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EDF's core earnings fall on lower electricity costs
The French power giant EDF announced a decline in its annual core earnings Friday. This was due to lower electricity prices, despite higher power production from its nuclear fleet. In 2024, the state-owned electric company reported a core profit of 36.65 billion euros ($38.28billion), down from 39.9 bn euros a year before. The company said that its net debt in 2024 would remain at 54.3 billion euro, despite the huge debt it has accumulated as a result previous years of maintenance on its nuclear reactors. EDF, the state-owned company that runs Europe's biggest nuclear fleet, reported a net profit of 11.4 billion euros in 2023, up from 10 billion. This was due to a reduction in impairment charges for Britain's long delayed Hinkley Point C Project. EDF wants to build six nuclear reactors in France over the next few years, but it hasn't yet secured financing. The French Court of Auditors recommended last month that the company not make a final decision on investment until the designs are finalized and the financing is secured. The CEO Luc Remont said to journalists that the work is ongoing to refine the estimated costs of the project. A final investment decision will be made in the second half 2026.
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London aluminium lingers near eight-month high
London's aluminium prices were near an eight-month high on Friday, as traders assessed their concerns about the European Union's envoys agreement to ban Russian imports of primary aluminium in the sanctions package. As of 0638 GMT the price for three-month aluminium at the London Metal Exchange was unchanged, $2,722 per metric ton. It had earlier reached its highest level since 2024. After reports that the European Union supported a ban on Russian Metal, aluminum led the sector to rise. "EU Ambassadors have agreed to implement a new package of sanctions" against the main supplier, said Daniel Hynes. EU diplomats reported that EU envoys agreed Wednesday on a 16th set of sanctions against Russia. This included a ban on the import of primary aluminium, a sale of gaming consoles, and a list of 73 shadow vessels. The U.S. president Donald Trump announced that he will announce new tariffs in the next month, or even sooner. He said he plans to add lumber and forest products, as well as previous plans on duties for imported cars, semiconductors, and pharmaceuticals. According to our opinion, Trump's tariffs will reduce demand growth. ANZ says that aggressive import tariffs could weigh on capex growth, as business confidence would remain low. Amid the ongoing tariff war and the concerns over a slowing demand, the focus will be on China. LME copper dropped 0.7% to $9.499.5. Nickel fell 1.3% to $15.455. Tin fell 0.2% at $33,325. Zinc eased 0.5% at $2.904.5. Lead firmed up 0.5% to $1.996.5. The price of SHFE aluminium increased by 0.1%, to 20,805 Chinese yuan ($2,870.09) per ton. SHFE copper dropped 0.5%, to 77,000 yuan. SHFE zinc fell 0.1%, to 23,940, and nickel fell 0.7%, to 123770, while lead rose 0.2%, to 17,080, and tin climbed 1.1%, to 263,730. $1 = 7.2489 Chinese Yuan Renminbi (Reporting and editing by Subhranshu, Rashmi, and Janane Venkatraman in Bengaluru)
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Gold and Asia's shares rise for the eighth consecutive weekly gain
The Asian share market reached a new three-month high on Friday, as investors returned to Chinese stocks that were previously not popular due to the optimism surrounding artificial intelligence. Meanwhile, the U.S. exceptionalism narrative has continued to lose its luster. Gold was hovering near its record high, and it looked set to continue its gains for the eighth week in a row. Gold was boosted by flows to safe-haven assets due to fears over Donald Trump's threats to impose tariffs and during contentious discussions as the U.S. President pushes to end the Russia-Ukraine conflict quickly. MSCI's broadest Asia-Pacific share index outside Japan rose more than 1% on Friday to its highest level since November 8, putting it on track for the sixth consecutive week of gains, the longest winning streak of over two years. The move was a result from a surge of Hong Kong and China listed stocks. The Hang Seng Index reached a three-year high and pushed the CSI300 Index 1% higher. Hong Kong's technology shares rose 4.7% while the Shanghai Composite Index increased 0.7%. Chinese stocks are on fire in recent days. DeepSeek’s AI breakthrough has reignited interest among investors in China’s technological capabilities. The Hang Seng Tech Index is up nearly 30% this year, while the S&P 500 has only gained 4%. Brian Arcese is the portfolio manager of Foord Asset Management. Earlier this month, Chinese President Xi Jinping met with some of China's biggest names in the technology sector. He encouraged them to "show off their talent" as well as be confident in China's market and model. "I believe that's a change in China." "These things are done with a purpose, the only thing that comes out of this meeting is that we have met... but it's a big message, you don’t do that lightly," Arcese said. The markets in Europe, however, were set to start on a gloomy note. EUROSTOXX futures fell 0.11%, while FTSE futures eased 0.08%. Nasdaq Futures fell 0.07% while S&P500 futures dropped 0.09%. DeepSeek’s breakthrough not only has investors refocusing their attention on China but also causing them to re-evaluate their positions in U.S. mega-cap technology stocks that are currently trading at a much higher valuation than their Chinese counterparts. Walmart's depressing forecast for Thursday, the largest retailer in the world, also stoked fears about the future of the largest economy. The U.S. economic growth narrative is beginning to crack, according to Tony Sycamore. Japan's Nikkei climbed 0.17%. DOLLAR EASES The threat of additional import duties by Trump continues to cast a pall on markets. However, traders have also woken up to the reality that his tariff bluster at the beginning of his second term was mostly empty. Dollar was heading for its third consecutive weekly loss as bulls, who had built large long positions in anticipation a trade conflict, have pulled back while Trump is ambiguous about tariffs. On Thursday, several Federal Reserve officials said that they were taking note of the rising inflation risks they perceive and of the uncertain impact Trump's immigration, trade and other policies may have. The dollar's weakness has left sterling at its highest level in two months at $1.2674. Meanwhile, the euro is stable at $1.0493 before a weekend German election. The yen fell by 0.5%, to 150.35 dollars, after comments from Bank of Japan governor Kazuo Ueda, which eased fears that the central banks may consider a more aggressive stance on rate hikes. The data released on Friday shows that Japan's core consumer price inflation reached 3.2% in January. This is the highest rate in 19 months. Alvin Tan is the head of Asia FX Strategy at RBC Capital Markets. He said that "the data support a growing market conviction" of a BOJ interest rate hike in July and possibly a third by year's end. Oil prices dropped but are headed to a weekly increase. Brent crude oil futures fell 0.21%, to $76.32 per barrel. However, they were on track to gain more than 2% in the coming week. U.S. West Texas Intermediate Crude fell 0.22% at $72.32, and was on course for a weekly increase of more than 2%.
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Oil gains weekly amid improved demand and supply concerns
The oil prices were stable on Friday, and are expected to rise by a significant amount this week due to an improved outlook for the demand in China and the United States. The price of oil was also supported by concerns over disruptions to supply in Russia. Brent futures fell 3 cents, to $76.45 a barrel by 0414 GMT. U.S. West Texas intermediate crude was down 4 cents at $72.44. Both indexes gained more than 2% in the past week, marking their largest weekly gains since early January. Brent will be marking its second week of gains following three weeks of declines. WTI will have its first positive week after four consecutive weeks of declines. JPMorgan analysts stated in a Friday note that the global oil demand averaged 103.4 millions barrels per daily (bpd). This is an increase of 1.4 million bpd. The coming week will see increased demand due to cold weather in China and an increase in industrial activity as Chinese people return from their holidays. The Energy Information Administration reported on Thursday that the U.S. crude stockpiles increased while gasoline and distillate stocks fell due to seasonal maintenance at refineries, which led to a lower processing. Toshitaka Takawa, an analyst with Fujitomi Securities, said that the oil price is supported by both the drawdown of U.S. gasoline stocks and concerns about tight supply in Russia. The hardened stance of Ukraine has led some investors to buy into the market. The Ukraine president Volodymyr Zelenskiy was furious earlier this week at U.S. and Russian attempts to negotiate a deal without Kyiv, and Donald Trump's comments blaming Ukraine as the cause of the three-year conflict with Moscow. Zelenskiy, however, said that after a meeting on Thursday with Trump's representative for the Ukraine conflict, Ukraine was prepared to work quickly in order to reach a solid agreement with the United States on security and investments. U.S. Treasury Sec. Scott Bessent said on Bloomberg Television that Russia may be able to get some relief from U.S. Sanctions if it is willing to negotiate a ceasefire in its war with Ukraine. Despite the disruptions in oil supply, prices continued to rise. Russia reported that oil flow through the Caspian Pipeline Consortium, which is a major route used for exporting crude oil from Kazakhstan, was reduced by 30-40% after an attack by a Ukrainian drone on a pumping facility on Tuesday. Industry sources reported on Thursday that Kazakhstan had pumped record oil volumes in spite of damage to its main route for export via Russia (the Caspian Pipeline Consortium). It wasn't immediately clear how Kazakhstan was able to pump such high volumes. Reporting by Yuka Obaashi in Tokyo, and Siyi Lu in Singapore. Editing by Sonali Paul & Edwin Gibbs
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Investors prefer German midcaps over bluechips on recovery bets
Investors who are betting on the German economy recovering, supported by a fiscal boost post-election and the possibility of a ceasefire in the Ukraine war, have piled into midcap stocks in Germany, which could prove to be the best long-term performers. The MDAX is a better barometer of any economic recovery spurred on by Sunday's elections than the internationally oriented DAX, which has soared this year due to the success of global companies like software maker SAP that are not as affected by domestic economic problems. If the outlook for the economy improves, which it is expected to do if the economy shrinks for the second consecutive year in 2024, the MDAX could outperform its benchmark. According to estimates by Deutsche, the midcap index tracks companies such as conglomerate Thyssenkrupp and chemicals maker Lanxess. It also includes defence firm Hensoldt, meal-kit company Hellofresh, and has a revenue exposure of 28% in Germany, compared to the DAX’s 20%. Andrea Scauri, portfolio manager at Lemanik, said that he increased his MDAX investment six-fold before the election. This was done partly by using derivatives and buying direct stocks. He said: "If the German elections result in a positive outcome that results in a greater deficit, then the MDAX is going to soar literally." "Its performance has been abysmal." Markets would be favourable to a conservative coalition government if populist parties failed to achieve a blocking majority of one third. The MDAX is down around 18% since Russia invaded Ukraine 2022, which drove energy prices higher. The DAX, however, has risen by 46%. This suggests that there may be a potential for catching up. The bet does not come without risk. Enrico Vaccari is the head of institutional sales for Consultinvest, in Milan. He said that the market had gotten ahead of itself by expecting a new government to be formed after the elections with a more lenient fiscal policy. Roger Peeters is a managing partner of fund advisory firm pfp Advisory, based in Frankfurt. He is cautious and says it's too early to search for profiteers in Ukraine. He said that "even peace, let alone ceasefire, wouldn't necessarily mean old trade relationships would be revived." Goldman Sachs said that if the German elections or the talks about Ukraine fail to deliver, the already bullish options positioning could limit the upside. The U.S. Bank said that certain cyclical European stocks, like the MDAX which tends to do well when the economy is growing, are still attractive for hedging upside risks. The MDAX is dominated by the industrials and chemicals sectors, which should be able to benefit from the recovery of the economy and the falling energy prices. Together, they represent a third of its weight. Relative valuations look attractive. LSEG Datastream's forward PE metric shows that midcaps trade at a discount of 2.4% to the DAX. Historically, they traded at a premium.
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Fist US-Built Wind Turbine Installation Vessel Starts Sea Trials
The United States' first Jones Act-compliant offshore wind turbine installation vessel (WTIV), Charybdis, has started sea trials ahead of delivery to Dominion Energy planned for later in 2025.The Seatrium AmFELS shipyard in Bronsville, Texas, has been in charge of the construction of the WTIV vessel, the first of its kind to be build in the United States.The vessel, commissioned by Dominion Energy, also recently completed the jacking trial and main crane load testing, Seatrium informed, adding the Charybdis is 96% completed.The vessel complies with U.S. Jones Act regulations, which means it is allowed to operate in U.S. waters for domestic offshore wind projects.One of the largest WTIVs of its kind globally, the Charybdis is designed to handle current and next-generation wind turbines up to 12 MW or larger.With a length of 472 feet, width of 184 feet, and depth of 38 feet, it is equipped with a 426-foot crane capable of lifting up to 2,200 tonnes, and an accommodation capacity of up to 119 people.Charybdis remains on schedule to be delivered and support Dominion Energy’s Coastal Virginia Offshore Wind project later in 2025 after vessel preparatios, including grillage installation works, are completed, Seatrium said.The vessel was originally slated to cost about $500 million when U.S. power company Dominion ordered it from Seatrium AmFELS (then Keppel AmFELS) in 2020.However, the price estimates have since risen, first to $625 million, and then to $715 million, as reported by Dominion Energy in 2024.The prices reflect new modifications to accommodate project specific turbine loads based on final certified weights and dimensions of the equipment and additional financing costs, and other factors.Cost of US-built WTIV Charybdis Balloons to $715 MillionCharybdis WTIV Launches In United States
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Japan's Japex Shifts Back to Oil and Gas Investments
Japan Petroleum Exploration (Japex) is prioritizing investment in oil and gas exploration and production (E&P) through 2030 - revising an earlier plan to aggressively expand its renewables businesses, its president said."For now, the investment focus will remain on oil and gas exploration and production... as securing a fair return from renewable energy sources such as offshore wind is challenging due to rising costs," President Michiro Yamashita told Reuters in an interview on Wednesday.Other global peers have also scaled back renewables investments due to lower returns. At the same time, profits from oil and gas have soared since Russia's invasion of Ukraine disrupted supply and propelled energy prices higher.In 2022, Japex set a goal of having its profits split equally between E&P and other businesses by the 2030 financial year to support the energy transition towards carbon neutrality.Yamashita said, however, that the current ratio of E&P contributing 70%-80% of earnings will likely remain unchanged through 2030, driven by expansion in the U.S. and Norway.He added that Japex could selectively invest in non-oil and gas segments if returns are viable.Japex's original plan called for E&P investment of 230 billion yen ($1.5 billion) over nine years. But the company now expects to invest 1.5 times that amount or even more as current crude prices exceed the plan's assumed $50 a barrel by a large margin."My biggest challenge now is acquiring a tight oil operator business in the U.S. and building an investment structure for sustainable profits," Yamashita said, adding that the company would like to secure a deal this year or in 2026.Investment will likely be capped at $300 million per project, reflecting lessons from past losses on large investments and Japex's exit from a Canadian oil sands project, he said.Japex wants to strike a balance between shareholder returns, financial soundness and investment discipline, Yamashita said.In Norway, Japex is seeking to boost profit by expanding production at an existing project and with further exploration.Yamashita said the Japanese company views the Trump administration's energy policy as enhancing predictability and stability, making it "favourable" for them.Given Trump's plan to expand liquefied natural gas (LNG) exports, the company aims to gradually acquire gas assets, he said. But the Alaska LNG project, which Trump supports, is not a realistic investment proposition due to its unclear economics and large scale, he said.($1 = 151.0000 yen)(Reuters)
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Iron ore prices rise on a brighter outlook for demand and China's stimulus hopes
The price of iron ore futures rose on Friday, reaching their highest level in over four months. They are also expected to gain a lot this week as the demand outlook for steel in China's top consumer has improved. The May contract for iron ore on China's Dalian Commodity Exchange ended the morning trading 1.69% higher, at 840 Yuan ($116.00) per metric ton. This is the highest price since October 8, 2024. As of 0338 GMT the benchmark March iron ore traded on the Singapore Exchange had risen by 0.34% to $109.05 per ton. This was also the highest price since October 8, 2024. So far, both benchmarks have seen gains of about 3%. Mysteel, a consultancy, reported that downstream steel consumption was showing signs of improvement. Transaction volumes for construction steel products jumped by 44% in a week, to 112,600 tonnes on Thursday. This helped support ore prices. The Chinese central bank also boosted sentiment by pledging to support the private economy's growth and healthy development. Mysteel's survey revealed that the average daily output of hot metal was down 0.2% for the second week in a row, to 2,28 million tons on February 20. This limited gains. Coking coal and coke both increased by 2.3% and 1.63 % respectively. The Shanghai Futures Exchange saw a rise in most steel benchmarks. Rebar grew by 1.05%. Hot-rolled coils increased by 0.96%. Stainless steel increased by 0.95%. Wire rod fell 0.23%.
Anglo Platinum pays cash dividends in addition to spin-off plans
Anglo American Platinum announced on Monday that it would pay an additional cash dividend of $856 million ahead of the planned spin-off into a separate unit.
This is despite a 40% drop in profit to 8.4 billion Rands as the lower prices of platinum group metals continue to hurt earnings.
Amplats, a Johannesburg-based company, said that the cash payment of 15.7 billion rands is an addition to its final dividend of 3 Rand per share in anticipation of its demerger from parent Anglo American.
Amplats CEO Craig Miller told a media conference that the company will pay an additional dividend out of its cash reserves, which are estimated at 17.6 billion rand.
Amplats will be spun off from its parent company Anglo in June of this year.
The London-listed group is separating the platinum miner as part of its restructuring strategy, which was implemented by Anglo American after it resisted a $49 Billion takeover bid last year from BHP.
Anglo is selling its nickel assets in Brazil as part of a strategic overhaul. It plans to sell its De Beers diamond division.
(source: Reuters)