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Stocks continue to fall as Trump's extension of the Trump-Pence fails to calm markets
The global stock markets fell again on Friday following a?U.S. Donald Trump's decision to extend a?deadline to Iran for reopening the?Strait?of Hormuz did not calm down oil prices or government bond yields. Trump's decision to postpone the deadline after which he said Iran would face attacks on its infrastructure came shortly after Wall Street closed out the biggest one-day drop since the beginning of the war on Thursday. The markets appeared to be sceptical of the possibility of a deal between the two parties, as?oil price rose again on Friday, and government bonds fell. The pan-European STOXX 600 fell 1.4%, after falling 1.1% on Thursday. Germany's DAX was 1.7% lower. MSCI's index for Asian shares, excluding Japan, fell by 0.7% overnight. MARKETS SLAM OFF TRUMP'S DELAY Futures in the U.S. S&P 500 lost earlier gains, and was last down by 0.5% after falling 1.7% the previous session. The Nasdaq composite, which is a tech-focused index, fell 2.4% on Friday. This puts the index at a loss of nearly 11% since its record high close in October. Nasdaq Futures last fell 0.7%. The?Wall Street Journal's report that?Trump considered sending more troops raised concerns about the war escalating to a ground-based conflict. There was also no guarantee that the Strait of Hormuz, through which 20% of the world's energy flows, would be opened to shipping anytime soon. A senior Iranian official called the U.S. plan to end this conflict "unfair" and "one-sided". Matt Britzman is a senior equity analyst at Hargreaves Lansdown. He said that words alone were not enough to change the mood. "Tangible proof of progress is needed." Brent crude oil, a global benchmark, increased?2.6%, to $110.90 per barrel. Global Bond Yields Surge Investors were concerned about a possible inflationary shock which could force central banks into raising interest rates. As prices drop, yields also rise. The 10-year U.S. Treasury rate, which is used to set borrowing costs in other countries, increased by more than four basis points, reaching a high of?4.464%. This was its highest level since last July. Money markets see roughly 70% chances that the U.S. Federal Reserve will raise rates this year. This is a dramatic change from late February, when traders bet?on two rate cuts in 2026. Germany's 10-year yield has risen to its highest level in 2011 with more than 3,1%. The U.S. Dollar Index, which tracks currency performance against six peers, increased 0.2%, marking the fourth consecutive session of gains.
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Severstal, a Russian steelmaker, will cut its investment by half as the demand for its products falls
MOSCOW, 27 March - Severstal is one of Russia's four largest steelmakers and plans to reduce investment by a fifth?and labour by 5% by 2026. This is due to a falling?demand? for steel in the face of an economic recession. The demand for metals in Russia's major industries - construction, energy, automobile and machinery manufacturing - is decreasing as businesses halt investment because of high interest rates to curb inflation. Metals production has been affected by Western sanctions and drones from Ukraine. "The industry's situation is getting more difficult." The demand for steel in Russia has dropped 31% since 2024. This has led to a sharp decrease in capacity utilization among our clients, and a drop in prices. He said that the company intends to reduce labour costs by freezing hiring and replacing contractors with internal personnel. Severstal reported that its plant in the city?Cherepovets (about 360 km north of Moscow) was?hit by a Ukrainian drone attack Friday. These attacks, which used to be primarily targeted at the energy and defence sectors, are now spreading into other industries. Evgeny Vinogradov is CEO of Severstal’s Russian Steel Division. He said that the plant was operating normally after the drone attack overnight. "All units were in operation and there were no major damages," he added. (Reporting and writing by Anastasia Lyrchikova, Editing by Mark Trevelyan).
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Stocks continue to fall as Trump's extension of the Trump-Pence fails to calm markets
The global stock markets dropped again on Friday, after U.S. president?Donald Trump extended a deadline to Iran for it to reopen the Strait of Hormuz. This did not calm down oil prices or government bond yields. Trump's decision to postpone the deadline came after Wall Street closed its biggest one-day drop since the beginning of the war on Thursday. Oil prices rose again on Friday, and government bonds fell. The markets appeared to be sceptical that a deal could be reached between the two parties. After a 1.1% decline on Thursday, the pan-European STOXX 600 Index fell?0.7% at opening trade. Overnight, MSCI's Asian share index excluding Japan dropped 0.6%. MARKETS STRUGGLING OFF TRUMP DELEGATION Futures for the U.S. S&P500 gave up gains earlier and were flat at the last session, after falling 1.7% the previous day. The Nasdaq composite, which is a tech-focused index, fell 2.4% on Thursday. This means that the index has fallen nearly 11% since its record-high closing in late October. Nasdaq Futures were also flat. The Wall Street Journal's report that Trump is considering sending more troops has added to the concern that the war could escalate into a ground-based conflict. There is also no certainty that shipping will soon be allowed through the Strait of Hormuz, which typically carries 20% of the world's energy. On Thursday, an Iranian official called the U.S. plan to end this conflict "unfair and one-sided". Matt Britzman is a senior equity analyst at Hargreaves Lansdown. He said that words alone were not enough to change the mood. The need for tangible evidence of progress. Brent crude oil rose by around 2%, to $110 per barrel. Global Bond Yields Surge Investors grappled with the possibility of inflationary shocks that could force central bankers to increase interest rates. As prices drop, yields also rise. The 10-year U.S. Treasury yield, which sets the global tone for borrowing rates, has risen 4 basis points to 4,456%. This is its highest level since last July. Money markets see roughly 70% chances that the U.S. Federal Reserve will raise rates this year. This is a "sharp" change from February, when traders were betting on two rate cuts in 2026. The yield on Germany's 10-year bond rose to its highest since 2011 of more than 3.1%. The U.S. Dollar Index, which measures the currency's performance against six other currencies, gained 0.1%, marking a fourth consecutive session of gains.
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Taiwan freezes its electricity rates in order to maintain price stability and industrial competitiveness
Taiwan won't raise electricity prices at this time despite the increase in energy prices caused by the Middle East war, according to the Economy Ministry. This will help to maintain price stability and industrial competitiveness. The government has been heavily subsidising energy to limit the impact on consumers of the rising energy prices caused by the Middle East war. The ministry released a statement saying that "in light of the 'risks' arising from the escalating conflict and the changes in international tariffs and to maintain industrial competitiveness and stabilize consumer prices, the committee decided to not adjust electricity rates at this time." Taiwan is a major supplier of advanced semiconductors that power the AI megatrend. The Ministry's Electricity Price Review Committee meets every end of March and September for discussions on rates for the state-owned utility Taipower. Taiwan had to look at alternative sources of crude oil and LNG, including in the United States, since the beginning of the war, given its heavy dependence on Middle East. Taiwan has 'also re-examined the use of nuclear energy, after closing the last station in the south of the island last year. In a separate statement, Taipower announced on Friday that it had submitted a proposal for the reopening of this plant to the Nuclear Safety Commission. It added that, 'even if this plan is approved the plant will not be back in operation immediately as safety inspections can take up to 2 years. (Reporting and editing by PhilippaFletcher; Ben Blanchard, Jeanny Kao)
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Oil shock causes record-breaking flight of foreign investors from Indian assets, causing rupee to plummet
The rupee is in a tailspin as foreign?investors pull out at record rates from Indian bonds and equities. This is due to the Iran War-driven rise?in oil price, which has sparked a flurry of 'worries about a possible increase?in inflation. Since the beginning of the war on February 28, foreign investors have sold an estimated $12.14 billion in Indian shares, marking the largest monthly outflow ever recorded. The net bond sales of foreign portfolio investors under the Fully Accessible Route, or FAR, reached 152 billion rupees (1.6 billion dollars), the highest amount since the category was first introduced six years back. The?rupee has fallen to new all-time lows due to these outflows and risk-off sentiment. The local currency dropped 0.9% on Friday to 94.7875. It has fallen about 4.2% since war began. This is compounding the losses of?foreigners and has likely hastened their exit from Indian assets. India faces increased macro-risks as a result of the war against Iran. The conflict has been ongoing for nearly a month. India imports between 85-90% its crude oil, making it vulnerable to rising oil prices. The rupee's volatility and Indian equity prices are expected to rise as a result of the?worries. Economists have revised up their inflation forecasts. They've also downgraded growth estimates and included a steeper depreciation of the rupee in their "baseline". The escalation of the Middle East has brought energy risks to the forefront of India's macro outlook, with the oil?price, the rupee, and the current accounts now closely?intertwined. ", said Krishna Bhimavarapu. APAC Economist, State Street Investment Management. Since the war, hedging costs for rupee depreciation also increased. The increased volatility expectations and this have eroded foreign investor's interest in Indian bonds and stocks.
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Sources say Asian refiners are switching from Dubai to Brent for US crude pricing
Three sources in the refining industry said that Asian refiners have begun to price U.S. crude oil purchases against the global benchmark ICE Brent rather than Dubai after Middle East benchmark ICE Dubai spiked to'record levels' this month. One of the traders said that the move could result in a reduction in liquidity on the Middle East benchmark derivatives market, as traders switch hedges to ICE Brent. Asian buyers have just started booking U.S. cargoes to be delivered in July,?he said. He added that Japanese refiner Taiyo Oil purchased 2 million barrels. Light crude was offered via a tender for delivery in July at a price of $19 a bar above ICE Brent. The Japanese refiner, who typically purchases WTI crude at prices pegged to Dubai, declined comment. The same source reported that other Japanese refiners had also purchased U.S. Crude priced against ICE Brent in place of Dubai. The source said that details of these deals could not be immediately revealed as they were done in private negotiations. Dubai's oil price soared to a record high of $169.75 per barrel last week, surpassing Brent. The Middle East now supplies the most expensive crude in the world. This is because S&P Global Platts?excluded?three of five crude grades? in anticipation of a long-term disruption in shipping through the Strait of Hormuz. Dubai prices have been supported by the strong demand of TotalEnergies, a French company. Traders said that due to the volatility of the market, Asian refiners requested the top?exporter Saudi Aramco switch its 'benchmark' from Platts Dubai to ICE Brent. Outside of office hours, it was not possible to reach Saudi Aramco for a comment.
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The PM has said that the government of Romania could reduce temporarily the excise taxes on fuels.
In a recent media interview, Prime Minister Ilie Bolojan stated that Romania's broad coalition could decide to lower excise duty?on fuels temporarily next week to combat the economic repercussions of the Iran war. The government approved the first set of measures on Thursday. These include limiting the exports of gasoline and the amount of biofuel that can be added to it for three months, as well as capping the fuel price increase at the average level of last year. After criticism by employers and unions, the approved measures were 'watered-down' from their initial plans. Leftist Social Democrats, government's biggest party and vocal critic of Bolojan, also asked for the government to?lower the excise tax. Bolojan, a journalist for the news website G4media.ro, was quoted by the site as saying: "From the standpoint of excise duty, it is the simplest solution and we are very likely to go for this aspect." "On the other hand, it is important to estimate the amount of a reduction in excise duties that the Romanian government - and the state as a whole - can support, for how long. Unfortunately, we cannot predict the duration of the war with Iran." The Finance Ministry approved earlier this month a 652 mil lei (147.23 mill) scheme of?state assistance? to offset?partially the gasoline prices? for road transporters. Farmers will also receive a similar scheme. (Reporting and editing by SonaliPaul; Luiza Ilie)
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For hungry markets in Europe, it was the kids' menu.
Stella Qiu gives us a look at what the future holds for European and global markets. Investors who bet on TACO'seemed to have gotten what they wanted. Donald Trump, after Nasdaq fell?into correction area overnight, announced that he would delay his planned attacks on Iranian power stations for another 10 days. The price response?has?not been as completely awe-inspiring as he had hoped. Brent crude futures fell less than 1%, to $107.24 per barrel. This is a small decline after a nearly 6% rise overnight. Wall Street futures are up 0.4% but this is nothing compared to the surge on Tuesday, when Trump extended his 48-hour deadline?to five days. The EuroStoxx 50 futures in Europe rose by 0.5% while Treasuries, the dollar and other currencies are mostly flat. Investors may be growing numb with Trump's verbal assurances. Some thought that by extending the date twice, Trump was merely pushing the issue?down to the future, which would suggest the war will not end anytime soon. Reports that an additional?10,000 U.S. soldiers may be headed to the Middle East fueled fears of a ground conflict. Mission creep could drag the U.S. to a full-blown war. However, there is no guarantee that the Strait of Hormuz will be opened anytime soon. This led to cautious trading over the weekend. MSCI's broadest Asia-Pacific share index outside Japan has fallen over 11% since its peak at the end of February. Japan's Nikkei fell 10% from its peak in February. South Korea's KOSPI fell 1.5% bringing their weekly loss to an imposing 7%. Central banks warn against raising rates if they can, to combat a stagflation-like threat, similar to the 1970s. Norges Bank in Norway raised eyebrows on Thursday with a "spectacular" U-turn, saying it would not be raising rates this year despite previously predicting three reductions by 2028. Both Governor Michael Barr and Vice-Chair Philip Jeffers sounded worried about sticky inflation. Three of their colleagues are scheduled to speak later today. The markets will be listening out for more hawkish opinions. The stakes are high, given the recent seismic shift in market pricing. A rate increase in September is already priced in at about 50%. Fed officials were predicting a rate reduction this year. The following are key developments that may influence the markets on Friday. The Middle East Conflict: Recent Developments Retail sales in the UK are published for February Thomas Barkin and Anna Paulson, as well as Mary Daly, Fed officials speak
Denmark to permit conservation work on harmed Nord Stream 2 pipeline
Denmark's energy agency on Tuesday said it had actually approved Nord Stream 2 AG, a system of Russia's. Gazprom, consent to carry out preservation deal with. the Nord Stream 2 gas pipeline in the Baltic Sea, which was. harmed in a series of blasts in 2022.
The upkeep work is necessary to decrease ecological. and security threats coming from the pipeline being filled with. seawater and staying gas, the agency stated in a. declaration.
The work intends to protect the damaged pipeline by. installing customised plugs at each of the open pipeline ends to. avoid even more gas blow-out and the intro of oxygenated. seawater, it said.
Nord Stream 2 AG completed the $11 billion pipeline task. in 2021 to pump gas from Russia to Germany. However Germany halted. the plan as relations with Moscow broke down ahead of Russia's. war in Ukraine, while the United States enforced sanctions.
In September 2022, among the 2 lines of the Nord Stream 2. pipeline was damaged by mysterious blasts, along with both lines. of Nord Stream 1. No one has taken responsibility for causing. the damage.
The damaged line of NS2 is approximated to still include. around 9-10 million cubic metres of gas, while. the intact line stays filled with gas, the Danish firm stated.
The United States in December
provided further sanctions
on the operator and other Russian entities stating it. thinks about Nord Stream 2 a Russian geopolitical task and. opposes efforts to revive it.
Both the United States and Ukraine have actually rejected having. anything to do with the attacks as has Russia. Moscow, without. offering evidence, has blamed Western sabotage for the blasts,. which mainly cut Russian gas off from the financially rewarding European. market.
(source: Reuters)