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Reliance's profits top estimates for energy business rebound
Reliance Industries, owned by Indian billionaire Mukesh Amani, beat expectations for its quarterly profit on Thursday, thanks to strong growth in the company's energy, retail, and digital services businesses. According to LSEG, the combined profit for the quarter ending June 30 was 269.94 billion rupees (3.14 billion dollars), a 78.3% increase over analysts' estimates of 198.59 trillion rupees. Reliance’s oil-to-chemicals division, which accounts for 57% of the company’s revenue, has been under pressure over recent quarters due to a decline in transportation cracks, and a sluggish petrochemical demand. The oil-tochemicals segment, however, has benefited from an improvement in domestic fuel retail margins. The oil-tochemicals business saw its earnings before interest, taxes and depreciation increase 10.8%, to 145.11bn rupees. EBITDA for its digital services, which include telecom unit Jio jumped by 23.9% compared to a year ago, while EBITDA for the retail segment grew by 12.7%. Reliance Retail, Jio and the Energy business had helped Reliance to offset the weakness in its earnings for the six-month period ending March. Retail revenue accounts for approximately 31% of total company revenues.
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US steelmakers expect mixed results in the second quarter, despite price hikes due to tariffs
The fortunes of the top U.S. Steelmakers in the second quarter are likely to be mixed, caught between an upswing from higher steel prices as well as uneven demand amid uncertainty surrounding President Donald Trump's Tariffs. Nucor's mid-quarter update forecasted a second-quarter profit that was higher than analysts' estimates compiled LSEG. It cited higher average selling price across its steelmaking segment, particularly sheet and plate mills which produce flat-rolled product used in the construction, automotive manufacturing, agricultural and energy sectors. Analysts at J.P. Morgan said that Nucor's increased shipments and stable pricing can be attributed "to a more diverse footprint". Steel Dynamics' profit was below analyst estimates due to a lower volume of flat-rolled products. Steel Dynamics also predicted lower earnings for its fabrications division due to higher input costs. The constant flip-flops in demand eventually dampened the initial surge of steel prices after Trump announced steel tariffs on February 2. BMO Equity Research stated that the increase in steel prices was due to a growing domestic supply. However, demand has been weakened by seasonality and tariff uncertainties. Trump's plan to double tariffs for U.S. imports of steel and aluminum to 50%, from the current level of 25%, has increased costs and hurt manufacturing. Analysts expect that the benefits of higher prices will be seen in the third quarter, as producers are bound by fixed-price contracts lasting several months. Raul Munoz is the managing director of insurance broker Marsh. He said that while tariffs might push up spot prices, these increases will take time to trickle down to earnings. Analysts predict that spot prices will remain in a range over the summer. Jefferies stated that they believe the impact of tariffs on imports will continue to have a long-lasting effect on the 3Q earnings. Steel Dynamics and Nucor will both report their results on the 21st of July.
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Russian rouble weakens against US dollar after fresh EU sanctions
The Russian rouble fell against the U.S. Dollar and the Chinese Yuan on Friday, after the European Union approved its 18th package against Russia for its war in Ukraine. This included measures against its energy industry. According to LSEG's data compiled from over-the counter quotes, as of 1245 GMT the rouble had fallen 0.8%, or 78.70 dollars per rouble. The rouble has risen by about 45% versus the dollar since January. The rouble remained strong, even though Donald Trump's attitude toward Russia has changed in recent weeks. Analysts say the new EU sanctions won't have much impact. More foreign currency sales from the central bank are supporting the rouble. "Sanctions may increase pressure on Russia's economy, but they could have a limited effect." In a recent research note, Russian Agricultural Bank analysts stated that Russia would continue to reorient their exports toward Asia. The EU has decided to set a price cap for Russian crude oil at 15% less than its average market price. However, Russia has managed to sell the majority of its oil over the previous cap because the current mechanism leaves it unclear as who is responsible for its enforcement. The last time that the rouble was affected by Western sanctions, it was in November 2024 when the U.S. sanctioned Gazprombank which dealt with Russia's energy trading. Early this year, the rouble rose against all major currencies, largely due to hopes of a peace agreement with Ukraine, mediated by the United States, but those hopes have since vanished. The rouble fell by 0.8% against the Chinese Yuan, which is the most commonly traded currency in Russia. It now stands at 10.94. (Reporting and editing by Gleb Brnski)
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Chevron wins arbitration against Exxon over Hess deal, according to analysts.
Chevron is moving forward with its acquisition of Hess for $53 billion after winning a landmark court battle against Exxon Mobil, allowing it to access the largest oil find in decades off of the coast of Guyana. AJAY PARMAR IS THE OIL AND ENERGY TRANSITION ANALYTICS DIRECTOR OF CONSULTANCY ICIS The U.S. oil giant's victory in the arbitration case over the Guyana oil assets is a major win. It opens the door for the acquisition of Hess, which will strengthen Chevron’s upstream presence across Guyana, Canada and U.S. On-shore... We expect the company to further strengthen its portfolio in the coming years." BIRAJ BORKHATARIA, ANALYST AT RBC CAPITAL MARKETS We expect Chevron shares to outperform in the next few weeks... now that investors are more confident about the investment case, and can concentrate on the growth of Hess assets as well as free-cash-flow inflections into 2026-2027. Chevron will likely review its synergy targets at (Capital Market Day), which is scheduled for November 12th. Chevron plans to dig deeper into the company's longer-term goals. JASON GABELMAN ANALYST AT TD COWEN Chevron said when it announced the deal that eight assets (Guyana GOA Australia TCO Permian DJ Bakken Eastern Med) were core. This is not clear if it still holds true, as some may see the Bakken area as a potential divestment. "Chord Energy, Devon Energy and other companies have been acquiring in the basin. We expect Chevron to be interested in future opportunities as a consolidator and/or divesting." PHILLIPS JOHNSTON, ANALYST AT CAPITAL ONE SECURITIES The ruling ends a 16-month long saga which began in March 2024 when Exxon attempted to block the merger deal. Since the first announcement on October 23, 20,23, Hess's total shareholder return has been -6.6%, compared to -2.2% for Chevron and +7.7% for Exxon (all before today's trading). Reporting by Seher Daeen, Vallari Srivastava, and Pooja menon in Bengaluru. Editing by Louise Heavens.
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Netflix's failure to ignite the Wall Street market has led to a tepid start for Wall Street
Wall Street was preparing for a calm start to the weekend, as investors considered a week full of mixed economic indicators and earnings reports. Netflix's record-breaking profit also failed to elicit much enthusiasm. At 8:15 am. S&P E-minis rose 4.5 points or 0.07%. Nasdaq E-minis gained 11.75 points or 0.05%. Dow E-minis increased 52 points or 0.12%. Wall Street's record run continued overnight as the S&P and Nasdaq climbed to new highs on the back of upbeat sentiment. Retail sales Jobless Claims The Federal Reserve can now pause to watch for inflation driven by tariffs. Netflix The success of the ride Premarket trading saw its shares fall 2.4% despite the fact that "Squid Game", a game based on squids, is expected to smash earnings expectations and increase revenue forecasts for the year. Heavyweight industrial 3M jumped After raising its profit forecast for the full year, it has seen a 3.3% increase in profits. The company attributes this to aggressive cost-cutting and a greater focus on products with high margins. American Express Outpaced Profit estimates for the second quarter are boosted by strong spending among its cardholders. Its shares increased by 1.1%. The S&P 500, Dow Jones, and other major stock indexes are expected to make modest gains in the coming week as investors try to sort through a confusing maze of mixed messages - robust retail sales and a spike up in consumer inflation. Producer prices have also stagnated for the month of June. As the deadline for tariffs loomed, concerns about President Donald Trump's policy on trade lingered behind the scenes, while corporate earnings and economic statistics took the spotlight. Add to the nervousness, Reports of a possible removal Reports that Fed chair Jerome Powell was about to leave office briefly roiled the markets. Trump, however, quickly shot down these reports. "It's all mixed up." "Mixed economic data, Trump criticizing Powell, and tariffs are creating confusion, which is resulting in a lack direction for the markets," said Daniela H. Hathorn, senior analyst at Capital.com. According to CME’s FedWatch tool, traders see a 57.9% probability of a Federal Reserve interest rate cut in September. A move in July is virtually off the table. Investors also awaited the preliminary reading of July consumer sentiment data, which was released later that day. Christopher Waller, the Federal Reserve Governor, said on Thursday he was backed by tame inflation and mounting economic risks to cut interest rates this month. He also downplayed concerns that tariffs would fuel price increases that will last. LSEG data shows that, as the second quarter earnings season begins, 36 S&P500 companies have already reported their results. Of those, more than 80% exceeded Wall Street's expectations. The price of cryptocurrency stocks increased after the U.S. House of Representatives approved a bill to develop a regulatory structure for cryptocurrencies. Robinhood Markets, Coinbase Global and Bitfarms all gained more than 2.6%. Hut 8 also gained 1%. Chevron is moving forward with its acquisition of Hess for $53 billion after winning a landmark court battle against Exxon Mobil. This was to gain access the biggest oil discovery in decades. The shares of Chevron rose by 3.4%, and Hess's rose 7.5%. (Reporting and editing by Maju Samuel in Bengaluru, with Pranav Kashyap reporting from Bengaluru)
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Nordic Industrials reports FX losses as the dollar dents Q2 profits
The second quarter earnings of some of Sweden's largest industrial companies showed that currency fluctuations and tariff uncertainty are weighing on their profits. The first impression is that activity levels are still healthy. However, a weaker U.S. Dollar has affected companies in this quarter. This has eroded profits, even for those companies with strong order books and global presence. After the company missed its expectations, Epiroc shares dropped by 5.5% and landed at the bottom of STOXX 600, the pan-European index, on Friday. Weak demand, pressures on the construction unit and company efforts to improve efficiency were not enough. The earnings of Miner Boliden were also below expectations due to the weakening U.S. Dollar. Boliden’s results were a stark reminder how important the dollar is in Scandinavia, a region that exports heavily. The Swedish miner sells metals in U.S. dollars, so when the dollar falls the value of the products will fall when converted into Swedish crowns. While the demand for industrial components and minerals is still high, SKF and Trelleborg report that clients are delaying non-essential purchases and phasing in investments because of tariff uncertainty. SKF exceeded expectations this quarter but noted a currency headwind that impacted earnings. Atlas Copco has reported lower orders due to the negative currency effects. Its shares dropped nearly 10% on the Friday, their worst trading day in nine years. Trelleborg missed the market expectations for core earnings in the second quarter on Thursday. The company warned that the trade war between President Donald Trump and China was causing customers to be cautious when placing new orders. Analysts say that companies' profit margins have held steady due to their efforts to cut costs, raise prices and increase profits. However, it is uncertain how long these efficiency initiatives will last as rising foreign exchange rates and cost increases eat away at profits.
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After the Russian floods, rescuers saved families and farm animals as well as a pet hamster.
Rescuers brought more than 100 people, their animals, and pets to safety after heavy rains flooded villages in eastern Russia. Rubber dinghies were piloted by emergency crews through flooded streets of settlements in Russia’s Sakha Republic (also known as Yakutia), a vast area larger than Argentina. Some villagers were rescued by piggybacking from windows into boats that were waiting. Video released by the emergency ministry of the region showed that rescuers took in cows as well as hens, and at least one pet Hamster. Scientists say climate change is a major factor in the recent spate of fires and floods that have hit Yakutia. In this fire season, which lasts roughly from May to September, authorities have extinguished 169 forest fires. Aerial footage from this week showed villages submerged by brackish flooding, with only roofs visible among the water. The ministry reported that around a third were children. It added that 93 houses were submerged in eight villages. Reporting by Lucy Papachristou, Writing by Andrew Heavens; Editing By Andrew Heavens
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G20 finance chiefs reach consensus in South Africa, despite US tariff tensions
The finance chiefs of G20 nations were close to agreeing on Friday a position on trade, and other global issues. This would be the first time since Donald Trump won the election and waged a tariff war. To the disappointment of the South African hosts, the G20, which was created as a forum to promote cooperation in the fight against the global financial crisis of 2008, failed to come to a consensus when the finance ministers and central banks met in February. Even though G20 communiqués are not binding and their exact wording is unclear, an agreement in Durban's coastal city would be considered a success. "I don’t think it's secret." "I don't think it's a secret," said Raymond Gilpin, Chief of Strategy, Analysis and Research at the United Nations Development Programme Africa on Friday. Francois-Philippe champagne, Canada's Finance Minister, said late Thursday that he had a cautious optimism about the outcome of the meeting. Unidentified official from another G20 nation expressed a similar optimism. "We need to see the final document, but it is important that we reach a common language and communique," said Eelco Heinen. Dutch Finance Minister EelcoHeinen said that this was an improvement over the previous G20. South Africa has promoted an African agenda under the motto of its presidency "Solidarity Equality Sustainability". Topics include high capital costs and funding climate change actions. The delegates at the meeting tried to reach agreement on the global economic challenges including the uncertainty caused by trade tensions as well as language on climate finance. Officials suggested that the language of the agreement could emphasize the benefits and avoid the term climate change by referring to extreme weather events and not tariffs. Two delegates stated that the biggest challenge was determining what language Washington would accept. This task was made more difficult by the absence from the meeting of U.S. Treasury Sec. Scott Bessent. Bessent also skipped the Cape Town meeting in February, to which several officials from China and Japan, as well as Canada, did not attend. Washington will assume its rotating G20 presidency in December. Bessent's absent was not ideal but the U.S. engaged in discussions about trade, global economy, and climate language. A G20 delegate who requested anonymity said that Bessent’s absence wasn’t ideal. Tariff Threats The finance ministers of Brazil, China and India as well as France, Russia, and France's Central Bank Governor Lesetja Kganyago also missed Durban, but South Africa's Central Bank governor Lesetja Kganyago stated that it was important to have all G20 nations represented. The meeting takes place in the shadow of Trump’s tariff policies, which have ripped up global trade rules and clouded economic forecasts. Lars Klingbeil, the German Finance Minister, said that he told his counterparts in the Group of Seven Major Economies on Friday the need to end the global trade dispute quickly. The G7 talks were held on the sidelines to the G20. "What I took away from this is I heard a lot countries advocating free trade and its importance. It is under pressure at the moment. The Dutch finance minister stated that it was not good for the global economy.
Global shares increase as U.S. consumers hold up and the yen is weak before Japan's vote
Global shares rose on Friday, as strong U.S. corporate earnings and economic data this week helped to ease tariff concerns. The yen was headed for a second consecutive weekly loss in advance of the crucial legislative election that will take place in Japan on Sunday.
Stronger-than-expected U.S. retail sales and jobless claims suggesting modest improvement in economic activity helped to push the S&P 500 and the Nasdaq to close at record highs on Thursday.
European and Asian stocks also gained on Friday. European stocks last rose 0.4%, while Asian shares outside Japan were up 0.9%. Wall Street futures also rose around 0.1%.
Eren Osman said that the positive start of earnings season in America, with streaming giant Netflix exceeding expectations, was also a factor supporting investor confidence.
"We are pretty positive on the macro-background (in the U.S.)... We see some scope for growth slowing, but nothing material, and this is giving the markets a nice boost," Osman added, adding that the full potential impact of U.S. Tariffs remains in focus.
Next week, Alphabet and Tesla will be among the companies reporting their half-year results. This will test the mood of the market.
The dollar's value against the yen was essentially unchanged at 148.65, but it was down almost 1% in this week following polls that showed Shigeru Shiba's government was in danger to lose its majority during the Sunday upper house elections.
The data released on Friday revealed that Japan's core rate of inflation decreased in June, due to temporary reductions in utility bills. However, it remained above the central banks 2% target. Ishiba has been losing popularity because of the rising cost of living. This includes the price of rice.
Jayati Bharadwaj is the head of FX Strategy at TD Securities. She said that if PM Ishiba resigns due to an election loss, USDJPY would easily rise above 149.7, as this would bring about an initial period political turmoil.
The JPY could recover from its recent dramatic weakness, if the ruling alliance wins and can make rapid progress on a deal with Trump.
The U.S. Dollar Index fell 0.1% on the currency markets to 98.365 but is heading for its second consecutive weekly gain after bouncing back from a three-and-a half year low reached over two weeks ago.
Fed Governor Christopher Waller continued to say on Thursday that he believes the central bank should reduce interest rates by the end of the month, despite the fact that most officials have not expressed a desire to do so.
Treasury yields are slightly lower. Benchmark 10-year U.S. Treasury Yields fell 2 basis points, to 4.44%. Two-year yields were also 2 bps lower at 3.90%.
After drone strikes on Iraqi Kurdistan's oil fields, supply concerns fueled Friday's gains in oil prices.
U.S. crude oil rose by 0.4%, to $67.81 a barrel. Brent rose by 0.4% as well to $69.79 per barrel. Gold prices rose 0.3%, to $3348 per ounce.
(source: Reuters)