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China's central banks buys gold 12th consecutive month
Data from the People's Bank of China showed that China's central banks added gold to their reserves for the 12th consecutive month in October. China's gold reserves increased from 74.06 to 74.09 fine troy pounds at the end October. This compares to 72.8 million ounces a year ago, a 1.8% increase. According to the PBOC, the value of gold held by the PBOC was $297.21 Billion at the end last month compared with $283.29 Billion in September. Gold spot was just above $4000 per ounce Friday, as the safe haven gained traction in the face of a weaker US dollar and as bets grew on the Federal Reserve cutting rates by December. Gold prices were also supported by concerns over a long-term U.S. shutdown, and the uncertainty surrounding U.S. tariffs. In October, gold reached a new record of $4,381 an ounce. Beijing has cut the value added tax for gold purchased via the Shanghai Gold Exchange or the Shanghai Futures Exchange. China still hasn't released official data on gold production for the last quarter, so analysts are left without an update. The PBOC halted their 18-month gold buying spree in May 2024. The central bank began buying gold again in November of that same year. (Reporting and editing by Christian Schmollinger, Kim Coghill and Kim Coghill; Qiaoyi Li and Dylan Duan).
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Foreign Minister: Hungary will buy US nuclear fuel from the US and technology for storing spent fuel.
Hungary will sign a nuclear cooperation agreement with the United States. This includes a deal for American nuclear fuel, and U.S. technologies to store spent fuel in a Russian nuclear power plant. The deal is expected to be signed when U.S. president Donald Trump sits down with Hungarian prime minister Viktor Orban for talks later on Friday. Both leaders are expected to discuss Hungary’s dependence on Russian oil. Peter Szijjarto, Foreign Minister, said: "We will be signing a major agreement intergovernmental on cooperation in the nuclear energy sector with Marco Rubio my colleague as a foreign minister." Hungary has maintained close relations with Moscow ever since Russia invaded Ukraine. It is also reluctant to reduce its dependence on Russian energy. Trump supports Orban, a fellow right-wing politician. He has however called on European nations to reduce their energy ties with Moscow and purchase more energy from the United States. Szijjarto stated that Hungary will buy American nuclear fuel to meet its increasing energy needs. Rosatom, a Russian company, is building two new reactors at Paks. Rosatom was awarded the "Paks II", a project that has been delayed significantly, in 2014 without any tender. Szijjarto stated that "in addition to maintaining our existing supplier relationships, we will purchase American nuclear fuel for the first ever time in Hungary's history of energy." Szijjarto, in a press release, said that Hungary would also purchase American technology to safely store spent nuclear fuel inside the Paks Nuclear Plant. Minister said that the agreement would also cover small modular reactors. In August, Hungary announced a partnership with Poland's Synthos Green Energy. Synthos Green Energy holds the technology rights for GE Vernova Hitachi on small modular reactors throughout central Europe. (Reporting and editing by Anita Komuves)
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AI rally hits speedbump, tech stocks drop to weekly low
Investors became uneasy over the extent of the artificial intelligence rally, and yen and bonds were stable. S&P 500 and Nasdaq futures were up about 0.3% by the afternoon in Asia. This was after a Nasdaq drop of 1.9% on Thursday. The world's largest tech index has fallen 2.8% this week, and if that trend continues, it will be the biggest drop in a single week since April when tariffs were first announced. Since then, the Nasdaq index has gained over 50%. European futures and FTSE Futures both fell by 0.3%. Japan's Nikkei dropped 1.2%, resulting in a loss of 4.1% per week, the biggest since April. In Seoul, the KOSPI declined 1.8%, resulting in a weekly drop of 3.7%, the biggest since February. Softbank Group Corp, a tech investor, fell nearly 20% in the past week. Chip and cable manufacturers were also amongst the worst performers. Bitcoin, which is sometimes used as a barometer for tech sentiments, has fallen 8% this week to $101,090. MOOD SHIFT The pullback of AI-related shares has not been triggered by any obvious event, but the reaction to recent results reveals that some fears are beginning to surface about the possibility of a bubble and profitability questions. Meta's stock plunged late last month after it revealed large capital expenditures as the company builds data centres to support its AI push. Palantir Technologies, a data and AI company, has also seen its shares fall despite exceeding earnings expectations. Herald van der Linde is the head of equity strategies for Asia Pacific, HSBC. "And another one says it. Then a third. A fourth person says that these three are all selling. It's possible that I am selling, too. It's just a change in market sentiment. This could be happening now." Overnight, the S&P 500 index closed down 1.1% and the Philadelphia SE Semiconductor Index fell 2.4%. BONDS, YEN HIGHER Bond markets rose on the back of a demand for safety, and as second-tier U.S. data indicated a wave layoffs which could support future rate cuts in the U.S. The benchmark 10-year U.S. Treasury rates fell 6.4 basis point to 4.09% Thursday, after Challenger, Gray & Christmas, a firm that specializes in outplacement, said that there was a spike in the number of announced job cuts for October. On Friday, the yields remained unchanged. These private surveys have attracted attention on the market, while a long-term U.S. shutdown has stopped official U.S. data publishing. The dollar was dragged down by the lower yields, but it was still set to have a relatively steady week. The euro was largely stable throughout the Asia session, at $1.1535. The safe-haven Japanese yen is expected to rise modestly by 0.3% per week, last trading at 153.47 yen for every dollar. The pound jumped in value after the Bank of England held interest rates, but the possibility of a rate cut in December limited gains. It traded at a slight discount in Asia and was trading at $1.3115. Brent crude oil held steady at $63.58 per barrel and Safe-haven Gold briefly traded above $4,000 per ounce. The price of soybeans is expected to drop by a week, but there are no signs yet that China will be buying 12 million tons before the year's end. (Editing by Lincoln Feast, Jacqueline Wong and Jacqueline Feast)
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China's production of steel and iron ore is reducing, resulting in a weekly loss for the industry.
Dalian iron ore contracts fell on Friday, logging a loss for the week as weakened steel demand and production reductions in China's top consumer pushed prices down. The January contract for iron ore most traded on China's Dalian Commodity Exchange(DCE) dropped 1.87%, to 760.5 Yuan ($106.77) per metric ton. The contract closed the week at a 3.95% loss. As of 0712 GMT, the benchmark December iron ore contract on Singapore Exchange was down by 2.46% to $101.35 per ton. The contract has fallen 4.51% this week. Analysts from ANZ said that in order to control deflation in China, the country has been focusing on eliminating overcapacity. The steel industry is a particular focus, as rapid capacity growth in this sector has impacted profitability. SteelHome data showed that blast furnace production was cut in North China, the region with the largest steelmaking industry. This led to a drop in steel output. Galaxy Futures, a Chinese broker, says that ore prices will remain low, as steel demand is expected to continue declining, as real estate, infrastructure and manufacturing consumption declined on an annual basis. The fourth quarter should not see any significant improvement. After the European Commission proposed last month that tariff-free import quotas for steel be cut by almost half, while the duty on steel imported outside of the quotas would double to 50%, German Chancellor Friedrich Merz called for European patriotism in order to protect the EU’s steel industry. ArcelorMittal is the second largest steelmaker in the world. It beat earnings estimates for the third quarter, and provided a positive outlook to 2026. However, it noted that the overall demand was weak during the quarter, and there were few signs of restocking. Coking coal and coke, which are used in steelmaking, also lost ground. They fell by 0.97% each and 0.62% respectively. The Shanghai Futures Exchange saw a rise in most steel benchmarks. The price of rebar rose by 0.2%. Wire rod increased by 0.03%. Stainless steel was up 0.2%. Hot-rolled coil fell 0.34%. ($1 = 7.1230 Chinese yuan). (Reporting and editing by Subhranshu Sahu, Janane Venkatraman and Lucas Liew)
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Gold prices rise as the dollar falls and US rate-cut betting increases
Gold prices rose Friday, as the dollar fell after U.S. job reports showed weakness in the labour market. This fueled expectations for another U.S. rate cut. A prolonged government shutdown also increased demand for safe havens. As of 0702 GMT spot gold was trading at $4,005.53 an ounce. This represents a 0.1% weekly gain. Bullion is down 8% from its record high of $4.381.21 reached on October 20. U.S. Gold Futures for December Delivery were up 0.3% to $4,004.0 an ounce. Data showed that the U.S. economy lost jobs in October, mainly due to losses in the retail and government sectors. Cost-cutting and artificial intelligence adoption by companies also led to an increase in announced layoffs. Soni Kumari is a commodity analyst with ANZ. She said: "The private employment data still indicates that a rate reduction in December is probable and that's the reason gold prices are receiving some sort of support." Investors, lacking official data about the U.S. labor market, seized on signs of weakness from private sector surveys. Rate cuts are more likely to occur when the job market is weak. The market participants see a 67% probability of a Fed interest rate cut in December. This is up from 60% the day before. Last week, the Fed cut rates and Chairman Jerome Powell said it could be the last time the borrowing costs are reduced for the year. Kumari said that the focus now is on macro numbers, and when will the U.S. government shutdown end, which also helps safe-haven gold demand. The longest government shutdown in U.S. history has been caused by a congressional impasse. Investors and the Fed, who rely heavily on data, have had to rely upon private sector indicators. Gold that does not yield tends to perform well in low interest rate environments and times of economic uncertainty. Other than that, spot silver rose by 1.5% per ounce to $48.69, pointing to a 0.1% weekly gain. Platinum rose by 0.6% to 1,550.70 and is expected to end the week with a 1.1% weekly decline. Palladium rose by 1.6% to 1,397.20, but was headed to a 2.4% weekly loss. (Reporting and editing by Rashmi aich and Sherry j. Phillips in Bengaluru)
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Aperam lags earnings estimates as steel prices decline in Europe
Aperam, an European stainless steel manufacturer, reported lower than expected core earnings on Friday. This was due to lower volumes and increasing price pressure in its native continent. The adjusted earnings before taxes, depreciation, and amortization dropped around 25% from the year prior to 74 millions euros ($86million), whereas analysts surveyed by the company expected 76 million euro on average. The main drivers of the decline were lower seasonal volumes, increased price pressures in Europe and temporary soft Alloys contributions. The group made a statement. Data from the company showed that the average steel price per ton fell by 10% in a quarter to 2,040 Euros. Last month, the group released its outlook for the third quarter. It anticipated a seasonal drop in shipments in Europe due to a reduced summer demand. Aperam also expects that its core profit will decrease in the last quarter of 2025, compared to previous three-month period. The company's strong cash flow has allowed it to raise its deleveraging forecast, and now expects to reduce its net debt of more than 200 millions euros by the end of the year. End of the year compared with the third quarter. This decrease was expected to be about 200 million.
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Gold prices rise as the dollar falls and US rate-cut betting increases
Gold prices rose Friday, as the dollar fell after U.S. job reports showed weakness in the labour market. This boosted expectations for another U.S. rate cut. A prolonged government shutdown also increased demand for safe havens. As of 0537 GMT spot gold was up by 0.5%, at $3,996.67 an ounce. However, it is expected to lose 0.2% on a weekly basis. Bullion is down 9% from its record high of $4381.21 reached on October 20. U.S. Gold Futures for December Delivery were up 0.3% to $4,004.0 an ounce. Data showed that the U.S. economy lost jobs in October, mainly due to losses in the retail and government sectors. Cost-cutting and artificial intelligence adoption by companies also led to an increase in the number of announced layoffs. Soni Kumari is a commodity analyst with ANZ. She said: "The private employment data still indicates that a rate reduction in December is probable and that's the reason gold prices are receiving some sort of support." Investors, lacking official data about the U.S. labor market, seized on signs of weakness from private sector surveys. Rate cuts are more likely to occur when the job market is weak. The market participants see a 69% probability of a Fed interest rate cut in December. This is up from 60% the day before. Last week, the Fed cut rates and Chairman Jerome Powell said it could be the last time the borrowing costs are reduced for the year. Kumari said that the focus now is on macro numbers, and when will the U.S. government shutdown end, which also helps safe-haven gold demand. The longest government shutdown in U.S. history has been caused by a congressional impasse. Investors and the Fed, who rely heavily on data, are now forced to rely solely on indicators from the private sector. Gold that does not yield tends to perform well in low interest rate environments and times of economic uncertainty. The price of palladium increased 0.5%, to $1381.75, and was headed to a loss of 2.7% for the week. Platinum rose by 0.2%, to $1544.15, though it was down almost 1.3% on the week. (Reporting and editing by Rashmi aich and Sherry j. Phillips in Bengaluru)
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The AI dip is not done in the morning bid of Europe
Tom Westbrook gives us a look at what the future holds for European and global markets. The tech stocks are headed for a shaky finish in what could be the biggest market decline since the turmoil around U.S. Tariffs seven months ago. Softbank Group shares, the Japanese investment conglomerate known for its high-risk and high-reward technology bets, are down by around 20% this week, the largest one-week decline since the pandemic. The Nasdaq has fallen more than 2% in this week, and futures have been under pressure during the Asia session. Japan and South Korea, which are tech-heavy markets, fell. These are not major drops, but they do represent a modest drop in markets that have been booming for several months. Nasdaq has recovered 50% since April's lows. The pullback has been unsettling because there was no clear trigger or reason why AI shares broke their stride. This raises the possibility that investors are beginning to doubt the rally. BofA surveyed more than half of fund managers in October and found that they believe we are in a AI equity bubble. Markets' negative reaction to AI plans at Meta, and the outwardly strong results of Palantir Technologies may have given some indication. Herald van der Linde is HSBC’s chief Asia equity strategy. He has been following the markets for several decades. He said that high values are like the blue sky. "The minute there is one tiny black cloud, the sky will no longer be blue. If you have high valuations, even small news or changes in sentiment can cause the markets to fall a lot. The U.S. shutdown means that there won't be any U.S. employment data in the afternoon, so investors will have to make their own decisions about the changing mood of the market. The Chinese trade figures for October were surprisingly weak, with a drop of 1.1% in exports denominated in dollars. However, the outlook should stabilize following the recent trade truce with the U.S. The focus will be on the equities market until the weekend. Bond markets, however, have taken the private data indicating a surge of U.S. layoffs to increase the likelihood that interest rates could be cut. In the Asia session, safe assets like the Swiss franc, yen and gold were in high demand. The following are key developments that may influence the markets on Friday. - German trade data - Canadian jobs figures U.S. equity session
Botswana, Angola to hold talks over De Beers
Botswana, Angola and their mining ministers will meet in Botswana’s capital for talks on Friday. The two Southern African nations are seeking to control the Anglo American diamond company De Beers.
Botswana considers De Beers, which owns 15% and produces 70% of its rough diamonds, as a strategic asset for the country, despite the global price slump that has hurt their economy.
Angola originally sought a minor stake in De Beers, but submitted a bid later for a major stake. This could lead to a bidding war between Angola and its neighbour.
According to a program shared by the Botswana mines ministry, their meeting is expected to begin around 8am GMT.
The program did not specify what the two ministers were going to discuss. Azevedo will fly to Angola at 1230 GMT after their meeting.
Anglo has put De Beers up for sale, one of the leading diamond companies in the world, to focus on its other business areas. It values it at $4.9billion.
(source: Reuters)