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Gold poised to lose 1% in a week as US jobs data dampens rate-cutting hopes
Gold prices dropped more than 1% Friday, and are set to fall for the week after a strong U.S. employment report dampened expectations that a Federal Reserve rate reduction will be made next month. This weighed on non-yielding gold. As of 1056 GMT, spot gold dropped 1% to $4.036.21 an ounce. Bullion prices have fallen 1% in the last week. U.S. Gold Futures for December Delivery fell by 0.7% to $4.033.30 an ounce. The prospect of more rate cuts is somewhat weakened by the good labour market data released yesterday. Nitesh Sha, commodities strategist at WisdomTree, believes that this is the main factor affecting gold. MIXED VIEW OF US LABOUR MARKET The delayed U.S. job report on Thursday offered a mixed picture of the labour markets. Non-farm payrolls increased by 119,000, compared to estimates of 50,000. However, the unemployment rate hit a four-year-high. The next jobs report will be released only after the Fed meeting in December, where traders see a reduced chance of a cut to rates, from 44% this week. In low-interest rate environments, gold, which is a non-yielding investment, does well. Beth Hammack of the Cleveland Fed, who was opposed to the Fed's latest rate cut, warned on Thursday against further lowering borrowing rates due to inflation. The physical gold market in major Asian markets has remained weak, despite the volatility of rates. INTACT FUNDAMENTALS ANZ stated in a report that the fundamentals of gold remained unchanged. "Factors such as slower economic growth, expensive stock market valuations, geopolitical uncertainties, and diversification from U.S.-based assets are likely sustain robust investment demand, and central bank buying," ANZ noted. "I think that we are currently at the bottom of the gold price. "Prices may temporarily go lower, but the overall path will be upwards in the coming months," WisdomTree’s Shah said. Silver fell 3.3%, to $48.94 an ounce. Platinum dropped 1.3%, to $1.491.36, while palladium declined 2%, to $1.350.50. (Reporting from Noel John, Bengaluru. Editing by Alex Richardson.)
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As oil prices rise to $60, Permian's resilience is tested.
Oil production in Texas is on the rise. Mark Waters owns a shop that sells safety and tools to oil companies. In the past four to six month, Tie Specialties in Odessa in Texas has seen a drop of 25% in sales in the oilfield. Shelves are filled with power tools, wrenches and augers to dig holes. Pegboards display hard hats and gloves as well as various colors of overalls. This is my sixth boom and bust. I've seen it all. Waters, 65, said, "I'd call it slowdown but everyone I've spoken to says that the future for the next two years is not bright." The full impact of this downturn has not yet been felt by the U.S. Oil output. Interviews with 10 producers, services companies, and residents in the Permian basin show that Waters, and other people who live and work around oilfields, are having a harder time making a profit. Crude is hovering around $60 per barrel and this indicates that the economy will be worsened. The biggest U.S. Oilfield has survived previous downturns. But President Donald Trump's policy has added to the slide of per-barrel profits of U.S. Producers. This was already stifled due to rising production from producer group Organization of the Petroleum Exporting Countries (OPEC) and its allies as well as the largest wave of consolidation since a century. Cracks are starting to show Local business owners are noticing a decline in footfall and sales. Waters now hopes to counter the loss of oilfield services by relying on demand for electrical products from the data center boom. Waters also runs a generator-repair business that is experiencing a boom in business due to companies avoiding spending on new equipment. Midland's skyline is beginning to show signs of the recession, with idle 100-foot rigs lining stockyards. Equipment is being liquidated by service firms. Leading producers such as ConocoPhillips and Chevron have laid off employees. The latest U.S. Bureau of Labor Statistics data showed that oil and gas production jobs nationwide have dropped by 4,000 between January and July of this year. Approximately 370,000 Texans were employed in oil and natural gas production at the beginning of this year. The U.S. produced a record number of barrels per day this month. The improvements in technology and efficiency have allowed producers to squeeze more oil from fewer wells. As a result, some analysts predict that output will drop this year or the next due to spending cuts. In the next two years, any growth in output will come more from offshore deepwater fields than the shale patches. Data from Enverus, an energy analytics company, showed that the Permian Rig Count, which is a proxy of future production, fell by 52 to 252 in October from the previous year. This was the biggest decline since 2020 when COVID-19 reduced demand. We've been in contact with the administration to let them know that investment returns are becoming more difficult when oil prices are between $50 and $60. Denzil WEST, CEO of Admiral Permian Resources (which produces around 25,000 bpd) said that this will eventually lead to the current production levels becoming unsustainable. The Economics of Drilling are 'Upside Down' Oil companies are now facing higher production costs due to inflation and Trump's tariffs. They will need to charge even more for their oil than in previous cycles. Kirk Edwards of Texas-based Latigo Petroleum said that drilling and finishing a shale oil well cost between $10 million and $12 million. This is 5% to 10% more than the previous year. "The economics have completely flipped from what they were in January." Edwards stated that drilling a well is more expensive and that you are getting 20% less oil for it. Executives said that companies need oil at around $70 a barrel to maintain and increase production. However, for more than half of the days since Trump was elected, prices have been below $65 a barrel as OPEC, its allies and demand concerns continue. The U.S. Energy Information Administration forecast that West Texas Intermediate crude oil, which is the U.S. benchmark for pricing Permian Basin Oil, will average $51.26 by 2026. Surge Energy, a major private producer in the Midland Basin, plans to continue drilling at the current price, but will do so at a slower pace, according to CEO Linhua Guan. The company has operated three rigs in the Midland basin since 2021. In July, it dropped one, reducing capex by a high single-digit percentage. The Permian oilfield, the biggest in the United States and the engine for shale production in the US, is becoming harder to gain efficiency. The area with the best economics for drilling is shrinking, forcing producers to more expensive areas. "Investment returns are lower at $60 to $55 per barrel than they were five years ago, because the best wells had been drilled," said Admiral Permian West. The company will assess the drilling required, but may defer completion of the wells in the event that prices fall below $50. West stated that the return of investor equity would be the priority, over increasing capital deployment. "MORE RIGS than Work" Oilfield services are also feeling the pain. Superior Energy Auctioneers sold equipment last month from Cleveland Lease Services contract well service division, and Lone Star Directional Drilling. A person with knowledge of the auction stated that large trucks used for hauling fracking equipment and trailers sold at a 30% lower price in August than they did in April. Terrel Hardin is the president of King Well Service which provides workover rigs to maintain existing production. He said that this year only two to three rigs of his company were being used, as opposed to four or five last year. Hardin stated that "these prices don't cover the bills and everyone pulls back." SLB, a leading service provider in North America, said in October that it did not expect drilling to pick up in the near future. Halliburton, a rival company, said it would idle its equipment to cut costs. Both companies laid off employees this year. Unemployment in the area is increasing. According to the U.S. Bureau of Labor Statistics (BLS), Midland's unemployment rate increased by 0.5 percentage point to 3.6% in august. This was a level that the industry last reached in mid-2022, when it was recovering from a demand shock caused by the COVID-19 Pandemic. Waters, from Tie Specialties, said that "we get people coming in everyday looking for work." Local economies and small businesses are also feeling the effects of job losses. D.S. Fabela's Restaurant in Odessa, which is frequented by oilfield employees, is thinning out as workers are laid off, according to manager Dulce Solis. Yogashri Pradhan, who was laid off for the third time from her industry, decided to start IronLady Energy Advisors as a consultancy on reservoir engineering and production data. "We are seeing more panic over $60 oil and I believe that a large part of this is due to the rhetoric and administration of, oh we could do it cheaper," said Pradhan who was laid off from Chevron in the month of June.
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What impact US sanctions against Russian oil companies will have on the Ruble and economy
The Russian currency market may be affected by the U.S. sanctions against Russian oil companies Rosneft, and Lukoil that will take effect on Friday at 1701 GMT. The rouble strengthened ahead of the deadline on the back of reports that the U.S. had drafted a plan to end the conflict in Ukraine. If implemented, this could lead to the cancellation or the sanctions. What has been happening on the Russian Forex Market? Last year, sanctions were imposed on Russia's largest operator, MOEX, in June, and Russia's third largest bank, Gazprombank in November. MOEX was subject to sanctions, which halted all foreign exchange transactions in dollars and euros. China's Yuan, still traded on MOEX has become the dominant currency. Since then, western currencies are traded on the open market through domestic dollar accounts that have no counterpart accounts abroad. This trade is used by the central bank to determine its official exchange rate. In 2024, the rouble will have fallen by 37% compared to the dollar. The main reasons are sanctions and the attack of Ukraine on Russia's Kursk Region. The rouble rose by up to 45% in 2025's first half due to interest rate increases from the central bank and the hope for a peaceful resolution in Ukraine after U.S. president Donald Trump began talks with Russia. The rouble remained stable during the second half 2025, despite the overwhelming majority of analysts who predicted that the currency was overvalued and would weaken. Its fair value is closer to 100 roubles per dollar. Economists attribute the unexpected behavior of the rouble to a slower than expected decrease in interest rates, central bank forex interventions, slow imports as a result of an economic downturn, and the government’s policy to encourage import substitution. What is the role of Rosneft and Lukoil on the Forex Market? New sanctions prohibit all transactions between the two Russian companies. Lukoil must sell its foreign assets by December 13. An official of the U.S. Treasury said Thursday that companies buying Russian oil would also be subject to U.S. sanctions. The majority of oil companies and exporters convert their earnings in foreign currencies, which are now mostly in yuan currency, into roubles to pay for taxes, salaries and other domestic expenses. Finam, an analyst-driven financial services firm in Russia, estimates that Rosneft, Lukoil, and other oil companies account for as much as 35% of the domestic sales of foreign currencies. They predicted that sales would drop by 10 to 20 percent in early December. The central bank, which is estimated by traders to have a 10% share of the market, is also a major player. The central bank was a net seller in foreign currency throughout the year, mainly yuan. The majority of Russian analysts predict a gradual weakening in the rouble's value after the deadline for sanctions due to the reduced forex sales, and the expected reduction in the central bank forex sales starting from 2026. The key to a successful response is the reaction of China and India The impact of the sanctions will be determined by the response of the banks and companies of China and India. These countries are the largest buyers of Russian crude oil, with about 85% of sales. The Treasury official stated that Indian and Chinese refining companies are aware of the sanctions, and they're risk-averse. On November 17, the Treasury's Office of Foreign Assets Control stated that their analysis of the initial impact on the market showed they were "having their intended effect of dampening Russian revenue by lowering the Russian oil price". On October 23, Russian President Vladimir Putin stated that the new sanctions are "serious" and could have "certain consequences". However, he added that these sanctions will not have an impact on Russia's economy. China and India, Russia’s partners in BRICS, a group of developing countries, have been cautious about their dealings, for fear of punishment by Western financial regulators. Impact on Budget and Economy Taxes on oil production and not exports are the main source of revenue for the Russian budget. The decline in physical exports due to the new sanctions won't directly affect the budget revenue, but the growing discount between Russian and international blends will. Calculations showed that in November, the price of Russian oil used to calculate taxes was 24 percent lower than what the budget had estimated. This suggests a further drop in revenue. The budget revenues from oil and gas have declined by 21% in the first ten months of the year. In the amended budget for 2025, oil and gas revenue will decline by the same percentage throughout the year. The weakening rouble will increase the budget revenues in roubles from the oil and gas sector, which is a good way to balance the budget.
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Israeli forces kill 2 Palestinian teenagers in West Bank violence
Residents said that Israeli forces killed two Palestinian teens during an overnight raid in a town near Ramallah, in the Israeli-occupied West Bank. Violence is escalating in the area, with more and more deaths. According to the Palestinian Authority, which exercises limited autonomy in the West Bank, the Palestinian Authority's health ministry, forces shot Sami Ibrahim Mashaikha (16) and Amr Khaled al-Marboua (18) in Kfar-Aqab. Both died later from their injuries. According to WAFA, the Palestinian news agency, Israeli forces raided Kfar Aqab over night. They deployed forces on the streets and atop the buildings of the town before opening fire. When asked for a comment, the Israeli Military deferred to Israel Border Police, an unit of Israel's National Police. This unit did not respond immediately to a comment request. The West Bank is seeing increasing violence despite the ceasefire that was reached on October 10. In the last two years, Palestinians have been subjected to tighter military restrictions that limit their freedom of mobility. Israeli settlers are also increasingly attacking Palestinians. Residents in Huwara, Abu Falah and nearby communities reported that overnight, settlers set fire to property, burning it, near Nablus. Israeli soldiers have responded to reports that Israelis were throwing rocks at Palestinian vehicles in Huwara and setting property on fire. The military released a statement saying that Israeli soldiers searched the area and found no suspects. Benjamin Netanyahu, the Prime Minister, said on Monday that he will meet with cabinet members to ensure Israelis responsible for attacks against Palestinians are brought before justice. He called those responsible an "extremist, small group". In recent months, videos widely shared on social networks showed dozens of settlers attacking Palestinian West Bank Communities, sometimes with wooden clubs, and other times guns. According to a count, Israeli forces have so far killed six Palestinians under 18 in the West Bank this month. The military reported that in one incident near Ramallah where the Palestinian Authority has its headquarters, two 16-year old youths hurled petrol-bombs onto a road for civilians. The claim could not be independently verified. The military released an unreliable nine-second video, which it claimed showed the teenagers throwing petrol bombs. The military refused to release the entire video or to answer questions regarding why the soldier opened fire instead of attempting to arrest the two teenagers. In a stabbing and car-ramming attack on Tuesday in the West Bank by Palestinian attackers, an Israeli was killed and three others were injured. The Israeli soldiers then shot and killed them. Netanyahu referred to the incident as a terrorist act. No one has claimed responsibility for the attack. (Written by Alexander Cornwell, edited by Mark Heinrich.
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Industry: Europe will face copper shortages without EU scrap exports
European companies who make copper products have warned that they will face critical shortages, unless the EU curbs exports of scrap metal as it did for aluminium. Investors attracted to higher prices in the U.S. based on expectations of tariffs have shipped large amounts of refined Copper there. According to a paper released by companies that account for over 90% of European scrap copper usage, the exports of scrap copper from the EU have risen by 31% in the last three years, with half of it going to China. Uwe Schmidt is a manager at Wieland, a German metal products manufacturer. "Scrap and cathode shortfalls will be a deadly mixture for semi-fabricators." Copper is refined into cathodes, which are used by fabricators to make a wide range of semi-finished goods such as wires, tubes, and rods. The European Commission announced on Tuesday plans to limit EU exports for scrap aluminum to prevent the metal from flooding out of the EU. Schmidt stated that it would be logical if the EU did the same thing for the copper sector. Aurubis ElvalHalcor La Farga and Aurubis were also named in this industry paper.
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Gold poised to lose 1% in a week as US jobs data dampens rate-cutting hopes
Gold prices dropped more than 1% Friday, and are set to fall for the week after a strong U.S. employment report dampened expectations that the Federal Reserve will cut rates next month. This weighed on non-yielding gold. As of 0909 GMT spot gold was down 0.7% at $4,047.14 an ounce after having fallen more than 1% in the previous session. Bullion prices have fallen 0.5% in the last week. U.S. Gold Futures for December Delivery fell by 0.4% to $4.044.50 an ounce. The prospect of more rate cuts is somewhat doomed due to the good labour market data released yesterday. Nitesh Sha, commodities strategist at WisdomTree, believes that this is the main factor weighing down on gold. MIXED VIEW OF US LABOUR MARKET The delayed U.S. job report on Thursday revealed a mixed picture of the labour markets. Non-farm payrolls increased by 119,000, compared to estimates of 50,000. However, the unemployment rate reached a four-year-high. The next jobs report will be released only after the Fed meeting in December, where traders see a reduced chance of a cut to rates, from 44% last Friday. In low-interest rate environments, gold, which is a non-yielding investment, does well. Beth Hammack of the Cleveland Fed, who was opposed to the Fed's latest rate cut, warned on Thursday against further lowering borrowing rates due to inflation. The physical gold market in major Asian markets has remained low this week due to the volatility of rates. This deterred buyers from purchasing. FUNDAMENTALS IN ACT ANZ stated in a report that the fundamentals of gold remained unchanged. "Factors such as slower economic growth, expensive stock market valuations, geopolitical uncertainties, and diversification from U.S.-based assets are likely sustain robust investment demand, and central bank buying," ANZ noted. "I think that we are currently at the bottom of the gold price. "Prices may temporarily go lower, but the overall path will be upwards in the coming months," WisdomTree’s Shah said. Other than that, silver fell 2.1% per ounce to $49.55, platinum increased 0.2% at $1,515.25, while palladium dropped 0.2% at $1,375. (Reporting and editing by Alex Richardson in Bengaluru)
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Draft COP30 deal drops effort for fossil fuel transition agreement
Brazil, the COP30 summit's president, released a draft of a proposed agreement for this year’s U.N. Climate Summit early on Friday. It dropped a proposal that was included in a previous version to develop a plan to move away from fossil-fuels. This issue was one of the most controversial at the two week conference in the Brazilian Amazon city of Belem, attended by nearly 200 government officials. The nations have been arguing over the future for fossil fuels. Their burning releases greenhouse gases, which are the biggest contributors to global warming. The first draft of the deal, which was released earlier this week, included a number of possible options on how to phrase the issue. Dozens nations, including Germany and Kenya, as well as low-lying islands states, have been pressing for a roadmap that outlines how countries can follow through on a promise they made two years ago at COP28 to move away from fossil fuels. In the text that was released on Friday morning, fossil fuels were completely omitted. To adopt the text, which remains subject to further negotiations, it would be necessary to reach consensus. Brazil's COP30 presidency held consultations on Thursday with key negotiating groups, after an emergency evacuation forced by a fire in the summit venue disrupted hours of talks. Although the conference is expected to end later on Friday, it is possible that the talks may continue into the weekend. This is not uncommon at annual climate conferences around the world. CLIMATE FINANCE & TRADE The draft also calls for global efforts to triple funding available to assist nations adapt to climate changes by 2030 from levels in 2025. It did not specify if the money would come directly from wealthy governments or from other sources, such as development banks or private sector. This may disappoint those nations that are poorer and want to be sure of the public funds' use in this area. Adaptation investments - such as improving infrastructures to deal with extreme heat or strengthening buildings to withstand worsening storms, are often crucial for saving lives, but offer little return on investment, making it hard to attract private financing. The draft agreement would also initiate a "dialogue", involving governments, other actors and the World Trade Organization at the three next COP climate summits. This would be a victory for many countries, including China, who have demanded long-term that the climate summit include trade issues. It may not be comfortable for the European Union as such discussions are often centered around the EU border carbon levy. South Africa and India criticised the tax and called for its scrapping. (Reporting and editing by Katy Daigle, Hugh Lawson and William James)
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GEK Terna’s profit for the nine-month period increased on concessions boost
GEK Terna, a Greek energy and infrastructure group, reported a 66.2% increase in core profit adjusted for the first nine-month period of 2025. This was largely due to a rise in concession revenue. The adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) of the group for the period January to September rose to 463.9 millions euros ($535.34million), up from 279.2 in the same period the previous year. The segment concessions contributed 57% to the adjusted core profit of the group. Its adjusted EBITDA has more than doubled, reaching 267.3 million euro, thanks to increased motorway traffic, and Attiki Odos's contribution of 133.7 millions euros. Construction segment's adjusted EBITDA rose 35.7%, to 123.4 millions euros. The company's backlog of signed contracts increased to 6.8 billion euro at the end September, from 4.1 billion euros in 2024. The Athens listed group expects its profitability to be sustained, thanks to long-term concessions. It added that future milestones will include the signing by the end 2025 of the Egnatia Odos contract, the anticipated signing in early 2026 of the North Crete Motorway concession, as well as progress on the Hellinikon Resort and Kastelli Airport projects.
European stocks drop as traders fret about technology
European shares dropped on Friday as traders worried about the valuations of tech stocks.
The U.S. employment data showed a mixed picture. This added to the traders' insecurity and diminished hopes that Federal Reserve would cut rates this year.
Wall Street was led lower by technology stocks on Thursday, despite a positive report from Nvidia about its earnings. Fears of a market bubble fueled by AI were not dispelled despite the chipmaker's good news. Investors continued to dump riskier assets during Friday's Asian trade.
At 1007 GMT the MSCI World Equity Index had dropped 0.5%, and was on course for a weekly decline of 3.2%, its largest drop since March.
The pan-European STOXX 600 fell 1%, while London's FTSE 100 dropped 0.6%.
MOVES "HIGHLY CONTRAINTUITIVE
After Ukraine's President said he would be ready to work "honestly" on a U.S. backed plan to end this war, European Defence shares dropped to their lowest level since early September.
The delayed U.S. employment data released on Thursday showed that the rate of unemployment was at its highest level in four years, but that employment growth had accelerated.
Hani Redha is a portfolio manager with PineBridge Investments. He called the market's reaction to Nvidia's earnings and the data on jobs "highly contrary".
He said that he would attribute this to the fact that some parts of market are under pressure, and are not supported by fundamentals.
It may be that Nvidia acted as a sort of ATM yesterday, with people selling to make gains or to compensate for losses in other areas.
The AI investment frenzy has driven global markets to record highs, but some participants in the market are concerned that massive spending may not translate into meaningful progress. Sundar Pichai, Alphabet CEO, said earlier this week that no company will be untouched if the AI boom fails.
Some people still expect AI to continue to deliver further gains.
"AI is a major driver of equity markets." In a recent monthly note, UBS's Chief Investment Officer Mark Haefele said that he expects AI-linked stocks to rise in the coming year due to rising capex and increasing adoption.
YEN BOOSTED WITH VERBAL INTERVENTION
Satsuki Katayama said that the possibility of intervention in the yen existed. This was his strongest comment to date about the currency. It has dropped around 6% since Prime Minster Sanae Takaichi became leader of her own party.
After the comments, the yen gained some support and was trading at 156.55 to dollar. It is still close to Thursday's 10-month-low of 157.9.
The Japanese cabinet has approved a stimulus package for the economy worth approximately $135 billion.
The dollar index was also unchanged at 100.23 and the euro at $1.1516, resulting in a 0.8% gain for the week.
The yields on euro zone bonds fell. The benchmark German Bund yield of 10 years dropped from its six-week peak, falling 5 basis points to 2.6726%.
Oil prices dropped for the third consecutive day as the U.S. pushed for an agreement between Russia and Ukraine to end the conflict, raising the possibility that more oil would be brought onto the market.
Bitcoin has fallen to its lowest level in seven months at $82,013.57.
Gold fell 0.9% to $4,040.59 an ounce. (Reporting and editing by Elizabeth Howcroft)
(source: Reuters)