turn around its money-losing business.

Gove said that “less than a handful” have been closed since August and that a number of stores will close “closer to the end of this calendar year.”

Last month, the company reported a bigger-than-expected second-quarter loss, but added that there were early signs that efforts to clear excess inventory were working and it expected its cash flow to break even in the fourth quarter.

In September, the company had named accounting head Laura Crossen as interim chief financial officer following the death of finance chief Gustavo Arnal.

(Reporting by Ananya Mariam Rajesh in Bengaluru; Editing by Shailesh Kuber, Sriraj Kalluvila and Josie Kao)

By Jonathan Landay

FRONT LINES NORTH OF KHERSON, Ukraine (Reuters) – Ukrainian troops at the front line said on Wednesday they were expecting a bitter fight for the southern Kherson region, which Russia now appeared to be reinforcing after days in which it seemed possible that Moscow might withdraw.

In Russia, the military staged a high-profile rehearsal for nuclear war, with state television broadcasts dominated by footage of submarines, strategic bombers and missile forces practicing launches in retaliation for an atomic attack.

Moscow has conducted a diplomatic campaign this week to promote an accusation that Kyiv is preparing to release nuclear material with a so-called “dirty bomb”, an allegation the West calls baseless and a potential pretext for Russian escalation.

The looming battle for Kherson at the mouth of the Dnipro River is expected to be one of the most consequential of the war, determining whether Kyiv can loosen Moscow’s grip on southern Ukraine.

While much of the front line remains off limits to journalists, at one section of the front north of the Russian-occupied pocket on the west bank of the Dnipro, Ukrainian soldiers said Russian shelling was stepping up again after having tailed off in recent weeks.

Radio intercepts indicated freshly mobilised recruits had been sent to the front and Russian forces were firmly dug in.

“They have good defensive lines with deep trenches, and they are sitting deep underground,” said Vitalii, a Ukrainian soldier squatting in a weed-choked irrigation canal, concealed from any prowling enemy drones by overhanging trees.

Both Russia and NATO are holding long-standing annual drills of their nuclear forces this week. But Russia has given the exercises a much higher profile than usual, timing it to coincide with its dirty bomb accusations against Ukraine.

Kyiv says Moscow has been brandishing the prospect of nuclear war to intimidate Western countries into withdrawing their support for Ukraine. Moscow said President Vladimir Putin had personally overseen the nuclear drills remotely.

The Pentagon said a day earlier that Russia had notified it of its intention to carry out the exercises, which reduced the risk of miscalculation at a time of “reckless” Russian nuclear rhetoric.

‘THEY ARE FIGHTING WELL’

Ukrainian forces advanced along the Dnipro River in a dramatic push in the south at the start of this month, but progress appears to have slowed. Russia has been evacuating civilians from the pocket of territory it holds on the west bank this week but says it has no plans to pull out its troops.

Oleksii Reznikov, Ukraine’s defence minister, said wet weather and rough terrain were making Kyiv’s counter-offensive in Kherson harder than it was in the northeast, where it pushed Russia back in September.

At the front, intermittent artillery fire echoed from both sides, with towers of smoke rising in the distance.

A Ukrainian helicopter gunship swept low over the fields, loosed rockets at the Russian positions and wheeled around spitting flares to distract any heat-seeking anti-aircraft rockets fired at it.

“In the press they say the Russians are afraid and will withdraw their troops, but that is not true,” said a unit commander at the front, who asked to be quoted by his nickname, Nikifor. “They are fighting well and hitting our troops.

“In this area, they are very active. They shell every day and are digging trenches and preparing for defence,” said Nikifor, whose location in Mykolaiv province could not be identified under Ukrainian military regulations.

The unit holds a network of well fortified trenches dug into tree lines opposite the Russian fortifications, and recent rains have turned the dirt tracks that access them to mud, especially where tank treads have churned them up.

Since Russia began losing ground in a counter-offensive in September, Putin has taken a series of steps to escalate the conflict, calling up hundreds of thousands of Russian reservists, proclaiming the annexation of occupied land and repeatedly threatening to use nuclear weapons to defend Russia.

This month, Russia launched a new campaign of strikes using missiles and Iranian-made drones against Ukraine’s energy infrastructure, also hitting parks and homes across the country.

The remains of a U.S. citizen killed in Ukraine were turned over to Ukrainian authorities as part of a prisoner swap.

Andriy Yermak, head of Ukraine’s president’s office, identified the U.S. citizen as Joshua Jones, a U.S. Army veteran. The U.S. State Department, which did not identify the person, said the remains would soon be returned to the person’s family.

(Reporting by Reuters bureaux; Writing by Peter Graff; Editing by Cynthia Osterman)

By Trevor Hunnicutt and Steve Holland

WASHINGTON (Reuters) – President Joe Biden and Israeli President Isaac Herzog held talks on Wednesday focused heavily on Iran, with the two leaders discussing Tehran’s nuclear program and what Washington says is the supply of Iranian weapons to Russia.

Speaking to reporters as they sat down in the Oval Office, Herzog said he and Biden would attend the COP27 U.N. climate change summit being held in Egypt next month.

“One item that you and I will be participating in, Mr. President, with leaders from all over the world is COP27 in Sharm-el-Sheikh in Egypt a few weeks down the road,” he said.

Biden is expected to attend the G20 summit in Bali, Indonesia, next month. A White House spokesperson declined to comment on the president’s travel plans.

Biden had sought to negotiate the return of Iran to the Iran nuclear deal after then-President Donald Trump pulled out of the agreement in 2018. Last week the White House said it had set aside diplomacy for now and said Tehran had supplied drones to Russia for use in its war against Ukraine.

Herzog noted that Wednesday marked 40 days since the death in custody of Iranian citizen Mahsa Amini. She had been detained by morality police for wearing an “improper” hijab, and her death has set off protests.

“This is an example of Iran crushing their own citizens while moving forward towards nuclear weapons and supplying lethal weapons that are killing innocent citizens in Ukraine. The Iranian challenge will be a major challenge to be discussed,” Herzog said.

Biden noted that Israel and Lebanon on Thursday will sign a maritime accord to establish a permanent boundary. The United States helped negotiate the deal.

“I think it’s a historic breakthrough. It took a lot of courage for you to step up and step into it, and it took some real guts, and I think it took principle and persistent diplomacy to get it done,” Biden said.

A White House statement on the meeting said Biden emphasized the importance of taking steps to de-escalate the security situation in the West Bank and that a negotiate two-state solution between Israel and the Palestinians remains the best way for a lasting peace.

“They discussed the importance of promoting co-existence and weakening extremists who promote hatred and violence,” the statement said.

(Reporting by Trevor Hunnicutt, Jarrett Renshaw and Steve Holland; Editing by Chris Reese, Jonathan Oatis and David Gregorio)

(Reuters) – Australia’s Lynas Rare Earths on Thursday reported a 34.7% jump in first-quarter revenue, helped by a surge in demand for specialised metals used in electric vehicle components.

Global demand for minerals used to power electric-vehicle motors has continued to surge amid a global push to reduce carbon emissions from fossil-fuel powered vehicles, benefiting miners such as Lynas.

Rare earths minerals are also used in a wide variety of goods such as iPhones and military equipment.

The world’s largest producer of rare earths outside China said revenue rose to A$163.8 million ($106.34 million) in the three months to Sept. 30, compared with A$121.6 million a year ago and a Barrenjoey estimate of A$146 million.

However, the miner’s quarterly revenue fell about 44% sequentially due to operational challenges including a water supply disruption at its plant in Malaysia, which it flagged in July.

Production of neodymium and praseodymium (NdPr), used in magnets that power electric-vehicle motors, came in at 1,045 tonnes in the September quarter, compared with 1,255 tonnes a year earlier and a Barrenjoey estimate of 903 tonnes.

“Our NdPr, Nd and Pr customers (mostly outside China) continue to forecast very strong demand,” Lynas said, adding that “FY23 full year production (at Malaysia plant) is anticipated to remain consistent with that achieved in FY22.”

Lynas raked in an average selling price of A$49.3 per kilogram (kg) for its product range in the reported quarter, compared with A$44.6 per kg last year.

($1 = 1.5404 Australian dollars)

(This story has been corrected to say “revenue”, not “production”, in paragraph 5)

(Reporting by Upasana Singh in Bengaluru; Editing by Shinjini Ganguli)

By Luc Cohen

NEW YORK (Reuters) -Prosecutors charging onetime Donald Trump fundraiser Tom Barrack with being an illegal foreign agent can ask him about his comments on the killing of Saudi journalist Jamal Khashoggi and efforts to build nuclear power plants in the Middle East, the judge overseeing Barrack’s trial said on Wednesday.

The ruling by U.S. District Judge Brian Cogan came on the third day of Barrack’s testimony in his own defense in Brooklyn federal court. He faces charges of pushing the United Arab Emirates’ interests to the former president’s administration without notifying the U.S. Attorney General, as required by law. Cross-examination is expected to begin on Thursday.

Barrack, 75, has pleaded not guilty. He has said his interactions with Middle Eastern officials were part of his role running private equity firm Colony Capital, now known as DigitalBridge Group Inc, and that even when his interests aligned with the UAE’s he was acting on his own.

Cogan did not state in open court what Barrack said about Khashoggi, a Saudi insider-turned-critic who was murdered and dismembered inside the kingdom’s consulate in Istanbul in an operation U.S. intelligence says was approved by Crown Prince Mohammed bin Salman, the de facto ruler.

In 2019, Barrack said at a conference in Abu Dhabi that “atrocities in America are equal or worse” than the killing of Khashoggi, news outlets reported at the time. Barrack later apologized for the comments, calling the killing “atrocious.”

The prince has denied ordering the killing but acknowledged it took place “under my watch”.

While Barrack is not charged with acting as a Saudi agent, the country and the UAE are close allies.

Cogan also said he would let prosecutors ask Barrack about a plan he pushed in the early days of the Trump administration to construct 40 nuclear plants in Saudi Arabia and elsewhere in the Middle East. A Democratic-led Congressional report in 2019 found that Barrack sought to profit from the deal even as he pushed to be named to a diplomatic post.

Barrack is not charged with any crimes over the civil nuclear plan, which fell through. But Cogan said the defense opened the door for prosecutors to ask about it by displaying communications involving Barrack and the co-founder of IP3, the consortium of firms pushing plan.

ENERGY SPEECH

Earlier on Wednesday, Barrack testified that former Trump campaign chairman Paul Manafort asked him to solicit input from Middle Eastern officials on a speech the candidate was to deliver on energy policy in 2016. One of prosecutors’ major charges is that Emirati officials provided input to Barrack on what Trump should say in the speech.

Barrack’s assertion that it was not his idea to seek out Emirati input on the speech could bolster his defense that while he long sought to improve ties between the United States and several Middle Eastern countries, he never acted at Abu Dhabi’s direction or under its control – which prosecutors must prove to show he was an agent.

A lawyer for Manafort, who is not accused of wrongdoing in the case, declined to comment.

Barrack – who was not on the campaign, though he later chaired Trump’s inauguration – said he sent a draft of the speech to an energy executive in the Emirates as well as Rashid Al-Malik, a businessman who prosecutors have charged with acting as an intermediary between Barrack and UAE officials. Al-Malik is at large.

But he said he ultimately did not include the feedback that Al-Malik sent him from a UAE official in the draft.

(Reporting by Luc Cohen in New York; editing by Jonathan Oatis and David Gregorio)

By Paul Lienert and Joseph White

DETROIT (Reuters) -Ford Motor Co on Wednesday reported a third-quarter net loss driven by its decision to shift spending from the Argo AI self-driving business.

Ford’s move, a sharp contrast with rival General Motors Co’s decision to double down on investments in its Cruise robotaxi unit, highlights the pressure on automakers to make hard choices as the financial demands of shifting to electric vehicles continue to rise.

Both U.S. automakers continue to post heavy losses on automated-vehicle development.

Ford posted a net loss in the quarter of $827 million, after taking a $2.7 billion noncash pretax impairment on its investment in Argo AI.

Ford shares were down 1.6% in after-hours trading.

The automaker said Argo will be “wound down” and that “talented engineers” will be offered positions with Ford.

The other key investor in Pittsburgh-based Argo, Volkswagen AG, said it, too, expects to hire some personnel from Argo.

In a statement on Wednesday, Argo said it “will not continue on its mission as a company,” a decision that was made “in coordination with our shareholders.” It said some Argo employees will be let go.

Ford and VW each hold around 39% of Argo, with Lyft Inc owning about 2% and the rest held by Argo’s founders and employees.

Chief Executive Jim Farley on Wednesday said Ford will shift its development focus away from fully self-driving systems developed by Argo to advanced driver assistance systems (ADAS) created internally at Ford. Such systems are partially automated but still require humans to stay engaged when a vehicle is moving.

“Profitable, fully autonomous vehicles at scale are a long way off and we won’t necessarily have to create that technology ourselves,” Farley said in a statement.

The U.S. automaker said third-quarter revenue jumped to $39.4 billion, up 10% from a year ago. Adjusted operating profit fell to $1.8 billion from $3.0 billion last year, but beat analysts’ consensus estimate of $1.7 billion.

Adjusted operating earnings per share of 30 cents beat analysts’ estimate of 27 cents.

Ford warned in mid-September that inflation-related supplier costs were running about $1 billion higher than expected.

GM on Tuesday reported a net profit of $3.3 billion on record third-quarter revenue of $41.9 billion. GM reaffirmed its guidance for full-year net income of $9.6 billion to $11.2 billion.

While GM executives were generally upbeat on the company’s earnings call, Ford was more cautious.

Ford Chief Financial Officer John Lawler, in a briefing Wednesday, said: “We see the probability that we could move into a mild (or) moderate recession in the U.S. next year. We could potentially have a more substantial decline in Europe.”

Ford said it expects full-year adjusted earnings before interest and taxes to rise to about $11.5 billion, up around 15% from a year ago, but at the low end of its previous guidance of $11.5 billion to $12.5 billion.

(Reporting by Joseph White and Paul Lienert in DetroitAdditional reporting by David Shepardson in WashingtonEditing by Ben Klayman and Matthew Lewis)

By Mohammad Azakir

ARSAL, Lebanon (Reuters) -Hundreds of Syrian refugees returned home from Lebanon on Wednesday, the first day of repatriations organised by Beirut, their mood more subdued than celebratory amid concerns over a scheme that rights groups say may involve elements of coercion.

Lugging suitcases, power generators, fridges and even chickens and mostly skirting around watching media, some 700 Syrians who had agreed to cross over gathered from early morning in a desolate northeastern border zone.

Lebanese authorities say the repatriations, under a revived programme coordinated by General Security, the agency responsible for safeguarding its borders, are voluntary.

But while frontlines in Syria’s 11-year war are now largely inactive, the United Nations says flare-ups in violence and the risk of detention mean large-scale returns remain unsafe.

Lebanon is home to more than 800,000 Syrians registered with the U.N. refugee agency, who fled the conflict unleashed in 2011 after protests against President Bashar Al-Assad.

In 2018, Lebanon launched a mechanism to bring down that number, which had peaked at 1.2 million, providing funding for General Security to repatriate refugees who registered a desire to return home, after checking they were not wanted by Syrian authorities.

Around 400,000 Syrians returned home through that system before it was paused when COVID-19 broke out. Outgoing Lebanese President Michel Aoun revived it this month and it resumed on Wednesday.

The scheme has been criticised by rights groups including Amnesty International, which said its research showed that some past returnees had been subject to rights violations.

Amnesty has also said refugees may not have accurate or complete information on the level of risk in their hometowns, meaning the repatriations may not be “free and informed”.

Much of Syria remains in ruins, with homes and public infrastructure, including power stations, schools and water services, devastated.

However, Lebanon is itself in the throes of a financial meltdown that has pushed hundreds of thousands of residents into poverty, leaving many Syrian expatriates facing an unenviable choice.

Omar al-Borraqi, one of very few returnees willing to speak to Reuters on Wednesday, said that, after nine years in Lebanon, emotional and financial factors had played a role in his decision.

“There were so many reasons that we didn’t go back (earlier),” he said as he sat in a lorry preparing to return to his hometown near Damascus.

“Now God has made it easier for us.”

(Reporting by Mohammad Azakir and Maya Gebeily in Beirut; editing by John Stonestreet)

BRASILIA (Reuters) -Brazil President Jair Bolsonaro’s government is considering raising the minimum wage and civil servants’ salaries above inflation, Economy Minister Paulo Guedes said on Tuesday, but he denied intentions to end middle class tax benefits.

The remarks, made at a virtual event on cooperativism, took place ahead of an Oct. 30 presidential election runoff vote in which right-wing Bolsonaro trails former leftist President Luiz Inacio Lula da Silva in polls.

Folha de S. Paulo newspaper last week reported the government was studying whether to end a constitutional obligation to adjust the minimum wage annually by at least the previous year’s inflation, news that negatively hit Bolsonaro’s campaign.

On Tuesday, the O Estado de S. Paulo newspaper reported on Tuesday that studies by the ministry proposed abolishing the ability to deduct medical and education expenses from income tax. Such a measure would mainly affect the middle class.

In both cases, Guedes acknowledged the existence of internal studies but attributed their preparation and leakage to Lula’s Workers Party (PT) members who work in the ministry.

“On the eve of elections, they leak studies that were discarded,” he said.

PT did not immediately respond to Reuters’ request for comment.

The minister stressed that Bolsonaro’s administration wants to approve a tax reform that reduces the burden on the poorest and taxes profits and dividends.

Later on Tuesday, the Economy ministry said in a statement that supposed studies, analyses, essays and opinions produced by the technical areas of the cabinet could not be “incorrectly taken as proposals from the ministry or the minister.”

(Reporting by Marcela Ayres; Editing by Mark Porter, Josie Kao and Richard Pullin)

By Divya Rajagopal and Tiyashi Datta

(Reuters) -Shaw Communications Inc’s shares rose as much as 10% on Wednesday after the government’s intervention raised hopes that Canada is likely to approve Rogers Communications’ C$20 billion ($14.7 billion) bid for Shaw.

Analysts said they expected the deal to close before year end as the terms put forward by Industry Minister Francois Champagne late on Tuesday brings Canada’s anti-trust authority and Rogers-Shaw a step closer to a settlement.

However, Canada’s anti-trust authority still has objections to the deal.

“We remain firm in our decision to challenge this proposed merger to protect the public interest,” a competition bureau spokesperson said in an email. The bureau declined to comment further and said the matter will be determined by courts.

Rogers’ launched its bid to buy Shaw in March 2021, but the competition bureau blocked it, saying it would lessen competition in a market that has among the highest wireless prices in the world.

“It is likely that we see a settlement coming through during the mediation process scheduled for later this week,” said Aaron Glick, an analyst with New York-based Cowen. Since the competition bureau sits under the minister, it is a signal to the bureau to settle, he said.

Rogers shares closed up 5.8%, while Shaw ended up 7.2%.

Matthew Dolgin, equity analyst with Morningstar, said the mediation between the parties seems more fruitful now than it appeared couple of days ago.

To allay the antitrust bureau’s concerns, Rogers offered to sell Shaw-owned Freedom Mobile to Quebecor.

On Tuesday, Champagne outlined conditions to approve that deal, saying Quebecor should hold on the new spectrum for at least 10 years and keep the price of its services at par with what they are in Quebec, which is 20% lower than rest of Canada.

Quebecor Chief Executive Pierre Karl Peladeau told Reuters on Tuesday that the company intends to accept the conditions stipulated by the minister.

Champagne’s announcement comes as the companies are set to begin a two-day mediation process on Thursday at the Competition Tribunal. The competition bureau has said the sale of Freedom Mobile to Quebecor is not sufficient to overcome its concerns about market concentration.

The bureau and the companies will try and find a remedy during the mediation process though the parties are not bound to come to a settlement. If the mediation fails there will be a hearing that is scheduled to start on Nov. 7..

“We believe this pragmatic view by the minister has the chance to provide a good middle ground to build on between the parties,” said Scotiabank analyst Maher Yaghi, who upgraded Shaw to “sector outperform” on increasing odds of the deal closing.

($1 = 1.3573 Canadian dollars)

(Reporting by Tiyashi Datta in Bengaluru and Divya Rajagopal in Toronto; Editing by Maju Samuel, Marguerita Choy and Bill Berkrot)