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MUFG's climate loan fund has raised an initial $600 Million
Executives revealed that a climate finance platform, co-founded by MUFG (Japan's largest financial group), has raised $600 million in order to assist countries in developing markets to adapt to climate change impacts and reduce emissions. Bill Gates, a billionaire investor and business leader in Brazil, made the announcement as business leaders gathered ahead of COP30 climate talks. The GAIA Climate Loan Fund will support projects that build resilience in countries as extreme weather events like floods and droughts become more intense. Ariane Pvide, Director of Climate and Blended Finance, MUFG, stated in an emailed comment that "Adaptation Finance has become a hot topic at recent COPs." "We hope the closure of GAIA strengthens the argument for private capital focused on adaption as a blueprint for market." FinDev Canada (Canada's development finance agency) and the Green Climate Fund (the world's largest dedicated climate fund) also invested, with the goal of growing the fund to $1.5 billion. Amit Mohan is the Head of Private Credit at Climate Fund Managers. The fund's manager. In a press release, the fund's founders explained that it works by providing long term loans to state-owned, sovereign, sub- or quasi-sovereign entities in 19 countries. The money spent on adaptation, such as water management and sustainable agriculture, will be at least 70%, while the remainder is allocated to mitigation, such as renewable energies. It is expected to create 11,000 new jobs and benefit 19 million people, while avoiding 30 millions tons of greenhouse gas emissions per year. (Reporting and editing by Toby Chopra; Simon Jessop)
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Australia shares rise as Westpac shines, but gold stocks limit gains
Australian shares made modest gains on Monday as Westpac's record closing after a profit beating offset weakness in gold stock. Investors largely stayed the course ahead of this week's central bank policy decision. The benchmark S&P/ASX 200 index closed 0.2% higher, at 8,894.8. The benchmark index gained only 0.4% in October. Westpac's gain of 2.8% lifted heavyweight financials by 1.3%. Australia's third largest lender in terms of market value reported a modestly better-than-expected annual profit, sending its share price to a new record high. Investors look at the results to see if the trend and the net interest margins have improved. Lochlan Halloway is an equity market analyst with Morningstar. The benchmark index was also boosted by 2.3% at the top lender Commonwealth Bank of Australia. Gold stocks, however, saw a 1.4% drop, as the bullion price eased due to a stronger dollar, and a rising optimism in global trade. The two major gold producers, Northern Star Resources (Northern Star Resources) and Evolution Mining (Evolution Mining), lost 2.5% and 2.5% respectively. A 90% increase in the sub-index of gold this year is a result of an unprecedented rise in gold prices. This puts it on course for its best performance since its launch in about 20 years ago. Gold miners have fixed costs they must cover. Halloway explained that once they surpass the cash costs, they have more leverage over the gold price. The Reserve Bank of Australia is expected to meet on Tuesday, and will likely hold its key rate at 3,6%. Hotter than expected core inflation data from last week upset rate-cut bets. The benchmark S&P/NZX 50 closed 0.1% higher in New Zealand at 13,556.30. Reporting by Nichiket SUNIL in Bengaluru, editing by Eileen Soreng
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MORNING BID EUROPE - Private jobs on the spotlight amid data blackout
Ankur Banerjee gives us a look at what the future holds for European and global markets The markets are still recovering after a week of action packed events that have left the risk momentum intact. This week, the focus has shifted on a few private economic data that could shed light on the state of the U.S. labor market. The U.S. government shutdown is expected to continue, and there will no longer be any economic data from the government. So, no nonfarm payrolls, no JOLTS job openings. Investors will instead analyze private employment data provided by ADP in order to gauge the direction U.S. monetary policies. ADP's data will be released later this week. Investors are searching for answers due to a divided Federal Reserve. Fed Chair Jerome Powell shocked markets last week by expressing a hawkish attitude, suggesting that the recent rate reduction could be the final one of the year. Christopher Waller, the influential Fed governor, made a case for further policy easing on Friday to support a weakening labor market. CME FedWatch showed that traders are now pricing in only a 69% probability of a December rate cut, down from 90% one week ago. As Chinese stocks continue to fall, the afterglow from the much-anticipated trade truce has waned. This is the classic case of buying the rumour and selling the truth. Data released on Monday showed that China's factory output and new orders both declined amid the tariff fears. Meanwhile, big manufacturing hubs in other parts of the world also struggled to get going in October. Later in the session, markets will also be looking at similar reports from Europe. European futures indicate a higher opening, while the euro is hovering at a 3-month low. Powell's hawkish tones have helped boost the dollar, although analysts do not expect it to remain strong for very long. They suggest that data will soon reveal cracks in the largest economy of the world. Market developments on Monday that may have a significant impact Manufacturing data for October
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Investors reduce rate-cut betting as gold prices rise on stronger dollar
Gold prices held steady Monday as investors backed off their bets on further Federal Reserve rate reductions in the near future. Meanwhile, easing U.S. China trade tensions also dampened bullion demand. As of 0504 GMT, spot gold was unchanged at $4,000.65 an ounce. U.S. Gold Futures for December Delivery rose 0.4% to $4.010 per ounce. The dollar has risen to near a three-month high, and prices have fallen about 9% since the record high of $4381.21 set on October 20. Kelvin Wong, senior market analyst at OANDA, said: "There is a lack in upside momentum for gold due to technical factors. The dollar also remains resilient. This has a negative effect on gold." The Fed cut rates by 25 basis point on October 29, the second time in this year. However, Jerome Powell’s hawkish remarks following that cut cast doubt on further rate easing for 2025. CME's FedWatch Tool shows that traders now expect a rate reduction in December of 71%, down from 90% prior to Powell's comments. Gold that does not yield is a good investment in low interest rate environments and economic uncertainty. Investors are watching other economic indicators, such as the ADP U.S. Employment Data and ISM PMIs, this week to see if they can change the Fed's hawkish position. The safe-haven strategy has decreased at this time due to the de-escalation in U.S. China trade tensions. Wong added that it could be a shift towards a more risky play on the equity markets. Last week, U.S. president Donald Trump announced that he had agreed to reduce tariffs against China in exchange of concessions from Beijing on the illicit fentanyl market, U.S. soya purchases and rare earths imports. The price of palladium fell 0.1%, while platinum rose 1.5%, to $1,590.86. (Reporting by Ishaan Arora in Bengaluru; Editing by Subhranshu Sahu, Ronojoy Mazumdar and Harikrishnan Nair)
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Investors reduce rate-cut betting as gold prices rise on stronger dollar
Gold prices held steady Monday as the dollar strengthened. Investors were reducing their bets on further Federal Reserve rate reductions following Jerome Powell's recent hawkish comments. Meanwhile, demand for gold was also dampened by the easing of U.S. China trade tensions. As of 0250 GMT, spot gold fell 0.1% to $3.997.94 an ounce. U.S. Gold Futures for December Delivery rose 0.3% to $4.008.60 an ounce. The gold price has fallen about 10% since the record high of $4381.21 set on October 20, while the dollar is climbing to a three-month high. Kelvin Wong, senior market analyst at OANDA, said: "There is a lack in upside momentum for gold due to technical factors. The dollar also remains fairly resilient. This has a negative effect on gold." On October 29, the Fed cut interest rates for the second consecutive time by 25 basis points. CME's FedWatch Tool shows that traders now expect the Fed to cut rates in December by 71%, down from 90% before Powell made his remarks. Gold that does not yield is a good investment in low interest rate environments and economic uncertainty. Investors are watching other economic indicators, such as the ADP employment data or ISM PMIs, this week to see if they can change the Fed's hawkish position. Wong said that the safe-haven effect has diminished at this time due to the de-escalation in U.S. China trade tensions. It could also be a rotation to a play with much more risk in the equity market." Last week, U.S. president Donald Trump announced that he and Chinese President Xi Jinping had agreed to reduce tariffs against China in exchange of concessions from Beijing on the illicit fentanyl market, U.S. soya bean purchases, and rare earths imports. Silver spot rose 0.3% per ounce to $48,77, platinum was up 1% at $1,583,28, and palladium climbed 0.4% to $1439.21. (Reporting by Ishaan Arora in Bengaluru; Editing by Subhranshu Sahu)
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Shanghai copper continues to lose money on the back of weak China factory data
Shanghai copper continued to suffer losses from last week, as weak Chinese manufacturing data dampened sentiment. As of 0315 GMT, the most active copper contract traded on the Shanghai Futures Exchange fell 0.41%, to 86850 yuan (12,192.90 dollars) per metric tonne. Benchmark copper for the three months ended at $10,853.5 per ton. The copper price fell as factory activity in China, the world's largest metal consumer, remained low. The RatingDog PMI (Purchasing Managers' Index) compiled by S&P Global fell to 50.6 in the month of October, according to a survey conducted on Monday. This was below the polled expectation of 50.9. The official survey, published on Friday, showed that China's factory activities shrank for the seventh consecutive month in October. The official manufacturing PMI fell to 49.0, from 49.8 in Septembre. After months of trying to get ahead of potential U.S. Tariffs, the reading fell below expectations. The stronger U.S. Dollar also affected the market. This made commodities that are traded in the greenback costlier for investors who use other currencies. Last week, the U.S. Federal Reserve expressed reservations about cutting rates. This raised questions about whether a second cut in December is likely. The Yangshan premium on copper continued to be a factor in the decline of China's copper demand despite high prices. The price of copper, which is a reflection of the demand for it imported into China, was $36 per ton last Friday. This has dropped from $50 per ton one month earlier. Aluminium gained 0.78% among other SHFE base materials, while zinc rose 0.34% and tin grew 0.56%. Lead and nickel showed little change. Monday, November 3 DATA/EVENTS (GMT) 0850 France HCOB Manufacturing PMI Oct 0855 Germany HCOB Mfg PMI Oct 0900 EU HCOB Mfg Final pmi October 0930 UK S&P GLOBAL MANUFACTURING PMI Oct 1445 US S&P Global Manufacturing final pmi Oct 1500 US ISM Manufacturing oct. ($1 = 7.1230 Chinese yuan). Monday, November 3, DATA/EVENTS(GMT) 0850 France HCOB Manufacturing Mfg Oct 0855 Germany HCOB Manufacturing Mfg Oct 0900 EU HCOB Manufacturing Final PMI October 0930 UK S&P Global Manufacturing PMI final Oct 1445 US S&P Global Manufacturing PMI final Oct 1500 US ISM Manufacturing Oct ($1 = 7.1230 Chinese yuan). (Reporting and editing by Dylan Duan & Lewis Jackson.
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China's iron ore prices fall due to declining steel production and rising inventories
Iron ore prices weakened on Monday due to a decline in steel production in China and rising port inventories. There was also concern about a weakening of downstream demand. By 0240 GMT, the most traded January iron ore contract at China's Dalian Commodity Exchange fell by 0.75% to $791 yuan (US$111.05) per metric ton. The benchmark December Iron Ore at the Singapore Exchange fell 0.56% to $105.55 per ton. According to Mysteel, the capacity utilisation rate at Chinese blast-furnace steel producers fell by 1.3 percentage point to 88.6% on average, for the fifth consecutive week between October 24-30. Mysteel's data shows that the daily hot metal production, which is a measure of iron ore consumption, fell 1.5% from one week to another, reaching 2.36 million tonnes. Everbright Futures, a Chinese broker, predicted that overseas supply would continue to improve in November. Shipments and arrivals are expected to increase. Analysts from Galaxy Futures stated that while domestic steel production may improve in the fourth quarter of this year, the main issue is the rapidly declining end-user demand for iron ore. As part of China's government pledge to reduce the overcapacity, China's steel association, which is backed by the state, announced that its steel production would drop below 1 billion tonnes in 2025. SteelHome data shows that the total iron ore stocks across Chinese ports increased by 1.53% in a week to 135.6 million tonnes as of October 31. Coking coal and coke, which are both steelmaking ingredients, have lost ground. They fell by 0.5% and 1.06 %, respectively. The benchmarks for steel on the Shanghai Futures Exchange fell. Rebar fell 0.8%, while hot-rolled coils dropped 0.63%. Wire rod slipped 0.24%, and stainless steel declined 0.59%. ($1 = 7.1230 Chinese yuan) (Reporting by Lucas Liew; Editing by Subhranshu Sahu)
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Sources say that India's BPCL will buy Upper Zakum crude in December to replace Russian oil.
Two trade sources reported on Monday that India's Bharat Oil Corp bought crude oil in Abu Dhabi as part of a spot-tender to replace oil imported from Russia, after the U.S. imposed sanctions against two major Russian producers. They said that the Indian refiner bought 2 million barrels Upper Zakum crude to be loaded in December. ADNOC Trading is said to be the supplier of the cargo, according to a source. Washington imposed sanctions last week on Rosneft, and Lukoil - the two largest Russian oil companies - in an effort to increase pressure on President Vladimir Putin for ending the war in Ukraine. Last week, a BPCL spokesperson said that the company will only buy Russian oil from entities not sanctioned. BPCL purchases 2 million metric tonnes (14,66 million barrels), mainly Russian oil, from the spot markets every month. The source stated that BPCL hopes to continue buying Russian oil through non-sanctioned sources for half of the supply.
Draft shows that the EU is considering lowering its 2040 climate target due to forest CO2 absorption.
A draft EU compromise proposal revealed that the European Union was considering a clause to slow down its climate targets for 2040 if the forests of the countries were not able to absorb enough CO2 to reach the target.
The EU is trying to get their new climate target approved at a meeting of their climate minsters on November 4, just in time for Ursula von der Leyen, the President of the European Commission to not go empty-handed with other world leaders to the U.N. COP30 Climate Summit on November 6,
The EU is looking at various options and flexibilities to reduce the climate goal, which, according to the Commission, should be a 90% reduction in global warming emissions by 2040.
The latest draft of the negotiating agreement, which was seen on Sunday by, included a clause that stated that if forest and other land-based activity that absorbs CO2 emissions fail to meet the EU's target, it will be permitted to propose an "adjustment of the intermediate 2040 target that corresponds to and is within the limits" of any possible shortfalls.
It said that Brussels could respond by suggesting additional measures to get the forest sector on track with the emission goal.
This move is similar to a proposal by France made last week. As reported previously, France had called for an "emergency break" that would reduce the 90% target of emissions by 3% if the forests and land-use sectors fail to deliver.
In the past decade, Europe's forest and land use sector has absorbed less CO2, mainly due to wildfires and inefficient forest management.
In previous drafts of negotiations, it was revealed that countries had already considered allowing the EU to revise its 2040 target every two years. This could have weakened the goal in the future.
On Tuesday, their ministers must still resolve key issues. This includes the percentage of the 90 percent reduction in emissions that countries can cover by purchasing foreign carbon credits.
To achieve the target, at least 15 out of 27 EU member states must support it.
A spokesperson from Denmark, the rotating EU presidency, and the author of the document, stated that all the ingredients are in place for a successful deal. The spokesperson stated that the COP30 is about to begin and now was the right time to set the target of 2040.
(source: Reuters)