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Indian stocks rise as banks and oil prices fall; RBI eases interest rate concerns
Indian shares rose on Wednesday on the back of a fall in crude oil prices, and an eased concern about interest rate hikes at home. Meanwhile, heavyweight banks saw their profits rise after the central banking system allowed them to borrow against foreign currency deposits. Brent crude futures fell to their lowest level since February 27, just a day before the Iran War began, as signs suggested that oil tankers stranded in the Strait of Hormuz were about to leave. Reserve Bank of India Governor Sanjay Malhotra said to ET Now that rate hikes were premature as the central banks did not see signs of inflation spreading. The longer-term reduction in borrowing costs may support corporate earnings, consumer spending and equity valuations. The Sensex rose 1.04%, while the?Nifty 50 gained 0.83%. "The decline in crude oil has powered market gains, as they have brightened both the outlook for the economy and the markets after a difficult spell," said Aishvarya dadheech. She is the founder and chief investment office at Fident Asset Management. The central bank's actions, including Tuesday's clarification, to support the rupee, banks and boost foreign inflows, has sparked renewed interest, as these measures could help deposit and credit growth. After the RBI clarified banks could lend to non-resident Indians using foreign currency deposits, lending flexibility improved. The index heavyweights - HDFC Bank and ICICI Bank - climbed 2.5% and 2.6% respectively. State Bank of India gained 1%. Eleven out of 16 major sectors rose. The larger small-caps, and mid-caps, gained 0.4% and 0.10% respectively. Trent rose 3.3% following a?raised price?target by HSBC, and textile stocks soared after Motilal oswal began coverage with a projection of export-led earnings. Since the U.S. reached a preliminary agreement with Iran, domestic benchmarks have risen by about 4% each session. Crude prices fell 16.6% in the same time period. Two analysts stated that with crude prices falling, the monsoon has become the most important near-term market indicator, due to its implications for consumption, inflation, and the markets. The monsoon rains are running 43% below the average, which could lead to the weakest rainfall in 11 years. Bharathrajeswaran, reporting from Bengaluru. Mrigank Dhaniwala. Sonia Cheema. Harikrishnan Nair.
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UN Guterres: Finance ministers must prioritize climate risks
United?Nations?Secretary-General Antonio Guterres stated on?Wednesday? that climate adaptation should be treated as an important priority by governments -- and valued appropriately by the financial system. As climate risks increase and funding gaps widen, this must become a top priority. Guterres said that as droughts, flooding and other extreme weather conditions affect communities around the world, adaptation has been chronically underfunded and undervalued. "Finance Ministers, Central Banks, Planning Ministries and Public Investment Authorities must 'treat climate risks as core economic policies in order to mobilize greater domestic resources," said he, urging government to 'incorporate climate risk into everything from fiscal policy through to regulation. Guterres stated that closing the gap would require a wide range of tools. These include?levies against polluting industries and blended finance structures, as well as guarantees to encourage private investments. He called for a windfall tax on fossil fuel companies with the proceeds going to adaptation and climate-related damages and losses. In the context of reforming the world's Development Banks, he said that their shareholders should give them "far more firepower," which includes increased capital, in order to increase lending for resilience building projects. The poorest nations are most vulnerable to climate impacts He said that the need for more public funding and grants is greatest in developing countries. These are the ones most vulnerable to climate change impacts, but also have the lowest capacity to prepare. According to the UN Environment Program, these countries need between $310 and 365 billion dollars a year in 2035. Yet, they only received about 26 billion dollars?in 2023. Guterres stated that the financial system needs to change its approach in valuing resilience, especially for private capital. "Countries who invest in reducing risk should not be punished," he said. He called on insurers, credit rating agencies, and regulators to reflect the adaptation efforts through lower borrowing costs, better insurance terms, etc. He said that better preparation is needed before disasters strike, such as universal access to early warning systems, and affordable pre-arranged financing, like insurance. He said: "You can't let climate disasters become fiscal disasters." "Adaptation is a necessity for economic growth, security, and climate justice." (Reporting and editing by Tommy Reggiori Wilkes, Ros Russell and Simon Jessop)
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Sources: Brazil's CSN is in discussions with China's iron ore state buyer
Two'sources' with knowledge of the matter said that CSN Mineracao, a Brazilian miner and steelmaker, is in talks to establish a supply deal with China's iron ore buyer. This is another sign that Beijing wants to tighten up its control over iron ore prices. China Mineral Resources Group plans to become the exclusive agent for some of CSN's Iron Ore cargoes that are sold in China, according to one source. This is similar to a deal struck with Roy Hill (now part of Australia's Hancock Prospecting). China Mineral Resources Group has negotiated better sales terms between steelmakers and miners in its deals with other companies, such as BHP. CSN and CMRG didn't immediately respond to comments. CMRG, which was established in?2022, was created to centralise China’s iron ore purchasing and secure better terms with upstream mining giants. CSN, with 45.5 million metric tonnes of iron ore produced in Brazil last year, is a major producer, but its output is lower than that of the '250 million tons and more produced by majors such as Australian BHP. The sources asked not to be named as they were unable to talk to the media and their 'talks' are confidential. Reporting by Staff, Editing by Milla Nissi Prussak
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Dollar rises as uncertainty over peace talks boosts the dollar
On Wednesday, stocks recovered from a crash in technology shares due to caution about overstretched AI valuations. Meanwhile, crude oil prices dropped towards four-month-lows and the dollar climbed up to a one-year-high. The technology stocks that were hard hit on Tuesday edged higher ahead of Micron's earnings, whose chips are key to the AI boom. Investors chose the dollar as a safe haven because sentiment was fragile. Michael McCarthy, a market analyst at Moomoo Securities Australia, said that the price action on markets in the past seven trading days was alarming. Not only when it fell, but when it rose as well. When markets move rapidly in either direction it is a sign that there's instability. The wild swings overnight in Asian stocks that saw South Korea’s Kospi rise 3.5% on Wednesday, despite a 10% fall on Tuesday, did not translate to high volatility in Europe. The regional stock market was essentially unchanged for the day. The broader regional stock market was roughly unchanged on the day. U.S. Stock Futures rose between 0.1% and 0.4%. The dollar rose against a basket major currencies for the third day in a row, reaching its highest level in over a year. The strategists at Scotiabank believe that the dollar is overvalued, given the expectations of at least one rate increase from the Federal Reserve in this year. This has boosted the currency. The dollar continues to enjoy a 'fear premium,' due to the lingering geopolitical concerns and in particular the US/Iran Conflict," they stated. On Wednesday, oil prices dropped more than 1%, continuing this week's losses, and trading at near four-month lows. This was on the back of signs that more tankers stuck in the Gulf will be moving out of the Strait of Hormuz. The outlook is uncertain, as the U.S., and Iran, have given conflicting reports on the key elements of their agreement, such as nuclear inspections, and control of strait. The yield on the benchmark 10-year U.S. notes fell by 1 basis point to 4.48%. The 'euro' was one of a few?main losers of Wednesday’s dollar strength, as investors lowered their expectations that the European Central Bank would raise rates more than they had expected this year. They also increased the likelihood that the Federal Reserve will increase borrowing costs. The euro traded at its lowest level in over a year. It was down for the third day, trading at $1.1354. It has already lost more than 2.5% of its value in June, and is on track to have the worst month since July. The yen also fell on the day and traded around 161.695. This kept markets on edge about a possible currency intervention designed to support the?battered Japanese?currency. The minutes of the Bank of Japan’s latest?meeting at which interest rates were raised to a 31 year high of 1.00% showed that policymakers discussed the rising inflation risks. Some called for a faster increase in interest rates to bring borrowing costs closer to levels considered neutral to the economy. Gold prices continued to fall, with the dollar rising, and fell 0.7%, or $4,078 per ounce. This is nearing the two-week lows. (Editing by Lincoln Feast, with additional reporting from Satoshi Fugiyama in Tokyo)
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Aluminium hits a three-month low due to fading Gulf risk premium and strong dollar
Aluminium prices fell to a three-month low on Wednesday due to a?lower Middle East risk premium, and a stronger U.S. dollar. LME benchmark?aluminum for three months was down 0.76% at $3,208 per metric ton as of 0701 GMT. It had touched $3,191 earlier in the day, the lowest price since March 24. The Shanghai Futures Exchange's most traded aluminium contract lost 1.43% and closed at 23,405 Yuan ($3,439.23). On Wednesday, it fell to 23,320?yuan - its lowest level since March 20. Analysts have predicted that the market will expect the supply of aluminium?from Gulf to normalise following the war-induced production and shipping interruptions, as well as the higher energy costs. However, the resumption of flows is expected to be gradual. "The peace dividend in?aluminium] primarily consists of a reduction in the level of uncertainty and not a structural 'change in aluminium demand-supply fundamentals,"?Rupankar RM said, head market research at AL Circle. The U.S. Dollar gained a fifth consecutive day on the back of safe-haven purchases. This made the entire base metals complex – which is mostly traded using the greenback – more expensive for buyers who use other currencies. Dollar has strengthened amid expectations of an increase in U.S. interest rates, amid persistently high inflation. Meanwhile, a selloff in tech-led stocks has clouded the growth outlook. Borrowing becomes more expensive and dampens demand for metals that are tied to economic growth. Copper rose 0.14% at the LME, but fell 0.56% at the SHFE. Red metal is a result of?forecasts that demand will be high for AI infrastructure, grid investments and electric vehicles. Other LME metals saw a decline of 0.69% in?zinc, 0.08% in lead, 2.02% for?nickel and 0.23% for tin. On the SHFE, nickel, tin, and lead all fell.
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Swiss cinemas provide seniors with a place to escape the heat wave
Daniel 'Gillieron', 82 sat down in the Nord-Sud Cinema of Geneva, anticipating a?free?film, and a?longer ac blast, as the heatwave blasted the streets. The senior citizen was among hundreds who attended free daytime films organised by regional authorities and cinemas to give seniors a break. MeteoSuisse, a Swiss weather agency, predicts temperatures in the city to reach as high as 36?Celsius this week (97 degrees Fahrenheit). The manager of three participating cinemas, Laurent Dutoit said, "The more hot it gets, the better the cinema is as a refuge." Since Thursday, around?650 people took up the offer. Gillieron stated that the air-conditioned theater was a great way to enjoy a movie. The month of June will be one of the warmest on record in Switzerland. This is due to a heatwave which has been sweeping across Europe. In lowland regions, daytime temperatures reached 35 C. Some areas exceeded 36 C. MeteoSuisse's forecaster,?Elie Kirchner, said: "It really underscores the exceptional nature? of this heatwave which is... very long and intense." Heatwaves are?also earlier this year than normal. Temperatures in Switzerland usually soar around the second half July and first half August. (Reporting and editing by Andrew Heavens; Olivia Le Poidevin)
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Dollar gains as Fed hikes rates and gold falls to a two-week low
Investors weighed conflicting signals about U.S. peace talks with Iran as they assessed the varying signals from U.S. and Iran. Gold spot fell 0.7%, to $4,081.24 an ounce, at 0751 GMT. It had earlier fallen to its lowest level since June 11. U.S. Gold Futures for August Delivery declined by 1.2% to $4.098.70. Donald Trump, the U.S. president, said on Tuesday that Iran agreed to nuclear inspections in "infinity" while Tehran claimed it had not made such a concession during negotiations. This raises questions about whether their fragile peace agreement will survive. Both sides disagreed over the details of a clause that would give Iran access to frozen funds in foreign accounts. Tastylive's head of global macro,?Ilya?Spivak, said: "What we are witnessing is the evolution of the pressure gold was under as a result of the war." The dollar has risen, gold has fallen, and bonds have fallen. The price of gold has dropped by about 23% in the last few months since the U.S. and Israel's war against Iran began late February. This is because rising inflationary pressure has led to the expectation of an interest rate increase by the U.S. Federal Reserve. Gold is traditionally viewed as a hedge against inflation, but it becomes less attractive as an asset that does not yield in an environment with high interest rates. Dollar has reached a record high, more than a year ago. This makes bullion expensive for buyers from abroad. According to CME FedWatch Tool, traders are betting on three Fed rate increases in this year, as opposed to one before the Fed meeting last week. Investors are now awaiting the U.S. Personal Consumption Spending data, the Fed’s preferred inflation measure, which is due on Thursday. Spivak explained that if we focus primarily on inflation, we will be heading in the direction of $3.800. We'll then have a discussion about whether we should test $3.500 next. Silver spot fell by 0.4%, to $61.80 an ounce. Platinum lost 0.6%, to $1.641.35, while palladium fell 1.3%, to $1.221.71. (Reporting and editing by Subhranshu sahu in Bengaluru, Rashmi aich and Ronojoy Mazumdar.
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Australia intensifies bird flu testing after second state reports case
Australian authorities increased surveillance and testing of animals and wildlife on Wednesday, after a second state confirmed a case. Peter Malinauskas, the state premier of South Australia, confirmed that a migratory pigeon had tested positive for avian influenza. This comes days after two cases were confirmed in Western Australia near Esperance. Australia's agriculture minister, Julie Collins, stated that there is currently no danger to humans. She said that chicken meat and eggs prepared in the normal way are perfectly safe. Drone surveys and ground-based surveillance are conducted at sea-lion breeding sites on South Australia's West and Far West Coasts. Testing frequency has also been increased in areas of high risk. Western Australia?on Wednesday?anticipated a third case?of the virus?after 11 samples?were sent?for testing?in the state?following dozens?of reports?of sick or dead birds? Collins stated that the restrictions have now been lifted, but with some caveats. Australia's biggest export market is Papua-New Guinea, which will buy A$44,38, 000 worth of goods by 2023. Collins stated that her department received information from PNG indicating that the suspension was lifted, but with certain exceptions. The two countries are continuing to work together on this issue. Australia was the only continent to have not had a mainland case confirmed. However, the virus was detected in the sub-Antarctic island of Heard Island, late 2025. The?human?infections are rare. However, the spread of avian flu has affected the poultry industry in many countries. This has led to a disruption of the supply and price for eggs and meat. Australia's efforts to combat?bird influenza have included tightening farm biosecurity and increasing testing of shore birds. It has also vaccinated susceptible species and conducted simulations.
GIC Re, India's GIC plans to reduce its share of overseas property risks as climate losses increase
GIC Re, an Indian reinsurer, plans to focus more on specialty and casualty lines. It will also reduce its dependence on catastrophes and property business abroad. This is due to the increasing number of 'climate-related' losses.
Joshi noted that climate change has reshaped global risk patterns. He cited floods in regions with historically low risks, such as South Africa, Dubai, and the severity of hurricanes, storms and cyclones.
This shift is a result of reinsurers around the world grappling with increasing losses due to "climate-related disasters", which has led many to reassess exposure to catastrophe and property?risks.
A report from?insurance broker Aon says that economic losses due to natural disasters will reach $368 billion by 2024. This is 14% higher than the inflation-adjusted yearly?average? since 2000.
Joshi, who spoke at the headquarters of the company in Mumbai on Tuesday, said: "We should, to the extent possible, based on our internal analyses, rebalance the exposure we have to natural disasters."
He added that the reinsurer wants to rebalance their overseas portfolio, favoring an increased share in casualty lines and specialty insurance.
Specialty insurance includes, for example, shipping, aviation or cybersecurity coverage.
GIC Re is active in 137 countries and processed premiums of 443 billion rupees between 2025-2026. About 25% of the company's business comes from international markets.
Joshi stated that the company aims to increase the share of foreign business to around 40% of the total risk portfolio in the next three to five year period. It also plans to expand into other markets, such as Japan, Taiwan and South Korea, along with parts of Europe. (Reporting and editing by Nivedita Battacharjee; Ashwin Manikandan)
(source: Reuters)