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US to close rare earths gap; others less so
The U.S. will be able to wean itself off Chinese rare Earths thanks to a multi-billion dollar pipeline, but it falls short of breaking Beijing’s grip on the sector in most other countries. According to an analysis of data from the International Energy Agency, China will still be supplying roughly 60% of all rare earths used in magnet manufacturing by 2030. The U.S., on the other hand, is on track to meet 95% of their own demand with domestic sources. These projections are based on the assumption that today's pipe is constructed and scaled according to schedule. Experts point out the long time needed to build mines and refineries as well as the difficulty in finding equipment and skilled workers outside of China. The IEA's estimates also focus on only four of the seventeen rare earth elements. China will continue to dominate the processing of heavy rare Earths, which is a small but important subgroup of elements. The West, as a group, will still be reliant on China in 2030 for 91%. Neha Mukherjee is the research manager for Benchmark Minerals. She said, "By 2030 we will be in trouble." It's just that if these projects are brought online, then we would be less in trouble than we are now.
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China's net gold imports through Hong Kong in October fell by 64% compared to September
Hong Kong Census and Statistics Department figures released on Tuesday show that China's net imports of gold via Hong Kong fell by 64% in October compared to September. Why it's important China is the largest gold buyer in the world. Its buying activities can have a significant impact on global gold markets. Hong Kong's data might not be a complete view of Chinese gold purchases as it is also imported through Shanghai and Beijing. By the Numbers The net imports from Hong Kong into China in October were 8.02 metric tonnes, down from 22.047 tons for September. China's total imports of gold via Hong Kong fell 17% to 30.08 tonnes in October from 36.275 tonnes in September. KEY QUOTE Ross Norman, a independent analyst, said: "What we are really seeing is a weakening in Chinese demand. They were firmly strong in the early part of the year." The local market is likely meeting domestic demand. The market is able to take care of itself in a certain way. CONTEXT Bullion was in China last week Prices range from parity to a $5 discount per ounce in comparison with the global benchmark. Last month, the demand for gold in China was low. Discounts of $48 to $60 an ounce were offered as incentives. Data released last week showed that Swiss gold exports in China fell 93%, to 2.1 tonnes, as high prices impacted Chinese demand. Beijing cut the value-added taxes on certain gold purchases through the Shanghai Gold Exchange or the Shanghai Futures Exchange. This move is expected to increase the cost of gold used for jewellery and industrial purposes. China's central banks added to their gold reserves for the 12th consecutive month in October. At the end of the month, the bank's gold reserves increased from 74.06 to 74.09 fine troy-ounces. The spot gold price hit a new record of $4,381.21/oz in October, driven by geopolitical concerns, economic concerns and the de-dollarization. Reporting by Noel John, Bengaluru Editing Mark Potter
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Outflows into U.S. stocks support copper prices
The copper price rose to its highest level in over a week Tuesday, boosted by the ongoing withdrawals from U.S. stocks, but weaker prospects for demand from China, a major metals consumer, capped gains. The benchmark copper price on the London Metal Exchange rose 0.6% to $10,833.50 per metric tonne by 0948 GMT, after reaching $10,884.50. This was its highest level since November 14. Copper stocks at the LME registered warehouses The Comex Copper stocks have fallen 42% this year. After hitting a new record in recent days, the continues to rise. The premium for the LME Cash Copper Contract over the 3-month forward was a result of this activity. On Monday, the price of a ton rose to $25. This was its highest level since mid-October. The premium last stood at $10 on February. Commodity Market Analytics' managing director Dan Smith said that there is a continuing squeeze caused by the outflow of Comex copper stock as people worry about potential U.S. tariffs. This is causing an artificial tightening, which has led LME copper to act in its own way. Smith said that the weak fixed-asset investments data for China between January and October could indicate a broader economic slowdown, which would add pressure to industrial metal prices next month. The Yangshan premium The, a measure of Chinese demand for copper, dropped 6% on Monday and fell back to its four-month-low, which was reached a week earlier. The LME copper benchmark broke above the resistance of the 21-day moving median, which now supports the price at $10,828. Metal, which is used for power and construction, reached a record of $11,200 a tonne less than a week ago, due to concerns about a tighter supply of copper from the Grasberg Mine in Indonesia in this year and next. Aluminium and zinc, two other LME metals rose by 0.1% each to $2,812.50 per ton and to $3,002.50. Lead dropped 0.1% to $1982, tin rose 0.2% at $37,385 while nickel fell 0.2% at $14,670. (Reporting and editing by Louise Heavens; Polina Devtt)
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Report: Serbia's NIS refinery ceases operations due to U.S. sanctions
The NOVA.RS TV in Belgrade reported that the operations at Serbia's Russian owned NIS oil refinery had ceased due to a shortage of crude oil. This is the latest indication that U.S. sanction on the project may threaten fuel supplies throughout the Balkan nation. NIS officials and the Serbian government declined comment. In January, the Office of Foreign Assets Control of the U.S. Treasury Department placed sanctions on Russia’s oil sector, including NIS. NIS is owned in majority by Russia’s Gazprom and Gazprom. US repeatedly granted NIS waivers until the sanctions came into force in October. The banks then stopped processing NIS and Croatia's JANAF JANF.ZA The pipeline has halted crude oil deliveries to refineries. Serbia has scrambled to find alternative fuels for the winter since then. Serbian government said on Monday that it has sufficient fuel Reserves to supply the domestic markets. NOVA reported that on Tuesday the refinery stopped working due to a shortage of crude oil. This means it won't be able produce any more gasoline, jet fuel, or diesel. The news was confirmed by a refinery source. NOVA and a source confirmed that the refinery has fuel in storage. Dugravka Djedovic Handanovic, the energy minister, said that NIS reserves, including all reserves held with NIS, totaled 89,825 tons of diesel, and 53,648 tonnes of gasoline. She said that the government approved the importation of 38,000 tons of petrol and 66,000 tonnes of diesel to be stored in state reserves. Gazprom holds 44.9% and Gazprom GAZP.MM 11,3% of NIS. Serbia holds 29.9% of NIS, and the rest is held by small investors. Washington wants NIS to divest of all Russian assets and has given its owners three months in which to find a buyer for the Russian stake.
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Gold drops from over a week high due to delayed US data
The dollar remained firm on Tuesday as gold prices fell from a peak of over a week. Investors awaited delayed U.S. data that may help refine expectations about future Federal Reserve rate reductions. Gold spot dropped 0.2%, to $4,129.89 an ounce, by 0942 GMT. This follows a surge of more than 2% the previous session. Prices had risen to their highest levels since November 14 earlier in the day. U.S. Gold Futures for December Delivery were 0.8% higher, at $4.126.60 an ounce. The dollar remained close to the near six-month peak reached last week, limiting bullion's gains as a stronger greenback increases gold's price for holders of other currencies. Nitesh Sha, commodities strategist at WisdomTree, said: "We have seen a broad rise across all assets. This is partly due to the markets reevaluating the timing of future Fed cuts." The shutdown has delayed the release of new data, which is adding to the volatility. However, the fragility of the market itself continues to be in gold's favor. Even today's pullback appears to be a normal correction after the prices rose too quickly." Later in the day, the U.S. releases retail sales data and producer price data. The shutdown delayed the release of both datasets. Investors are expecting to get a better understanding of the Fed rate path. CME data shows that the markets are pricing in an 81% probability of a rate cut for December and an 86% chance of one in January. On Monday, Fed Governor Christopher Waller stated that the labor market has softened to the point where another quarter-point reduction in December is justified. However, further steps will depend on the data. John Williams, the New York Fed president, had said that rates may fall "in a near-term." Low interest rates are a good thing for non-yielding gold. Shah said that a dollar with a structurally weaker structure could push gold to $4,700 in 2026. Palladium fell 1.1%, to $1,380.00, while platinum was unchanged at $1,543.46. (Reporting and editing by Sonia Cheema in Bengaluru, Sherin Elizabeth Varighese)
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European shares sluggish as markets become cautious in anticipation of US data
Investors were cautious on Tuesday ahead of U.S. data and expectations of rate cuts in the largest economy of the world. By 0934 GMT, the pan-European STOXX 600 index was down by 0.2% to 562.06 point. The major regional bourses also fell, with Germany's DAX down 0.4%, and France down by 0.1%. The markets are awaiting the release of the producer inflation report as well as retail sales data in the U.S. These are among the first large datasets released after the longest government shutdown ever, which has left the Federal Reserve and the markets with a data hole. Fiona Cincotta is a senior market analyst with City Index. She said: "This will be the first real insight we get into how the economy performed during that long shutdown. So, understandably, there's an element of caution." This data was released after New York's President John William, who is also a Fed Governor, suggested that the continued weakness of labour data might warrant a further quarter-point decrease in December. Travel and leisure stocks and automobile stocks both fell by 0.9% and 0.7% respectively. Defense firms led the way in a 0.1% increase for industrial stocks. The European defence industry as a whole was up by 0.9%. The stock had fallen over 5% during the previous two sessions on expectations of a Russia-Ukraine deal. Cincotta said that the latest headlines raise questions about whether or not this peace agreement will be implemented. This is why there's a growth in the defense sector. Investor sentiment has soured as the STOXX index fell from its record highs of mid-November, as fears over a rally driven by AI that was overheated and expectations that Fed would delay a rate cut in December soured investor sentiment. Kingfisher, a home improvement retailer, upgraded its profit forecast for the full year and was one of the best-performing stocks on the STOXX 600. Beazley's share price dropped 10%, making it one of the worst performers in STOXX600 after reducing its written premium forecast. The company cited increased competition and a weakening growth rate for cyber insurance. Compass Group, a London-based company, lost 3% of its annual revenues and profits despite exceeding expectations. Thyssenkrupp nucera dropped 7.6% following a sharply reduced sales forecast for 2026. Thyssenkrupp is the majority owner, and it fell 3.6%. A spokesperson from the Spanish stock exchange stated that the stock market was operating normally but the index values weren't displayed due to a technical problem. (Reporting from Anastasiia Kozolova in Gdansk, and Purvi Agarwal at Bengaluru. Editing by Mrigank Dahniwala and Sonia Cheema.
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Sources say that India's Russian oil binge will end in December, as sanctions bite.
India's Russian crude oil imports will be at their lowest level in three years by December. They were already higher than they had been for several months in November as refiners sought alternatives to avoid violating Western sanctions. The United States, Britain and the European Union have all tightened sanctions against Moscow in response to the conflict in Ukraine. Washington's most recent measures target top Russian oil producers Rosneft, and Lukoil. The deadline for buyers of Russian oil to end their dealings with these two companies was November 21. Separately the EU set a deadline of 21 January after which it would refuse fuel from refineries who handled Russian crude in the 60 days following the bill of loading. BANK SCRUTINY LEADS BANK CAUTION One of the sources in the refinery industry said that the recent U.S. sanction has caused Indian refiners to be "extremely careful" after the scrutiny of banks. India will likely receive 600,000 - 650,000 barrels of Russian oil per day by December. Source: These include imports from Indian Oil Corp., Nayara Energy, and the delivery of certain November-loading cargoes to Reliance Industries. The source cited preliminary lifting plans by Indian companies. Kpler's preliminary data showed that India will receive 1,87 million bpd in Russian crude this month. Data from trade sources show that in October, India imported 1.65 millions bpd more Russian oil than it did in September. A trade source said that "Russian supplies are expected to be very high in November, as many refineries have been trying to fill their stocks before the U.S. sanction deadline. This is also due to a rule that will allow oil products to be produced for the EU market using non-Russian crude oil starting 2026." Sources requested anonymity because they weren't authorized to speak with media. MOST INDIAN REFINERS STOP RUSSIAN BUYS The majority of Indian refiners such as Hindustan Petroleum Corp, HPCL-Mittal Energy Ltd and Mangalore Refinery & Petrochemicals Ltd have stopped purchasing Russian oil. Indian Oil Corp. and Bharat Petrol Corp., both state-owned companies, have announced that they will only buy from non-sanctioned parties. Nayara Energy, a company owned in part by Rosneft and exclusively processing Russian oil, has been the sole supplier of Russian crude after other suppliers withdrew following British sanctions and EU sanctions. Reliance Industries Ltd. has announced that it had loaded Russian oil cargoes as "precommitted", starting on October 22. It will also process any parcels arriving after November 20, at its refinery, which is designed to produce fuels specifically for the local market. Reliance is the operator of one of the largest refining complexes in the world. It has two refineries, with the first catering to the export market. As refiners took advantage of an arbitrage opportunity, the share of U.S. crude oil in India's imports of oil in October soared to its highest level since June 2024. India is also being urged to buy more U.S. Energy after Washington doubled the tariffs on Indian Imports to 50% citing New Delhi’s purchase of Russian Oil.
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Source: India considers import tariffs on certain steel products
According to a person with direct knowledge, India is considering increasing the import duty on certain steel products, also known locally as a "safeguard duty", to compete against cheaper imports, primarily from China. India, which is the second largest crude steel producer in the world, recommended in August a three-year tariff of 11-12% on certain steel products, as part of its final findings. The Directorate General of Trade Remedies, under the federal ministry of trade, was responsible for this recommendation. The source declined to identify themselves due to the sensitive nature the issue. The Indian Ministry of Finance didn't immediately reply to an email seeking comment. In April, the Indian government imposed a temporary tariff of 12% for 200 days. This expired earlier this month. India's imports of finished steel during the first seven month period of the current financial year fell 34.1% on an annual basis. South Korea, China, Japan, and Russia were the top exporters of finished steel into India in the past year, with 1.4 million tons. Sources said that Chinese steel exports left India "vulnerable" primarily because of the lower prices. The state-backed Steel Association announced late last month that China's output of steel will fall below 1 billion tonnes this year, for the first in six years. This is on track to meet government pledges to reduce production. Beijing announced a plan in late October to reduce the existing steel capacity. This will help to balance supply and demand for a sector that has been plagued by overcapacity. (Reporting and editing by Louise Heavens, Neha Arora)
Stocks gain from Fed cuts; dollar stable
Investors piled into technology stocks on Tuesday, despite concerns that the sector was overheating. Alphabet, the parent company of Google, is on the verge of reaching a valuation of $4 trillion, making it the only fourth company in the world to do so. This shows that investors are confident the AI-fueled tech boom will continue. MSCI's All-World Index rose for the third consecutive day, lifting it off its two-month-lows from last week. Shares in Europe increased by 0.2%, and U.S. index futures were nearing positive territory.
Bets on RISING RATE Cuts
The yield on 10-year Treasury bills was unchanged at 4,036%. The yield on two-year Treasury notes, which is influenced by traders' expectations for lower Fed funds rates, was flat at 3.49% after dropping 2.5 basis point in the previous session. Fed Governor Christopher Waller stated that available data indicated the U.S. employment market was still weak enough to warrant a further quarter-point reduction. His comments followed those made by New York Fed president John Williams who said late Friday night that a rate cut could be possible in December.
According to CME's FedWatch Tool the markets now price in 81% of a quarter point cut next month. This is up from 42.4% one week ago. The U.S. central bank will meet on December 9-10.
Investors will have the opportunity to review delayed data about retail sales, wholesale prices, consumer confidence and home prices on Tuesday. However, these numbers may not be significant in determining what the Fed does next month.
Dollar's impact has been limited by the recent shift in expectations regarding interest rates. This month it has risen against all major currencies except for the offshore Chinese Yuan which has increased by around 0.5%. This suggests to me that the FX markets are still trading on growth differentials, and the U.S. is outperforming its peers, now, and will likely continue to do so until 2026.
Tensions over Japan
The dollar is gaining against the Japanese yen. It's at its lowest level in 10 months, and officials in Tokyo are worried about intervening to help it.
The dollar fell 0.3% in the last hour at 156.47 after gaining 1.6% during November. The euro rose 0.1% to $1.1531. The ongoing dispute between Tokyo and Beijing is adding to the tension on Japanese markets. This was over a comment made by Japan's prime minister Sanae Takaichi in November, that a Chinese invasion of Taiwan would trigger a Japanese response.
Takaichi spoke with Donald Trump on Tuesday after his Monday call with Chinese President Xi Jinping. She claimed that Trump had explained U.S. China relations to her. Trump announced on Monday that he will travel to Beijing in early April. This was seen as another sign of the improvement of diplomatic and political relations following the truce in their trade war.
The U.S. bond and stock markets will close on Thanksgiving Day, Thursday. They will reopen on Friday for a half-day.
ALPHABET HEADS TO $4 TRILLION Alphabet's shares rose 2.5% on the Frankfurt Stock Exchange, suggesting a rally in U.S. Premarket Trading. This follows a report by The Information, stating that Facebook parent Meta was in talks with Alphabet to use their AI chips in data centres starting in 2027, and to rent them next year.
Brent crude futures dropped 0.8% to $62.88 per barrel on concerns that global supplies could increase significantly relative to demand in the next year. Gold fell 0.6%, to $4,115 per ounce. However, it was still on track for a gain of nearly 3% in November. (Reporting and editing by Scott Murdoch, Amanda Cooper and Tomasz Janowowski)
(source: Reuters)