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INDIA BONDS - India bonds fall ahead of the auction due to fuel price hike and US debt crisis
Indian government bonds fell on Friday in the early trade, as domestic fuel prices?hiked inflation fears and U.S. Treasury Yields were at one-year-highs, reducing the appeal of emerging market?debt. This dampened demand before a 'fresh debt supply. By 11:30 am IST on Friday, the yield on the benchmark 2035 bond of 6.48% had risen to 7.0591% compared to 7.0203% Thursday. Bond yields are inversely related to bond prices. Delhi-based retailers announced on Friday that India had raised petrol and diesel by more than 3% or 3 rupees per litre for the first time since 2004. This was to make up some of the losses caused?by higher crude oil prices around the world. Since the start of the "war", crude prices have risen by about 50%. Benchmark Brent crude futures last rose 1.23% to $107.04 per barrel. Trump said he had lost patience with Iran, but there was no relief in the geopolitical arena. Despite Tehran's claim that 30 ships had passed through the Strait of Hormuz, there was still concern about ship attacks and seizure. India imports 90% of its crude oil needs. High oil prices could cause inflation, pressure on the rupee, and a widening of the current account deficit. Barclays economists wrote in a recent note that the fuel price increase today will add 8 bps in addition to the 6-bp rise from the gold import duty hike. India's wholesale prices?index spiked from 3.9% to 8.3% in March. This is much higher than the market expectations of 5% plus, which traders are concerned could lead to consumer inflation. The 10-year Treasury yield has also been impacted by inflation concerns, as it is now at its highest level in a year. New Delhi is set to raise 320 Billion Rupees via a bond issue. India's overnight swap rates increased 7-10 basis points as fuel price hikes changed inflation expectations and central bank policy expectations. The swap rate for the one-year period was 6.1575%. For the two-year, it was 6.3850%. And the five-year, 6.71%. $1 = 95.7625 Indian Rupees (Reporting and editing by Eileen Soreng, Janane Venkatraman).
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French and Benelux stocks: Factors to watch
Here are some company news and stories that could have an impact on markets or individual stocks in?France and Benelux. AMG Critical Materials: AMG Critical Materials, a producer of energy storage materials, announced that it would acquire the remaining 71% Zinnwald Lithium, for 56 million dollars. The acquisition will be funded by 50% cash and 50% new AMG shares. Deal closing is expected in Q3. LVMH: French group LVMH LVMH.PA agreed to sell fashion brand Marc Jacobs?to a joint venture consisting of brand?manager WHP Global, and apparel company GIII 'Apparel Group GIII.O. The companies are raising up to 850 million dollars to fund this deal. STELLANTIS Stellantis STLAM.MI said on Friday that it had signed a deal worth about 1 billion euros ($1.17 billion), with Chinese?state owned Dongfeng 0489.SG, to produce Peugeot and Jeep cars in China. Pan-European market data: European ?Equities speed guide................... FTSE Eurotop 300 index.............................. DJ STOXX ?index...................................... Top ?10 STOXX sectors........................... Top 10 EUROSTOXX sectors...................... Top 10 Eurotop 300 sectors..................... Top 25 ?European pct gainers....................... Top 25 European ?pct losers........................ Main stock markets: Dow Jones ............... Wall Street Report ..... Nikkei 225............. Tokyo ?report............ London report ........... Xetra ?DAX............. Frankfurt items......... CAC-40................. Paris ?items............ World Indices..................................... Survey of global bourse outlook ......... European Asset Allocation........................ News in a nutshell: Top News ............. Equities.............. Main Oil Report ........... Main currency report .....
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Bloomberg News: Greer, USTR, says that China wants the Strait of Hormuz to be open without any restrictions.
U.S. trade representative Jamieson Greer said in a live interview with Bloomberg News on Friday that China wanted to see the Strait of Hormuz open again without any curbs or tolls. He added that the U.S. Beijing was confident that it would take action to 'limit' material support for Iran. He cited remarks made by Chinese officials during the Beijing summit of U.S.-China leaders. "It was very clear that the Strait of Hormuz should be open for China, with no tolling and no military control. We welcome this. Greer attended summit meetings between the?U.S. President Donald Trump met with Chinese President Xi Jinping. Trump is eager to gain Chinese support in order to end the Iran conflict. This has lowered his approval rating ahead of the November midterm elections. China is Iran's main oil buyer and close to the country. Iran has closed the Strait to all ships except its own. This is the largest disruption in global energy supply ever. Greer said that the Chinese were being pragmatic and didn't want be on the wrong end of the issue. They want peace in this area. President Trump is interested in peace. We are confident that they will limit any material support for Iran." In a recent statement on the Iran talks, China's foreign ministry urged a continued and stabilized momentum for deescalation. It said that there was no need to continue this war, which should never have occurred. Finding a solution sooner is beneficial for both the United States and Iran...and even the entire world. In its summary, the ministry did not mention the Strait of Hormuz but called for all shipping routes to be opened as quickly as possible. China has consistently called for the end of the fighting and the restoration of safe passage through the Strait. Beijing has engaged in a flurry diplomatic efforts but has not criticised the U.S. war conduct. In normal times, the Strait is home to a fifth or more of all global oil and gas supplies. Reporting by David Lawder and Liz Lee, both in Washington; editing by Jacqueline Wong & Clarence Fernandez
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India increases petrol and diesel prices by more than 3% according to retailers
?India raised petrol and diesel by more than 3% or 3 rupees per litre for the first time in 4 years, according to retail stores in?Delhi? on Friday. This was to recoup losses due to rising crude oil prices. After the U.S. and Israeli attacks on Iran began, the global oil price spiked up to over $120 per barrel. Then it dropped back down to $100 or $105. India is among the last major economies to raise fuel prices at retail. Diesel will now cost 90.67 rupies per litre in Delhi, and petrol will be 97.77 rupees. This represents a 3.4% increase and a 3.2% increase respectively from 87.67 rupies and 94.77 rupies per litre. According to Madhavi Arora of Emkay Financial Services in Mumbai, the direct impact on inflation will be about 15 basis points, but the indirect effect is much greater. The Indian Oil Corp., Hindustan Petroleum Corp. and Bharat Petroleum Corp., all state-run companies, control over 90% of India's fuel stations. The soaring?global oil prices have put a strain on the country's reserves of foreign currency. On Sunday, Prime Minister Narendra Modi called for a series of measures, including fuel conservation and work-from home practices. He also urged limits on travels and imports. Analysts and opposition parties said state retailers delayed raising prices while key state elections were taking place. Modi's BJP grew its influence after winning two out of four states in the polls that ended this month. Sujata sharma, a spokesman for the Oil Ministry in April, said that retailers lost about?20 per litre of petrol and?100 rupees when selling diesel. Nayara Energy, an Indian refiner with Russian backing, raised its pump prices in late March to offset some of the revenue losses it had suffered from retail sales.
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Oil prices rise more than 1% since Trump brought up China's interest to US oil supplies
Oil prices rose more than 1% as a result of?President Donald Trump's statement that China wanted to buy oil from?the United?States. Also, concerns about ship attacks and securing?ships remained despite Iran claiming 30 vessels passed through the Strait of Hormuz. Brent crude oil futures climbed $1.17 or 1.11% to $106.89 a bar by 0252 GMT. U.S. West Texas intermediate futures rose by $1.10 or 1.09% to $102.27. Trump said in a Fox News interview that he would be less patient with Iran and urged Tehran to make a deal with Washington. On Thursday, a ship reported to be seized by Iranians off the United Arab Emirates was reportedly heading for Iranian waters. Meanwhile, the White House stated that U.S. president Donald Trump and Chinese president Xi Jinping 'had agreed on the necessity of keeping the Strait of Hormuz Shipping lane open. A cargo vessel from India, carrying livestock to the United Arab Emirates from Africa, was also sunk in the waters near the coast of Oman on Wednesday. Iran's Revolutionary Guards reported 30 vessels have crossed the Strait of Hormuz as of Wednesday evening. This is still short of the 140 vessels that would normally cross the Strait of Hormuz daily prior to the war but it represents a significant increase, if confirmed. Yang An, an analyst at Haitong Futures said that the main driver for oil prices is still tight supply. He said that the oil prices fluctuated several times yesterday, but closed at or near their day's highest price. "Ships crossing the strait eased some market concerns but not enough to reverse the strong trend caused by tight supply." Trump and China's Xi Jinping - who have been on a two day?state trip that has included pomp and business deals - will meet to conclude their visit. In an interview with Bloomberg, U.S. trade representative Jamieson Greer stated that China was'very pragmatic in its involvement with Iran and that it is important to China for the Strait of Hormuz to remain open. Reporting by Mohi N. Narayan from New Delhi, and Sam Li, Lewis Jackson and Himani Sarkar in Beijing. Editing by Jamie Freed & Himani Sarkar.
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Gold prices drop on inflation worries fueled by oil; gold markets watch Trump-Xi talks
Gold?fell on Friday to a lower level than one week ago and?was destined for a weekly drop as rising energy prices fueled inflation fears and extended higher interest rates. Investors were focused on the meeting of U.S. president Donald Trump with Chinese president Xi Jinping. By?0205 GMT the spot gold price was down by 0.8% to $4,613.19 an ounce, its lowest since May 6. Bullion is down 2.1% this week. U.S. gold futures for June delivery fell 1.4% to $4 619. Dollar has gained more than 1% this week. This makes greenback priced bullion costly for holders of currencies other than the dollar. Tim Waterer is the chief market analyst for KCM Trade. He said that "gold has been hit on all sides. Rising oil prices have brought inflation to the forefront and pushed yields up, making the dollar stronger. The yellow metal has become the unfortunate victim of a renewed scepticism about rate cuts in the market." The yields on the benchmark 10-year U.S. Treasury note rose to an almost one-year high. This increased the opportunity costs of gold. Brent crude oil prices rose 5.5% in the past week and hovered above $106 per barrel as the Iran War drags on. This has kept the Strait of Hormuz, which is a key shipping route, largely closed. Since the U.S. - Iran conflict began late in February, gold has dropped about 13%. This is due to the rising energy prices which have raised inflation fears and the possibility of higher U.S. rates. This week, a series of inflation reports showed that the risk was high that rising energy costs would spread to other goods and service. Gold is often seen as a?hedging against inflation. However, the high interest rates can weigh down on this non-yielding asset. Trump and Xi Jinping will meet in the evening to conclude a two-day visit to China that included a lot of pomp and business, but also a warning by Xi about the potential for a spiraling relationship if the Taiwan issue is not handled correctly. Silver spot fell by 3.1%, to $80.93, platinum dropped 1.7%, to $2,021.75, while palladium fell 0.9% to $1,423.75. (Reporting and editing by Rashmi aich in Bengaluru)
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Australian shares rise on the back of tech and banks, but a weekly drop is looming
Australian shares rose on Friday as banks and 'tech stocks' gained, but remained on course for a weekly loss, with gains limited by miners - and investor focus on the upcoming Beijing summit between U.S. President Trump and his Chinese equivalent, Xi Jinping. S&P/ASX 200 rose 0.5% by 0044 GMT to 8,681.6. The benchmark index, which fell 0.1% on Friday, is on course for a loss of 1.3% on a weekly basis. Financials rose 1.9% on Friday, continuing its gains for a second consecutive day. However, it was set to have its worst week ever since mid-November after losing 3.6%. This sub-index suffered from the Federal Budget this week, which dampened sentiment about mortgage growth - an important profit driver for banks. Commonwealth Bank of Australia, the top lender in Australia, rose by over 3% on April 8th. This is its largest % gain for a single day since April 8. The rest of the four "Big" banks traded in green. Investors will also be watching the talks between Australia's major trading partners who met on Friday to conclude a two-day visit. The benchmark index gained 4% more after tech stocks. The sub-index followed its Wall Street peers, who gained on the tech rally. Copper prices fell, but iron ore prices were unchanged. The heavyweight index was about to have its worst day for over two weeks but was also on track to post a weekly increase of over 2%. Rio Tinto and BHP, the two biggest players, have both fallen from record highs. They fell by 1.9% and 1,4% respectively. Gold stocks fell 1.5%, as bullion price declined. The benchmark S&P/NZX 50 Index in New Zealand was down by 0.1% at 13,015.89.
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Bloomberg News: US Trade Representative Greer says that chip export controls are not a major issue in China's talks with the US.
U.S. trade representative Jamieson Greer said in an interview with Bloomberg TV on Friday that U.S. controls on exports of semiconductor chips were not a main topic during discussions between Chinese officials and U.S. officials. These comments indicate that a breakthrough in selling Nvidia’s advanced H200 chip to China is still far off, despite Nvidia CEO Jensen Huang’s last-minute invite to U.S. president Donald Trump's Beijing visit this week. This was not the main topic of discussion during the bilateral meeting. We didn't discuss?chip export control at the meeting," Greer stated, adding that between "15 and 17" U.S. Chief Executive Officers were present at Thursday's summit between Trump and Xi Jinping. Reports claim that the U.S. has cleared 10 Chinese companies, including Alibaba Tencent, and Bytedance to purchase?H200s. However, not a single H200 has been delivered. The Trump administration approved exports of H200s to China in December, and added additional conditions in January. Greer said that China's decision to allow the import of H200 would be "sovereign?decision". "They're fluid, right? They change with time. "It depends on the threats that you perceive, what is commercially available around the world, and what Chinese technology can do," Greer said. "You want to strike a balance in terms of national security and protecting high-tech, while also ensuring that we benefit from overseas markets." These are the types of factors that were considered when deciding whether or not the Chinese would buy the H200. Chinese AI firms like DeepSeek are increasingly claiming their reliance upon domestic chips. However, U.S. curbs on chip production continue to stifle Beijing's efforts to achieve self-sufficiency at a time when domestic fabs struggle to increase output. In recent months, computing power shortages forced many Chinese AI models to restrict user access. However, Chinese policymakers worry about the deepening dependence on U.S. chip suppliers. They view this as a vulnerability in their supply chain. Former Biden administration officials and hawkish U.S. legislators have claimed that China could catch up to the U.S. on frontier AI by selling "advanced AI" chips. This would also advance China's militaristic ambitions. "They make their own decisions." Greer said that they were "very committed" to?domestic?production. They often view U.S. high-tech as a threat because, if we are ahead of the curve like we are with AI chips on some occasions, they may feel that this can hinder their own growth.
The equity party is ruined by the morning bid in Europe-yield surge
Stella Qiu gives us a look at what the future holds for European and global markets.
Investors in stocks are finally waking up. Since weeks, the bond market has sounded an alarm - "runaway inflation" means that rate hikes are back on the table.
The AI-fueled rally is running out of steam. Wall Street may be at new highs thanks to a 4% rise in Nvidia after CEO Jensen Huang accompanied Trump to Beijing. But it's a sea red in Asia.
Nikkei, the Japanese stock market index, fell more than 1% following the biggest producer price jump in three years. This boosted bets that Bank of Japan would hike rates in June. South Korea's KOSPI fell over 3%. Europe faces a drop of around 1% at the opening.
The Strait of?Hormuz is looming large over all of this. Iran claims that 30 ships have made it through the Strait of Hormuz, but this is still a trickle in comparison to normal pre-war traffic. Trump is showing signs of impatience after his talks with Beijing.
There are increasing concerns that the Strait will remain choked past June, draining the global reserves and causing a full-blown oil crisis.
Bond markets are already bracing for smart money. The soft U.S. Treasury Auctions this week are the "warning shot", highlighting fading investors' appetite as inflation rises.
For the first time in 2007, the latest 30-year sale was cleared at 5%. Yields reached 5.061%, a 10-month-high on Friday. Even the front end isn't secure, with the two-year pushing to 4,055%, an one-year high.
The Federal Reserve's policy is being re-pricing rapidly as oil prices continue to rise and consumers are still spending. Even under Trump's choice to lead the Fed, Kevin Warsh, the odds of another rate hike this year more than doubled to 45% in just a week.
Investors might not want to dial it back too much as they head into the weekend.
The following are key developments that may influence the markets on Friday.
Trump to conclude his State visit to China
(source: Reuters)