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Hegseth, Pentagon's Hegseth, defends Iran War and says it is not a Quagmire
Hegseth, the U.S. Defense Secretary, made fiery remarks to Congress on Wednesday. He defended the Iran War by saying it was not a "quagmire" and called Democratic lawmakers "feckless," for criticizing this unpopular conflict. Hegseth testified before Congress for first time after the U.S. launched a war on Iran in February. Trump's popularity is down since the conflict started. The /Ipsos survey found that only?34% Americans approve of the U.S. conflict against?Iran. This is down from 36% at mid-April, and 38% at mid-March. Democrats bombarded Hegseth's office with questions regarding the ongoing conflict. Rep. John Garamendi, of California, called it a "quagmire," and a "political disaster on every level." Hegseth replied angrily. "You call ?it a quagmire, handing propaganda to our ?enemies? Hegseth responded to Garamendi by saying, "Shame 'on you. You made a foolish statement." He also criticized the "reckless feckless and defeatist" Congressional Democrats. "Don't say: 'I'm in support of the troops, but a two-month military mission is a quagmire. ' Whom are you cheering here? "Who are you rooting for?" Reporting by Phil Stewart and Idrees Al, editing by Michelle Nikil
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Pentagon official: U.S. War in Iran cost 25 billion dollars so far
A senior Pentagon official said that the United States war against Iran had 'cost' $25 billion to date. This was the first estimate of the cost for the military. Democrats have been able to gain a strong lead in opinion polls in the six months before mid-term elections, when Trump's Republicans will likely face a tough battle to maintain their House majority. They are also attempting to link affordability with the unpopular Iran War. Jules Hurst who is the comptroller told the House Armed Services Committee members that the majority of this money was "for munitions". Hurst didn't specify what was included in that estimate, or whether it took into account the projected costs for rebuilding and repairing the base infrastructure damaged by the conflict in the Middle East. Rep. Adam 'Smith, the top Democrat in the House Armed Services Committee responded to?Hurst by saying: "I am glad that you answered that?"question. We've asked for a very long time and nobody has given us a number. The United States began to conduct strikes against Iran in February. Both sides maintain a fragile truce. Pentagon has sent tens and thousands of additional forces to the Middle East. Three aircraft carriers are also stationed in the area. Thirteen U.S. soldiers have died in the conflict and hundreds of others were injured. The disruptions in oil and gas shipments since the start of the war have caused a rise in the price of gasoline and agricultural products like fertilizers in the United States, in addition to the list of other high prices for consumers. Trump's popularity is down since U.S. and Israel started a war on Iran in February, which led to an increase in gas prices. A recent Ipsos survey found that only?34% Americans approve of the U.S. war with Iran. This is down from 36% at mid-April, and 38% at mid-March.
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Thyssenkrupp to receive $4 billion in Kone-TK Elevator Deal
Analysts estimate that Thyssenkrupp's share of the proceeds from Kone's proposed purchase of liftmaker TK Elevator is nearly two thirds of its current market capitalisation. According to Jefferies and JPMorgan estimates, the windfall for the German company if the deal is completed could be as high as 3.4 billion euro ($4 billion). This would be a huge financial boost to the German firm that's undergoing a major restructuring in order to become a holding corporation. Thyssenkrupp's shares, which were up 7.5% by 1437 GMT, didn't comment on the financial implications of the deal. They only said they were reviewing the proposal. Under the plan, Kone would be the world’s largest lift manufacturer. In December, the company stated that its 16.2% share in TKE retained after a landmark division sale to a consortium headed by Advent and Cinven, in 2020, has a book value of approximately 2 billion euros. Jefferies analysts called it "clearly positive" for Thyssenkrupp. It delivered long-awaited value crystallisation from a non core asset, and improved transparency materially. According to the terms of the deal, TKE shareholders will receive 5 Billion Euros, which is equivalent to 810 Million Euros for Thyssenkrupp, based on Thyssenkrupp's TKE stake. According to the terms, Thyssenkrupp will also receive up to 2,46 billion euros worth of newly issued 'Kone shares. This would give it a stake of 5.5% in the combined Kone/TKE entity.
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The most diverse corals of the South Atlantic, Brazil's Abrolhos, are declining as the climate warms
Researchers in Rio de Janeiro reported that the coral cover on Brazil's Abrolhos reefs, which is the most biodiverse ecosystem of the South Atlantic, had fallen by around 15% in 18 years due to climate changes and human activity. The climate change-linked heatwaves have intensified the so-called "bleaching events" where corals expulse the algae they call home. This permanently undermines the coral health. Corals are dying because their health is compromised by the increased frequency of heatwaves. They may even regain color with this increase, but will develop diseases and necrosis. Coral reefs sustain about 25% of marine life around the globe, but are in a state of almost irreversible death. Scientists have called this the "tipping point" for climate-driven ecosystem collapse. Scientists say that in order for reefs to recover, the world must drastically increase climate action and bring temperatures to just 1 degree Celsius below the preindustrial norm. According to U.N. data and EU science agencies, global temperatures are already 1.3-1.4 degrees Celsius (2-3 degrees Fahrenheit above preindustrial levels) warmer than the average. Brazilian researchers studied the Abrolhos Reefs from 2006 to 2023. The Royal Society Proceedings B journal published the results of this study. The findings show "insidious shifts in coral assemblages including the collapse branching corals." The study found that while larger branching corals provide reef structure, they are being replaced with species that grow faster and offer fewer "ecological" benefits. Moura stated that human activity is responsible for the worsening of the damage. The sediment created by the dredging of a nearby shipping channel in the Port of Caravelas damages the water quality and kills corals. The report stated that local marine protected areas had not 'halted the corals decline. This indicates that, while they are fundamental in protecting biodiversity, it is 'not enough to face a global climate emergency. Ricardo Gomes is a biologist from the Instituto Mar Urbano. He said that reefs are vital for fishing, tourism, coastal livelihoods and jobs. Gomes stated that "putting Abrolhos in danger means putting all of the biodiversity along the Brazilian coast in peril." (Reporting by Sergio Queiroz in Rio de Janeiro; Writing by Oliver Griffin; Editing by Aurora Ellis)
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Thyssenkrupp to receive $4 billion in Kone-TK Elevator Deal
Analysts estimate that Thyssenkrupp will benefit from Kone's $34.4 billion acquisition of liftmaker TK Elevator. According to Jefferies' and JPMorgan's estimates, the windfall would be as high as $4 billion. This is a huge financial boost for the German business that is undergoing a major restructuring in order to become a holding. Thyssenkrupp's shares, which were up 7.5% by 1409 GMT, didn't comment on the financial implications of the deal. They only said they were examining "the proposal" under which Kone could become a world leader in lift manufacturing. The?company stated in December that the book value of its 16.2% share in TKE was around?2bn euros. This stake will be retained by the company after it sells TKE to a consortium headed by Advent and Cinven. Jefferies analysts called it "a clear positive for Thyssenkrupp as it delivers long-awaited value from a non-core asset, and materially improves transparency". Thyssenkrupp's TKE stake is worth 810 million euro, or 5 billion euros. According to the terms of the agreement, Thyssenkrupp will also receive up to 2,46 billion euros worth of newly issued Kone shares. This would give the company a 5.5% share in the combined Kone/TKE entity.
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Sources say Indian refiners are limiting the use of a special FX credit facility, causing rupee pressure.
Three sources with knowledge of the matter said that India's state oil refineries are only using a limited amount of the "special FX credit lines" offered by India's largest banks to help ease the pressure on the rupee. They expressed concern about the rupee falling further. The rupee is under pressure again, and has dipped near its record low of 95.21. This comes after several steps taken by the Reserve Bank of India to support the currency. According to FX traders, the currency has been affected by dollar purchases related to oil in recent sessions. India's biggest imports are crude?oil, petroleum products and petroleum products. These items have added $12 billion to $13 billion per month in the last three months to the country?s import bill. India offered state-run refineries a special credit line via State Bank of India at the end of April. This allowed them to borrow dollars for oil import payments. This was done to curb spot dollar purchases for oil imports. Two sources from state-run refineries said that the'refiners are reluctant to use the facility because they anticipate the rupee weakening a little more, increasing their repayment burden. One source said that using the special FX line was not cost-effective when the rupee will likely weaken. His company uses the facility to meet a portion of its dollar needs, while the remainder is met through spot purchases. Second source: His company has limited access to the credit facility and is borrowing short-term from the markets. The source stated that the weakening rupee and high oil prices have reduced the appeal of the credit facility. Sources spoke under anonymity as they weren't authorized to make public comments. OIL WORRYS The rupee has fallen by about 2% in the last eight sessions. This is similar to the rate of declines seen among other Asian countries that import oil, such as Thailand and the Philippines. Brent crude, which fell to $86 per barrel around mid-April amid optimism about a resolution of the U.S./Iran conflict, has now climbed to $112 per barrel. The third source who is familiar with the thinking of the central bank said that dollar purchases by oil refiners on the spot market were 'among the main sources of pressure against the rupee. This is not the only factor, said this source, without going into detail. The RBI didn't immediately respond to our request for comment.
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Gold continues to decline as inflation concerns linger and a Fed meeting is looming
The gold price fell for the?third consecutive session on Wednesday as inflation concerns linked to the?ongoing?conflict? in the Middle East clouded monetary policy outlooks. Meanwhile, the U.S. Federal Reserve rate decision was in the spotlight later that day. As of 8:55 am EDT (1255 GMT), spot gold was down by 1.1%, at $4,543.57 an ounce. This is a new low for the month. U.S. Gold Futures dropped 1.1% to $4,555.70. We are seeing some positions ahead of the FOMC's decision this afternoon. "Rising U.S. Treasury Yields and higher crude oil prices have been negative for the gold price," said Jim Wyckoff. Senior analyst at Kitco Metals. Gold is a popular inflation hedge. However, its appeal will diminish if central banks increase interest rates. U.S. president Donald Trump called on Iran to sign a deal and "get smart" soon, after a stalemate in efforts to end conflict in the Middle East. This was in response to media reports that the U.S. will extend its blockade against Iran's ports. Brent oil hit a month-high as supply disruptions continued to be a concern. Meanwhile, U.S. Treasury yields increased. At 2 p.m. ET (1800 GMT), the Federal Reserve is expected to announce its policy decision. Rates are expected to remain unchanged. Fed Chair Jerome Powell will hold a presser half an hour after the meeting, which could be his last as Fed head. No rate changes are expected at today's meeting. Wyckoff said that any surprise from Powell could be market-sensitive. The World Gold Council reported that global gold demand increased 2% on an annual basis in the first quarter 2026, primarily due to a surge of purchases?of coins and gold bars, as well as a growth of 3% in central bank buying. This outweighed a decline of 23% in jewellery demand. (Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Ronojoy Mazumdar) (Reporting and editing by Ronojoy Mazumdar in Bengaluru)
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The most diverse corals of the South Atlantic, Brazil's Abrolhos, are declining as the climate warms
Researchers in Rio de Janeiro have reported that the coral cover on Brazil's Abrolhos Reefs, which is the most biodiverse coral system in the South Atlantic has decreased by around 15% in 18 years as a result of climate change and human activity. The marine heatwaves caused by climate change have intensified the so-called "bleaching" events, where corals expulse the algae they call home. This permanently damages coral health. Corals are dying because of their compromised health, Moura explained. "With increasing heatwaves corals might regain color but develop diseases and?necrosis." Scientists have called the current state of coral reefs in the world, which sustains a quarter marine life on earth, a "tipping point". Scientists say that for reefs to recover the world needs to 'dramatically ramp up climate actions to bring temperatures down by just one degree Celsius above pre-industrial average. According to U.N. data and EU science agencies, global temperatures are already 1.3-1.4 degrees Celsius (2-3 degrees Fahrenheit above preindustrial levels) warmer than they were before the industrial revolution. Brazilian researchers studied the Abrolhos Reefs between 2006 and 2023. The findings, published in The Royal Society Proceedings B journal, reveal "insidious changes in coral assemblages including the collapse of branching reefs." The study concluded that while larger branching corals provide reef structure, they are being replaced with species which grow faster and offer fewer benefits to the environment. Moura stated that human?activity exacerbates the damage. The sediment stirred up during the dredging of a?shipping canal at the nearby Port of Caravelas damages water quality and smothers corals. The report stated that local marine protected areas had not stopped the corals from declining, "indicating they are essential for protecting biodiversity but not enough" in the face of the global climate crisis. Ricardo Gomes is a biologist at the Instituto Mar Urbano. He said that reefs are vital for fishing, tourism, coastal livelihoods and jobs. Gomes stated that "putting Abrolhos in danger means putting all of the biodiversity along the Brazilian coast in peril." (Reporting by Sergio Queiroz in Rio de Janeiro; Writing by Oliver Griffin; Editing by Aurora Ellis)
Investors wait for Fed earnings, tech earnings, and oil prices to rise as stocks fall.
European stocks dropped on Wednesday, but Wall Street Futures were up. Markets struggled to find direction as they awaited the?earnings of major U.S. tech firms and the result of 'the Federal Reserve's recent policy meeting. U.S. technology stocks fell in the previous session following a report that OpenAI, a company focused on artificial intelligence, had missed its internal targets. This raised concerns over the sustainability of AI's boom. Oil prices were also up as a result of the Iran war.
The STOXX 60 was down 0.3%, while the FTSE 100 in London fell 0.8%. Nasdaq's e-minis rose 0.4%, while Dow Jones, S&P, and Dow Jones & Co. futures were all close to flat.
Microsoft, Alphabet and Amazon will report their earnings later in the session. Shaniel Ramjee is the co-head of Pictet Asset Management's multi-asset investment division. He said that investors will focus on capital spending plans by so-called hyperscalers who operate huge data centres and AI Infrastructure.
"What we saw with OpenAI yesterday was some questions about the targets and whether that could impact on some of the spending. He said that the market would be paying close attention to what hyperscalers have to say today about how much money they are willing to spend and where it is coming from.
OIL PRICE RISE AS IRAN WAR CONTINUES There are few signs that the Iran War will end after two months. U.S. president Donald Trump stated that he is 'unhappy' with Iran's most recent proposal. The Wall Street Journal reported that he told his aides to be prepared for an extended port blockade. Trump encouraged Iran to sign the deal in a post on social media.
Brent oil prices reached a new high. Brent crude futures, for June, were last up by 2.7% to $114.29 per barrel, marking the eighth day in a row of gains. U.S. West Texas intermediate futures rose 3.1% to $103,06. Analysts say the United Arab Emirates decision to leave OPEC will not have a significant impact on oil prices in the near future, but it could weaken the group of oil producers. Russia claimed that the decision would increase output and reduce prices over time. Since the ceasefire of April 8, attacks on Gulf countries are down.
Data showed that the economic sentiment in the Eurozone was at its lowest level for three and a quarter years. The Iran war hit the services sector, and inflation was on the rise. The yields on euro zone government bonds were the highest they've been in weeks as inflation concerns continued. The European Central Bank will likely leave rates unchanged Thursday.
The UK 10-year gilt yields are on course to reach their highest close in 2008 as fears of inflation from higher oil prices push up borrowing costs worldwide. Also, concerns about the future of the prime minister linger.
FEDERAL RATE Investors also awaited the outcome of April's Fed meeting, which may be the last one with Jerome Powell at the helm. The Fed is expected to maintain rates while they assess the economic impact of war in Iran.
Ramjee, from Pictet, said that the Fed will be looking at how much energy prices have increased and whether or not inflation is a factor. The dollar index rose 0.1% to 98.697 while the euro fell 0.1% to $1.1704. The dollar was a safe haven during the conflict. However, it has dropped this month since its peak in late March. The 10-year Treasury yield was 4.3556%.
In the previous session, gold prices had fallen to their lowest level since April 2, a drop of 0.6%. Reporting by Gregor Stuart Hunter. Kate Mayberry and Mark Potter edited the story.
(source: Reuters)