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London court approves UK's Thames Water Debt Lifeline
The court approved a debt relief of 3 billion pounds ($3.8 billion), preventing the nationalisation of Britain's largest water provider in the short-term and giving the company time to fix its finances. The government is ready to place Thames Water in special administration. Thames Water has 18 billion pounds of debt and needs temporary nationalisation in order to keep the taps running in the event of a financial collapse. The public is angry at the privatised water sector in the country, which they blame for polluting the rivers with sewage. The government is focused on reforming this sector and wants Thames to be free from administration. The judge approved the debt lifeline provided by senior creditor. It will provide Thames with an initial amount of 1.5 billion pounds, plus the possibility of another 1.5 billion. This will extend its funding to May 2026. The company had said that it would have been out of money in six weeks without the approval. However, the new debt package was controversial. The new debt package was controversial. A group of lower ranking creditors were against it. They called its interest rate of 9.75% too expensive. Thames Water has 16 million customers and despite the rescue package, it still faces multiple challenges in order to survive past 2026. To avoid millions of fines, it must raise more than 3 billion pounds as new equity and restructure debts. It also needs to improve its infrastructure and its environmental performance. The price that Thames Water can charge its customers in the next five-year period is a complicating factor for investors. The regulator said that the company could raise its bills by 35% in this time period, which is less than the 53% increase it claims it needs. The company filed an appeal on February 14, attempting to improve terms. The rescue package came from a group including Abrdn and Elliott Investment Management in London, M&G, PIMCO, M&G, and Invesco. $1 = 0.7931 pounds (Reporting and editing by Mrigank Dahniwala, Kate Holton and Sam Tobin in London; Yadarisa Shabbong in Bengaluru)
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Samurai loan raised by Czech investor Kretinsky’s EPH for the first time, $527 million
The Czech energy group EPH is controlled by billionaire Daniel Kretinsky. As part of its efforts to diversify access to funding, the company announced that it raised its first Japanese lending facility worth 80 billion Japanese yen (527 million dollars). EPH announced in a Monday statement that the so-called Samurai Loan matures in Febuary 2030, and will pay an interest margin 160 basis points above the Tokyo overnight average (TONAR) rate. The loan was coordinated by SMBC Group. In a press release, Vice-Chairman Pavel Horsky stated that "we are pleased to have raised our first Samurai loan. This is an important milestone for the diversification of EPH’s funding model." Horsky said that it was the biggest debut of a corporate borrower on the Samurai Loan market since the global economic crisis. Kretinsky is a 49-year old former lawyer in an investment bank who has grown Energeticky a Prumyslovy Holding into one of Europe’s largest energy groups. He also expanded his investments in retail, media, and other areas in Europe over the past few years. EPH reported earnings of 3.6 billion euro ($3.76 billion), before interest, taxes, depreciation, and amortization (EBITDA), on revenues of 24.2 billion euro in 2023. (1 dollar = 151.8500 yen; 1 euro = 0.9563 euros) (Reporting and editing by Clarence Fernandez).
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Indian exports are uncertain due to Trump's tariffs
Citi Research analysts estimate that potential losses could be as high as $7 billion per year. Officials from the government are waiting for details on how tariffs will work before they can fully assess their economic impact. They have also been working to develop a U.S. Trade Deal to reduce tariffs and increase two-way trading. The impact of reciprocal tariffs in India is summarized below. SECTORS at Risk Citi analysts state that chemicals, metals and jewellery are the most vulnerable, followed by pharmaceuticals, food products and automobiles. India's merchandise exported to the United States is estimated to be nearly $74 billion by 2024. This includes pearls, gemstones and jewellery valued at $8.5 billion; pharmaceuticals worth about $8 billion; and petrochemicals of around $4 billion. Citi estimates that India's tariffs for Indian exports will be around 8.2 points higher in 2023 than the U.S. US Exports to India U.S. manufacturing exported to India will be worth nearly $42 billion by 2024. The tariffs are significantly higher, from as little as 7% for wood products and machinery, to as high as 15%-20% on footwear, transport equipment and food. The White House stated in a factsheet last week that the average tariff applied by the U.S. on farm products was 5%, compared with India's 39%. It added that India imposed a tariff of 100% on U.S. Motorcycles, while the U.S. only imposed a tariff of 2.4% on Indian Motorcycles. AGRICULTURE SECTOR India's food and farm exports, where the tariff differentials are highest but the trade volume is low, would be the most affected if the United States decided to impose reciprocal duties on a wider range of agricultural products. PRODUCTS MADE FROM TEXTILE AND LEATHER, AS WELL AS WOOD Textiles, leather, and wood products, which are labour-intensive, face a relatively lower risk due to lower tariff differentials or the limited share of U.S. India trade. Many American companies also produce these products in South Asia, and they benefit from India's Free Trade Agreements. This allows them to sell the products on their domestic market with lower tariffs. WORST CASE SCENARIO Standard Chartered Bank's economists estimate that in the worst case scenario, if the United States imposes a uniform 10% tariff on all goods imported from India, the Indian economy would suffer a 50- to 60-basis point hit, assuming a drop of between 11% and 12% of imports. What India can offer India has reduced tariffs to ease tensions over trade. For example, it has cut the tariff on high-end motorbikes to 30% from 50%, and on bourbon whisky to 100% from 150%. It also promised to review other tariffs and increase energy imports and buy more defence equipment. (Reporting and editing by Clarence Fernandez; Manoj Kumar)
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Europe stocks continue record run on defence sector boost
The European share market reached a new high on Tuesday, as defence stocks rose on the prospect of higher military spending in the area. However, a Capgemini led drop in IT shares capped the gains. The STOXX 600 pan-European index rose by 0.2%, to a new record of 555.42. The aerospace and defense index jumped 1%. After European Commission President Ursula von der Leyen announced that the Commission would propose an exemption for defense spending from EU budget limits, the sector grew by 4.6% Monday. This is its largest one-day increase since Russia invaded Ukraine, in February 2022. Defense stocks gained on Tuesday. Italy's Leonardo rose 1.4%; Sweden's Saab increased by 1%; and Britain's BAE Systems advanced 0.5%. Thyssenkrupp's warship division is being spun off and Thyssenkrupp has gained 2.7%. Its shares had risen nearly 20% Monday. Capgemini, on the other hand, fell 6.2%, despite the fact that the French IT giant had reported an annual sales decline of 2%, which was above expectations. IHG, owner of Holiday Inns, has lost 1.3% since the release of its results for 2024. Antofagasta's core profit increased by 11%. (Reporting and editing by Savio d'Souza in Bengaluru, Pranav Kashyap from Bengaluru)
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Antofagasta mine's core annual profit increases by 11%
LONDON, February 18 - Chilean Copper Miner Antofagasta reported an 11% increase in annual core profits on Tuesday, thanks to higher metal prices. EBITDA (earnings before tax, depreciation, and amortization) for the entire year increased to $3.43 from $3.09 billion one year earlier. The proposed final dividend by the copper miner of 23.5 cents per share represents a payout of 50% of the underlying earnings. Antofagasta paid out a record amount of $1.4 billion to shareholders in 2021. This was 142.5 cents per share. Its policy is that at least 35% net profits are returned to shareholders. The company reported a capital expenditure of $2.4billion last year and expects this to rise to $3.9billion in 2025 as it works on the Centinela concentrator's peak. The Luksic family of Chile, which owns the majority of the company, operates four mines in South America. The share prices of pure-play miners will rise in 2024 due to the booming demand for copper used in solar panels, electric vehicles and other energy transition applications. Antofagasta shares rose 15% in the past year. In a recent statement, CEO Ivan Arriagada stated that he was encouraged by the prospects for copper, as global constraints such as ore hardness, grade decline and capex inflation are slowly limiting current supply expansions. (Reporting and editing by Clara Denina and Shashwat Arriagada)
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Anglo American sells nickel business up to $500 Million
Anglo American announced on Tuesday that it would sell its nickel mining business to an MMG Ltd unit listed in Hong Kong for up to $500m. A broader restructuring is underway to focus its operations on iron ore and copper. Nickel business in Brazil includes two ferronickel projects and two greenfields. Anglo will receive $350 million upon completion, up $100 million as a price-linked gainout, and an additional $50 million for potential project development, according to a company statement. Together, the assets produce around 38,000 metric tonnes of nickel each year. In January, the metal's price fell to a record low of four years as Indonesia became a major producer. Anglo American, a London-listed company, rejected a hostile bid of $49 billion from BHP in May. BHP was focusing on Anglo’s copper assets. Duncan Wanblad, CEO of Anglo American, said: "We unlock the inherent value in all of Anglo American by creating a simpler business that is more resilient and agile. This will allow full value transparency on the market." Anglo said this week that the spin-off from its platinum unit in South Africa would be completed by June, ahead of its financial results due on February 20. Anglo sold coal assets worth $4.9 billion as part of its restructuring and plans to divest De Beers.
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Iron ore prices rise as China's demand is a major factor.
Iron ore futures rose on Tuesday as expectations of a stronger stimulus package from China, the world's largest consumer, and improved downstream steel demand boosted sentiment. The May contract for iron ore on China's Dalian Commodity Exchange ended the daytime trading 2.51% higher, at 818 Yuan ($112.34) per metric ton. As of 0718 GMT, the benchmark March iron ore traded on Singapore Exchange recovered an earlier loss and jumped 1.18% to $106,95 per ton. Analysts in Shanghai and Singapore said that the volume of transactions for steel products in Hangzhou, east China, exceeded expectations. This boosted sentiment and sent ore prices up. They both requested anonymity because they were not authorized to speak with media. Analysts at ANZ also noted that there is speculation about the upcoming "Two Sessions", which will be held in China, providing more proactive policies aimed to stimulate consumption. Two parallel sessions of "Two Sessions" will be held in Beijing, China next month. "With the resumption in exports from Australia’s largest iron ore port the market has shifted its focus on broader demand dynamics," ANZ said. Prices fell on Monday as iron ore shipments to Australia increased after major ports reopened following the tropical cyclone Zelia. GF Futures analysts believe that a slow recovery of ore demand is likely to keep ore prices from rising. They also expect hot metal production, a measure of iron ore consumption, to remain at a level similar to the assessment of consultancy Mysteel as of February 14th. Coking coal and coke, which are used to make steel, also increased in price, by 1.34% and 1.61 %, respectively. The Shanghai Futures Exchange has seen a rise in most steel benchmarks. Rebar gained 1.3%, hot-rolled coil rose by 1.3%, wire rod grew by 0.31%, and stainless steel slipped 0.04%. Reporting by Amy Lv, Lewis Jackson and Sumana Nandy; Editing by Sumana Niandy. $1 = 7.2812 Chinese Yuan
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Copper prices are little changed as contract expires; US-Russian talks focus
The price of copper traded within a narrow range on Tuesday, as traders moved forward their positions in anticipation of a contract that expires this week. Meanwhile, the market's attention was shifted to U.S. efforts aimed at ending Russia's almost three-year long war in Ukraine. The London Metal Exchange's (LME) three-month copper traded flat at $9 398 per metric ton as of 0716 GMT. On Friday, the contract reached its highest level in three months at $9.684.50. A trader stated that "if the talks between the U.S.A. and Russia progress favorably, there will be an increase in the likelihood of lifting of the ban on metals from Russia, which would lead to a flood of Russian metals onto the western market." Russia is one of the world's largest producers of nickel, copper and aluminium. The LME has banned Russian metals that were produced after or on April 13, last year. Later in the day, senior U.S. officials and Russian officials are expected to meet in Saudi Arabia for the first time in many years. This is ahead of the meeting between U.S. president Donald Trump and Russian president Vladimir Putin. The spread between cash LME copper and benchmark 3-month futures For the first time since 19 months, prices spiked on Friday to $249 per ton. Investors and traders completed rolling forward positions in anticipation of the contract expiration this week. Three sources said on Saturday that the U.S. proposed to take ownership of 50% Ukraine's essential minerals. Aluminium prices on the LME were down 0.3% at $2,637 per ton. Zinc was also down 0.3%, to $2.864, while tin remained unchanged at $32,670. Lead was off 0.2%, to $1,988, and nickel was 0.7% lower, to $15,385. The price of aluminium at the SHFE fell 0.2%, to 20,665 Yuan ($2,839.18). SHFE copper was down 0.8%, to 76850 yuan. Nickel was up 0.2%, to 123 730 yuan. Zinc gained 0.3%, to 23,880 Yuan. Lead rose 0.1%, to 17,150 Yuan. Tin lost 0.8%, to 261,060 Yuan. $1 = 7.2785 Yuan (Reporting and editing by Sumana Nady and Subhranshu Saghu)
What Trump 2.0 could mean for trade, migrants, Ukraine and variety programs
Donald Trump's 2nd presidential term might have substantial implications for U.S. trade policy, environment modification, the war in Ukraine, electric vehicles, Americans' taxes and prohibited migration.
While a few of his campaign propositions would require congressional approval, here is a summary of the policies Trump has actually stated he will pursue after he takes workplace on Monday.
MORE TARIFFS
Trump has actually stated he will release executive orders on his very first day in office to impose a 25% tariff on all imports from Canada and Mexico if the two U.S. neighbors do not clamp down on the circulation of drugs into the U.S. and people entering the country unlawfully. The tasks might badly hinder the highly incorporated economies, where car parts can cross borders several times before last assembly. Trump has actually also called for an international tariff of a minimum of 10% on all goods imported into the U.S., a move he says would get rid of a. $ 1-trillion annual trade deficit. Critics say it would cause. higher prices for American customers and draw vindictive duties. on American exports.
Trump has said he should have the authority to set higher. tariffs on countries that have actually positioned tariffs on U.S. imports,. often grumbling about Europe's higher tasks on autos. At. times on the project path, he threatened tariffs of 200% on. cars made in Mexico, particularly if Chinese automakers launch. production there. Trump has actually targeted China in particular in an effort to decouple. the world's 2 biggest economies. He has actually proposed tariffs of. 60% or more on all Chinese imports, far above his first-term. tariffs, in part to phase out imports of Chinese electronics and. pharmaceuticals. He also has stated he wishes to prohibit Chinese. companies from owning U.S. real estate and facilities in the. energy and tech sectors.
MASS DEPORTATIONS
Trump has actually pledged to restore his first-term policies. targeting unlawful border crossings and to forge ahead with. sweeping brand-new restrictions.
He has pledged to restrict access to asylum at the U.S.-Mexico. border and to embark on the biggest deportation effort in. American history, which would likely activate legal obstacles. and opposition from Democrats in Congress.
He has said he will use the National Guard, and, if. needed, federal troops, to attain his goal, and he has. not dismissed setting up detention camps to process individuals for. deportation. Trump has stated he would look for to end automated citizenship for. children born to immigrants. While such a relocation would run versus. the long-running interpretation of the U.S. Constitution's 14th. Modification, Trump has stated he would think about trying to press. through a new change that would accomplish his goal. He is expected to attempt to withdraw protected legal status for some. populations such as Haitians or Venezuelans, but would attempt to. look for a congressional offer to protect Dreamers - kids of. moms and dads who came to the country unlawfully.
Trump states he will reinstitute a version of his travel ban. policy that restricted entry into the U.S. of people from. Muslim-dominant countries and other nations, and triggered. several legal fights throughout his first term. A few of Trump's earliest appointments showed a seriousness to. follow through on his migration program. Trump has named a. border czar, Tom Homan, and will make Stephen Miller, the. designer of his immigration strategies, a White Home deputy chief. of staff.
DRILLING AWAY. Trump has vowed to increase U.S. production of nonrenewable fuel sources by. relieving allowing and expanding drilling on federal land. He has. said he would support prevalent oil drilling in the Arctic. National Wildlife Sanctuary in Alaska. Trump has actually vowed to create a National Energy Council to. coordinate policies to improve U.S. energy production, led by his. pick for interior secretary, former North Dakota Governor Doug. Burgum.
Whether the oil market follows through and raises. production - which is currently running at record highs - remains. to be seen.
Trump is most likely to again pull the U.S. out of the Paris. climate offer, a framework for lowering international greenhouse gas. emissions, and would support increased nuclear-energy. production. He would also roll back Democratic President Joe Biden's. electric-vehicle requireds and other policies targeted at reducing. auto emissions.
Trump has argued the U.S. needs to increase energy production. to be competitive in developing artificial-intelligence systems,. which take in big quantities of power.
TAX RELIEF. Along with his trade and energy programs, Trump has guaranteed to. slash federal guidelines that he states limit task development. He. has pledged to extend personal income-tax cuts that he signed. into law in 2017 however which are because of end on Dec. 31, and he. has actually proposed a variety of individual and business tax cuts. beyond those enacted in his very first term.
Trump has actually promised to decrease the corporate tax rate from 21%. to 15% for companies that make their products in the U.S.
. He has actually said he would look for legislation to end tax of. suggestions and overtime incomes to help waiters and other service. employees. He has pledged not to tax or cut Social Security. benefits.
Trump also has actually stated he would press the Federal Reserve to. lower interest rates - however would stop brief of requiring it.
The majority of, if not all, of his tax propositions would need. congressional action. Budget plan experts have cautioned that the bunch. of tax cuts would swell the federal debt by trillions of. dollars over a years without cost savings elsewhere.
GETTING RID OF VARIETY PROGRAMS. Trump has promised to require U.S. colleges and universities to. protect American custom and Western civilization and to. purge them of variety programs. He said he would direct the. Justice Department to pursue civil rights cases against schools. that participate in racial discrimination.
At K-12 schools, Trump would support programs allowing. moms and dads to utilize public funds for private or religious. guideline.
Trump has actually likewise suggested abolishing the federal Department. of Education and leaving states in control of schooling.
NO FEDERAL ABORTION RESTRICTION
Trump appointed three justices to the U.S. Supreme Court who. were part of the bulk that reversed the court's landmark. Roe v. Wade choice that ruled there was a constitutional right. to an abortion. He likely will continue to select federal. judges who would promote abortion limitations.
At the exact same time, Trump has said a federal abortion ban is. unneeded which the concern must be dealt with at the state. level. He has argued that a six-week ban preferred by some. Republicans is overly severe and that any legislation should. include exceptions for rape, incest and the health of the. mother.
Trump has recommended he would not look for to restrict access to the. abortion drug mifepristone after the U.S. Supreme Court declined. a challenge to the federal government's technique to managing it.
He supports policies that advance in vitro fertilization,. birth control and prenatal care.
A PUSH TO END WARS. Trump has actually been vital of U.S. support for Ukraine in its war. with Russia, and has stated he might end the war in 24 hr if. chosen - although consultants concede it will likely take months. if not longer.
He has actually recommended Ukraine might need to yield some of its. territory if a peace deal is to be struck. Trump and his pick for national security adviser, U.S. Representative Michael Waltz, have slammed the Biden. administration's choice in November to allow Ukraine to use. U.S.-provided missiles to strike within Russian territory.
Trump has likewise said that under his presidency the U.S. would. fundamentally reconsider NATO's function and NATO's objective.
Trump named U.S. Senator Marco Rubio, a China hawk, as his. secretary of state, charged with performing his diplomacy. goals. Trump has backed Israel in its fight versus Hamas in Gaza and. hailed a ceasefire deal revealed on Wednesday that might see. the eventual withdrawal of Israeli soldiers from Gaza and the. release of captives recorded by Hamas.
Trump is most likely to promote historical normalization of. relations between Israel and Saudi Arabia, an effort he made. during his 2017-2021 presidency and which Biden has likewise. pursued. He has urged the U.S. to stay out of the dispute in Syria that. has seen long time leader Bashar al-Assad deposed.
Trump has actually suggested building an iron dome - a. missile-defense guard comparable to Israel's - over the entire. continental U.S.
Trump has actually likewise floated the concept of sending out militaries into. Mexico to battle drug cartels and utilizing the U.S. Navy to form a. blockade of that country to stop smuggling of the opioid. fentanyl and its precursors. His transition group has actually been drawing up lists of capacity. high-ranking U.S. military officers to fire as part of a purge. of the Pentagon of those believed to be disloyal to Trump.
EXAMINING OPPONENTS, ASSISTING ALLIES. Trump has promised sometimes to utilize federal law enforcement. agencies to examine his political foes, including election. officials, attorneys and celebration donors. Trump tapped previous Florida Attorney general of the United States Pam Bondi as his. chief law officer and previous national security assistant Kash Patel as. his option to lead the FBI. Both have expressed sympathy for. Trump's desire to precise retribution on some of his critics,. although Trump of late has said that he will not direct them on. how to do their jobs.
He has actually said he would think about shooting a U.S. lawyer who did. not follow his regulations - which would make up a break with. the longstanding U.S. policy of an independent federal law. enforcement apparatus. Trump has said he will likely pardon many of those who have actually been. convicted of crimes in connection with the Jan. 6, 2021, attack. on the U.S. Capitol. In December, he recommended members of the. congressional committee that examined the attack needs to be. imprisoned.
In addition to criminal examinations, he has recommended. using the federal government's regulatory powers to punish those he. consider as critics, such as television networks.
PURGING THE FEDERAL BUREAUCRACY
Trump would seek to decimate what he terms the deep state--. career federal workers he states are clandestinely pursuing. their own agendas-- through an executive order that would. reclassify thousands of employees to allow them to be fired. That. would likely be challenged in court. He has actually said he will set up an independent federal government efficiency. panel headed by billionaire fan Elon Musk and former. presidential candidate Vivek Ramaswamy to root out waste in the. federal government. The federal government currently has guard dogs such as. the Office of Management and Spending plan, and inspectors general at. federal companies.
Trump would punish federal whistleblowers, who are. generally protected by law, and would institute an independent. body to keep track of U.S. intelligence companies.
(source: Reuters)