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The Pakistan Finance Minister sees a staff agreement on the $1.2 billion IMF payment this week
The Pakistani finance minister announced that the country is set to sign an agreement on the review of its loan program with the International Monetary Fund in the coming week. This will pave the path for a further $1.24 billion payment from the lender. The IMF delegation left Pakistan last weekend without signing the so-called staff-level agreement for the second review of its $7 billion Extended Fund Facility and first one for the $1.4 billion Resilience and Sustainability Facility, which was agreed upon in 2024 as a way to stabilize the economy following a severe financial crises. Muhammad Aurangzeb said in an interview conducted on the sidelines the IMF World Bank Annual Meeting that the mission had been on the ground for two weeks. We had a very constructive discussion with them about the quantitative benchmarks and the structural benchmarks. And we have also been having follow-up conversations. We hope to complete the SLA this week. The IMF's lending programme requires that countries undergo regular reviews. Once approved by the Fund executive board, the next tranche will be paid. The IMF program agreed in September 2024 helped stabilize Pakistan's then cash-strapped $370 billion economy, which was engulfed by an economic crisis. Inflation had reached record highs and the currency was rapidly depreciating. Aurangzeb predicted that the government would issue a green Panda Bond - the first bond denominated by Chinese yuan in Pakistan - before the end of the year and return to the international markets with a bond sales of at least one billion dollars next year, although details had yet to be determined. He said: "We're keeping all our options open, whether it is dollar, euro, Sukuk or Islam Sukuk." After disappointing results in last year's fiscal year, the privatisation drive - part of the long-delayed sales of state assets as part of an economic reform agenda and fiscal stabilisation - was expected gain momentum this year. He said, "This is a very important part of our economic road map." Pakistan has also made progress in the sale of Pakistan International Airlines, a national airline and three power distribution companies. Aurangzeb stated that he was "quite hopeful" about the prospects of qualified bidders to bid for PIA, citing lucrative routes into Europe and Britain, which "made it a very good proposition for investors." This would be the first major privatization for about 20 years. The government's previous attempt to privatize the country last year failed after only one lowball bid was received. However, five business groups have expressed interest in the deal, including Airblue and Lucky Cement as well as investment firm Arif Habib, and military-backed Fauji Fertilizer. The final bids will be announced later this year. (Reporting and editing by Sharon Singleton: Karin Strohecker)
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Titan Mining will produce graphite at its New York facility
Titan Mining announced on Tuesday that it would begin producing graphite at its Empire State Mines, located in New York. This comes just days after China increased export restrictions on rare earth minerals. The Canadian miner is targeting ramp-up to a 40,000-tonne-per-year commercial graphite facility, which the company said would be capable of supplying about half of current U.S. natural graphite demand. Titan CEO Rita Adiani said, "China's move to restrict graphite exports highlights the importance of having an adequate supply of natural graphite at home." China had already tightened its controls on rare earth exports. But last week, it added five more elements to the list, making the total of 12 elements that are restricted. It also restricted the export of dozens pieces of equipment and materials used to mine and refine the rare earths - processes that it leads the world in. In March, U.S. president Donald Trump invoked his emergency powers in order to increase domestic production of critical mineral such as cobalt and lithium. Titan says the new facility will produce high-purity natural flake graphite derived from its Kilbourne deposit. (Reporting and editing by Sahal Muhammad in Bengaluru, Katha Kalia from Bengaluru)
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Polish defense industry could help JSW coal miner, says PM Tusk
The Polish Prime Minister Donald Tusk stated on Tuesday that Poland's defence sector may play a part in restructuring the state-controlled coal firm JSW, which is struggling. Tusk stated that his government will soon present a new plan for JSW. The European Union’s largest coking coal producer, used in the production of steel, is preparing a restructuring plan which may include wage cuts. This will help to deal with rising energy prices, falling coal costs and low-cost imports of steel. Tusk said at a press briefing that "we will do everything we can to transform JSW, and save this company or at least an important part of it." "This plan includes co-financing of voluntary redundancies." Poland has invested heavily in its military and defence industry since the Russian invasion of Ukraine's neighbour in February 2022. Tusk stated that JSW could benefit from these efforts, as the region of south-western Silesia is traditionally dominated by mining, steelmaking, and heavy machinery production. He said: "I don't rule out the possibility that the Polish Armaments Group, the Polish Defence Industry, will be able, in this case, to play a role, even in the case JSW, if only in part, in its activities." (Reporting by Anna Wlodarczak-Semczuk, Pawel Florkiewicz and Marek Strzelecki; Editing by Tomasz Janowski)
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Eversource charges record $75 Million Charge for Offshore Wind Sale Settlement
Eversource Energy, a utility firm, said Tuesday that it expects to incur a charge of $75 million after tax or 20 cents per common share in the third quarter as a result of an increased liability for two wind projects sold by Global Infrastructure Partners (GIP). Eversource sold to GIP its South Fork and Revolution Wind project stakes in 2024. The proceeds were $745 million (down from $1.12 Billion) due to lower capital expenditure and the delayed commercial operation of Revolution Wind. The company said it had increased its payments to GIP, by approximately $285 million. This was due to revised estimates of construction costs, including higher insurance costs, tariff impacts and turbine vessel damages, as well as costs related to a temporary work stop order issued by Bureau of Ocean Energy Management. The company said that it also expects to offset some of the impact by an estimated $210 millions federal tax benefit related to tax losses on offshore wind investments. The company said that it will also be reducing its forecast for the full year adjusted profit to $4.72 to $4.80 per shares from an earlier forecast of $4.67 - $4.82. (Reporting from Tanay Dhumal, Bengaluru. Editing by Vijay Kishore.)
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Madagascar's President dissolves National Assembly amid escalating crises
Andry Rajoelina, Madagascar's president, announced on Tuesday that he had disbanded the lower house. This accelerated a standoff between youth-led demonstrators and the military which forced him to leave the island. According to a decree posted on Facebook by the presidency, the 51-year old Rajoelina consulted the leaders of both the National Assembly as well as the Senate's upper house. However, the legality was not clear. Rajoelina, in a defiant speech delivered from an unnamed location Monday evening, refused to step aside despite the protests of Gen Z demanding his resignation as well as widespread defections within the army. Rajoelina claimed that he was forced to leave the country because of threats against his life. A foreign diplomat, an opposition official and a military source all confirmed that he fled the country Sunday on a French military aircraft. In a separate posting on X Rajoelina stated that the decision to dissolve Madagascar's national assembly was "necessary" to restore order in Madagascar. This would pave way for new local elections to take place in the next 60 days. "The people need to be heard again." He said, "It's time to listen to the youth." The leader of the National Assembly's opposition has disputed the decree. Siteny Randrianasoloniaiko is the vice president of the National Assembly and said that the decree was not valid. DEMOSTRATIONS ELEVATING THE TEMPEL The opposition is trying to collect enough signatures in order to impeach Rajoelina, who commands a majority within the parliament. On September 25, protests erupted across the country over water and electricity shortages. They quickly grew into a general uprising against corruption, poor governance, and a lack basic services. This anger was similar to recent protests in Nepal and Morocco against ruling elites. The anger was similar to recent protests against ruling elites in Nepal and Morocco. Many people were waving Malagasy and Gen Z protest banners, which are skulls and crossbones that originated from the Japanese anime "One Piece". French President Emmanuel Macron stated on Tuesday that the constitutional order must remain and that France understands the grievances expressed by the youth but should not exploit them. Rajoelina appears increasingly isolated since losing the support from CAPSAT, a unit of elites who had helped him seize power during a 2009 coup. CAPSAT joined protesters at the weekend and said it would not fire on them. It escorted thousands of demonstrators to the Antananarivo main square. Later, it announced that it would take control of the military. A new army chief was appointed. Rajoelina warned on Sunday about an attempted coup. Since then, the paramilitary police and gendarmerie have broken ranks with President. Madagascar has an estimated 30 million people, of which three quarters live in poverty. According to the World Bank, the GDP per person has dropped by 45% since independence in 1960. Reporting by Lovasoa Rabary and Tim Cocks from Antananarivo, and Giulia Paraavicini from Nairobi; Writing and editing by Andrew Cawthorne
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The oil executives expect a rebalancing of the market from surplus to deficit in the medium term
A range of oil executives in London said this week that the global oil market would tighten on a medium-to-longer term. They remained optimistic despite an immediate glut caused by increased production. The executives stated that the production decline rates could increase as oil prices drop, helping to rebalance a market where demand will be supported in the long-term by the rising consumption of emerging economies. In its monthly oil report, published on Tuesday, the International Energy Agency said that the global oil surplus would reach 3.6 millions barrels per day by the end of the fourth quarter. This compares to a 1.9million bpd daily average for the first three months of this year. The rising production of both OPEC+ and non-members, as well as the Organization of Petroleum Exporting Countries (OPEC+), has held oil prices in check this year. Brent futures traded at around $62 per barrel on Tuesday, down $15 from the same day last. TIGHTNESS MEDIUM-TERM Patrick Pouyanne, CEO of TotalEnergies, said that oil production by producers outside OPEC would start to fall if the price of crude drops to $60 per barrel. Pouyanne, speaking at the Energy Intelligence Forum in London, said that the short-term market was a bit bearish, but the medium-term outlook is quite positive. He cited the decline in production rates and the fact that global oil demand has not peaked. ExxonMobil's CEO Darren Woods said on Monday, at the same conference that if investment is not made in unconventional oil fields and gas, decline rates may reach 15% per annum. He also stated that he believes that oversupply would be a short-term problem. Amin Nasser, Saudi Aramco's CEO, said on Monday that the company sees a resilient demand and a pressing need to invest in long-term supply. ConocoPhillips CEO Ryan Lance stated that the key question for companies such as mine is where will the conventional oil come from in order to meet the growing demand, given the plateauing or peaking of U.S. unconventional supplies. Lance said that oil prices may recover to $75-$80 a barrel in mid-cycle, since supply must be increased to meet demand.
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Copper prices fall on US-China Trade Tensions
Copper prices dropped on Tuesday as a result of concerns about trade tensions between China and the United States, two of the world's largest economies. These tensions could have an impact on the demand for metals that are dependent on growth. The price of three-month copper at the London Metal Exchange fell 2.6%, to $10544.50 per metric ton as of 1004 GMT. The price of copper, which is used for power and construction, has dropped 4% after concerns about a reduced mine supply following disruptions in Indonesia and the Democratic Republic of Congo. Dan Smith, managing Director at Commodity Market Analytics, said that despite the supply issues, copper demand is still not good. The 21-day moving average is currently $10,375. On Tuesday, the U.S. & China began charging additional fees to ocean shipping companies that transport everything from holiday toys and crude oil. U.S. U.S. Treasury Sec. Scott Bessent stated on Monday that Donald Trump is still on track to meet Chinese Leader Xi Jinping at the end of October in South Korea. The Yangshan copper premium is a major metals consumer in China. The price of copper, which is a reflection of demand, dropped 8%, to $45 per ton, a new low for two months. The yuan fell against the dollar, which made metals priced in dollars more expensive for Chinese buyers. Due to the activity leading up to this Wednesday when holders of short positions will have to reduce or rollover contracts, the spreads between LME cash contracts and the three-months contracts for copper, zinc, and aluminium widened on Monday. On Monday, the premium for cash copper compared to the three-month contract reached its highest level since June at $227 per ton. LME aluminium dropped 0.8% to 2,739.50 per ton. Zinc fell 2.4% to 2,946.50. Nickel fell 0.2% to $16,175. Tin and lead both declined 0.4%, to $35,505 a ton and $1,980.50 a ton respectively. Lead, nickel and zinc all reached their lowest levels since September 10, 11, and 30, respectively. (Reporting and editing by Leroy Leo; Polina Devtt)
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LMEWEEK - Copper producer Aurubis has held discussions with US about support for a new smelter. CEO of Aurubis says
Aurubis, a German company, has had preliminary discussions with the U.S. Government about the support of a new copper-smelter there following the launch a recycling facility. The biggest copper producer in Europe is looking at three options to capitalize on a U.S. push to increase domestic production of the metal. President Donald Trump announced a tariff of 50% on copper products, but excluded ores, concentrates, and cathodes. We need to first lay out our options and make more concrete proposals. Toralf Haag, CEO of the metals industry's LME Week, said that there were positive signals from the U.S. Government. The US is a big demand for reducing capacity Aurubis began production last month at its new recycling facility in Georgia, U.S.A., the first greenfield site it built in 115-years. The plant will eventually ramp up to an annual output of 70,000 tons of high grade blister copper. Aurubis said that the U.S. can only supply half of its 1.7 million ton refined copper demand from domestic production. The gap will widen in the coming years, as the demand is expected to increase by two thirds, to 2.3 millions by 2035. "There are 60 Smelters in China and 15 in Europe. Now, there are only three smelters left in the U.S." Haag explained that there is a high demand for smelting capacities. He said that building a new smelter is a long-term undertaking, but two alternatives could be realized in as little as three to four year without the support of government. Haag explained that the first step would be to expand recycling operations in the United States by building an anode smelter and tank house for cathodes, and perhaps rods. The second option would be to build a new recycling plant in the U.S. West Coast to take advantage higher scrap availability following the tariff ruling that limited exports. Aurubis said that the U.S. Recycling Market is expected to grow by 26% in the next decade, to 555,00 metric tons per year. A COMPANY PLAN HIGHER PLATINUM AND ANTIMONY PRODUCTION Haag stated that Aurubis plans to increase platinum and antimony production by building in Hamburg a complex recycling plant and a new precious-metal refinery, which will cost about 500 million euro ($577.7 millions). Aurubis, citing a strong demand and concerns about a shortage of supply, increased the premium that it would charge European customers in 2019 to $315 per metric tonne, a 38% increase from last year. Last week, supply concerns from mine disruptions occurring in Indonesia and Chile as well as the Congo pushed benchmark copper at the London Metal Exchange up to $11,000 per ton. This was a 16-month high. On Tuesday morning, it was down 2.7% to $10,525 per ton.
Stocks fall as new trade insults knock the wind out of rally
Asian stocks fell on Tuesday as growing doubts about whether China and the U.S. can reach a deal over tariffs when they meet later this week amid renewed tensions regarding trade.
S&P 500 Futures fell 0.6% as MSCI's broadest Asia-Pacific index outside Japan lost early gains and fell 1.2%. Nikkei stocks fell up to 3%.
Marc Velan said that both Washington and Beijing were posturing ahead of the November summit – escalate to deescalate. "Neither side can afford a war of words as we head into the U.S. mid-terms." mid-terms."
The markets had already recovered from the Monday cash session, after U.S. Treasury secretary Scott Bessent stated that President Donald Trump is still on track to meet Chinese Leader Xi Jinping at the end of October in South Korea. In an interview with the Financial Times, he accused Beijing inflaming the situation by attempting to harm the global economy.
The U.S. will begin to charge port fees for ocean shipping companies that transport everything from holiday toys and crude oil.
Wall Street's major indexes ended up as much as 2,2% higher on Monday. Chipmakers led the way, as Trump struck a more accommodative tone regarding trade tensions with China. This reversed some of Friday's panic when Trump announced 100% tariffs against China.
Citi analysts do not anticipate an increase in trade tensions between Beijing & Washington.
Citi reported that the U.S. might have to adjust its negotiating stance because China is the only country who has bargaining power.
A spokesperson from China's Commerce Ministry said Tuesday that the U.S. could not seek to negotiate while making threats. This would keep markets nervous about the prospects of a wider trade agreement.
Beijing announced sanctions against five U.S. linked subsidiaries of South Korean shipbuilder Hanwha Ocean on Tuesday.
The Hang Seng Index, which measures blue-chip Chinese shares, fell 1.3% on the mainland after early gains.
Asian chipmakers have experienced a sharp swing between profits and losses. TSMC held onto gains after OpenAI announced it had partnered with Broadcom in order to produce its own artificial intelligence processors.
The Kospi index in South Korea lost its early gains due to the wider selloff. Samsung Electronics, which had projected a higher-than-expected rise of 32% in its third-quarter profits, was credited with helping the market rally at the beginning of the session. However, the tech giant fell 1.7% throughout the day.
The yen rose 0.3% to 151.85 per dollar after Japan’s finance minister said the country needed a new strategy for dealing with inflation rather than deflation.
The yield of the 10-year Treasury Bond in the United States was 4.0187% at last close, down 3.23 basis point from a previous closing of 4.051%.
Dans a recent research report, analysts at Danske Bank stated that "Trump's new tariff threats remain primarily seen as a negotiation strategy and not a policy reality."
The Federal Reserve noted that any increase in the intensity of the trade war could only increase the chances of Federal Reserve implementing its planned rate reductions sooner.
The traders expect Fed easing to be a near certainty later this month. According to CME Group's FedWatch, the pricing of Fed funds futures indicates a 96% probability that the Fed will cut interest rates by 25 basis points at its meeting on October 29. This is compared to a 98.3% possibility a day before.
The euro barely changed from $1.1584 to $1.1584 on Monday after French President Emmanuel Macron refused calls for resignation, even as two motions of no confidence threatened his current government.
Brent crude fell 0.4% to $63,06 per barrel, after an OPEC-released report revealed that world oil supplies are expected to match demand closely next year. This is a stark contrast with last month's forecast, which predicted a shortage.
After setting a new record, gold dropped 0.2%, to $4,104.39 an ounce.
Bitcoin fell 3.1% to $112 235.34 while ether plunged 6.5% to $ 4,012.79.
(source: Reuters)