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Copper edges lower on firmer dollar
Copper prices dropped on Friday, as the dollar strengthened against the yuan and continued withdrawals from warehouses registered at the LME, along with concerns over short-term supplies, capped the losses. As of 1058 GMT, the three-month contract for copper on the LME dropped 0.6% to $9685.5 per ton. The metal, which is used in construction and power, reached $9,809.5 on Thursday, its highest level in over two months. Nitesh Sha, a commodity strategist at WisdomTree, said that the U.S. Dollar is down a little bit today and this has pushed most base metals prices lower. Dollar index rose 0.3% making metals in U.S. dollars more expensive for holders other currencies. The yuan has fallen to a 2-year low in the world's largest metal consumer, China. Donald Trump, the U.S. president and Xi Jinping, the Chinese leader took part in a rare phone call between leaders on Thursday. Trump said later on social media that they had made a progress in matters relating to rare earth minerals. However, neither leader confirmed that the issue was resolved. Trump increased tariffs on imported aluminum and steel to 50% earlier this week. This is double the previous rate, which was 25%. After the announcement, the market's attention has been drawn to an investigation underway in Washington regarding copper imports. Shah stated that "the restart of trade talks between Trump and Xi on yesterday will likely take the edge off friction between the leaders and allow for lower copper tariffs when they are announced." The investigation led to an increase in the copper inventory at Comex's warehouses Since late February, stocks in LME-registered warehouses have dropped by 49%. Stocks in LME registered warehouses, on the other hand, have fallen by 49% over the same time period . Teck Resources, a copper miner in Chile, reported this week that production had been affected at two of its operations. Other metals include LME aluminium, which fell 1.2% to 2,448.5 per ton. Zinc slipped 0.8% to 2,662.5, lead rose 0.1% to 1,980, and nickel dropped 0.2% to 15,495. (Reporting from Ashitha Shivaprasad and Polina Devitt in London; editing by Barbara Lewis.
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Germany's Merz claims that some US legislators have 'no clue' about the scale of Russia's nuclear rearmament
The German Chancellor Friedrich Merz stated on Friday that some U.S. legislators do not understand Russia's rearmament program. This was a day following his meeting with U.S. president Donald Trump at the White House. Merz said at a Berlin business conference: "I spoke with senators from Capitol Hill, and I told them that they should look into the rearmament Russia has been doing." He said that the senators "clearly have no idea" what was happening in South Africa at this moment. Russia has moved defence factories to Round-the-clock Production Since the beginning of its full scale invasion of Ukraine in Febuary 2022, Russia has signed weapons deals with North Korea. This prompted European officials to warn Moscow could be soon in a position where it can attack NATO territory. Russia denies such an intention, and claims to be conducting a "special operation" (military action) in Ukraine for its own protection against what they portray as a hostile, aggressive West. Merz, the conservative leader who came to power in May, was the latest European leader visiting Trump to try to convince him that Ukraine must be defended against Russia's invasion, and NATO should continue to support Europe's security. Merz stated that he was reassured by Trump's words during their public meeting in the Oval Office. He cited the "resounding" no to the question of whether the United States planned to withdraw from NATO. Since the beginning of Russia's full scale invasion of Ukraine in the continent's most bloody conflict since World War Two, European countries have increased their defence spending. Merz has supported Trump's call for NATO to commit to an objective of more than double defence spending in the future to 5%. Trump welcomed this commitment on Thursday, and told Merz U.S. troops would remain in Germany. Merz stated on Friday that "whether we like it or no, we will be dependent on the United States...for a very long time." (Reporting and writing by Friederike Rinke and Andreas Rinke; Editing by Gareth Jones).
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Tesla shares gain ground in premarket, as stocks watch for US employment data
The global stock markets were subdued Friday as investors prepared for the release of key U.S. employment data. Tesla shares recovered some ground during pre-market trading following a public spat between President Donald Trump, and billionaire Elon Musk. The markets are wary after a string of weak economic data, including a weak payrolls report in the United States. This would increase concerns about stagflation while increasing pressure on Federal Reserve policy. Investors also pondered whether a telephone call between Trump on Thursday and Chinese leader Xi Jinping, and the prospect of future talks, would ease the deep tensions in trade between the two world's largest economies. Jason da Silva is the global investment strategy director of Arbuthnot-Latham. He said that any breakthrough would likely be the most important thing for markets. Tesla shares jumped 5% during pre-market trading, and its Frankfurt stock gained 4%. This was after Politico reported that White House aides had scheduled a phone call between Musk and Trump. Tesla shares fell 14% overnight, wiping out $150 billion of market value. Trump had threatened to stop government contracts for Musk's businesses as their once-close relationship deteriorated into an open and bitter disagreement. European stocks were largely flat following similar trading in Asia. Nasdaq and S&P futures gained 0.4% each. The euro was trading near its six-week-highs against the dollar after the European Central Bank, as expected, cut interest rates on Thursday, but hinted that it would pause the year-long cycle of easing. The euro fell 0.2% to $1.1424 on Friday, slightly weighed down by weak German export figures, but was still on track for a weekly gain of 0.7%. The money markets are now pricing in a roughly 16% chance of a cut for July, compared to almost 30% before ECB president Christine Lagarde's press conference on Friday. Martins Kazaks, a policymaker at the ECB, said that it was time to stop cutting rates every time they met and instead hold their powder dry in light of an uncertain economy outlook. The dollar rose 0.3% against its major counterparts and was just a little bit above its six-week low. Payrolls report expectations have been dampened by weaker-than-expected U.S. Labour Market data. This includes a 47% jump in layoffs recorded by Challenger, and a major surprise on the downside in ADP’s private payrolls. Forecasts predict a gain of 130,000 new jobs in May with a 4.2% unemployment rate. A sudden weakness in the U.S. economy could trigger the next rate cut and cause a massive rally in Treasuries. Futures prices indicate that there is little chance of a rate reduction until September. This is approximately 76% priced in. On the commodities market, oil prices last week were broadly flat. They were on track to gain weekly gains due to supply concerns. U.S. Crude Futures last stood at $63.36 per barrel. Gold prices rose 0.3%, to $3363 per ounce.
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De Beers attracts interest from Qatari funds and billionaire Agarwal
Sources close to De Beers have confirmed that at least six consortiums are interested in the diamond giant, including Anil Agarwal and Indian diamond companies, as well as Qatari investment funds. De Beers will be carved out from Anglo American, as the London listed miner refocuses its efforts on iron ore and copper. However, the global diamond price is under pressure. Two sources confirmed that Agarwal is a member of the larger group of interested parties. Vedanta, which operates mines in Zambia, South Africa and elsewhere, has a chairman named Agarwal. Both Anglo and Agarwal declined to comment. Two sources familiar with the matter have confirmed that Indian companies such as KGK and Kapu Gems which dominate India's domestic cutting and polishing industry and are De Beers’s largest customers, also expressed interest. KGK Group and Kapu Gems have not responded to any requests for comments. Anglo American has hired financial advisers Morgan Stanley and Goldman Sachs to assist with the sale, demerger, and possible listing of De Beers. The book value for De Beers is $4.9 billion after $3.5 billion worth of impairments in the past two years.
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Silver reaches 13-year-high; gold poised to gain weekly
The price of gold rose on Friday and it was expected to rise for the week after U.S. interest rate cuts were anticipated by the Federal Reserve. Silver also hit a record high. As of 0854 GMT, spot gold was up by 0.4% to $3,367.45 per ounce. Bullion is up 2.4% this week. U.S. Gold Futures rose 0.5% to $3.390.70. Alexander Zumpfe is a precious metals dealer at Heraeus Metals Germany. He said that the disappointing data on jobless claims, which indicates a possible labor market weakness has had a greater impact on gold than President Trump's phone call with President Xi. U.S. president Donald Trump and Chinese President Xi Jinping made a rare phone call on Thursday amid tensions over trade and a dispute about critical minerals. The Labor Department reported Thursday that the number of Americans who filed new claims for unemployment benefits reached a seven-month record high. The markets are now awaiting the release of the non-farm payroll report in the U.S., which is due at 1230 GMT. This follows a number of data releases that indicated a softening labor market this week. The economists polled predicted that nonfarm payrolls would increase by 130,000 jobs by May, and the unemployment rate will remain at 4.2%. Zumpfe said that a softening US labour market would increase pressure on Fed to ease its monetary policy. This is especially true if payrolls are disappointing. In a low rate environment, gold, which is traditionally viewed as a safe haven during times of political and economic unrest, thrives. Silver spot rose 0.2%, to $36.23 an ounce. It had previously reached a record high of more than 13 years. Platinum rose by 2.7% to reach $1,163.95, the highest since March 2022. Palladium rose 1.4% to $1,019.62. Ole Hansen is the head of commodity strategy for Saxo Bank. He said that gold has been struggling to rise in value over the short-term, which has led investors towards undervalued platinum and silver. (Reporting by Anushree Mukherjee in Bengaluru, Additonal)
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Tesla shares gain ground in premarket, as stocks watch for US employment data
The global stock markets were subdued Friday as investors prepared for the release of key U.S. employment data. Tesla shares recovered some ground during pre-market trading following a public spat between President Donald Trump, and billionaire Elon Musk. The markets are wary after a string of weak economic data, including a deterioration in the U.S. payrolls figure. This would increase concerns about stagflation while increasing pressure on Federal Reserve policy. Investors also pondered whether a telephone call between U.S. president Donald Trump and Chinese leader Xi Jinping, made on Thursday, and the prospect of future talks could help ease the deep tensions in trade between the two world's largest economies. Jason da Silva is the global investment strategy director of Arbuthnot-Latham. He said that any breakthrough would likely be the most important thing for markets. Tesla shares jumped nearly 5% during pre-market trading, and its Frankfurt listed stock gained 4% following a Politico report that White House aides had scheduled a phone call between Elon Musk CEO and Trump. Tesla shares fell 14% overnight, wiping out $150 billion of market value. Trump had threatened to stop government contracts for Musk's businesses as their once-close relationship turned into an open bitter disagreement. European stocks opened flat, following a similar muted Asian trading. Nasdaq and S&P futures both rose by 0.4%. The euro was trading near its six-week-highs against the dollar after the European Central Bank, as expected, cut interest rates on Thursday, but hinted that it would pause the year-long cycle of easing. The euro fell 0.1% to $1.14245 on Friday, slightly weighed down by weak German export figures, but was still on track for a weekly gain of 0.7%. The money markets are now pricing in a 19% chance that a cut will occur in July, compared to almost 30% before Christine Lagarde's press conference. Martins Kazaks, a policymaker at the ECB, said that it was time to stop cutting rates every meeting and keep its powder dry in light of an uncertain economy. The dollar rose 0.2% against major peers, just a little above its six-week low. Payrolls report expectations have been dampened by weaker-than-expected U.S. Labour Market data. This includes a 47% jump in layoffs recorded by Challenger, and a major surprise on the downside in ADP’s private payrolls. Forecasts predict a gain of 130,000 new jobs in May with the unemployment rate remaining at 4.2%. A sudden weakness in the U.S. economy could trigger a rate cut and cause a massive rally in Treasuries. Futures prices indicate that there is little chance of a rate reduction until September. This is approximately 76% priced in. On the commodities market, oil prices are slightly lower than last week but they will likely rise this coming week due to supply concerns. U.S. Crude Futures fell 0.5% to $63.05 per barrel. Gold prices rose 0.3% to $3363 per ounce.
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London copper to gain weekly on the back of easing trade tensions and supply concerns
London copper rose on Friday, and is on course to finish the week higher. This was boosted by expectations of a easing of U.S. China trade tensions as well as concerns over supply disruptions. As of 0706 GMT, the three-month contract for copper on LME rose 0.1% to $9.746 per metric tonne. The price is up 2.7% this week and will be the biggest weekly gain since April. The market reached its highest level since March 31, at $9,809.50. The Shanghai Futures Exchange's most traded copper contract gained 1%, to 78.930 yuan per ton ($10.996), and is up 0.5% for the week. Donald Trump, the U.S. president and Xi Jinping, the Chinese leader held a rare call between them on Thursday. They left the key issues for further discussions, but they invited each other to their respective countries. According to ANZ, "Market sentiment has been boosted by easing of trade tensions. Trump and Xi have agreed to further trade talks after Trump claimed that they had resolved disputes over rare earth exports in a phone call." LME copper stock fell to 138,000 tonnes, the lowest level in almost a year. They are down nearly half this year. . Teck Resources, a copper miner, reported this week production setbacks in two Chilean operations. The Kakula copper project in the Democratic Republic of Congo, ANZ stated, was also affected by seismic activity resulting in flooding of the underground part of the project. LME aluminium fell 0.5%, to $2,466.5 per ton, and LME lead rose 0.6%, to $1,990. SHFE Tin remained the best performer Friday, with a 1.8% increase to 263,600 Yuan. Two analysts in China said that the gains in tin are due to market speculation about disruptions of tin concentrats shipments from Myanmar via Thailand to China. Other SHFE metals saw a 0.1% increase in aluminium to 20,070 Yuan per ton. Lead gained 0.4% at 16,780 Yuan and nickel increased 0.4% to 122,220 Yuan. The copper inventories of SHFE registered warehouses increased by 1.5% in the last week. $1 = 7.1842 Chinese Yuan (Reporting and editing by Janane Vekatraman, Edwinn Gibbs and Janane Venkatraman)
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Governor of Engels says that a drone attack caused a fire at an industrial site in Russia.
The regional governor reported that drones caused a fire at an industrial facility in the southern Russian city of Engels. A video posted on social media, and confirmed by, showed a fierce fire emitting massive clouds of black smoke. The Governor Roman Busargin didn't specify which industrial site was the target. In January, the state of emergency in Engels was declared after a Ukrainian drone struck an oil depot serving a nearby Russian base for nuclear bomber aircraft, causing an fire that took several days to extinguish. Busargin confirmed that a high-rise building was also struck, but no one was injured. The Ukrainian general staff stated that it had struck Russian airfields and fuel reservoirs in the Saratov region, as well as in the Ryazan region, during an attack overnight on Friday. Saratov includes Engels. Since the middle of March the United States negotiated a one-month pause on attacks against energy facilities. A drone strike on March 14 caused an oil refinery in Russia, Black Sea Tuapse, to catch fire. The fire was extinguished after three days.
Asian shares continue to rise, while the dollar languishes in front of the ECB
The U.S. Dollar remained stagnant as the European Central Bank released its outlook on a turbulent global economy.
Dollar fell in the previous session due to weak U.S. data on jobs and services. Friday will bring more important employment data. The damage to the U.S. economic system is becoming more evident as a result of President Donald Trump's erratic trade policies, and bilateral agreements remain unrealised.
Canada was preparing possible retaliations against new U.S. tariffs on metals, while the European Union announced progress in its trade negotiations with Washington. Market watchers will therefore pay more attention to the signals that Christine Lagarde gives about future decisions.
Kyle Rodda is a senior analyst for Capital.com. He said that there's uncertainty regarding the guidance given by the central bank, due to the uncertain outlook of U.S. global trade policy and U.S. Trade Policy. If the central bank fails to provide sufficiently dovish advice, it could disrupt the equity markets and give the euro upward momentum.
Trump's doubled tariffs on imports of steel and aluminum took effect on Wednesday. They were aimed at Canada and Mexico. On the same day, Trump's administration asked trading partners for "best offers" to prevent other import levies from taking effect in July.
Ryosei Acaza, Japan's top trade negotiator, will be in the U.S. for a second round of negotiations on Thursday. Friedrich Merz is due to travel to Washington as well.
MSCI's broadest Asia-Pacific share index outside Japan rose 0.7% in the early trading, while Japan's Nikkei index fell 0.2%.
The dollar index (which measures the greenback versus a basket currencies) was flat at 98.85, after a 0.5% decline on Wednesday.
The dollar gained 0.1% to 142.92 yen. The euro traded at $1.1416, unchanged from the previous trading session when it had gained 0.4%.
Gold lost its gains of the previous day, while oil fell after an increase in U.S. stocks and Saudi Arabia slashed its July crude prices for Asian buyers.
Spot gold was down 0.1% to $3,372.7 an ounce. U.S. crude fell 0.2% to $62.75 per barrel.
The Euro Stoxx futures for the entire region were not much changed, while U.S. stocks futures, S&P 500 E-minis were down by 0.1%.
(source: Reuters)