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Data shows a decline in global crude steel production, resulting in a fall in iron ore.
The price of iron ore futures fell on Wednesday due to a drop in crude steel production around the world. As of 0241 GMT, the most-traded May iron ore contract at China's Dalian Commodity Exchange was?0.32% less expensive. It traded for 775 yuan (US$110.29) per metric ton. The benchmark January Iron Ore at the Singapore Exchange fell 0.55% to $103.8 per ton. The World Steel Association reported that global crude steel production fell by 4.6% in November compared to the same month last year, to 140.1 millions tons. Meanwhile, China, the world's largest producer and consumer, saw its output drop 10.9%, to 69.9million tons. The construction and manufacturing sectors are expected to be weak, causing a 1.7% drop in crude steel production by Japan. The country's output would have decreased by?3.2% in the fiscal year ending March 31, the lowest since fiscal 1968. Mysteel, a consultancy, reported that Chinese blast furnace steelmakers reduced their purchases of feed material last week. They only purchased the amount needed to meet immediate production requirements to avoid losses. China pledged to increase urban renewal in 2026 and to stabilize its property market at the start of its new five-year plan (from 2026-2030). This is to provide more affordable housing. China's real estate sector has been under pressure since the middle of 2021. Weak home sales and falling prices have weighed on consumer confidence, despite repeated attempts by the government to shore up the sector. Coking coal and?coke were both up and down on the DCE. The benchmarks for steel on the Shanghai Futures Exchange remained mostly positive. Hot-rolled coils gained 0.15%. Wire rods increased 0.03%. Stainless steel strengthened 1.43%. Rebars declined 0.06%.
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Supply risks and strong US economic growth are driving oil prices higher
The oil prices rose modestly on Wednesday. They extended gains from the previous session. This was due to the robust U.S. economy and the threat of "supply disruptions" from Venezuela and Russia. Brent crude futures rose 4 cents or 0.06% to $62.42 per barrel at 0117 GMT. U.S. West Texas Intermediate crude gained 3 cents or 0.05% to $58.41. Brent oil prices rose by over 2% Monday. WTI also climbed the highest since November 14. Prices rose by more than 0.5% again on Tuesday. In its first estimate of the third-quarter GDP, Commerce Department's Bureau of Economic Analysis stated that consumer spending was driving faster growth than expected. It said that the gross domestic product grew at the fastest rate since the third quarter 2023 (a 4.3% annualized increase). The robust U.S. GDP print last night was a major factor in the overnight gains. "Q3 GDP was printed against a backdrop escalating global tensions," IG's Tony Sycamore wrote in a note. Haitong Futures stated in a recent report that disruptions to Venezuelan exports have been the main factor for market sentiment. Russia and Ukraine continuing attacks on each others' energy infrastructure has also supported prices. Analysts say that the market has overlooked the oil inventory data for the largest consumer of oil in the world due to other factors. Market sources cited American Petroleum Institute data on Tuesday to report that U.S. crude oil inventories increased by 2.39 millions barrels in the past week. Gasoline stocks also rose by 1.09 million barrels. Distillate inventories also rose by 685,000, according to market sources. Due to the holiday, U.S. Energy Information Administration will release their data on Monday. Haitong Futures stated in its report that the market's reaction to this build in inventory was limited due to the temporary spike in refined oil demand in December. The U.S. president Donald Trump announced earlier this month that all oil tankers subject to sanctions would be blocked from entering or leaving Venezuela. This has caused vessel owners to be on high alert. TankerTrackers.com, a monitoring service, reported on Tuesday that the Panama-flagged, very large crude carrier Kelly has returned to Venezuelan waters after U.S. interceptions. After the U.S. targeted two more vessels over the weekend, and seized the supertanker Skipper this month, there are now 12 loaded vessels in Venezuela awaiting new instructions from their owners. (Reporting from Sam Li in Beijing, Siyi Liu and Muralikumar Anantharaman in Singapore)
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Gold and silver records smash records as the markets wind down after a bumper year
Asian shares rose on Wednesday, capping off a year of rapid artificial intelligence-driven gains. Commodities such as gold and silver also extended their bullish trend to new highs, as 2025 approaches. Overnight, on Wall Street the S&P 500 closed at a record high as the long-elusive Santa Claus rally finally took hold. The U.S. economic data that showed the economy expanding at a faster rate than expected in the third quarter helped boost risk sentiment, but also weighed on bonds. Early Asian trading was dominated by gold and silver. Gold spot prices rose 0.8%, to $4,524 an ounce. This brings the year-long gain to 72%. Silver prices jumped by 1.2%, reaching a new record of $72.27 an ounce. This was the best year for silver ever, with a projected annual increase of nearly 150%. The broadest MSCI index of Asia-Pacific stocks outside Japan rose 0.3%. The index has risen by 26% in a year, the best performance it's had since?2017. Euro STOXX Futures, Nasdaq Futures and S&P500 futures are little changed due to thin liquidity. Nikkei, the Japanese stock index, rose by 0.4% this year and is up 26%. South Korea's 72% surge in the stock market was the best performance for Asia this year. Scott Chronert is a U.S.-based equity strategist. Citi's equity strategist, Scott Chronert, predicts that equities will continue to rise in value this year due to high valuations and earnings growth. "Yet high performance dispersion in themes, sectors and markets is expected." The yen has gained on the foreign exchange markets for the third session in a row amid the risk of intervention by Japanese authorities. The dollar fell 0.3%, to 155.78 Japanese yen. This is a retreat from the previous 158-level zone which drew interventions. The euro remained largely unchanged at $1.18 after a 14% increase this year. The?dollar has been down around 10% against its major counterparts this year. Treasuries rose this year due to the Fed's return to rate cuts. The yields on two-year Treasury bills were unchanged at 3.532% after falling by 72 basis points in the past year. Meanwhile, the yields on the 10-year Treasury bill traded at 4.1589% despite a 42 basis point decline for the year. Early trades showed no change in oil prices, but the market was set for another year of declines. Brent crude futures were unchanged at $62.41 per barrel but down 16% on the year. (Editing by Shri Navaratnam).
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US warns UN that it will rob Venezuela's Maduro drug cartel of its resources
On Tuesday, the United States informed the United Nations that it would impose and enforce sanctions to "the maximum extent" in order to 'deprive' Venezuelan President Nicolas Maduro resources. Meanwhile, Russia warned that other Latin American nations could follow. The administration of U.S. president Donald Trump has been conducting a deadly campaign against suspected drug-trafficking boats near the Venezuelan and Pacific coasts of Latin America for several months. He has also threatened to strike Venezuelan soil. U.S. Ambassador Mike Waltz told the U.N. Security Council that "the single most serious threat facing this hemisphere and our own backyard, as well as the United States of America, is transnational terrorists and criminal groups." Mike Waltz, the U.N. Ambassador, told the U.N. Security Council. Trump has announced a ban on all vessels that are subject to U.S. sanction. The U.S. military presence in the area has increased. The U.S. Coast Guard has so far intercepted in the Caribbean Sea two tankers, both loaded with Venezuelan crude. The Coast Guard also pursues a third vessel approaching the shore of an OPEC nation. The reality is that the sanctioned oil tanks are the main economic lifeline of?Maduro's illegitimate government. Waltz stated that sanctioned oil tankers are also funding the Cartel de Los Soles, a narco terrorist group. Washington designated Cartel de los Soles or Cartel of the Suns as a terrorist group late last month due to the group's alleged involvement in the importation of illegal drugs into the U.S. It accuses Maduro of leading Cartel de los Soles. Venezuela's government has rejected the move it deemed "ridiculous", to label the "nonexistent" group. "This intervention, which is unfolding, can become a model for future acts of violence?against Latin American countries," Russia's U.N. Ambassador Vassily Nachzia spoke to the Security Council citing Trump's recent strategy document that stated the U.S. would reassert their dominance in Western Hemisphere. Waltz did not respond directly to the remark made by?Nebenzia. China's Deputy U.N. Ambassador Sun Lei told the council that it urged "the United States to immediately halt all relevant actions and prevent further escalation in tensions." Sun Lei, the ambassador to China, addressed the council. Venezuela, supported by Russia and China requested the meeting on Tuesday, the second to be held in response to the escalating tensions. The Security Council met for the first time in October when the United States justified their actions by citing Article 51 of the founding U.N. Charter which states that the Security Council must be informed immediately of any state's action taken in self-defense in the face of an armed attack. Venezuela's U.N. representative said: "Let us be clear that there is not a war in the Caribbean. There is neither an international armed conflict nor a non-international armed conflict. It is therefore absurd for the U.S. Government to try to justify its action by applying war rules." Samuel Moncada, the ambassador to Venezuela, addressed the council. He said, "The U.S. Government is the real threat. Not Venezuela." (Reporting and editing by Alistair Bell; Michelle Nichols)
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London's FTSE100 edges higher as miners rally over record copper prices
London's FTSE 100 closed higher on Tuesday amid low trading volume before the Christmas holiday. Gains in banks and mining shares were a major factor. The UK's blue chip FTSE 100 closed up 0.3%, extending the upward momentum it had gained last week following the Bank of England’s?25 basis-point rate cut. This pushed the index to a new five-week-high. The domestically focused?midcap FTSE 250 Index added 0.1%. During the week-long holiday, trading volumes are typically lower. The markets will close early on the Wednesday before Christmas and remain closed on Christmas Day, Boxing Day and Thursday. Anglo American, Antofagasta and Rio Tinto all rose by 2.6%, while copper prices reached a new record, surpassing $12,000, for the first time. Anglo American was also a beneficiary of Wells Fargo's coverage, which began with a weighted rating equal to that of the target price and an equal weight. Lenders HSBC added 0.7% to Barclays, respectively. The FTSE 100, which has gained 16% this year, is largely due to the gains of financial and mining stocks. STOXX 600, the pan-European index, and Wall Street’s benchmark S&P 500 have both gained around 16% so far. After heavyweight Novo?Nordisk won the U.S. approval for its weight-loss drug, healthcare stocks rose 0.4%. Metlen Energy and Metals jumped after the real estate investment trust had completed a renewables deal in Chile. Diageo, which has been in a downward spiral for two sessions, fell by 1.8%. Compass Group also dropped by 1.2%. (Reporting by Tharuniyaa Lakshmi in Bengaluru; Editing by Vijay Kishore)
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Congo stops artisanal copper, cobalt and cobalt production amid corruption crackdown
According to a?decree seen by?, the Democratic Republic of Congo suspended artisanal cobalt and copper mineral processing in an attempt to improve transparency and prevent illegal exports. This is a problem that plagues this?mineral rich?nation. The Congo has been fighting illegal artisanal mining for decades, which diverts money from the national coffers. The Decree, signed by Mines Minister Louis Watum Kabamba on December 19, orders all entities who process and sell artisanal cobalt and copper to cease operations and certify that the minerals used are of a certain origin. The document stated that a commission would be established to ensure compliance, and to verify traceability and legality. The document did not provide any figures on the likely impact of illegal exports. This suspension will allow the government to determine the volume and flow of minerals processed in the processing units, according to a president's office source. LICOCO is a non-governmental organization that fights corruption in the mining sector. In?November, the Congo launched its traceable artisanal?cobalt to improve the supply chain. This was done in order to align production with international standards for environmental, social and governance. Artisanal cobalt mining provides a livelihood for millions of people in Congo. It employs between 1.5 and 2 million people, while indirectly supporting over 10 million. Unregulated cobalt production is hard to track and can be confiscated by government officials. This increases the cost of ethically produced traceable cobalt. (Reporting and writing by Yassin Kobi; editing by Jessica Donati and Alexandra Hudson).
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Stocks and yields are up after US GDP data, but yen is firm on currency warnings
Major stock indexes were up slightly and Treasury yields rose ?on Tuesday after stronger-than-expected U.S. economic data, while the yen shot up after warnings from Tokyo on its readiness to ?support the battered currency. After Novo Nordisk's weight-loss pills were approved by the U.S., the pan-European STOXX 600 Index briefly reached a record-high. Silver reached a new record of $70 per ounce while gold also hit a new record. The third quarter of the year saw the U.S. economic growth accelerate faster than anticipated, largely due to robust consumer spending. According to early estimates, the gross domestic product grew at an annualized rate of 4.3% last quarter. This was far higher than economists' expectations for a rise in GDP at 3.3%, according a poll. "We are still playing catch-up on economic data and GDP is outdated." It shows strength in the economy and strength above expectations, said Tim Ghriskey senior portfolio strategist of Ingalls & Snyder, New York. The record-breaking federal government shutdown has delayed U.S. economic releases. The Dow Jones Industrial Average rose by 44.14 points or 0.09% to 48,406.82. The S&P 500 gained 5.95 points or 0.09% to 6,884.37. And the Nasdaq Composite increased 7.37 points or 0.03% to 23,435.22. The MSCI index of global stocks rose by 2.31 points or 0.23% to 1,017.80. The pan-European STOXX 600 Index was up by?0.4%. Japan's blue chip Nikkei index closed the day little changed. Novo Nordisk's shares rose on Tuesday, after the U.S. Food and Drug Administration (FDA) approved the?weight loss pill. This gives the Danish drugmaker an edge in the rapidly evolving obesity treatment market. Novo Nordisk is now in a better position to compete with Eli Lilly for the market share that was lost due to its powerful oral weight loss medication. The yield on the 10-year Treasury note was last up 2,71 basis points at 4,198%. After the U.S. growth data, the U.S. Dollar halted its declines against the yen (yen) and euro (euro), which reinforced expectations that the Federal Reserve would pause its rate cuts at its meeting in January. Investors weighed up the chances of a Japanese intervention to "stabilize" the currency. Satsuki Katayama, Japan's Finance Minister, said that Tokyo has the right to intervene on the market in order to stop sharp drops in the yen. This is the strongest warning to date about Tokyo’s willingness to intervene. The Japanese yen gained 0.55% to reach 156.21 dollars. The euro rose 0.12% to $1.1775 while the dollar index fell 0.19% last time at 98.05. The BOJ increased rates on Friday at its policy meeting for December. This was widely anticipated and Governor Kazuo ueda gave few hints about the future extent of rate increases. The dollar fell against major currencies with the Euro up 0.3% to $1.1795, and Sterling 0.4% higher to $1.3514. Silver continued its record rally and reached the crucial $70 per ounce mark. Gold, on the other hand, cut gains after reaching an all-time peak. Silver spot rose by 0.7% to $69.48 an ounce, after reaching a record earlier. Gold spot was flat at $4,445.36. U.S. crude dropped 0.24%, to $57.88 per barrel. Brent was down to $61.87 a barrel, a 0.32% drop on the day. China's blue chip CSI300 index grew by 0.2%. China's blue-chip CSI300 index rose 0.2%.
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Guinea's water and crops are polluted by a bauxite explosion.
Guinea's bauxite reserves are the largest in the world Villagers near mines report air and water pollution Farmers claim they are losing money because their yields have dropped. Jaume Cano Do you think that we could cook and wash with it? "We have no choice", the 28-year old farmer said as she pointed to the water that she had collected from a river 500 metres away from her home, in the Telimele Prefecture, West Africa. Sow lays the blame for the poor state of the water at the Indian mining company Ashapura Minechem. The mine opened in 2019 about?2km from?Koussadji. Guinea has the largest reserves of bauxite (the raw material for aluminium) in the world. It is a critical component in the transition to clean energy. The people of Koussadji, and the nearby villages, say that they do not benefit from the bauxite mining boom. Instead, they suffer the negative environmental effects of large-scale mines, such as water and air pollution. These complaints are heard across Africa where governments and activists alike want to gain more control and benefit economically from the minerals that are vital for the transition away polluting fossil-fuels. Aluminium is used to make solar panels, windmills, electric vehicles and energy-efficient appliances, as well insulation materials for greener buildings. Look at this water. This is a gift. Do you believe that life is possible with this water? Sow, a farmer of rice, cassava and groundnuts, blamed the pollution for her declining crop yields. Ashapura has not responded to the three emails that asked for comment about the allegations of pollution made by the villagers. Souleymane BAH, a village teacher, said that the company built a borehole in the village of Bembou Silaty, near the city, about a year before. However, the water is not enough to meet the needs of the people. Ashapura is also facing allegations of pollution in India. Tokpa Fahand, an nurse at the Poste de?Sante health center, says that mining activities in Bembou Silaty are detrimental to the village, during both the dry and the wet seasons. He said that the dust in the mine caused respiratory problems, the village was surrounded by it, and the machines were never stopped. A 2023 audit by the community of the social and environmental impacts of mining in the region of Boke connected bauxite to air pollution, water pollution and a decrease in agricultural productivity. Oumar Totiya, executive director of independent Guinean Observatory for Mines and Metals (GOMM), said that the problems experienced at Bembou Silaty are typical. He said that "bauxite waste is a mixture of heavy metals,?acid and sediments. In cases of pollution it's caused by drainage during rainy seasons." Just a Transition? Guinea exported 3.7 million tonnes of bauxite a week, and produced 146 millions tons in the last year. Most of the bauxite exported by this country is shipped to China. The military-led Government, which came to power through a coup in 2021, has been pushing mining companies abroad to add value to the bauxite ore before sending it overseas to be processed. In recent years, the country has been urging mining companies to construct alumina refining plants and has revoked licenses. It is also joining other countries, such as oil-rich Nigeria, which are boosting their domestic refinery capacity. Despite the fact that several African countries pushed for a just transition in resource-rich nations at the COP30 U.N. Climate talks last month, the final text did not address the issue. Participants said that China and Russia were among those who opposed any "explicit" reference to minerals. Antonio Hill, a policy advisor with the Natural Resource Governance Institute, said: "Talk about a just transition is hollow as long as governments ignore minerals needed by future energy systems." In a press release issued after the talks, he stated that "by looking the other direction, governments feed delay, lose leadership, and miss the opportunity to anchor equity, justice, and fairness at the core of the global energy transition." Guinea has taken unilateral actions in the interim. Mamady Doumbouya is the general who led a coup in Guinea and will be running for president at an election in December 28. He has taken action to force companies to add value to the bauxite. Bouna Sylla, the Mines Minister of Algeria, said that the country will accelerate the construction of alumina reprocessing plants and iron ore pellet factories to stop the export of raw ore. NEW APPROACH Human Rights Watch stated in a report from 2021 on aluminium mining and production that included Guinea, that surface-level or "strip mining" can cause contamination of rivers and streams because it removes vegetation and facilitates erosion. Barry stated that the mining industry's noxious effects are a major factor in young Guineans migrating. Many of them take risky boat trips to Spain's Canary Islands. He said that although Guinea has many resources, they have not been turned into national wealth. Instead, the mining revenue is used to pay for police officers, soldiers, and civil servants. He said that legislation was needed to "guarantee Guineans a decent standard living". Employment benefits are also limited, since many young people lack the necessary training to obtain permanent employment. Women of Allawalli - a farmers association in Bembou Silaty & Koussadji - said that pollution from nearby mines had decreased food production. According to the data of Guinea's National Institute of Statistics, rice production in Telimele fell by 90% between 2018-2022. Binta Boye is 35 and grows cassava, rice and groundnuts in Bembou Silaty. She belongs to Allawalli.
MORNING BID EUROPE-The softest of soft landings
A look at the day ahead in European and worldwide markets from Wayne Cole.
Markets kicked off the week with a day of debt consolidation after their best week of the year, on expectations of a softer than soft landing for the U.S. economy - or no landing at all given numerous experts expect it to keep growing between 2% and 3%.
S&P 500 futures and Nasdaq futures are ahead by 0.2% or so while the Nikkei is flat, having actually rallied almost 9% last week. The euro is holding above $1.1000. and sterling struck its greatest in a month at $1.2953.
Federal Reserve members Mary Daly and Austan Goolsbee were. out over the weekend to flag the possibility of reducing in. September, while minutes due on Wednesday for the last policy. meeting should underline the dovish outlook.
Futures are 100% priced for a quarter-point cut, and 26% for. 50 basis points, with much most likely depending on whether the next. U.S. payrolls report shows the bounce that lots of expect.
On a cautionary note, Goldman Sachs noted the annual. re-analysis of payrolls is due on Wednesday and might show a. down modification in the range of 600,000 to 1 million jobs,. although they argue this would overstate the weakness of the. labour market.
Fed Chair Jerome Powell caps the week with his Jackson Hole. speech on Friday and markets are plainly priced for a dovish. outlook, although not one that approves a half-point easing.
Markets are also fully priced for a Riksbank rate cut on. Tuesday, with the only debate being whether they go by 25 or 50. basis points.
Japan's consumer cost report might revive talk of a Bank of. Japan hike, which had all but evaporated given that the Nikkei's. recent swoon.
Markets have just 2 basis points of Japan tightening priced. in for October, although some experts are still calling for a. rise of 25 basis points, to 0.5%.
On the U.S. politics front, the Democratic convention kicks. off on Monday with betting website PredictIt revealing Vice President. Kamala Harris at 58 cents compared with 45 cents for Donald. Trump, a complete turnaround from where it was before President. Joe Biden dropped out.
Secret developments that might affect markets on Monday:
- Riksbank starts two-day financial policy meeting
- Finland's reserve bank guv and ECB governing council. member Olli Rehn speaks in New york city
- Federal Reserve Board Guv Christopher Waller speaks
(source: Reuters)