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Gold drops as US-China positive talks erode safe haven appeal
Gold fell on Monday, as investors shifted away from safe-haven assets to riskier investments due to the positive signals generated by U.S. China trade talks. As of 0233 GMT, spot gold dropped 1.4% to $3277.68 per ounce. U.S. Gold Futures fell 1.9% to $3281.40. The dollar index rose as Trump's administration touted its progress in trade talks with China, following the negotiations that took place over the weekend in Switzerland, which weighed down on gold prices, said Jigar Trivedi. Senior commodity analyst at Reliance Securities. On Sunday, the U.S.-China high-stakes talks ended on a positive, as U.S. officials hailed a "deal" for reducing the U.S. deficit in trade, while Chinese officials claimed they had reached an "important consensus". He Lifeng, the Chinese Vice-Premier, said that a joint declaration would be released at Geneva on Monday. Last month, the U.S. imposed tariffs of equal value on China. This triggered a trade conflict that fueled fears of global recession. A majority of current and former Trump advisors said that the United States will have higher tariffs after the dust settles on the trade negotiations between Donald Trump and the U.S. In an environment of low interest rates, gold, which is traditionally seen as a hedge to economic and political uncertainty, thrives. The Cleveland Federal Reserve president Beth Hammack stated on Friday that the Fed will need more time to assess how the economy reacts to Trump's policies and tariffs before determining the best response. Traders will also be watching the release of U.S. Consumer Price Index for new signals about the Fed's monetary policies. Trivedi said that gold could continue to fall in the short term as the dollar may appreciate. Also, with the reduction of geopolitical risks, haven demand may also drop. (Reporting by Anushree Mukherjee in Bengaluru; Editing by Sumana Nandy and Rashmi Aich) Spot silver remained at $32.70 per ounce. Platinum rose 0.3% to $999.04, while palladium climbed 0.4% to $979.73. (Reporting and editing by Sumana Nady and Rashmi aich in Bengaluru)
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Progress in Sino-US Trade Talks Lifts Sentiment
Investor sentiment was lifted by "substantial progress," in the trade talks between China and the United States, the two world's largest economies. On Sunday, the U.S.-China high-stakes talks ended on a positive, as U.S. officials touted a "deal" that would reduce the U.S. deficit in trade, while Chinese officials claimed the two sides reached an "important consensus", and had agreed to create a new economic dialogue forum. As of 0215 GMT, the most-traded contract for September iron ore on China's Dalian Commodity Exchange was trading 1.51% higher. It was 707 yuan (US$97.9) per metric ton. The benchmark June Iron Ore at the Singapore Exchange rose 1.41%, to $98.3 per ton. Ore prices were supported by a relatively stable demand and mills' desire to continue operations, fueled by profit. A survey by Mysteel revealed that the average daily hot metal production - which is typically used to gauge demand for iron ore - increased 0.1% to 2,46 million tons on May 8. This was the highest level since October 2023. The price of crude steel has been fluctuating with the rise and fall in concerns over U.S. Tariff hikes, and discussions on China's crude output being cut to reduce demand for this key ingredient. Prices for seaborne ore Steelhome's data shows that prices have dropped by 11% since the peak of $107 per ton for the entire year in February. The benchmark steel prices on the Shanghai Futures Exchange have gained. Rebar gained 0.26%; hot-rolled coil 0.38%; wire rod 0.06%; and stainless steel 1.18%. Coking coal and coke, which are both steelmaking ingredients, also continued to decline as the weak fundamentals overshadowed trade optimism. They fell by 1.02% and 0.27 percent, respectively.
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Metals prices rise after 'constructive US-China trade discussions
The price of base metals rose on Monday, as progress in U.S. China trade talks helped ease global recession concerns. However, details of any possible deals are still unclear. As of 0113 GMT, the benchmark copper price on London Metal Exchange (LME), rose by 0.6% to $9497.5 per metric ton. U.S. Treasury secretary Scott Bessent referred to "substantial progress in trade discussions", while Chinese officials stated that the two sides had reached an "important consensus" on their respective side and agreed to create a new economic dialogue forum. He Lifeng, vice premier of China, described the discussions as "in-depth, candid and constructive". The two sides are expected to release a joint statement later Monday. A trader commented, "It is encouraging that both sides have expressed optimism regarding the outcome." The specifics of the trade talks are unclear at this time and it is possible that there will be several rounds. Other London metals include aluminium, which rose by 0.5%, to $2430 per ton. Zinc gained 0.6%, to $2668, while lead gained 0.5%, to $1991, and nickel grew 0.2%, to $15,845. Tin rose 0.5% to $22,035. The Shanghai Futures Exchange's (SHFE) most traded copper contract gained 0.6%, to 78.090 yuan per ton ($10,791.28). The nickel price on the SHFE has outperformed. It is up 2.1% at 126,280 Yuan. This was due to speculations that the Philippines will implement a ban on nickel ore exports from next month. The Shanghai Metals Market did note that the Philippines' policy proposal was still being reviewed and will be further discussed when Congress reconvenes June. It added that the news was unlikely to have a significant impact on the nickel industry in the short-term. SHFE aluminium rose 1% to 19800 yuan per ton. Zinc grew 0.6% to 22380 yuan. Lead climbed 0.9% to 16945 yuan. Nickel jumped 2.1% to 126,280 yuan. Tin grew 0.6% at 262,500 yuan. $1 = 7.2364 Yuan (Reporting and editing by Sumana Niandy; Violet Li, Lewis Jackson)
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Russell: China's rebound in crude oil imports has more of a bearish tone than a bullish one.
China's crude oil imports have been positive for the first few months of this year. However, rather than being a sign that fuel demand is improving, the improvement has more to do with rising inventories. Customs data released Friday show that the world's largest crude importer, Saudi Arabia, recorded an average of 11,69 million barrels a day in April. This is down from the 12.1 million bpd it had in March, but up 7.5% from the 10,88 million bpd for the same period last year. The imports in March were the highest since August 2023, and April's relatively strong performance brought the arrivals of the first four month to 11,83 million bpd. This is up 0.5% compared to the same period last year. The strength of imports in April and March was largely due to the availability discounted cargoes coming from Iran and Russia. Both countries are now under new US sanctions. According to commodity analysts Kpler, China's seaborne exports from Russia reached 1.38 million barrels per day (bpd) in April, and 1.22 millions bpd during March. These were the two strongest months since 1.51 million bpd was recorded in October of last year. Kpler estimated that imports from Iran fell to 743,000 barrels per day (bpd) in April. This was down from 1,39 million barrels per day in March which was the highest monthly figure since October. Imports from Iran were likely under pressure in April as the U.S. administration of President Donald Trump increased pressure on Tehran to curtail its nuclear program. Last week, it was reported that sanctions imposed on two Chinese refiners in March andApril for purchasing Iranian crude had led to problems in sourcing oil. This is because the companies Shandong Shouguang Luqing Petrochemical (SSH) and Shandong Shengxing Chemical were unable to source oil. The sanctions against the smaller operators have also deterred the larger independent refiners to buy Iranian barrels. This has led to the fall in imports for April. How long will Chinese buyers be wary about buying Iranian oil? Or, to put it another way, will they find ways to get around the latest sanctions to resume importing from Tehran? China's imports of Russian crude dropped sharply in January after new sanctions were imposed by the departing administration of former U.S. president Joe Biden against vessels transporting Russian crude. Kpler estimated that China's seaborne exports to Russia fell to their lowest level in 26 months during February. Since then, they have recovered as refiners worked around U.S. restrictions. STORAGE FLOWS Understanding why refiners buy more oil from Russia or Iran is important. As Chinese refiners try to take advantage of the discounted prices, they are storing the increased quantities in strategic or commercial storage. At the same time, they are worried that the United States will increase sanctions on the Russian and Iranian oil flows. China does not reveal the volume of crude oil flowing in or out of its strategic and commercial stockspiles. However, an estimate of surplus crude can be calculated by subtracting the amount processed from the total crude oil available from both imports and domestic production. According to calculations based upon official data, China's crude surplus in March was 1.74 million barrels a day (bpd), the highest since June 2023. In the first two month of the year oil imports were low due to the high prices at the time of cargo arrangements. This led to the swing in March from a shortage of crude oil available. Analysts Vortexa say that the average increase in inventories in the five-week period ending May 4 was over 1.1 million bpd. China's continued purchases of crude oil to build up its inventory is a question that arises as global crude prices are under pressure due to increased OPEC+ production and global demand concerns sparked by Trump’s trade war. The deteriorating economy may make refiners more cautious, given that periods of low oil prices tend to lead to higher imports. These are the views of the columnist, an author for.
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Prices of oil rise after US-China trade talks calm market fears
The oil prices increased on Monday, after both sides of the U.S. and China trade talks announced their progress over the weekend. This lifted the market's sentiment that they may be moving towards a resolution to their trade dispute. Brent crude futures rose 27 cents or 0.4% to $64.18 per barrel at 0001 GMT. U.S. West Texas Intermediate crude futures traded at $61,30 per barrel, up by 28 cents or 0.5% from Friday's closing price. The benchmarks gained more than $1 last Friday, and over 4% in the past week. This was their first weekly gain since mid-April. A U.S. deal with Britain made investors hopeful that tariffs imposed by the United States on its trading partners would not cause economic disruptions. On Sunday, the U.S.-China trade talks ended on a positive, as U.S. officials hailed a "deal" that would reduce the U.S. deficit in trade, while Chinese officials claimed the two sides had reached an "important consensus". He Lifeng, the Chinese Vice Premier, said that a joint press release would be issued on Monday. Positive talks between two of the largest economies in the world could boost crude oil demand, as trade between both countries is restored after being disrupted for years by huge tariffs. Toshitaka Takawa, an analyst with Fujitomi Securities, said: "Optimism about constructive U.S. China talks supported sentiment. However, limited details and OPEC’s plan to increase output capped gains." Tazawa was referring plans by the Organization of the Petroleum Exporting Countries (OPEC+) and its allies to increase output in May and Juni, which will add crude oil to the market. A survey revealed that OPEC's oil production was slightly lower in April. Officials said that talks between Iranians and Americans to resolve disputes about Tehran's nuclear program ended on Sunday in Oman, with more negotiations planned. Tehran, however, publicly insisted that it would continue its uranium-enrichment. The U.S. and Iran nuclear deal may alleviate fears about a lower global oil supply that could pressure oil prices. Baker Hughes, an energy services company, said that the U.S. oil and gas companies cut their number of rigs last week to its lowest level since January. (Reporting and editing by Christian Schmollinger; Yuka Obayashi)
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China's CATL will raise at least $4 Billion in Hong Kong listing
According to the prospectus it filed on Monday, Chinese battery manufacturer CATL aims at raising at least HK$31.01bn ($3.99bn) through its Hong Kong listing. This is the largest new share sales in the city for this year. According to documents filed with the Hong Kong Stock Exchange, the maker of batteries used in electric vehicles will sell 117.9 millions shares at a maximum price of HK$263 each. If the offer size adjustment and greenshoe options are used, then the size of this deal could reach $5.3 billion. The prospectus revealed that more than 20 cornerstone shareholders, including Sinopec, Kuwait Investment Authority and Kuwait Investment Authority have subscribed for CATL shares worth $2.62 billion. With the offer size adjustment, up to 17,7 million additional shares can be sold to raise an extra HK$4.65billion ($598,00 million). The greenshoe option allows for the sale of up to 17,7 million additional shares. The filings indicated that the price of the shares is expected to be determined between Tuesday and Friday. A final price will be announced no later than May 19. CATL will sell its Hong Kong shares at a slight discount to Shenzen's Friday closing price if they are priced at HK$263 per share. If the Hong Kong shares are below this level, the discount is larger. CATL stated in its prospectus that it had been granted a Hong Kong Stock Exchange exemption to not publish the minimum price at which shares can be sold, as this could have an impact on the trading of the Shenzhen listed stock. The prospectus stated that 109,1 million shares will be sold to institutional investors. Hong Kong retail investors can bid on 8,8 million shares. This will be the biggest share sale in Hong Kong since Midea Group raised $4,6 billion last year. CATL shares will begin trading at the Hong Kong Stock Exchange from May 20. CLOSING EYE ON US - CHINA TRADE WAR The filings revealed that U.S. investors onshore will not be allowed to purchase CATL shares as part of the Hong Kong deal. However, many of these funds have overseas operations and would be eligible to participate. In January, the company was listed on a list of Chinese companies that U.S. Defense Department claimed worked with China's Military. CATL stated in its prospectus that it was working closely with the U.S. Department to correct the 'false label'. It said: "It doesn't restrict us from doing business with entities, other than a few U.S. government authorities. Therefore is expected to not have a substantial adverse impact on business." CATL's book-building comes at a time when the U.S., China and other countries held constructive talks on de-escalating the trade war in Geneva. However, the 145% tariffs on Chinese goods by Washington and the 125% tariffs on U.S. products by Beijing remain in effect. Tariff policies are rapidly changing. We cannot assess with accuracy the impact that such policies will have on our business. However, we will monitor the situation closely. CATL previously stated that the impact of U.S. Tariffs would be minimal, as this market only accounts for a small portion of the company's business. The Biden administration's policies have severely restricted its North American business. These policies excluded Chinese batteries under an EV subvention scheme. CATL licenses its battery technology in order to assist its U.S. customers, including Ford and Tesla, to build their own battery plants rather than building its. Such partnerships are often criticized by U.S. lawmakers.
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Norway Wealth Fund divests Israel's Paz Retail and Energy Due to West Bank Activities
Norway's sovereign fund, which is the largest in the world, sold all its shares to Israel's Paz Retail and Energy, because the company owns and runs infrastructure that supplies fuel to Israeli settlements on the West Bank. The Council on Ethics of the fund, which is responsible for overseeing the fund's ethical standards, had adopted a stricter interpretation in August, aimed at businesses that support Israel's activities in the occupied Palestinian Territories. In December, the first divestment took place from Israeli telecoms company Bezeq. The fund operates according to guidelines set forth by the Norwegian parliament. It is regarded as a leader on environmental, social, and governance issues. This is the latest move by a European financial institution to reduce links with Israeli companies and those who have ties to Israel since the beginning of the Gaza War in October 2023. Paz, Israel's largest gas station operator, has nine stations located in the West Bank. In its recommendation for divestment, the Council on Ethics stated that Paz was contributing to the perpetuation of the settlements by operating the infrastructure to supply fuel to them on the West Bank. The settlements were established in violation international law and their continuance constitutes a continuing violation thereof. Paz is not available to comment immediately outside of normal business hours. The U.N.'s highest court Last year, it was said Tel Aviv has rejected the ruling as being "fundamentally incorrect" and biased. DIVESTMENTS The Norwegian central bank's board has final say in divestments. The fund has sold off all of its shares in the company. It wasn't immediately clear whether there would be more divestments. The fund's watchdog announced that it had cleared the majority of companies it had examined over their activities within the occupied Palestinian Territories after it conducted a new review following the outbreak the Gaza War. The watchdog stated at the time it had made two divestment recommendations - Bezeq, in December, and Paz now - but didn't say if it had made any more. The watchdog evaluated around 65 companies from the fund's investment portfolio, including those in energy, infrastructure, travel, tourism, banking and other sectors. (Reporting and editing by Leslie Adler, Andrea Ricci and Gwladys Fauch)
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Norway Wealth Fund divests Israel's Paz Retail and Energy Due to West Bank Activities
The world's largest sovereign wealth fund has sold its entire stake in Israel's Paz Retail and Energy, because the company owns and runs infrastructure to supply fuel to Israeli settlements on the West Bank occupied by Israel, the fund said. The Council on Ethics of the fund, which is responsible for overseeing the fund's ethical standards, had adopted a stricter interpretation in August, aimed at businesses that support Israel's activities in the occupied Palestinian Territories. In December, the first divestment took place from Israeli telecoms company Bezeq. The fund operates according to guidelines set forth by the Norwegian parliament. It is a leader on environmental, social, and governance issues. This is the latest move by a European financial institution to reduce links with Israeli companies and those who have ties to Israel since the beginning of the Gaza War in October 2023.
Syrah Resources plans to restart production at its Mozambique plant in the first quarter
Syrah Resources' chief executive stated on Wednesday that the company hopes to resume production at its Balama project in Mozambique within the first quarter. This will eventually lead to the lifting force majeure.
The company declared force majore in December, due to protests and civil unrest sparked by the Mozambique election results of October. This also caused it to default on U.S.-backed loan.
The stability of the country has improved significantly. Shaun Verner, CEO and Managing Director of Syrah Resources, said that the last two to three weeks were much better than previous periods.
We are working to resolve the dispute at the site, and we will try to resume production in this quarter. The outcome is not yet certain, but it's the goal.
The company said that protests by farmers at the Balama Project began late in September, and they have been preventing the movement of supplies and people as well as disrupting operations.
A clause called force majeure allows contracting parties to escape liability in the event of unexpected external circumstances which prevent them from fulfilling their obligations.
Verner responded that any additional tariffs would be beneficial to the industry when asked about the impact of President Donald Trump's proposed 10% duty on all Chinese imports.
He said that the 25% tariff on anode materials from China is a first attempt to help balance the increased volumes coming from China.
He added, "But what we are seeking in the end is a level playing field that will allow us to compete as well as continue to diversify and increase the supply of products into the U.S.
Syrah operates an anode material plant in Louisiana, United States. This material is a key component for battery and auto manufacturers.
Syrah announced that its unit, Syrah Technology LLC, had filed a petition for anti-dumping duties and countervailing duties with the U.S. Department of Commerce as well as the International Trade Commission in December.
The petition was submitted jointly with the North American Graphite Alliance and sought to investigate Chinese exports for natural and synthetic active anode materials used in lithium-ion battery batteries.
China is the world's largest producer of graphite, which is used in the battery of electric vehicles.
(source: Reuters)