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Aurubis shares fall as Salzgitter's share shrinks in bond deal
The shares of German copper producer Aurubis dropped on Wednesday, after Salzgitter, the company's largest shareholder sold bonds worth 500 million euros ($582 millions) that could be exchanged for 7.6% Aurubis stock. Aurubis shares, which had been boosted by the booming copper market, dropped 6.7% at 0752 GMT to 108.2 Euros, erasing gains made earlier in the month. This move quenched simmering speculation about a takeover. Salzgitter held 29.99% in Aurubis, and a stake greater than 30% would have required a mandatory offer for remaining shareholders. The bonds are due in 2032 and offer a fixed interest rate of 3,375%. They can be exchanged for Aurubis shares, at a price of 145.80 euro, initially. BNP Paribas acted as global coordinators, Commerzbank acted in the capacity of bookrunners, and UniCredit was the joint global coordinator. The transaction aims to diversify Salzgitter’s maturity profile and financing structure. Salzgitter's shares rose 0.5% and the company plans to list its bonds on the Frankfurt Stock Exchange Open Market segment.
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Iron ore prices continue to fall as US-China trade tensions and rising steel stocks weigh
Iron ore futures declined on Wednesday for the second consecutive session. This was due to concerns about demand, resulting from an escalating Sino-U.S. Trade spat as well as rising steel inventories in China, which is the top consumer. Donald Trump, the U.S. president, said that Washington is considering ending some trade relations with China. The U.S., and China began Tuesday charging each other additional port fees for ocean shipping companies. This is another sign that tensions are rising between the two world's largest economies. These tensions have impacted the market sentiment and pushed down commodity prices. The daytime trading price of the most traded January iron ore contract at China's Dalian Commodity Exchange closed 1.46% lower, at 776.5 Yuan ($108.97), per metric tonne. On Tuesday, the contract reached a low of more than a month. As of 8:10 GMT, the benchmark November iron ore traded on Singapore Exchange fell 0.45% to $104.7 per ton. Accumulated steel stocks could also affect the price of this key ingredient, as they can reduce margins, and make mills less interested in acquiring more feedstock. Analyst Zhuo Guqiu at Jinrui Futures said that the latest data revealed steel inventories continue to accumulate, causing concern over ore supply outlook. The hot metal production may continue to fall due to the increasing losses in some mills. Analysts at Everbright Futures say that ore demand is expected to remain strong in the short term and support prices. The data released by the China Iron and Steel Association, a state-sponsored organization, showed that the daily crude steel production among members steelmakers increased by 7.5% compared to the same 10-day period in September. Coking coal, coke and other steelmaking materials have risen by 1.01% apiece and 0.34% respectively. The benchmarks for steel on the Shanghai Futures Exchange are mixed. Rebar dropped 0.85%, while stainless steel fell 0.24%. Hot-rolled coils lost 0.86%, and wire rod gained 0.45%.
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OPEC Secretary general says that oil and gas industry requires more investment
Haitham Al Ghais, Secretary General of OPEC, reiterated Wednesday that oil and gas will continue to make up about 30% in the global energy mix until 2050. He said that a growing economy, population increase and urbanisation are all signs "that the world will require much more energy than what it consumes today", in his remarks at the Russian Energy Week Conference in Moscow. He predicted a 23% increase in the primary energy demand between 2050 and 2050. "Yes, the world is turbulent and there's much going on. But that's constant." "For us at OPEC, the constant is our ability to separate all the noise from the detailed, technical analysis we perform," he said. OPEC's forecasts of demand are higher than industry estimates. It expects a more gradual energy transition, unlike other forecasters such as the International Energy Agency. The latter has predicted a peak in oil demand by 2029, and a glut of up to 4 million barrels of oil per day in 2026. OPEC+ - a grouping of OPEC and Russia, as well as other allies - is adding crude oil to the market, after some member countries decided that they would unwind production cuts faster than originally planned. This extra supply adds to fears about a glut, and is weighing down on oil prices in this year.
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Gold crosses $4200 for the first time due to Fed rate-cut betting and US-China trade worries
Gold reached the $4,200 per ounce mark for the first ever time on Wednesday. This was boosted by expectations of more U.S. interest rate cuts. Meanwhile, renewed U.S. China trade concerns also increased demand for safe haven assets. As of 0659 GMT, spot gold rose 1.4% to $4,200.11 an ounce. U.S. Gold Futures for December Delivery gained 1.3%, to $4218.0. The U.S. president Donald Trump announced on Tuesday that his administration would produce a list on Friday of "Democrat programs" which will be closed due to the federal government shut down. Matt Simpson, senior analyst at StoneX, said that the U.S. shutdown and Jerome Powell's dovish remarks have been two of the most recent reasons why gold prices are on an upward trend. Federal Reserve Chair Jerome Powell stated that the U.S. labor market was subdued. However, the economy may be "on a slightly firmer trajectory than anticipated." Powell said that interest rate decisions will be taken "meeting by meeting", balancing the labour market's weakness against persistent inflation above the target. Investors have priced in the near certainty of a Fed rate cut of 25 basis points in October and December. Bullion is more likely to perform well when interest rates are low and there are political and economic uncertainties. Gold has gained 59% in the past year, mainly due to geopolitical and financial uncertainties, central bank purchases, the de-dollarisation of currencies, and strong exchange-traded funds. Simpson added that "this rally has become a momentum trading, where traders pile into the market to chase away prices." Trump stated that Washington is considering cutting off some trade relations with China, such as in the cooking oil sector. On Tuesday, both countries started imposing port fees based on a tit-fortat system. The International Monetary Fund increased its global growth forecast for 2025, citing better than expected tariff and financial conditions. However, it warned that renewed U.S. China trade tensions may curb growth. Silver climbed 2% to $52.48 after hitting a record of $53.60 Tuesday. This was due to the gold rally and tightening supply on the spot market. Palladium increased 0.9% and platinum rose 1.3%. (Reporting and editing by Sherry Phillips, Subhranshu Sahu and Ishaan Aroo in Bengaluru).
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India's palm-oil imports have fallen to a four-month low, as refiners prefer cheaper soyoil
The Solvent Extractors' Association of India reported on Wednesday that India's palm oils imports fell to their lowest level since May, as refiners switched to soyoil which is cheaper. Soyoil shipments reached a three-year record. The benchmark Malaysian palm futures are expected to be impacted by lower palm oil imports from India, which is the largest buyer of vegetable oil in the world. Meanwhile, U.S. soybean futures will benefit. The industry trade group said that India's imports of palm oil in September fell 16.3% to 829.017 metric tonnes, their lowest level since May. Imports of sunflower oil rose 6%, to 272,386 tonnes, which is the highest since January. According to the trade association, India's total imports of edible oils in September fell by 1% on a month-on-month basis. This equated to 1,60 million tons. India's palm-oil imports in October are expected to drop to about 600,000 tonnes, while imports of soyoil will likely surpass 450,000 tons. This is according to a Mumbai-based trader with a global trading house. India imports mainly palm oil from Indonesia and Malaysia. It also imports sunflower oil and soyoil from Argentina, Brazil and Ukraine. Dealers said that India bought 300,000 tonnes of soyoil in Argentina between September 23 and 24, making it the largest purchase ever made within a two-day time period. They took advantage of Buenos Aires’ decision to abolish export taxes on soybeans, and other food items. The demand for edible oils in India, especially palm oil, usually increases during festival seasons due to increased consumption of sweets, fried foods, and other fried food. Reporting by Anmol Chaubey, Mumbai; editing by Himani Sarkar & Mrigank Dhaniwala
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Gold reaches record highs on Fed rate-cut betting, US-China Trade woes
Gold reached a new high on Wednesday just below the $4,200 per ounce mark, boosted by expectations for further U.S. interest rate cuts. Meanwhile, renewed U.S. China trade concerns also increased demand for safe havens. As of 0604 GMT spot gold was up by 1.1%, at $4,185.59 an ounce. It had earlier reached a session high of $4193.38. U.S. Gold Futures for December Delivery gained 1%, to $4204.30. The U.S. president Donald Trump announced on Tuesday that his administration would produce a list on Friday of "Democrat programs" which will be closed due to the federal government shut down. Matt Simpson, senior analyst at StoneX, said that the U.S. shutdown and Jerome Powell's dovish remarks have been two of the most recent reasons why gold prices are on an upward trend. Federal Reserve Chair Jerome Powell stated that the U.S. labor market was subdued. However, the economy may be "on a slightly firmer trajectory than anticipated." Powell said that interest rate decisions will be taken "meeting by meeting", balancing the labour market's weakness against persistent inflation above target. Investors have priced in the near certainty of a Fed rate cut of 25 basis points in October and December. Bullion is more likely to perform well when interest rates are low and there is political and economic uncertainty. Gold has gained 59% in the past year, mainly due to geopolitical and financial uncertainties, central bank purchases, a de-dollarisation trend, and strong exchange-traded funds. Simpson added that "this rally has become a momentum trading, where traders pile into the market to chase away prices." Trump stated that Washington is considering cutting off some trade relations with China, such as in the cooking oil sector. On Tuesday, both countries started imposing port fees tit for tat. The International Monetary Fund increased its global growth forecast for 2025, citing better than expected tariff and financial conditions. However, it warned that renewed U.S. China trade tensions may curb growth. Silver climbed 1.9% to $52.43, following the gold rally and tightening of supply on the spot market. Palladium and platinum both rose by 0.8%, to $1,537.19, respectively. (Reporting and editing by Sherry Phillips, Subhranshu Sahu, and Ishaan Aroor in Bengaluru).
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The Chinese Communist Party holds a plenary on its new five-year plan. What does it mean to you?
From Monday to Thursday, the elite Central Committee of China’s ruling Communist Party is holding a closed door meeting to discuss, amongst other things, its 15th five-year plan for development. This meeting is known as a Plenum and it's the fourth one since the Party Congress of 2022. What does it all mean? What is a plenum? Central Committee, the largest decision-making body of the party, holds seven plenums in between congresses. The fifth plenum is traditionally used to discuss five-year plans. The party will now be expected to review the 2026-2030 Plan during the Fourth Plenum, which takes place from October 20-23. This is due to a nine-month delay that was not explained in the third plenum. In order to prevent leaks, the plenum is traditionally restricted within the premises for the duration. The proceedings are kept secret until the meeting is over. Most Chinese journalists and foreign media are not allowed access. China will release a short report the day after the plenum concludes, outlining the main points of agreement - in this case, the scope of the five-year plan. No mention will be made of dissent to project unity within the party. Beijing may release more details a few days later, possibly in the week beginning October 27. However, it is unlikely that these will contain any specific costs or targets for new policies. The next five-year plans are likely to be approved by the parliament in March. What is a five-year plan? This is a blueprint for a strategic plan that defines the economic and social goals of a country over a period of five years, and guides national policy, investments and reform. This typically includes economic growth, industrial development, technological innovation and environmental protection as well as national security goals. China will have 15 five-year plans since adopting quinquennial policy cycles of Soviet style in 1950. Plans from the 1980s were seen as crucial in China's subsequent growth into the second largest economy of the world. These reforms opened the market, allowed for private ownership and helped integrate China into the global economy. In the 2000s and 2010, poverty reduction and a shift to an economy based more on domestic consumption rather than infrastructure investment and manufacturing were the main focus. China has declared victory in the fight against poverty. It is generally accepted, however, that China has failed to create a durable household demand. Will the plenum discuss other topics? Most likely. In the past, fourth plenums discussed party governance including personnel reshuffles and disciplinary measures. Diplomats, military personnel, and other observers are likely to pay attention to those who may rise or fall in rank, especially within the military, as a way of better understanding Beijing's thoughts. What's at Stake China's next five-year economic plan will be closely monitored to see how much it focuses on rebalancing the economy. Beijing is expected to use strong words in its efforts to increase consumption, according to most observers. Analysts say that in practice, the trade war between China and the U.S. will likely keep policymakers focused primarily on technological advancements and industrial upgrades, meaning resources will continue to flow mainly towards strategic investments and factories, rather than consumers. It could consolidate China's successes in developing world-leading sectors, like electric vehicles and green energy, while opening up new opportunities in other areas where it still trails rivals, like semiconductors or aviation. It also means that deflationary pressures will continue and debt will increase, as China's small contribution to global demand in comparison to its increasing stake in the manufacturing sector will keep tensions at a high. The plenum is held just days before the APEC Summit in South Korea where Donald Trump and Xi Jinping may meet. The plenum comes just days after Beijing tightened its export controls for rare earths. This prompted Trump to threaten triple-digit tariffs. Analysts say Beijing's five-year plans are not affected by short-term changes in diplomatic and trading relationships. Instead, Beijing bases its policies on protecting national interests during a time of increasing great power rivalry.
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Orlen offers $278 million to purchase all shares of Grupa Azolty Polyolefins
Orlen, a Polish oil refiner, has offered to purchase all the shares in Grupa Azoty Polyolefins. GAP is a petrochemical division of Grupa Azoty - a state-controlled chemical company. Orlen owns 17.3% GAP and said that its offer valued at $1.02 billion (about $278.20m) includes financing for GAP to continue restructuring debts and claims, as well as purchasing shares from other shareholders. Orlen and Azoty have been discussing the future of polymers, which Azoty's core business is losing money in, since 2024. The country's largest oil refiner announced earlier this year that it would not purchase more shares of Azoty’s polymer project. The companies did sign a memorandum on understanding for the sale of GAP's logistical assets. Orlen announced on Wednesday that its offer was valid until the end of this year and contingent upon the completion of GAP's restructuring process and the final settlement of contract for the construction of the polypropylene factory. Hyundai Engineering Co. and Korea Overseas Infrastructure & Urban Development Corporation are the contractors for the project which has been delayed.
Dollar eases, shares rebound as Fed cuts bets and reclaims spotlight
The global stock market recovered its losses on Wednesday thanks to dovish remarks from Federal Reserve chair Jerome Powell, and positive bank earnings in Wall Street. However, simmering U.S. - China trade tensions kept risk appetite at bay.
Powell said that the possibility of further rate reductions was still open on Tuesday, and that the long-term effort of the central banks to reduce the size of their holdings could be nearing its end.
Some viewed his comments as dovish. They lifted the markets and reaffirmed expectations for more easing in this year. By December, roughly 48 basis point worth of cuts will be priced into the market.
Tom Kenny is a senior international economist with ANZ. He said that the Fed could announce its intention to end quantitative tightening at the upcoming FOMC meeting in October.
We expect the Fed will cut 25bps at the FOMC meetings in October and December.
The market was also supported by solid earnings from U.S. banks and an upward revision to the International Monetary Fund’s global growth forecast for 2025. Earlier in the week, the market had been slammed on signs of renewed tension in U.S. China trade relations.
The Nikkei rose 1.5%, after a 2.6% drop in the previous session.
Nasdaq Futures gained 0.31%, while S&P500 futures increased by 0.26%.
Even so, the sentiment was fragile. On Tuesday, U.S. president Donald Trump said that Washington would consider terminating certain trade ties with China. This included in relation to cooking oils.
Both the U.S.A. and China have begun charging extra port fees to ocean shipping companies that transport everything from holiday toys, to crude oil.
The markets have been thrown into turmoil in recent sessions due to a rapid escalation of the U.S. China trade war. Trump announced an additional 100% duty on Chinese goods as a retaliation against Beijing's dramatic expansion of export controls on rare Earths.
It does indicate that a lasting ceasefire is unlikely to be achieved easily. It's also a good reminder that the market needs to be aware that they are shooting these arrows, and then walking them back," said Tony Sycamore.
U.S. trade representative Jamieson Greer said separately on Tuesday that the timing of additional tariffs of 100% on China's exports to America depends on whether they kick in November 1, or earlier, but acknowledged that Beijing might find it difficult to find a way out.
Hong Kong's Hang Seng Index rose 1.2% on the back of the regional rally, while China's CSI300 Blue-chip Index bucked trend and fell a mere 0.03%.
The data released on Wednesday shows that deflationary pressures persist in China. Both consumer and producer prices fell in September. This supports the need for additional policy measures, as trade tensions and a prolonged slump in the property market weighs on confidence.
POLITICAL UNCERTAINTY
The political landscape in Japan is riven with uncertainty as the country's parliament's scheduling committee has failed to reach an agreement on the holding of a vote on the next premier on October 21, according to Kyodo News Agency.
Sebastien Lecornu, the French Prime Minister, promised to delay a historic pension reform until 2027, a measure that would provide some relief for investors.
EUROSTOXX50 futures gained 0.95% in Asia. FTSE and DAX were both up about 0.3%.
Juan Perez is the director of trading for Monex USA. He said: "I believe that anything that can bring relief to the squabbles within the French Parliament is an absolute victory."
The euro last traded at $1.1611 despite being largely insulated from France's political turmoil.
The Fed's cut bets weighed on the currency market as the dollar fell 0.4% to 151.23 yen and 0.16 % to 0.8000 Swiss Franc.
The sterling rose by 0.22%, to $1.3349.
Spot gold, meanwhile, continued its record-breaking run, and last rose 0.9% to $4,178.49 per ounce. This was helped by the geopolitical, economic, and expectations of a U.S. interest rate cut.
Brent crude futures fell 0.37%, to $62.16 per barrel, and U.S. crude fell 0.31%, to $58.52 a barrel.
(source: Reuters)