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Investors assess Venezuela's upheaval by assessing the oil price and stock market.
Asian stocks rose on Monday as AI-related themes were?infocus at the beginning of the first trading week of this year. Oil prices fell on the belief that U.S. military action in Venezuela was unlikely to disrupt an energy market well-supplied. MSCI's broadest Asia-Pacific share index outside Japan rose by?1.4%, reaching a new record high. S&P 500 futures also gained 0.2% as investors scanned the geopolitical landscape ahead of an upcoming week packed with economic data. Investors are assessing what the impact of the dramatic weekend will be. The U.S. had captured Venezuelan president Nicolas Maduro, and U.S. Donald Trump announced that he would temporarily take control of the South American country. Trump told reporters Sunday that he would order a second strike if Venezuela did not cooperate with U.S. efforts in opening up its oil industry or stopping drug trafficking. He also threatened to take military action in Colombia and Mexico. Neil Shearing is the group chief economist at Capital Economics. He said that the removal of Venezuelan president Nicolas Maduro from office by the U.S. will not have any significant economic effects on the global economy in the near future. "But its geopolitical and political ramifications are likely to reverberate." Brent crude futures fluctuated between gains and losses. The last drop was 0.7% to $60.33, as oil markets assessed how the U.S.' intervention in Venezuela would impact oil prices and the vote of OPEC+ Sunday night to maintain oil production at the same level. David Chao is the global market strategist at Invesco, Singapore. He said that Asia's market reaction was muted. Investors largely ignored weekend developments. In North Asia, the focus is firmly on the structural benefits of rising AI investment. This outweighs geopolitical worries. The Nikkei rose more than 3.3% among regional share markets to reach a near-record high, reached just two months ago. This was the first day of trading after the New Year. Data showed that manufacturing activity in Japan stabilised in December. This ended a five-month trend of decline. Seoul's Kospi, and Taiwan both climbed by more than 3% each to reach new record highs. Goldman Sachs analysts wrote in a recent research note that the AI investment boom, particularly from the United States has been a boon to top-line growth in Taiwan, and to a lesser degree Korea. "In Taiwan, between 5-10 cents per dollar of U.S. AI investments are invested... the remainder is largely sent to Asia with TSMC as the largest supplier." The Chinese markets were a bit more subdued, with the Hang Seng Index trading at a flat rate, as Chinese oil companies weighed down a measure of Hong Kong listed energy stocks, which fell 3%. Australian shares were flat, with gains from major miners countering declines by the top energy companies. Vasu Menon is the managing director of investment strategy for OCBC Singapore. He said that the strategic calculations were taking place against a backdrop of midterm elections, and that developments would be unpredictable. This uncertainty could support oil prices. "A more volatile geopolitical climate may boost haven assets such as precious metals." DAX Futures in Germany were up by 0.5% and FTSE Futures were up by 0.6%. The U.S. Dollar Index, which measures the strength of the greenback against a basket six currencies, rose 0.2% to 98.746, continuing recent gains for a sixth day in a row. The dollar rose 0.3% against the yen to a new two-week high. It was last traded at 157.21 yen. Kazuo Ueda, the Governor of the Bank of Japan, said that if prices and economic conditions continue to move in accordance with their forecasts then they will continue to increase interest rates. The yield of the 10-year Treasury Bond in the United States was up by 0.8 basis points to 4.179%. Gold gained 2%, trading at $4413.93 due to the increased demand for safe-haven assets. Bitcoin rose by 1.3% to $92,393.99 and ether rose 0.3% to $3,153.41. (Reporting and editing by Muralikumar Anatharaman and Shri Navaratnam; Reporting by Gregor Stuart Hunter)
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Investors and market analysts react to Trump’s Venezuela gamble
The capture by the U.S. of Venezuelan president Nicolas Maduro has triggered a new surge in geopolitical risks, but initial market reactions have been relatively calm with oil volatile and gold rising on safe-haven flows. The dollar rose on Monday, while stocks rose. Here are some comments by market analysts DAVID CHAO, GLOBAL MARKET STRATEGIST FOR ASIA-PACIFIC, INVESCO, SINGAPORE The weekend's events are unlikely to have a significant impact on the global macro-conditions or markets in the near future, due to Venezuela's relative minor role today's energy landscape. This is why oil prices have not moved significantly, nor has the price of U.S. equity or other macro assets. The broader message was that geopolitical uncertainties have become an integral part the macro-environment, and should continue to support demand for precious metals despite elevated volatility. GARY TAN PORTFOLIO MANAGEMENT, ALLSPRING GLOBAL INVESTIMENTS, SINGAPORE Credit markets are likely to feel the immediate impact from a EM perspective of the growing U.S. Presence in Latin America. As geopolitical risks premiums stabilize, we expect credit spreads to narrow, especially for lower-rated sovereigns. "On the geopolitical side, we do not anticipate any meaningful change in China-Taiwan dynamic as a result Venezuelan developments." Asian policymakers tend to see U.S. involvement in Latin America more as a regional strategy than a sign of reduced U.S. support in Asia. RONG REN GOH, PORTFOLIO MANAGEMENT, EASTSPRING INVESTORS, SINGAPORE "Venezuela is a major headline risk for investors in Asia. Direct exposure to the region is very limited. The impact will be felt more through market sentiment, and less so by what the oil price could do over time. In recent months, fixed income markets have benefitted from a calm and carry-friendly environment. This is a reminder of the fact that shocks like these can still occur, even when markets are tightly priced. CHARU CHANANA CHIEF INVESTMENT STRATEGIST SAXO SINGAPORE Geopolitics is a constant feature of our regime, and not something that comes as a shock. Investors tend to fade the initial shock unless it threatens the supply chain and then return their attention to rates, earnings and positioning. For now, this is more of a geopolitical than an oil shock. VISHNU VARATHAN HEAD OF MACRO RESEARCH ASIA EXJAPAN MIZUHO SINGAPORE We are reminded that the geopolitical risk is much greater than a number based on imports. "The sanctions against Venezuela and its exceptional dependence on oil exports... means that the Venezuelan regime change impact through trade channels and investment channels is quite naturally limited and ringfenced. This is why there hasn't been a big selloff. The question and case in mind are: Is the stability of LatAm at risk? The effects could be far greater." KYLE RODDA, SENIOR ?MARKET ANALYST, CAPITAL.COM, MELBOURNE The implications of the current situation are relatively limited and confined to the energy sector. The market is responding to the government's increased exposure to alternatives that are not dollar-based and do not use fiat currency. The markets, however, are more focused on what lies ahead than what occurred over the weekend. TAI HUI, CHIEF MARKET STRATEGIST FOR ASIA-PACIFIC, J.P. MORGAN ASSET MANAGEMENT, HONG KONG "The lack reaction to date is due to two factors. Venezuela's oil output in relation to the global production is very small (around 1%) It's not likely to be able increase production or add to the global supply anytime soon due to years of underinvestment. "It is still unclear what will become of the new regime, as President Trump has announced that the U.S. will be 'running Venezuela' in the near future. Global markets will be affected by the energy market. There will be geopolitical ramifications from this event. However, I do not believe that the financial markets are very effective in valuing such risks. VASU MENON MANAGING DIRECTOR FOR INVESTMENT STRATEGY, OCBC SINGAPORE While President Trump has pledged U.S. support for the industry to revitalise the oil production in Venezuela, restoring operations and capital investments will take significant time before the oil taps are fully reopened. Oil prices could rise modestly in the short-term due to supply disruptions caused by ongoing political turmoil. "However the impact could be limited given that Venezuela is currently not a major producer of oil. OPEC's production decisions could also stabilize prices. "It remains to be seen if the Trump administration is interested in more regime changes." (Reporting and editing by Shri Navaratnam; Ankur Banerjee, Ankur Banerjee in Singapore.
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MORNING BID EUROPE-Venezuela upheaval tests markets
Gregor Stuart Hunter gives us a look at what the future holds for European and global markets. The dramatic weekend that saw U.S. forces capture Venezuelan President Nicolas Maduro has caused the oil market to be roiled as the first full trading week of 2019 begins, even though the global stock markets appear to have ignored geopolitical risk for the moment. Brent crude futures fluctuated between gains and losses, but ended the day at $60.49. Traders are assessing the impact of the U.S. military attack on Venezuela, the country with the largest reserves of oil in the world, on global crude supplies. In recent hours, U.S. president Donald?Trump said that U.S. troops might launch a military strike against Venezuela if the remaining members of the?administration do not cooperate in his efforts to "fix" the country. He also hinted at future action in Colombia and Mexico. OPEC+ - which pumps half of the world's crude oil - also maintained its output on Sunday, after a brief meeting that avoided discussing the political crisis affecting some of the group's member producers. Venezuela's PDVSA, the state-run oil company, has cut back on crude production because of a lack of storage space due to the ongoing U.S. blockade. The stock market has taken geopolitical worries in stride. Many of the winners from last year in Asia have extended their gains. The Nikkei rose as much as 2,9%, nearing a record set two months earlier. Data showed that manufacturing activity had stabilised in December after a five-month decline. Taiwan's Kospi rallied by more than 3,4% and Seoul's Kospi rose 2.9% to new record highs. The shares of Samsung Electronics rose up to 6.5% due to the general buoyant market sentiment. According to its co-CEO, the company plans to double the number its mobile devices this year with AI powered by Google Gemini. The Hang Seng Index fell 0.1%, as Chinese oil companies?dragged the index down. A measure of Hong Kong listed energy stocks dropped 2.8%. Early European trading saw pan-regional futures up 0.7%. German DAX Futures rose 0.5%. FTSE Futures rose 0.6%. Market developments on Monday that may have a significant impact Sentix Index: Euro Zone for January U.K. BOE consumer credit and Mortgage Lending for November Debt auctions: France: 3-month-, 6-month- and 1-year government bonds Germany: 3-month debt and 9-month debt
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Gold prices surge as demand for safe-havens increases due to the US arrest of Venezuela's president
Gold prices rose Monday, and other precious metals surged, after the United States captured Venezuelan president Nicolas Maduro?over the weekend. This heightened geopolitical tensions, and lifted safe-haven demands. Gold spot rose by 1.8% at 0508 GMT to $4,406.77 an ounce. This is a new weekly high. U.S. Gold Futures for Delivery in February rose 1.9% to $4413.40. Tim Waterer is the chief market analyst at KCM Trade. He said that Venezuela's events have reignited demand for safe-haven assets, including gold and silver, as investors seek to protect themselves against geopolitical risk. The U.S. captured Maduro on Saturday in the most controversial attack in Latin America since Washington's invasion of Panama 37 years ago. Vice President Delcy Rodriguez, who has been appointed interim leader, said that Maduro is still president. Last year, geopolitical tensions combined with central bank purchases, interest rate reductions and large inflows to exchange-traded fund?led to the bullion market's biggest annual gain ever, 64%. The record high was $4,549.71, which occurred on December 26, 2025. Anna Paulson, President of the Federal Reserve Bank of Philadelphia, said on Saturday further rate reductions could be a long way off following an active campaign of ease last year. Investors still expect at least two Fed rate reductions this year. Waterer said that investors will be looking at the non-farm payroll figures, due on Friday, to get more clues about possible Fed rate cuts. In a low interest rate environment, and in times of geopolitical or economic uncertainty, non-yielding investments tend to perform well. After hitting an all time high of $83.62 per ounce on December 29, spot silver rose 3.9% to $75.46. The metal finished its best ever year at a record 147% higher. Silver's 'fresh highs' were boosted by its designation last year as a critical U.S. Mineral and the supply constraints that accompanied a rising industrial and investment demand. After touching an all-time record of $2,478.50 on Monday, spot platinum increased 2.2% to reach $2,189.88. Early Asia hours saw it rise more than 5% to a new high. Palladium climbed 2.1% to $1,671.95 per ounce. (Reporting and editing by IshaanArora, SherryJacob-Phillips, Ronojoy Mazumdar).
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Analysts predict that Venezuelan oil production will increase in the future and lower prices.
Oil analysts say that the?crude production?in Venezuela will increase in time, following a 'dramatic U.S. attack and the capture of its President. This is likely to raise?global supplies?and weigh on prices long-term. American forces captured Venezuelan President Nicolas Maduro in Caracas on the weekend. U.S. president Donald Trump announced that Washington would seize control of the oil producing nation, and that the U.S. oil embargo remained fully effective. According to the London-based Energy Institute, the Organization?of Petroleum Exporting countries (OPEC) member has about 17% global oil reserves or 303 billion barils, ahead of OPEC leader Saudi Arabia. Venezuela produced a staggering?3.5m barrels of crude oil per day in the 1970s. This was over 7% more than the global output at that time. The production fell below 2,000,000 bpd in the 2010s, and was averaging 1.1 million bpd on average last year. This represents just 1% of global oil output. JPMorgan analysts, led by Natasha Kaneva, said in a report that Venezuelan oil production could increase to 1.3-1.4m bpd in two years, and possibly reach 2.5m bpd during the next decade. Currently, it is around 800,000 bpd. The note continued, "These dynamics do not appear in the curve at the back end of oil futures." Goldman Sachs analysts, led by Daan Stuyven, said in a note dated January 4, that any recovery in production was likely to be gradual and would require substantial investments. Analysts estimated that oil prices would fall by $4 per barrel in 2030 if Venezuela's crude production rose to 2,000,000 bpd. Goldman analysts say that Venezuela's oil production in the short-term will be affected by the U.S. sanctions policy. They added that "we see Venezuela as a source of ambiguous, but modest risks for oil prices on the short term? depending on how U.S. policy changes." Goldman's forecasts for 2026 oil prices remained unchanged. Brent's average price is $56 a barrel and West Texas Intermediate's at $52 per barrel. Venezuela's oil production in 2026 will remain flat at 900,000. (Reporting and editing by Lincoln Feast, Muralikumar Aantharaman and Florence Tan)
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Trump declares that further strikes are possible if Venezuela's Maduro appears in US court
The United States President Donald Trump has left open the possibility of a second incursion in Venezuela if it doesn't get what it wants from the interim leader. Trump told reporters that he would order another strike against Venezuela if it did not cooperate with the United States. The U.S. is working to help Venezuela open its oil industry and end drug trafficking. He also warned of military action against Colombia and Mexico, and said that Cuba's communist government "looked like it was ready to fall on its own." The Colombian Embassy in Washington and the Mexican Embassy in Washington have not responded to requests for comments. Trump's remarks came just before Maduro was scheduled to appear in New York on Monday, before a federal court judge. Maduro was arrested during a Saturday military raid in Caracas, which sparked international concern and plunged Venezuelan into uncertainty. Trump administration officials have described the seizure of Maduro as a law enforcement action to hold him accountable for criminal charges filed in 2020 accusing him of narcoterrorism conspiracy. Trump has said that other factors are at play. He says the raid was partly prompted by the influx of Venezuelans to the United States, and Venezuela's decision decades ago to nationalize U.S. petroleum interests. 'WE ARE IN CHARGE.' He said on Air Force One, as he returned to Washington from Florida, Sunday. "We're the ones in charge." Trump stated that oil companies would return to Venezuela to rebuild the country's petrol industry. He said that oil companies would spend billions and extract the oil from the ground. Investors weighed the consequences of U.S. military actions in Venezuela while Asian stock markets rose. Maduro is still in charge in Caracas and his top officials remain defiant. Delcy Rodriguez has been appointed as the 'interim leader' and she has stated that Maduro is still president. She has also contradicted Trumps claim about her willingness to work with America. Rodriguez, who is also Maduro's oil minister, was long considered to be the most pragmatic of Maduro’s inner circle. Maduro is accused of supporting major drug trafficking gangs, including the Sinaloa Cartel, and the Tren de Aragua group. Prosecutors claim he used his presidential properties to transport drugs, directed routes for cocaine trafficking, protected shipments with the military, and sheltered violent trafficking organizations. On Saturday, the charges were updated to include Cilia Flores who is accused by prosecutors of ordering murders and kidnappings. The first charges were filed in 2020. Maduro denies any wrongdoing and it may be months before he is brought to trial. Since Maduro declared victory in an election that was marred by accusations of massive irregularities, the United States has considered him to be an illegitimate leader. Trump, however, has rejected the idea that Nobel Peace Prize-winning opposition leader Maria Corina Machado could take over. He says she is unsupported. Machado has been banned from the election of 2024, but she has stated that her ally Edmundo Gonzales has a mandate for the presidency. Some international observers claim he has won the vote overwhelmingly. Trump stated on Sunday that his administration would work with Venezuela's government to crack down on the drug trade and to open its oil industry rather than push for elections in order to install a new leader. Maduro may have few allies on the international stage, but many countries question the legality in seizing a head of state from another country and call for the U.S. respect "international law". The U.N. Security Council is scheduled to meet Monday to discuss the U.S. assault, which Secretary General Antonio Guterres called a dangerous precedent. The attack also raised questions in Washington where opposition Democrats claim they were misled about Venezuela policy by the administration. Marco Rubio, the Secretary of State, was to brief Capitol Hill's top lawmakers later Monday. Venezuela, once one of Latin America's most prosperous countries, has seen its economy collapse over the last 20 years. This has led to one-fifth of Venezuelans moving abroad, in what is one of the largest exodus in history. Maduro's removal, who was a former Venezuelan bus driver and led the country for over 12 years following the death of Hugo Chavez as strongman, could cause further destabilization of the 28-million-person nation.
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Trump declares that further strikes are possible if Venezuela's Maduro appears in US court
The interim Venezuelan government, led by Nicolas Maduro, was to appear before a U.S. Court on Monday following his capture over the weekend by American forces. U.S. president Donald Trump left open the possibility of a second incursion in the event that the United States did not get what it wanted from Venezuela. Trump said to reporters on Sunday that he would order another strike against Venezuela if it did not cooperate with U.S. efforts in opening up its oil industry and stopping drug trafficking. He also threatened to take military action against Colombia and Mexico, and said that Cuba's communist government "looks as if it is ready to fall." The Colombian Embassy in Washington and the Mexican Embassy in Washington have not responded to requests for comments. Trump's remarks came just before Maduro was scheduled to appear in New York on Monday, before a federal court judge. Maduro has been detained in a Caracas military raid that took place on Saturday. The incident has thrown Venezuela into turmoil. Trump administration officials have described the seizure of Maduro as a law enforcement action to hold him accountable for criminal accusations filed in '2020 accusing him of narcoterrorism conspiracy. Trump has denied that other factors are at play. He said the raid was in part triggered by the influx of Venezuelans to the United States, and Venezuela's decision decades ago to nationalize U.S. Oil interests. He said, "We are taking back what they took" as he returned to Washington on Sunday from Florida aboard Air Force One. Trump stated that oil companies will return to Venezuela to rebuild the country's petrol industry. He said that oil companies would spend billions and extract the oil from the ground. Maduro is still in charge in Caracas and his top officials have been defiant. Delcy Rodriguez has been appointed interim leader and she has stated that Maduro is still president. She has also contradicted Trumps claim that Rodriguez was 'willing to cooperate with the United States. Rodriguez, who is also the oil minister, was long considered to be the most pragmatic of Maduro’s inner circle. Maduro is accused of supporting major drug trafficking groups such as the Sinaloa Cartel, and the Tren de Aragua Gang. Prosecutors claim he used his presidential properties to transport drugs, protected violent trafficking groups, and directed routes for cocaine. On Saturday, the charges were updated to include Cilia Flores who is accused by the prosecution of ordering murders and kidnappings. The first charges were filed in 2020. Maduro denies any wrongdoing and a trial could take several months. Since Maduro declared victory in an election that was marred with allegations of massive irregularities, the United States has labeled him a 'illegitimate leader. Trump, however, has rejected the idea that Nobel Peace Prize-winning opposition leader Maria Corina Machado could take over. He said she lacked support. Machado has been banned from running in the 2024 elections, but she has said that her ally Edmundo Gonzales has the mandate to become president. Some international observers believe he won the vote overwhelmingly. Trump stated on Sunday that his administration would work with Venezuela's government to crack down on drug trafficking, and to open its oil industry rather than push for elections in order to install new leaders. Maduro may have few allies in the world, but many countries question the legality of seizing a head of state from another country and call on the U.S. respect international law. The U.N. Security Council is scheduled to meet on Monday to discuss this U.S. assault, which Secretary General Antonio Guterres called a dangerous precedent. The attack also raised questions about the Venezuela policy in Washington where opposition Democrats claim that they were misled by administration officials. Marco Rubio, the Secretary of State, was to brief Capitol Hill's top lawmakers later Monday. Venezuela, once one of Latin America's most prosperous countries, has seen its economy collapse over the last 20 years. This has led to one-fifth of Venezuelans moving abroad, in what is one of world's largest exodus. Maduro was a former Venezuelan bus driver and leader for over 12 years following the death of Hugo Chavez. His removal could cause further destabilization of the 28 million-person nation. Reporting by bureaux around the world; Writing by Andy Sullivan, Editing by Sergio Non & Lincoln Feast.
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Ukraine: First civilians killed in Russian attack on Kyiv
Two people were killed in an overnight Russian air strike on Kyiv and the surrounding region, Ukraine's authorities announced on Monday. This appears to be the first death reported in Russian attacks on the Ukrainian capital in this year. The State Emergency Service of Ukraine said that the strike ignited a medical facility located in Obolonskyi District?in the northern sector of Kyiv, where a inpatient ward operated. The service said that after the fire was put out, a dead body was discovered inside. The service reported that 25 people had been evacuated and a?woman also suffered injuries. It released a?photo of emergency responders carrying an?unconscious body on a stretcher, past an ambulance outside of a building with snow on the floor. Mykola Kashnyk, the governor of the region, said on Telegram that Russia had also struck towns and villages in the Kyiv area, destroying homes and critical infrastructure and killing one civilian?in the Fastiv District, southwest of the capital. Kalashnyk? added that only a few areas of the region remained without electricity. Russia has not yet responded. Both sides deny that they targeted civilians during their attacks. Russia says it has attacked Kyiv, and other Ukrainian cities, with drones and missiles over the past four years, claiming to be 'hitting military targets.' Ukraine claims that civilians, and civil infrastructure, are frequently targeted. Reporting by Gleb Garanich and Lidia Kelly, both in Kyiv; editing by Tom Hogue and Stephen Coates.
Vale, BHP make new offer on Mariana disaster reparations
Mining giants Vale and BHP and their joint venture Samarco have provided Brazilian authorities with a brand-new offer to settle reparations for a tailings dam collapse in 2015, Vale stated in a. securities filing on Wednesday.
The new proposition totals 140 billion reais ($ 26.09 billion),. consisting of 37 billion reais already paid out in reparation. steps, Vale stated, validating an earlier report from local. paper O Globo.
The total deal is 13 billion reais higher than the previous. one that was turned down by Brazil, but did not fulfill the 109. billion sought by the government, omitting the quantity currently. spent by the miners.
The miners have actually instead offered 82 billion reais to be paid. to the federal government and the impacted Minas Gerais and. Espirito Santo specifies over 20 years, and 21 billion reais to be. used for settling future responsibilities.
The Brazilian authorities were seeking a 12-year duration for. the payments to be made.
The dam collapse at a Samarco iron ore mine near Mariana,. Minas Gerais in November 2015 produced a vast flow of mud and. mining waste that buried a nearby village, eliminating 19 individuals,. leaving hundreds homeless and contaminating the Doce River, a major. waterway that streams through surrounding Espirito Santo.
Brazil's lawyer general's workplace, which is getting involved. in the talks, said it would evaluate the fresh proposition.
(source: Reuters)