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Iron ore prices rise on China's plan to reduce port fees
Iron ore futures were up on Tuesday, as the proposed reductions in Chinese port fees should discourage long-term storage. The January contract for iron ore on China's Dalian Commodity Exchange(DCE) rose 0.51%, to 794 Yuan ($111.90) per metric ton. By 0709 GMT, the benchmark December iron ore contract on Singapore Exchange was up 0.59% at $105.65 per ton. China has proposed lowering port fees for state owned enterprises that hold cargoes less than 30 days. ANZ analysts say this move would discourage long-term inventory stockpiling, accelerate inventory turnover and possibly tighten spot supply during periods when restocking is taking place. Galaxy Futures analysts said that a structural shortage in iron ore fines PB (Pilbara blend) will support steel prices for the short-term, but a rapid drop in domestic demand in the mid-term is likely to have a negative impact on iron ore. China's steel price pressure is likely to continue for the foreseeable, as the winter season slows down demand and inventories of finished steel remain high. This was stated by the China Iron & Steel Association in its most recent monthly report. The mood was also boosted on Tuesday as U.S. president Donald Trump declared that ties with China were "extremely solid" after a phone call with Chinese leader Xi Jinping. This came weeks after a South Korean meeting where they had agreed on a framework of a trade agreement which has not yet been finalised. The DCE also showed mixed results for other steelmaking ingredients, with coking coke and coking coal both up. Mysteel, a consultancy, said that the moderate increases in coke produced by China's Shanxi Province, which is the largest coke producing hub of China, were driven by higher profits from cheaper coal. The benchmarks for steel on the Shanghai Futures Exchange have increased. Rebar increased by 0.71%. Hot-rolled coils rose 0.64%. Wire rod increased 0.36%. Stainless steel gained 0.65%.
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Gold reaches a new high after Fed comments renew rate-cutting bets
Gold rose on Tuesday, reaching its highest level in over a week. This was despite a strong dollar after Federal Reserve policymakers' dovish remarks revived the prospects of an American rate cut in December. Gold spot rose 0.1%, to $4,141.49 an ounce, by 0631 GMT. This is the highest price since November 14. It follows a 1.8% increase on Monday. U.S. Gold Futures for December Delivery were 1.1% higher, at $4.139.10 an ounce. Kelvin Wong, senior market analyst at OANDA, said that gold prices recovered in the short-term due to expectations of a rate reduction. Market participants will be watching any data related to demand in the U.S. with more interest, right now, as they want to know if the Fed's concerns about a softening demand, which could be the labor market, retail sales or consumer confidence, are greater than the so-called "sticky inflation situation." Fed Governor Christopher Waller stated on Monday that the job market was weak enough to warrant a further quarter-point cut in rates for December. However, any action beyond this depends on upcoming data, which has been delayed due to the shutdown of government. Waller's remarks come after New York Fed president John Williams stated on Friday that U.S. rates of interest could fall "in a near term." According to the CME FedWatch tool, investors now price in an 81% probability of a rate reduction in December. This is up from 40% last weekend. Gold that does not yield tends to perform well in an environment of low interest rates. This week, the Fed will release key economic data that was delayed due to the government shutdown. These include U.S. retail sale, unemployment claims, and producer prices. Gold priced in dollars has seen gains capped as the dollar held near its six-month-highs from last week. The price of spot silver was unchanged at $51.43 an ounce. Platinum rose by 0.7% to 1,553.65, while palladium increased by 0.3% to 1,399.96. (Reporting and editing by Subhranshu sahu, Ronojoy Mazumdar, and Ishaan arora)
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UK development arm makes first, $150 mln push into energy transition financing
British International Investment (BII), the UK's development financing institution, announced Tuesday that it would provide FirstRand in South Africa with a $150-million facility to help African companies reduce carbon emissions. FirstRand’s RMB and FNB business banks will channel the funding to high-emission businesses willing to adopt cleaner technology and lower-carbon practices. Transitional finance loans aim to assist heavy emitters in modifying their operations rather than restricting access to financing. According to the 2025 South African Climate Finance Landscape Study, in 2022-2023, the country raised an average annual amount of 188 billion rands ($10.4 billion). South Africa could require as much as 500 billion rand per year to achieve its climate goals. This would leave a funding gap of more than 300 billion rand. A large portion of the funding allocated today is for power projects, such as wind farms and solar farms. Only a small percentage goes to initiatives that help communities adapt to climate changes or move away from coal. Nearly 60% of funding came from domestic institutions, and commercial banks were the biggest private financiers. Stephen Priestley said, BII's managing director: "This investment is a key step in our strategy of accelerating decarbonisation wherever it matters the most."
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Russell Russell: China can help Asia's diesel market, which is tightening up.
China could help ease the tightness of diesel markets in Asia in December by increasing exports to compensate for lower shipments coming from Indian refiners due to sanctions against Russian crude. According to trading sources the exports of China's diesel could reach 4.5 million barrels by December as refiners make use of high margins to produce this transport fuel. If the December loading cargoes rise to the level expected, this would be the best month since August. It is also a big jump from the forecast of commodity analysts Kpler that November exports will total 2.76 million barrels. China has the second largest oil refinery capacity in the World, but it uses less than 80% at the major state-owned facilities, and even less for smaller independent processors. Exports are also controlled through government quotas. These are more driven by the need to ensure domestic fuel security, than by market forces which allow refiners a higher profit margin when margins increase. China's refiners may still have enough quotas to increase December exports for diesel, jet fuel and other middle-distillate fuels. China has issued quotas for 8,395 millions metric tons of diesel, jet fuel, and gasoline. This brings the total amount for the year up to 40,195 million tons. That's about the same as 41.0 million for 2024. According to data released by the government on November 18, refiners exported 29,91 million tons of these three fuels during the first ten months of this year. The quotas are available for exports of about 10,29 million tonnes of each of the three fuels in November and December. Kpler predicts that November exports for the three products will be approximately 1.58 million tonnes. While this number may increase as more cargoes arrive at the end of the calendar month, it's clear that refiners have enough remaining quotas available to boost December exports. ROBUST FUEL MARK-UPS The refining margins of diesel and gasoline are at their highest levels in two years. Singapore's profit from making a barrel gasoil (the building block of diesel) ended Monday at $24.37, down from the previous close of $25.97, as traders factored in the possibility that Chinese exports could increase next month. The spread reached $31.25 per barrel on 19 November, the highest level since 23 September and up 140% from the lowest point in 2025 at $13.05 on 25 March. Profit margins on a barrel gasoline On Monday, the price was $14.54, up from $14.42. The price of a barrel had reached $17.71 on November 14. This was the highest level since August 29, 2023. It is also almost five times higher than the lowest point in 2025, which was $3.68 on the 21st January. The recent improvement in the refining margins is partly due to the weaker exports of India. According to Kpler, shipments of jet fuel, diesel and gasoline to the South Asian country are expected to fall to 4,34 million tons by November. This will be the lowest level since April, and the lowest so far for 2025, which was 5.54 million tonnes in September. In India, several refiners have been forced to look for alternative crudes in order to replace the Russian oil they were buying at a discount before the latest U.S. sanction on Russian oil companies. India's refiners are likely to find alternative crude oil supplies, so the decline in refined product exports is only likely to be a temporary phenomenon. While there may be a market gap, China appears to be the best-positioned country to benefit from additional gasoline and diesel. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X. These are the views of the columnist, an author for.
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MORNING BID - Flying blindly on a doveish wing
Ankur Banerjee gives us a look at what the future holds for European and global markets The risk-on rally that was sparked by the abrupt shift in U.S. interest rate cut bets following dovish policymakers' comments may fail in Europe, while currency markets are still wary of Tokyo intervening to support the yen. The phone-call diplomacy also came under the spotlight. Donald Trump, U.S. president, praised the "extremely solid" relationship between China and the United States on Monday after a phone call with his Chinese counterpart Xi Jinping. In their first telephone call after Tokyo's Prime Minister sparked an important diplomatic spat with China, Trump told Sanae Takaichi to "call me any time" The markets are focused on the rate developments in the United States after Federal Reserve Governor Christopher Waller stated that a quarter-point cut could be justified by the weak labor market. Investors are now expecting a rate reduction next month after Waller's comments. CME FedWatch shows that traders are now pricing an 81% probability of a reduction next month, compared to 42% one week ago. This huge swing highlights the difficulty the market has in pricing near-term rates due to the lack of economic data as a result of the longest U.S. Government shutdown which ended on November 14 The U.S. Dollar has been stable despite the steep rise in bets on rate-cuts. The yen is still near its 10-month-lows, and dangerously close to 160/dollar. There's no relief in sight, as the chatter about Tokyo officials intervening continues. The yen vigil will continue. The traders believe that a holiday-shortened week could provide Tokyo with a perfect opportunity to engage in some yen purchasing, but it may ultimately have limited impact. Shares of Novo Nordisk fell on Monday, after the obesity drugmaker revealed that its Alzheimer's studies for an older oral form of its semaglutide medication failed to slow down the progression of brain-wasting diseases. Analysts noted that investors' expectations were low for the success of the trial. However, they did not expect a prolonged market reaction. The European futures indicate a lower open as the momentum of Asian stocks slows. Investors may still be worried about last week's AI valuations. The following are the key developments that may influence Tuesday's markets: Easyjet earnings, French consumer confidence for November, Germany Q3 GDP data
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Gold reaches a new high after Fed comments renew rate-cutting bets
Gold rose on Tuesday, reaching its highest level in over a week. This was despite a strong dollar after Fed policymakers' dovish remarks revived the prospects of an American rate cut in December. Gold spot rose by 0.1% at $4,140.85 an ounce as of 0457 GMT. This is the highest level since November 14. It follows a 1.8% increase on Monday. U.S. Gold Futures for December Delivery were 1.2% higher, at $4.141.20 an ounce. Kelvin Wong, senior market analyst at OANDA, said that gold prices recovered in the short-term due to expectations of a rate reduction. Market participants will be watching any data related to demand in the U.S. with much greater interest, right now, to see if the Fed's concern about a soft demand situation, which could be the labor market, retail sale, or consumer confidence outweighs the so-called "sticky inflation situation." Fed Governor Christopher Waller stated on Monday that the job market was weak enough to warrant a further quarter-point cut in rates for December. However, any action beyond this depends on a upcoming flood data delayed by government shutdown. Waller's remarks come after New York Fed president John Williams stated on Friday that U.S. rates of interest could fall "in a near term." According to the CME FedWatch tool, investors now price in an 81% probability of a rate reduction in December. This is up from 40% last weekend. Gold that does not yield a return tends to perform well in environments with low interest rates. This week, the Fed will release key economic data that was delayed due to the government shutdown. These include U.S. retail sale figures, unemployment claims and producer prices. Gold priced in dollars has seen gains capped as the dollar remained near its six-month-highs from last week. Other metals rose in price, including spot silver, which rose by 0.2%, to $51.49 an ounce. Platinum rose 1%, to $1.559.61 and palladium rose 0.3%, to $1.399.25. (Reporting and editing by Subhranshu sahu, Ronojoy Mazumdar, and Ishaan arora)
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China launches Shenzhou-22 to Tiangong Space Station
China launched its Shenzhou-22 space mission on Tuesday to address safety concerns for the crewed spaceflight and space station program after an orbital vessel was damaged earlier this month. According to CCTV's livestream, the Shenzhou-22 took off at 12:11 pm (0411 GMT) from Jiuquan Satellite Launch Center. The spacecraft is headed to China's permanently-inhabited Tiangong station where three astronauts are currently residing. They do not have a flightworthy vessel to return them to Earth if an emergency occurs. The Shenzhou-20 was supposed to bring back three Chinese astronauts to Earth on November 5. However, it was declared unfit for flight after being docked in Tiangong and sustaining suspected debris damages. The only flight-capable vessel left, Shenzhou-21 (which had just arrived in the station late October), was deployed by the Chinese space authorities. Shenzhou-21 left Tiangong without a spacecraft six months earlier than scheduled, creating a safety concern. Shenzhou-22's arrival will eliminate this risk. China's rapid and methodical response contrasts with the United States which was forced to deal with two NASA Astronauts who were stuck on the International Space Station in the United States for nine months because of problems with the propulsion systems of the vessel that carried them. Both countries are studying each other's space technology and operational protocols as they race to land astronauts on the moon by 2030. (Reporting and editing by Jacqueline Wong, Saad Sayeed and Eduardo Baptista)
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Oil prices drop on concerns about oversupply while investors focus on Ukraine talks
The oil prices fell on Tuesday, as fears that Russian shipments would remain under sanctions despite the inconclusiveness of talks to end Ukraine's war outweighed concerns about supply exceeding demand. Brent futures dropped 27 cents or 0.4% to $63.10 per barrel at 0500 GMT. West Texas Intermediate crude (WTI), which is a blend of crude oil from Texas, fell 23 cents or 0.4% to $58.61. The two crude benchmarks both gained 1.3% Monday, as rising doubts over a peace agreement to end the Russia/Ukraine conflict reduced expectations of an unrestricted flow of Russian fuel and crude oil supplies. These are currently under sanctions by Western nations. While market participants are concerned about Russian crude oil shipments, there is a more relaxed outlook for the supply and demand balances of crude oil in 2026. This is because many forecasts predict that supply will grow faster than demand next year. In a Tuesday note, Priyanka Sackdeva, senior analyst at Phillip Nova said that the main risk in the short term is an oversupply. The current prices levels also seem vulnerable. Some Indian refiners, especially private companies, have reduced their purchases of Russian crude oil due to new sanctions against Russian oil giants Rosneft, Lukoil, and rules prohibiting the sale of oil products refined from Russian raw oil to Europe. Reliance Russia wants to increase its exports to China because it has limited sales options. Alexander Novak, the Russian deputy prime minister, spoke at a China-Russia Business Forum in Beijing on Tuesday. Beijing and Moscow have been discussing ways of Expand your mind with this: Exports of Russian oil to China Market analysts continue to focus on the possibility of wider imbalances in supply and demand. In a Monday note, Deutsche Bank said it sees an oil surplus in 2026 of at least two million barrels per a day. It also stated that there is no clear way to return to deficits by 2027. Analyst Michael Hsueh stated that "the path forward to 2026 remains bearish." Prices were supported by the expectation of softer markets in 2019. This outweighed the absence of a resolution to a Ukraine-Russian peace deal. The deal could result in the lifting of sanctions on Moscow and the release of previously restricted oil supply into market. Oil markets still find some support in the expectation that U.S. interest rates will be cut at their policy meeting on December 9-10, as Federal Reserve members have indicated support for a reduction. Lower interest rates can stimulate economic growth, and increase oil demand. Sachdeva stated that "the oil market is caught in a tug of war between a cautious supply overhang, and the demand expectations based on a looser monetary policy."
Asian stocks rise as US interest rate cuts return to focus
The Asian stock markets rose on Tuesday, as investors bought global technology stocks and shrugged off fears that the sector is becoming overheated.
The broadest MSCI index of Asia-Pacific stocks outside Japan rose 0.75%, led by tech stocks. This was a partial recovery of last week's losses of 4%. The index is set to post its first monthly drop since March.
The European futures were down 0.2%, which indicates a soft opening.
The yield on 10-year Treasury bills was unchanged at 4,038%. The two-year rate, which increases with traders' expectation of higher Fed Fund rates, was stable at 3,495% during Asian hours, after dropping 2.5 basis point in the previous session.
Nikkei, the Japanese stock market index, was only up 0.1% on February 2nd after a good start on its return to trading on Monday. Last week, the index fell 3.5% as markets were gripped by a wave of fear. The Hang Seng Index in Hong Kong was 0.6% higher Tuesday, while the CSI300 Index in China was 1.1% higher.
After Fed Governor Christopher Waller stated that available data indicated the U.S. employment market is still weak enough to warrant a further quarter-point reduction in interest rates, it's likely we will see a rate cut.
According to CME's FedWatch Tool the markets are now pricing in a 85.1% probability of a 25 basis point cut at the December meeting. This is up from 42.4% one week ago. The U.S. central bank will be meeting on December 9-10.
The dollar has been largely unaffected by the sudden change in bets on rate cuts. After a small overnight gain, the euro bought $1.15125 at its last chance.
The dollar index closed at 100.25 on Friday, holding its gains from the previous week when it rose by nearly 1%.
Jack Siu is the Head of Discretionary Portfolio Management for Asia at Lombard Odier.
He said that it is likely the ECB, the Swiss National Bank, and the BOJ have stopped cutting rates, and "the BOJ will be more dovish even though its next step is going be a hike."
The dollar will depreciate from a perspective of interest rate differentials. Siu stated that this rebound is not sustainable.
The ongoing dispute between Tokyo and Beijing continues to be in the spotlight. It is over a comment made by Japan's prime minister Sanae Takaichi in November, stating that a Chinese invasion of Taiwan would trigger a Japanese response.
Takaichi spoke with Donald Trump on Tuesday after his Monday call with Chinese President Xi Jinping. She claimed that Trump had explained U.S. China relations to her.
Trump announced on Monday that he will travel to Beijing, China in April. This is at the invitation from the Chinese government. The meeting proposal was seen as another sign that diplomatic and political ties between China and the United States are improving after their truce in their trade war.
Marcella Chow is JPMorgan Asset Management’s market strategist.
In Asian hours, Nasdaq and S&P futures both eased a little.
The U.S. bond and stock markets will close on Thanksgiving Day, Thursday. They will reopen on Friday for a half-day.
Brent crude futures fell 0.52% to $63.04 per barrel while U.S. Crude futures dropped 0.48% to $58.56 a barrel.
Spot gold remained at $4,141 per ounce. (Reporting and editing by SonaliPaul; Scott Murdoch)
(source: Reuters)