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IAEA chief: No further damage to Iranian enrichment sites
Rafael Grossi, the U.N.'s chief nuclear watchdog, provided an update Monday on the current situation at Iran’s nuclear facilities following Israel’s military strikes. He said that there were no signs of further damage to the Natanz and Fordow enrichment site. Grossi, and the International Atomic Energy Agency, which he leads, reported previously that the smallest Iranian enrichment plant, an above ground pilot plant, at the sprawling Natanz Nuclear Complex, had been destroyed. Although there were no physical signs of an attack on the larger underground enrichment facility at Natanz there was a disruption in its power supply, which could have caused damage to the centrifuges that enrich uranium there. The Fordow underground plant was not damaged. Grossi, in a special meeting of the 35-nation Board of Governors of his agency, said that there had been no further damage to the Natanz Fuel Enrichment Plant since the attack on Friday which destroyed the above ground part of the Pilot Fuel Enrichment Plant. He elaborated on damage caused by Israeli strikes at Isfahan's nuclear facilities, including the conversion facility for "yellowcake", uranium that is converted into uranium-hexafluoride to be used as a feedstock in centrifuges. He said that four buildings at the Esfahan Nuclear Site were damaged by the attack on Friday: a central chemical lab, a uranium-conversion plant, the Tehran Reactor Fuel Manufacturing Plant, and the UF4 to EU Metal Processing Facility, which was in construction. The (International Atomic Energy) Agency will continue to be present in Iran. "Safeguards inspections will continue in Iran as soon as the safety conditions permit, as required by Iran's NPT safeguard obligations," he said. Reporting by Francois Murph Editing Bernadettebaum, Editing William Maclean
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Gold drops as investors focus on G7 meeting and Fed decision
Gold prices fell on Monday, as investors assessed the impact of the ongoing Israel/Iran conflict. They also focused on the Group of Seven Leaders meeting and Federal Reserve's policy announcement later in the week. As of 0854 GMT spot gold dropped 0.5% to $3415.36 per ounce after reaching its highest level since the 22nd April earlier in session. U.S. Gold Futures fell 0.5% to $3434.50. Analyst Giovanni Staunovo at UBS said that geopolitical tensions will not be fading in the near future, and rates are likely to continue to fall. This should give gold a boost. Iranian missiles hit Israel's Tel Aviv, and the port of Haifa early on Monday morning. At least eight people were killed and homes destroyed. On the fourth day of this conflict, there was no sign that the fighting would cease. Investors showed no signs of panic as the currency markets remained calm and Wall Street futures rose after an initial dip. Ole Hansen is the head of commodity strategy for Saxo Bank. He said that investors will closely monitor developments in the Middle East, particularly the risk of other nations being drawn into the conflict. In times of geopolitical or economic uncertainty, gold is a popular safe-haven investment. Gold tends to do well in low-interest rates. The Federal Reserve will announce its interest rate decision this week and Fed Chairman Jerome Powell is expected to make a statement on Wednesday. Since December, the Fed has maintained its policy rate between 4.25% and 4.50%. Palladium rose 1.6% to 1,044.40, while platinum gained 1.2%. (Reporting by Anushree Mukherjee in Bengaluru; Editing by Kate Mayberry)
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TotalEnergies CEO: We will double our stake in Malaysian gas assets
Patrick Pouyanne, the CEO of TotalEnergies, announced on Monday that it had doubled its investment in Malaysian assets to meet the increasing energy needs of its Asian customers. Pouyanne, speaking at the Energy Asia Conference in Kuala Lumpur, said: "We produce natural gas and today afternoon, we will announce a deal to double our stake in Malaysia because the country is perfectly situated to produce energy and serve the market." The company didn't immediately respond to a question about the specifics of the transaction. TotalEnergies Buy Tickets SapuraOMV Upstream is a Malaysian independent gas producer whose principal assets are its operating interests in offshore blocks SK408 (40%), SK310 (30%), and SK410 (30%). Total has also signed contracts for liquefied gas worth 6 million metric tonnes in 2024. These are mainly with Asian customers, who, according to Pouyanne, form the "core" of Total's business, as sales to Europe have been declining. Pouyanne said that Total would also invest 30% of its capital to create an integrated power business. The goal is to increase the share of electricity to 20% in its portfolio by 2030. (Reporting and writing by Sudarshan Varadahan; editing by Martin Petty, Louise Heavens, and David Stanway)
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EU rejects proposals to reduce reliance on Russian nuclear energy
Dan Jorgensen, EU Energy Commissioner, said that the European Commission would not be proposing measures this week to limit EU reliance on Russian nucleofuel alongside its proposals for a ban on Russian gas. This week, the Commission will propose legal measures to stop the EU from importing Russian gas by 2027. The EU executive set this goal last month. The Commission said that it would also propose in June trade measures targeting enriched Uranium to make Russian imports less attractive and to encourage countries to switch suppliers. When asked Monday about the timing of nuclear proposals, Jorgensen said, "That too will come. But in the first phase, we'll focus on the gas." He did not give a new deadline for the proposals. "The nuclear question is complicated because we have to make sure we don't put countries in a position where they are unable to secure their supply. We are working hard to include that in the proposal," Jorgensen stated. According to Bruegel, Russia will supply 38% of EU enriched uranium by 2023 and 23% raw uranium. The Commission said that it would also restrict new supply contracts of Russian uranium, and enriched Uranium, which are signed by Euratom Supply Agency. Brussels has set a deadline of end-2027 for the EU to stop buying Russian gas. However, the EU has not specified a date when it should stop buying Russian nuclear fuels. This is due to the fact that many countries rely on Russia to provide fuel, spare parts or fuel cycle services, and this could threaten the security of the supply. Commission: In 2024, the EU spent 26.63 billion euros on Russian energy, including around 1 billion euro for nuclear fuel. Five EU countries, Bulgaria, the Czech Republic Finland, Hungary, and Slovakia, have Russian-designed nuclear reactors that run on Russian fuel. All but Hungary have signed alternative supply contracts since 2022. However, the long wait time means they cannot switch immediately. ($1 = 0.8636 euro) (Reporting and editing by Christian Schmollinger; Kate Abnett)
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The Gulf countries are recovering from the conflict between Iran and Israel.
The major stock markets in the Gulf recovered some of the losses they suffered in previous sessions, when the conflict between Israel and Iran escalated. Saudi Arabia's benchmark Index gained 1.2%. This was mainly due to a 1.9% increase at Al Rajhi Bank, and a 3.2% rise at Saudi Arabian Mining Company. Sunday, the index fell 1%. After a 7% increase on Friday, oil prices were volatile. Israel and Iran renewed their strikes over the weekend, raising fears that the conflict could spread across the Middle East and disrupt oil exports. The Qatari Index rose 1.7%, a day after it fell more than 3%. This was boosted by a 2.4% jump in the Gulf's largest lender Qatar National Bank as well as a 1.5% rise in the petrochemical manufacturer Industries Qatar. Iranian missiles destroyed homes in Tel Aviv, Israel and Haifa, the port city. This sparked fears among the world leaders attending this week's G7 summit that the conflict could spread to other regions. Israel announced that it began a long-term operation on Friday to stop Tehran from developing an atomic bomb by targeting Iran's ballistic missile factories, nuclear facilities and military commanders. Iran has promised to respond harshly. Dubai's main stock index rose 0.8%. Parkin Company, which manages public parking operations, rose 2.3%. Toll operator Salik gained 0.7%. The index in Abu Dhabi edged up 0.2%. (Reporting and editing by Topra Chopra in Bengaluru, Ateeq Sharriff in Bengaluru)
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Japan's Nikkei ends higher despite Middle East conflict; Advantest soars
The Nikkei 225 index rose more than 1% in Japan on Monday. This was largely due to the 9% increase by Advantest following an upgrade of its brokerage target price. Traders also shrugged off geopolitical tensions with Iran and Israel. The Nikkei closed at 38,311,33, up 1.26%. The Topix rose by 0.75%. Shuutarou Yasuda is a market analyst with Tokai Tokyo Intelligence Laboratory. He said that Japanese shares are strong despite concerns about geopolitical risk in the Middle East. He said that investors were relieved because oil prices did not spike today, which would have affected the local economy. Global investors closely monitored the Israel-Iran dispute for signs that it could escalate into a wider regional conflict. Advantest shares in Japan jumped 9.63% on Friday after JPMorgan Securities raised its target price from 10,500 to 11,000 yen. The Nikkei gained the most from the shares. SoftBank Group, the technology investor, and Uniqlo brand owner Fast Retailing both rose 2.5%. Yasuda, Tokai Tokyo, also cited a weaker yen as a factor that influenced sentiment. Last week, the yen fell as investors looked for safe havens such as the US dollar. This trend continued on Monday. The dollar was up by 0.1% last against the Japanese yen, at 144.235. Exporters benefit from a weaker yen, since it increases the value of overseas profits when they are returned to Japan. Nippon Steel shares rose 1.5% on Friday after U.S. President Donald Trump approved the $14.9 billion offer for U.S. Steel. Steelmakers' sector grew by 1%. Shipping sector rose 1% as a result of expectations that freight rates will rise amid the Middle East conflict. Kawasaki Kisen shares rose by 1.38%. On the TSE's Prime Market, out of more than 1,600 shares traded, 69% were up, 26% were down, and 3% were flat.
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Tariffs cap the rise in iron ore prices as China's demand grows.
Iron ore prices rose on Monday due to a resilient steelmaking demand, but U.S. tariffs capped gains. The daytime trading price of the most traded September iron ore contract at China's Dalian Commodity Exchange was 704.5 yuan (US$98.11). As of 0709 GMT, the benchmark July Iron Ore traded on Singapore Exchange increased by 0.31% to reach $94.45 per ton. Mysteel, a consultancy firm, reported that 60% of China's blast furnace steel mills had positive margins by June 12. Mysteel data shows that the average daily hot metal production, which is typically used to gauge iron ore consumption, remained stable on a week-to-week basis at around 2,42 million tons by June 13. China's crude output of steel fell sharply in May, surprising analysts, and keeping steelmakers in line for lower production in this year as Beijing pushes to reduce output in the industry. In May, factory output growth in the country reached a six-month high, while retail sales grew. From June 23, a wide range of household appliances imported from the United States, such as dishwashers, washing machine, refrigerators, and others, will be subjected to President Donald Trump’s steel tariffs of 50%. Official data released on Monday showed that China's new house prices declined in May, continuing a two-year stagnation. This highlights the challenges facing this sector, despite several rounds policy support measures. Coking coal and coke, which are used to make steel, have both gained in price, rising by 2.84% each and 1.9% respectively. The majority of steel benchmarks traded on the Shanghai Futures Exchange increased. Rebar was up by 0.98%. Hot-rolled coils were up 1.07%. Wire rod increased by 0.15%. Stainless steel decreased by 0.08%. ($1 = 7.1808 Chinese Yuan) (Reporting and editing by Rashmi aich; Michele Pek)
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Euro zone yields little changed, Middle East, Fed meeting in focus
Investors waited for the U.S. Federal Reserve policy meeting this week to assess the impact of the Middle East war on inflation and growth. Overnight, Iranian missiles hit Israel as part of a wave retaliatory strikes by Tehran in response to Israel's preemptive attacks last week against its nuclear and missile programs. At this week's G7 summit, world leaders expressed concern that the conflict between two old enemies could spark a wider regional conflict. Analysts say that a rise in the price of oil will cause inflation. However, there are downside risks to the economy. Brent crude futures fluctuated on Monday after a 7% rise on Friday. The yields on German 10-year government bonds were unchanged at 2.54% - 2.53%. They had been 2.422% last Friday, their lowest level since March 3. The yields of the two-year Schatz bond were down by 0.5 basis points at 1.85%. Market pricing for the European Central Bank's depo rate in December was at 1.75%. This is the same level as after the ECB meeting early June. This week, the Bank of England and Bank of Japan will also be announcing their monetary policy decisions. Investors are focusing on the central bank's new projections. The spread between Italian and German 10-year bond yields was 92 basis points, down 1 bps. Last week, it reached 84.20 basis points (bps), its highest since March 2015.
Nikkei shares rise in Japan as yen weakens, boosting exports
Japan's Nikkei average rose Monday, despite the continuing conflict between Israel and Iran. A weaker yen was a major factor in this rise.
The Nikkei rose 0.9% to 38,164.07 at 0155 GMT. Meanwhile, the Topix rose by 0.54%, reaching 2,772.46.
Kentaro Hayashi is a senior strategist at Daiwa Securities. He said that investors were less concerned about geopolitical tensions. The market did not see the need for further sell-offs.
He added that there is optimism about the end of the conflict with the United States and Russia taking action.
Nikkei dropped on Friday, after Israel launched attacks against Iran. Wall Street also ended the day sharply lower.
Advantest's 8% gain on Monday was the largest boost for the Nikkei. Advantest, a chip-making equipment manufacturer, is one of Nikkei's largest components. It tends to get bought when markets bet on the Nikkei index going up.
Honda Motor and Nissan Motor both rose 3.4% and 1.0% respectively, on the strength of a weaker Japanese yen. Toyota Motor rose 0.4%.
The yen dropped at the end the week, as investors purchased safe haven assets such as the U.S. Dollar.
The dollar rose 0.17% last week to 144.325 yens.
Weaker Japanese currency tends boost exporters' shares, since it increases the value in yen of profits earned overseas when firms repatriate their money to Japan.
Nippon Steel's share price rose by 2.4% on Friday after U.S. President Donald Trump approved the $14.9 billion deal for U.S. Steel.
Steel makers topped the 33 sub-indices of the Tokyo Stock Exchange (TSE), with a rise of 1.77%.
Shipping sector gained 1.66% as a result of expectations that freight rates will rise amid the Middle East conflict. Kawasaki Kisen rose 2.4%.
On the TSE prime market, out of more than 1,600 shares traded, 66% were up and 28% down. The remaining 4% were trading at a flat rate. (Reporting and editing by Junko Fujita)
(source: Reuters)