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Gold prices rise on trade tensions and a weak dollar
The gold price rose on Tuesday due to global trade tensions, the weaker dollar and tensions between U.S. companies and their main trading partners. After hitting its lowest price since March 13, gold spot rose by 0.8% at 0847 GMT to $3,005.21 per ounce. U.S. Gold Futures rose 1.6% to $3.020.70. Spot gold is still nearly 15% higher than last year, driven by geopolitical, economic, and central bank uncertainty, as well as increased flows to gold-backed ETFs. Zain Vawda is an analyst with MarketPulse, by OANDA. He said that the gold price has been regaining momentum due to a lower dollar and the persistent uncertainty around trade war developments. The U.S. Dollar Index has dipped, making greenback priced bullion cheaper for overseas buyers. China has refused to submit to the "blackmail" of the U.S., as a trade war sparked by President Donald Trump’s tariffs shows no signs of abating. The European Commission announced that it offered a "zero for zero" tariff deal. However, the European Commission responded with 25% tariffs against some U.S. imported goods. "If tariffs create further uncertainty for market players alongside the anticipation of rate cuts, then this combination could pave a way for a new rally in gold price," Vawda said. The market will closely monitor the minutes of the U.S. Federal Reserve’s latest policy meeting, due on Wednesday. 40% of traders expect the Fed to cut rates by 97 basis points by the end the year. In a low-interest rate environment, zero-yield gold tends to flourish. Ricardo Evangelista is a senior analyst with brokerage firm ActivTrades. He said, "The $3,000 level is a psychologically important level, so it's incredibly important right now... and if it passes through the resistance of $3,050, then I see it reaching $3,100." Silver spot rose by 0.4%, to $30.24 per ounce. Platinum gained 1.1% at $923.10 while palladium was up 0.1% at $919.78. (Reporting and editing by Shailesh Kuber in Bengaluru)
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China's State Asset Regulator will support companies with share buybacks
China's regulator for state assets announced on Tuesday that it would help central government-owned firms increase their stock holdings, and buy back shares to reduce the impact of a escalating trade war in the world on the stock market. Sinopec and other state-owned Chinese companies have announced plans to purchase shares in order to boost investor confidence. In a press release, the government's Assets Supervision and Administration Commission will guide state-owned companies and their listed subsidiaries in order to protect the rights and interest of shareholders and consolidate market confidence in listed firms. The U.S. President Donald Trump imposed additional tariffs on Chinese goods of 34% last week as part of the steep levies that were imposed against most U.S. trading partners. This brings the total tariffs on China for this year to 54%, and sends global stock markets into a tailspin. In response, the Chinese government has increased its efforts to protect its economy from the turmoil on global markets. Trump also threatened to impose an additional 50% tariff on Chinese goods if China did not remove the 34% levies it announced on U.S. products last week. The benchmark Shanghai Composite Index in China edged upwards on Tuesday after plummeting by more than 7% just the day before. (Reporting and editing by Farah master and Yukun zhang; Rachna uppal)
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Asian stocks are up, and so are major Gulf markets.
The major Gulf stock markets rose early on Tuesday following gains in Asian stocks, recovering from a global selling off on hopes that the United States would be willing to negotiate its high import tariffs. Saudi Arabia's benchmark Index advanced 2% on track to extend gains made in the previous session. This was led by Al Rajhi Bank's 2.3% increase and Saudi National Bank's 2.1% rise. Saudi Aramco, the oil giant, rose by 1.2%. The Saudi index fell 6.8% on Sunday, its largest one-day drop since the beginning of the COVID-19 Pandemic in 2020. A survey revealed that the non-oil sector of the private sector in the Kingdom grew rapidly during March, with new orders being boosted by the lower prices and improving economic conditions. However, the rate of growth has slowed down from the near-14-year-high reached in January. Dubai's main stock index rose 1.9%. Blue-chip developer Emaar Properties rose 1.7%, and sharia compliant lender Dubai Islamic Bank jumped 2.4%. In Abu Dhabi the index rose by 1.3%. Oil prices, a key catalyst for Gulf financial markets, were up about 1%. They had fallen to a four-year low the previous session, on fears that U.S. Tariffs could depress demand, leading to a recession worldwide. Analysts warned, however, that downside risks still remain. Qatar National Bank, the largest lender in the Gulf, increased 2.8%.
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Saudi's Ma'aden weighs foreign partner for minerals processing pact
Three sources familiar with the matter have confirmed that Saudi Arabia's Ma'aden, the country's largest mining company, is looking at forming a rare-earths processing partnership. The kingdom wants to be a global hub for critical minerals. Sources said Ma'aden was considering a partnership with MP Materials in the United States, China's Shenghe Resources or Australia's Lynas rare earths, as well as Canada's Neo Performance Materials. According to sources who weren't authorized to speak publicly about the discussions, Ma'aden intends to select at least one partner before the end of the month to assist in developing plans for a rare-earths processing facility, and ultimately a magnet plant, within the kingdom. Details of the selection process have never been revealed before, but it shows how minerals processing has become a necessity in tech-focused countries that want to build their own building block for artificial intelligence, electrical vehicles, and other sectors. Saudi Arabia's mining industry has grown rapidly and is an important part of Crown Prince Mohammed Bin Salman’s Vision 2030 plan to diversify Saudi Arabia's economy. The country and its mining companies are looking at projects to mine and refine minerals such as lithium, copper and zinc, which is used to produce magnets for electric vehicles, cell phones, and other devices. Ma'aden MP and Ma'aden declined to comment. Shenghe and Neo didn't respond to comments. Lynas stated that it was focused on rare-earths processing projects in Australia and Malaysia, as well as the United States. It also said that it "regularly held discussions with emerging rare-earths companies around the globe." Ma'aden and the selected partner will then study the best way to mine and process Saudi Arabia’s vast reserves of rare earth minerals. This is expected to be completed by December this year, according to one source. Shenghe, Neo, and MP have the most expertise in rare earths processing, and magnet production. However, MP is working to increase both within the United States. Lynas refines rare earths and processes them in Malaysia. Scientists are pushing for better processes to refine rare Earths because the standard method can be messy, expensive, and time-consuming. The geology of a rare earth deposit can lead to 17 different metals that are all nearly the same size, atomic weight and density, which makes separation difficult. These rare earths have to be separated in a certain order. This is a challenge for Ma'aden or any potential partner, as it would make it impossible to pick and choose the elements that they want. MP, who supplies Shenghe rare earths for processing in China from its California mine, invested with Shenghe 2023 in a Vietnamese facility to process rare earths. Both companies announced earlier this year that they intended to dissolve their partnership. CHINA'S UPPER HANDS According to the International Energy Agency, China began rapidly expanding the industry in the 1980s. It now controls almost 90% of the global capacity for rare earths refinement. Since 2023, geologists from the China Geological Survey, a state-controlled organization in China have been mapping Saudi Arabia's minerals reserves. China's mineral prowess has helped propel its economy to second place in the world. The U.S., among others, have acknowledged this and are trying to change it, particularly after Beijing banned exports of rare earths technology processing in 2023. Beijing imposed export restrictions last week on rare earths as well as magnets and finished products. Last month, U.S. president Donald Trump invoked his wartime powers in order to boost American metals refinery. Saudi officials nearly doubled last year their estimate of the kingdom's mineral reserves, bringing it to $2.5 trillion. This increase was largely due the additions of rare earths. According to one source, Riyadh wants to process the rare earths into a form which can be used for electronics in the Kingdom and doesn't want the supply chain exported anywhere else. BROAD INVESTMENTS This is just one of Riyadh’s recent efforts to enter the minerals supply chain. Global Supply Chain Resilience Initiative is a government program that falls under the National Investment Strategy of Saudi Arabia. Last November, it announced plans to invest 35 billion Riyals ($9.32 billion), in copper refineries and smelters from India's Vedanta, and a zinc-smelter by China's Zijin. Saudi Arabia's sovereign fund is the biggest shareholder in California-based EV maker Lucid. In 2023, Lucid will open its first factory outside of the U.S. Hastings Technology Metals, based in Australia, has signed a memorandum-of-understanding with the National Investment Strategy to explore a rare earths facility. Last year, Critical Metals of the United States signed a MOU that was non-binding to explore construction of a Lithium refinery in Saudi Arabia. The company is based in Riyadh. Ma'aden - a company controlled by the Saudi wealth funds - announced in May that it had extracted lithium from seawater. It is now working on making the process commercially feasible. Reporting by Ernest Scheyder and Clara Denina; Editing by Veronica Brown, Nik Williams and Nita Williams
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TASS cites the head of Russia's central bank as saying that a fall in oil prices is a risk to the economy.
Elvira Nabibullina, governor of the Russian central bank, was quoted by the state news agency TASS as saying that the sharp drop in oil prices caused by Donald Trump's tariffs is a threat to the Russian economy. She was quoted saying that she was analyzing the fallout with the central bank, but that a technical rule for budgeting would help to smoothen the effects on the budget. Brent and WTI prices had fallen by 14% and 15 % respectively on Monday following Trump's announcement of "reciprocal duties" on all imported goods. "You're absolutely right, the main influence could be via changes in oil price. Specifically a reduction in oil price," Nabiullina told members of the Russian lower chamber of parliament. She said that if tariff wars continue to escalate, they will lead to a decrease in global trade and the global economy. They may even reduce the demand for energy. Last week, the central bank stated that U.S. Tariff hikes could slow global economic growth and fuel inflation. Oil prices may also be lower than expected for several years due to reduced demand globally. The central bank predicts that the average price of oil will be $60 per barrel by 2026 and $65 per barrel in 2025. The central bank's board will review the forecasts on April 25, 2019. Reporting by Elena Fabrichnaya; writing by Gleb Brianski; editing by Andrew Osborn
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Dalian iron ore falls to a five-month low due to Sino-US tariff tensions
Iron ore futures declined for a third consecutive session on Tuesday, as the escalating tensions in trade between the U.S. The price of the most traded May iron ore contract at China's Dalian Commodity Exchange dropped by 3.15%, finishing at 738.5 Yuan ($100.73). In the early part of the session, the prices reached 735.5 Yuan, their lowest level since November 19, 2024. As of 0704 GMT, the benchmark May iron ore traded on Singapore Exchange had fallen 3.14% to $94.55 per ton. Atilla Wiednell, Navigate Commodities' managing director, said that iron ore futures had unsurprisingly responded to the tit-fortat trade measures taken by the two world superpowers. Beijing The Chinese government has vowed to fight to the bitter end, rejecting requests to remove its 34% tariffs on U.S. imported goods after President Donald Trump of the United States threatened to impose an additional 50% duty. If imposed, the new levy could bring total U.S. tariffs on Chinese products to 104%. Hexun Futures, a broker, says that the global outlook has fallen, and the higher than expected U.S. Tariffs could affect steel demand in the manufacturing sector. According to data collected by Chinese consultancy Mysteel, the total production of iron ore concentrations in domestic mining companies reached a new high. Coking coal and coke, which are used to make steel, also fell, by 4.68% and 40.88% respectively. The Shanghai Futures Exchange saw a decline in most steel benchmarks. Rebar dropped nearly 1.3%; hot-rolled coils fell 1.9%; stainless steel declined 1.2%; and wire rod was flat. Widnell said that the latest escalation of U.S. initiated trade measures increases the likelihood of China releasing further stimuli. $1 = 7.3316 Chinese Yuan (Reporting and editing by Sherry Jab-Phillips, Sumana Nady).
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Tronchetti Provera: Sinochem's share in Pirelli is affecting the US business of the company
Marco Tronchetti Provera, executive vice chairman of the Italian tyremaker, said that Pirelli has difficulty investing in the United States as its largest shareholder is China’s state-owned Sinochem in a newspaper article on Tuesday. Pirelli's Chinese shareholders and Italian investors are in disagreement over the group's management as Washington clamps down on Chinese tech in the auto industry by banning software and hardware. Tronchetti Provera, a journalist for the Italian newspaper La Repubblica, said that Sinochem's stake of 37% had been a problem when Pirelli was negotiating with local authorities about doing business in Alabama and Virginia. "Now, we are negotiating in Georgia, where there is already a factory and objections have been raised once again," said Tronchetti, Provera who was Pirelli CEO from 1980 to 2022. Tronchetti said that he believed an agreement could be reached between Sinochem and the U.S. to address their concerns. He said, "We will find ways to comply with American law in the interest of Pirelli." It is too important for us to not be able play on an equal playing field with our competition. (Reporting and editing by David Goodman, Jamie Freed, and Gavin Jones)
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Wall Street Journal, April 8,
These are the most popular stories from the Wall Street Journal. These stories have not been verified and we cannot vouch their accuracy. PNC Financial Services Group appointed Mark Wiedman, a former BlackRock executive, as its president on Monday. Apple intends to send more iPhones from India to the U.S. to offset the high tariffs on China, according to people familiar with the situation. According to a memo by Chief Executive Tobi Lutze, Shopify will not hire new employees unless their managers can prove that artificial intelligence cannot do the job. Iran's Foreign Minister Abbas Araqchi announced on Tuesday that the United States and Iran will hold indirect high-level discussions in Oman on 12 April. The President Donald Trump directed on Monday a U.S. National Security Panel to take another look at Nippon Steel’s bid to acquire U.S. Steel in order to determine whether "further actions" are appropriate. This has raised hopes that this deal may finally get the green light. The Supreme Court, with a 5-4 vote, lifted an order from a judge that blocked the deportation to a Salvadoran jail of suspected Venezuelan gangsters. It also granted the Trump Administration's request for expedited removals in accordance with the 18th century Alien Enemies Act.
US Supreme Court limits EPA's power to regulate water pollution discharge
The U.S. Supreme Court delivered a major blow to the Environmental Protection Agency on Tuesday in a case involving a wastewater-treatment facility owned by San Francisco. This ruling could make it more difficult for regulators and law enforcement to monitor water pollution.
In a decision of 5-4, the justices ruled that the EPA had exceeded its authority in a landmark antipollution act by including vague restrictions on a permit for the wastewater treatment plant, which empties directly into the Pacific Ocean. The city sued the EPA to challenge its restrictions.
The decision, written by conservative Justice Samuel Alito in San Francisco, overturned a ruling by the 9th U.S. Circuit Court of Appeals. Circuit Court of Appeals had previously upheld the permit.
Alito wrote in his letter that the EPA had exceeded its authority under the landmark Clean Water Act (1972) by imposing on permit holders undefined standards for water quality within the receiving water body.
Alito wrote: "This case involves provisions which do not specify what a permittee is required to do or refrain from; they instead make the permittee accountable for the quality in the water of the body of water that the permittee discharges contaminants into."
Alito said that "when a permit has such requirements, the permittee who follows the permit to the letter may still face crushing penalties" if the water quality in the receiving waters is below the standards.
State water quality standards must be approved by the federal government.
Amy Coney Barrett, a conservative justice on the court, wrote a dissent to which three members of the liberal court also signed.
Barrett wrote that "EPA must issue the limits necessary to ensure the water quality standards have been met." If EPA is denied a tool, it may be harder for them to issue permits to municipalities and businesses to ensure that their discharges are legal.
In recent years, the Supreme Court has weakened the EPA’s power as part of a number of rulings that have lowered the federal regulatory agencies’ authority.
(source: Reuters)