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Japan's nuclear regulator has cleared Hokkaido Elec Tomari reactor's safety review
The Nuclear Regulation Authority of Japan approved on Wednesday the safety review for Hokkaido Electric Power’s No.3 nuclear reactor at the Tomari Nuclear Power Station after more than 12 years. This was a requirement to restart its operations. The reactor was closed in 2012, as part of an overall push to improve safety following a massive earthquake that occurred the year before. This earthquake disabled cooling systems in Tokyo Electric Power Co’s Fukushima Daiichi Plant and caused the worst leakage of radioactive materials in 25 years. A spokesperson for the NRA said that at its regular meeting it concluded that the safety measures in the Tomari reactor met new regulatory standards, and that the plant passed the test. Now, the focus will be on obtaining local community approval for restart. Hokkaido Electric aims to finish construction of the seawall by March 20, 2027, and restart the 912 megawatt reactor as quickly as possible after that. Japan is heavily dependent on imports of fossil fuels. The government wants to see nuclear power play a larger role in the energy mix for the country and its energy security. Currently, the country operates over a dozen nuclear reactors with a combined power of 12 gigawatts. Many other reactors are being relicensed to meet the stricter safety standards that were implemented following the Fukushima catastrophe. Japan had 54 reactors in operation before 2011. Japan wants nuclear power to account for 20-22% (of its total electricity) by 2030, despite the difficulties the industry has faced since then. Nuclear power will account for 8.5% in 2023. (Reporting and editing by Jan Harvey; Yuka Obayashi)
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Earnings in the Gulf are below expectations.
Investors were watching global trade developments and the looming U.S. deadline for tariffs as they watched major Gulf stock markets in early trading on Wednesday. Investors have become more cautious since trade talks between China and the U.S. ended without a substantive agreement. The tariff policies of U.S. president Donald Trump continue to cause concern about global growth. Potential slowdowns in consumption and trade could threaten energy demand, and the fiscal security of Gulf economies that are dependent on oil. Saudi Arabia's benchmark stock index fell 0.1% due to a series of unbalanced earnings in key sectors. Halwani Brothers dropped 3.8% and Nahdi Medical fell 4.5% following the companies' reported drop in second-quarter profit. Halwani’s profit collapsed by nearly 85%. Dubai's benchmark stock index was flat after reaching a near two-decade-high in the previous session. This was due to a drop of 1.9% in Mashreqbank which reported a 17% decline in profit year-on-year for its second quarter. The Abu Dhabi Index edged lower on mixed earnings that dampened investor appetite and disrupted the momentum from the previous weeks robust results. Americana Restaurants International (ARI) and ADNOC Drilling (ADNOC) both added 0.5% after ARI's second quarter earnings increased year-on-year, but fell short of estimates. The latter kept its full-year forecast unchanged despite solid gains. Qatar's benchmark indices fell 0.1% amid a broad-based drop as investors locked in profits after a recent rally which pushed the index up to a two-and-a half-year high. Qatar Islamic Bank, which fell by nearly 1%, led the losses. Investors in the region were focused on the U.S. Federal Reserve policy announcement, which is due later that day. The Fed is expected to keep interest rates the same, but markets are prepared for possible dissension by central bank officials who may favor lower borrowing costs. The Fed's position has significant implications for Gulf economies. Most currencies in the region are pegged to U.S. dollars, which makes it a key anchor of regional monetary stabilty. (Reporting and editing by Mrigank Dahniwala in Bengaluru)
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Mercedes-Benz reduces its profit forecast due to US tariff impact
Mercedes-Benz cut its forecasts for annual sales and profit margins on Wednesday. The company cited a $420 million hit from U.S. Tariffs in the second-quarter. The German luxury automaker expects to achieve a profit margin between 4% and 6% in its car business for this year, and a group revenue that is "significantly lower" than the levels of 2024, for both its cars and vans. In February, before the U.S. Tariff Changes, the company said that they expected the profit margin of its car division this year to be 6-8%, after 2024 earnings had fallen 30%, with a 40% drop in the auto business. In April, it retracted that guidance. It said that if tariffs were excluded, the unit's outlook for margins would have been lower than the original guidance. Mercedes shares fell 1.5% at the opening of Frankfurt trading. The results reflect the wider impact of Trump's policy on tariffs, which saw European automakers being hit with higher U.S. Import taxes this year. Volkswagen's Porsche luxury brand cut its profitability target for the full year on Wednesday. The U.S. and the EU reached a framework agreement on trade on Sunday. It imposed a 15% tariff on the majority of EU goods, half the rate that was threatened. This prevented a larger trade war between these two allies who account for nearly a third the global trade. Mercedes reported that the impact of tariffs on its adjusted operating profit margin (EBIT) in the second quarter was 150 basis points. According to calculations, this amounted approximately to 362 million euro ($418) according to Mercedes. The trade agreement was welcomed by Chancellor Friedrich Merz, as it avoided a trade war that would have severely hurt Germany's export driven economy and large auto sector. BENEFIT OF A TRADE DEAL Morningstar analysts said in a Monday research note that Mercedes was among the biggest beneficiaries of the U.S. EU trade deal because it imports more from Europe than Mexico or Canada. The company also manufactures cars at its U.S. factory in Tuscaloosa (Alabama). The second-quarter operating profit of the company has more than doubled, to 1,99 billion euros (2.30 billion dollars). In a press release, the company said that tariffs and efficiency measures, as well as a 750-million-euro impact from a sale of an Argentine plant and reorganization, further lowered their reported EBIT or operating profit to 1.27 billion euro. The company's revenue dropped by 9%, to 33.15 Billion Euros. This was due to lower sales of cars and vans as well as tariffs. Jefferies stated in a report that the sales and operating profit numbers were "no surprises", pointing out lower volume, price and sales figures in China. It had announced earlier this month that unit sales in China would decrease by 10% and 19% respectively in the first quarter and second quarter of 2025, compared to last. Due to the intensified local competition, both the company and other German automakers are facing a decline in China.
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Gold prices rise as the dollar weakens ahead of Fed decision
Gold prices rose on Wednesday as investors waited for the Federal Reserve to announce its policy and make comments that might provide more clues about the timing of their next moves. As of 0828 GMT, spot gold rose 0.2% to $3,331.03 an ounce. U.S. Gold Futures climbed 0.1% to $3,328.30. Gold became less expensive to holders of other currencies after the dollar index fell by 0.1%. "There is a combination of factors that are holding gold prices back." "From a geopolitical perspective, we seem to be making some progress in the tariff negotiation but no one is willing to commit to anything," StoneX analyst Rhona o'Connell stated. After two days of constructive talks between the U.S. and China in Stockholm, officials will continue to monitor the negotiations between the U.S. and China. Both sides have agreed to extend their 90-day truce on tariffs. Investors were reassured by the trade agreements reached with Japan and the European Union last week. This week, the risk sentiment on the stock market has also been lifted. The Fed is expected to maintain rates on Wednesday despite President Donald Trump's repeated calls for them to be lowered. The markets will be watching Fed Chair Jerome Powell for further clues about the rate path. The markets have priced in two cuts by year's end, which is probably too mild. "The Fed will not yield to political pressure, but it will be fascinating to see if the vote is unanimous today," O'Connell stated. In an environment of low interest rates, gold tends to perform well. Other than that, silver spot fell 0.4% per ounce to $38.04, platinum dropped 1% to 1,381.69, and palladium dropped 0.5% to 1,252.40. (Reporting by Brijesh Patel in Bengaluru; Editing by Ronojoy Mazumdar)
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The tsunami warning in Japan brings back memories of the Fukushima catastrophe
Residents along the Pacific coast of Japan rushed for higher ground as tsunami warnings were issued following a massive quake off Russia's Far East. The earthquake brought back painful memories from the 2011 nuclear disaster and earthquake. The television banners read "TSUNAMI!" EVACUATE!" As tsunami waves approached Japan, broadcasters issued similar warnings. They cut their regular programming and focused on evacuation orders. "Do not stare at the screen." Evacuate now!" A news presenter from the public broadcaster NHK yelled. The warnings brought back memories of the March 11th, 2011 earthquake. More than 15,000 died when a 9.0-magnitude earthquake triggered a tsunami that ravaged the Fukushima Nuclear Power Plant and caused a radiation disaster. Residents were unable reach higher ground as waves dozens of meters high surged along the northeastern coast of the country. Residents recalled these events on Wednesday as evacuation warnings are issued. A woman from Fukushima said to NHK: "Everyone evacuated higher ground when the earthquake struck previously, so I considered doing the same." After the evacuation warning, workers in low-lying parts of Tokyo Electric Power’s Fukushima Nuclear Facility suspended decommissioning and fled higher ground. The spokesperson stated that the evacuation was not a safety issue. Over 2 million people were told to move to safer areas along the Pacific Coast. Locals called the 2011 disaster "3.11", and many recalled the lessons learned. They braved the heatstroke risk in the intense summer months to reach higher grounds. TV Asahi reports that a woman aged 58 died in Japan's Mie Prefecture when her car fell from a cliff as she evacuated. A representative of the Japan Meteorological Agency has warned that tsunami waves may continue to strike for up to a week. NHK reported that a male postal worker from Iwate Prefecture said, "I worked at the same office 14 years ago." This time, we all said "let's evacuate immediately." (Reporting and editing by Saad Saeed; Satoshi Sugiyama)
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Iron ore prices fall as China's stimulus fades
Iron ore futures prices fell on Wednesday, as expectations of further stimulus from China's top consumer faded. This erased gains made earlier in the week that were based on the prospect of an extension of the tariff truce between America and Asia. The September contract for iron ore on China's Dalian Commodity Exchange ended the day 0.44% lower, at 789 Yuan ($109.95) per metric ton. As of 0700 GMT, the benchmark September iron ore price on Singapore Exchange dropped by 0.91% to $100.80 per ton. The readout by Xinhua, the state media for the July Politburo that sets the course of economics for the remainder of the year, said China will keep its policy stable without specifying any concrete measures. This disappointed those who expected Beijing to take some steps to support the property market that is still struggling, and has been dragging down economic growth as well as consumption of industrial materials such steel. After two days of constructive talks, both sides in Stockholm described as productive, U.S. officials and Chinese officials decided to extend their 90-day trade truce. Treasury Secretary Scott Bessent has quashed any expectations that Donald Trump would reject the extension. The International Monetary Fund also raised its forecast of China's growth to 4.8% this year from 4.0%. This boosted sentiment and contributed to price increases. After a jump of over 6% in the morning, gains in coking coal, a steelmaking ingredient, and coke, slowed in the afternoon. They were up by 2.71% and 4.4% respectively. The benchmarks for steel on the Shanghai Futures Exchange have gained some ground. Rebar rose by 0.42%. Hot-rolled coils climbed by 0.81%. Wire rod gained 0.2%. Stainless steel gained 0.31%. ($1 = 7.1762 Chinese Yuan) (Reporting and editing by Amy Lv, Lewis Jackson and Janane Vekatraman).
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Chinese refiner Yulong buys first Canadian TMX crude oil cargoes
Trade sources report that China's Shandong Yulong Petrochemical purchased its first Canadian crude oil cargoes via the Trans Mountain Pipeline (TMX) to be delivered in September and October, diversifying its supply. Two sources confirmed that Yulong purchased an Access Western Blend cargo from Macquarie for September delivery, at a discounted price of $1.50 per barrel compared to the November ICE Brent. It also bought a cargo from Totsa for October delivery, at a comparable discount to the December ICE Brent. Each cargo contains approximately 550,000 barrels. Yulong didn't immediately reply to an email asking for comment. Macquarie and TotalEnergies don't comment on commercial issues. Yulong made its first purchase of Canadian crude oil in September, when the refinery began processing 200,000 barrels per day. The AWB bitumen is a heavy, highly acidic diluted version of bitumen that's produced by Canadian Natural Resources (CNR) and MEG Energy. Trade sources reported that Yulong also made a recent purchase of Urals crude oil from Russia. They said that the refiner usually buys West African crude and Russian Far East ESPO-grade crude. (Reporting and editing by Florence Tan in Singapore, Siyi Liu in Singapore)
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Rio Tinto reports smallest first-half profits in five years
Rio Tinto announced its lowest first-half profit in five years Wednesday as iron ore price remained low due to concerns about oversupply and weak China demand. This was offset by higher earnings from the copper business. The price of iron ore fell in the first half as the top steel consumer, China, decreased its steel production and increased supply from Australia and Brazil. This reduced Rio Tinto's earnings. Morgan Stanley notes that the expectation of China reducing overcapacity and restocking the steel industry before the end of 2025 could lead to an increase in price to $100 per ton by the end the year. Rio Tinto, world's biggest iron ore producer reported earnings of $4.81billion for the six-month period ended June 30. This was below the Visible Alpha consensus estimate of $5.05billion. This was the lowest first-half performance for the company since 2020. It reported earnings of $5.75 Billion. Rio Tinto has declared a lower interim dividend for the first half year of $1.48 compared to the $1.77 per share it paid out last year. (Reporting from Sameer Manekar in Bengaluru and Rishav Chaterjee in Melbourne, Melanie Burton in Sydney; editing by Subhranshu SAHU)
Crews search flood-ravaged central Texas for missing persons
On Wednesday, search teams continued to sift through piles of debris and mounds in Texas Hill Country as the hopes of finding survivors diminished five days after flash flooding ravaged through the area, killing at least 120 people, many of them children.
According to the figures released by Texas Governor Greg Abbott, as of Tuesday evening there were still more than 170 missing people. Since Friday, no one has been found alive.
Kerr County was the site of most fatalities and missing persons. Kerrville was completely devastated by torrential rains that swept through the county early Friday morning, July 4. The rains dropped more than one foot of rain in under an hour, and flooded the Guadalupe River up to nearly 30 feet (9 metres).
At a press briefing on Wednesday, Sheriff Larry Leitha informed reporters that the death toll for Kerr County had reached 95, which included three dozen children.
This figure includes at the very least 27 girls and their counselors who attend Camp Mystic on the Guadalupe, a Christian summer retreat for girls.
Authorities have warned the death toll is likely to continue rising as floodwaters recede.
In New Mexico, a flash flooding on Tuesday killed three people, including two young children. The village of Ruidoso is located in the mountains, around 135 miles (216 km) south of Albuquerque.
The village released a statement that the flooding was caused by heavy rains that fell over burn scars from wildfires. This led to a rapid runoff that saw the Rio Ruidoso River reach a new record of 20 feet. That's five feet higher than the previous high.
Scientists claim that climate change is causing extreme flooding events to be more damaging and frequent by creating warmer, wetter weather patterns.
The public officials in Texas were questioned for days about whether they should have warned the people earlier, allowing them to get to higher ground before the floodwaters raged.
The sheriff was pressed again at Wednesday's press conference to answer questions about the time it took officials to respond to the "Code Red" warnings regarding the flash floods that occurred in the early morning hours of the 4th.
He refused to directly respond, stating that his main focus was finding the missing victims. A full analysis on what went wrong in the response will come later.
He said, "We will respond to those questions." I can't say when, but it will be in a few weeks or days. We will get them. "We're not trying deflect them."
Dalton Rice, the city manager of Kerrville, said that the amount and speed of rain fell exceeded forecasts. There was no time to evacuate people without putting them in further danger.
Abbott announced on Tuesday that Texas lawmakers would convene a session special later this month in order to investigate emergency response and provide funds for disaster relief. (Reporting from Jane Ross in Kerrville, Additional reporting by Rich McKay, Andrew Hay and Joseph Ax. Writing by Joseph Ax. Editing by Frank McGurty & Bill Berkrot.
(source: Reuters)