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Wall St futures fall as caution grows ahead of Big Tech earnings
Investors were cautious as they awaited the first batch Big?Tech earnings that will determine whether Wall Street's AI driven rally still has room to run. After months of gains, which lifted the major indices from their lows in March, momentum has slowed as volatility among heavyweight semiconductor stocks has slowed risk appetite. Investors will be looking for new evidence after the bell that the multi-billion dollar AI investments of these companies are paying off. Alphabet is 'under special scrutiny? after the delay in launching a model that was central to their AI ambitions heightened concerns. Ipek Ozkardeskaya is a senior analyst at Swissquote Bank. She said that if Big Tech, which funnels its free cash into the pockets of chipmakers, shows signs of slowing down the pace of their spending, another selling wave could hit the semiconductor industry. In premarket trading Texas Instruments, which is also scheduled to report after close, fell 1.7%, following broader weakness in semiconductor stocks. Geopolitical risk and the heavy earnings schedule set up markets for a potentially volatile week. The Middle East conflict remained in the spotlight as the Houthi militia of Yemen, backed by Iran, threatened shipping and a wider conflict disrupted the two most important energy chokepoints in the world. U.S. Secretary of State Marco Rubio stated that Washington is still willing to discuss an end to Iran's crisis but Tehran "is not serious" in its talks. The oil price hovered around a six-week high, which complicated the outlook for central banks. According to a median forecast of economists in a recent poll, the Federal Reserve will likely keep interest rates steady through the remainder of 2026. However, respondents indicated that the risk of an increase was still high. CME Group’s FedWatch tool revealed that traders are pricing in a probability of more than 70% that the Fed will leave rates unchanged during?next weeks meeting. At 5:39 am. Dow E-minis fell 45 points or 0.09% and S&P E-minis dropped 22 points or 0.29%. Nasdaq?E -minis fell 208.75 or 0.71%. Super Micro Computer, one of the premarket movers, soared 16.8%. The AI server maker announced that it had received more than $60 billion worth of new orders for its fourth quarter and expects to see a gross margin exceeding its previous forecast. (Reporting and editing by Amanda Cooper, Joyjeet Das, and Ragini Mathur from Bengaluru)
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Copper prices rise, but Chinese buyers are wary, and inflation worries arise.
Copper prices rose on Wednesday, after reaching a six-week high the day before due to shortages and falling inventories outside of the U.S. However, gains were capped by resistance from China to higher 'prices and inflation fears. The benchmark three-month copper price on the London Metal Exchange rose 0.1% to $13,894 per metric tonne by 0930 GMT, after reaching its highest level in over six weeks on February 22 at $13,934. Alastair Munro is a senior base metals strategist with broker Marex. He said: "That it stalls before $14,000 reminds all of us that China is not a chasing price, but there on dips." The dollar's rise amid rising crude prices was "some sort of overnight headwind" with rates markets reflecting the inflationary risks. As hostilities in the Middle East escalated, oil prices reached near six-week highs. The dollar index has risen?during the last four sessions?, but was slightly lower on Wednesday. Traders weighed the possibility that Japan would intervene to support the weak yen. The dollar is stronger, making commodities priced in U.S. dollars more expensive to buyers of other currencies. Due to local shortages, the most traded copper contract at the Shanghai Futures Exchange reached its highest level since June 3, reaching?106.760 yuan. Craig Lang, principal analyst at CRU, said that "Traders continue to deliver metal to the U.S. because they are incentivized by the CME and LME import arbitrage before the U.S. decides whether or not to impose tariffs on refined copper." He said that typhoons and smelter maintenance are impacting the supply of copper cathode in China. A tight scrap supply also adds to demand. Yangshan Copper Premium On Wednesday, the, which measures import demand, reached its highest level since November 2022 at $115 per?ton. Other metals saw a 0.7% increase in LME aluminium to $3179 per ton. Zinc rose by 0.9% to $3585.50; lead increased 0.5% to $1877.50; nickel grew 0.3% to $17.135; and tin climbed 0.4% to $54,100. ($1 = 6.7722 Chinese Yuan) (Reporting and additional reporting by Solomon Cefai, Singapore; Editing Leroy Leo).
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Gold reaches two-week highs as investors watch Mideast developments
Gold reached a two week high on Wednesday. This was supported by some technical 'buying' and safe-haven demand. Investors were watching developments in the Middle East, while also preparing for the U.S. Federal Reserve Meeting next week to get clues about interest rate outlook. Gold spot rose by 0.9% to $4.112,29 per ounce at 0811 GMT. It had already reached its highest level since the 7th of July earlier in that day. U.S. gold futures for delivery in August gained 1%, to $4116.80. Safe-haven demand, and the hope that diplomatic efforts between the U.S., and Iran, could lead to a reduction of tensions, are reducing concerns that higher oil costs could fuel inflation and keep interest rates high for longer. The current price rebound is likely to?face headwinds due to volatile energy prices, but the $4,000 an ounce level still provides strong technical support. Marco Rubio, the U.S. secretary of state, said earlier on Wednesday that Washington was willing to negotiate a solution to the Iran Crisis but Tehran wasn't serious about talking. Three oil tankers carrying Saudi crude bound for China and India changed course in the Red Sea after receiving threats from Yemeni Houthis who are aligned with Iran. This pushed up oil prices. Gold prices are down from the record highs reached in January, after the war stoked inflation fears and increased the likelihood of longer-term higher interest rates. Gold is often seen as a hedge against inflation, but high interest rates can make it less appealing. A poll showed that the Fed will likely keep its main interest rate steady until the end of 2026. Markets are pricing in two rate increases by the end of March next year. CME FedWatch Tool data shows that traders now expect a 67% probability of an interest rate increase in September. Silver spot rose by 0.7% per ounce to $59.2135, platinum rose 0.8% to 1,642.74, while palladium grew by 1% to $1,294.19.
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Investors focus on US tech earnings as South Korean shares lose early gains
South Korean shares closed slightly higher on Tuesday, after a sharp rise in the early going. However, caution before key U.S. technology earnings and chip earnings underscored the market's reliance on heavyweight chipmakers. The benchmark KOSPI Index settled 0.7% higher, at 6,797.7, after rising 6.2% during early trading. This was largely due to a 9% increase in AI memory chips maker SK Hynix. SK Hynix reversed its course and ended marginally lower, while Samsung Electronics finished slightly higher. The'sharp swings' highlighted the dominance and power of Samsung Electronics, SK Hynix and other companies that together account for more than half of the KOSPI. These companies can have a major impact on the benchmark by leveraging their products and share prices. Wei Li is the head of multi-asset investment at BNP Paribas Securities in China. The performance of an equal-weighted index would be lower because traditional exporters like shipbuilders and autos, as well as?chemicals, have seen limited upside due to a softer global market. The KOSPI surged in early trading, but the 11th sidecar trading ban in 15 sessions in this month was triggered by it. This highlights the increased volatility caused by the heavy concentration of chipmakers, at the heart of the AI boom. Wall Street's overnight rebound set the tone for Wednesday's rally. Market participants, however, remained focused on Alphabet's results and those of chipmakers Intel and Texas Instruments. Jason Lui is the head of APAC equity derivate strategy at BNP Paribas. He said that after the sharp drop in share prices, which was largely due to valuation, there should be a less crowded positioning going into major tech earnings. Lui explained that this will help investors "better assess the growth prospects of companies in a fundamental way." Other notable stocks included Hyundai Motor, Kia?Corp, and Samsung BioLogics. In the week ending Tuesday, foreigners have invested around 2.71 trillion dollars. However, they remain net sellers for the year with more than $100 billion of?outflows. On the onshore settlement platform the won last traded at 1.478 U.S. dollars, up from the previous day's 1,471.
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Shanghai copper reaches 7-week high due to supply concerns and strong China demand
Shanghai copper prices rose on Wednesday to a seven week high as supply concerns and a 'firm Chinese demand' pushed up the price. London copper fell after reaching a six week peak just a day before. As of 0700 GMT, the most traded?copper?contract at the Shanghai Futures Exchange had risen by 0.94% to 105,820 Yuan ($15.625.65) per metric ton. It had reached its highest level since June 3, at 106760 yuan, earlier in the day. The benchmark three-month copper price on the London Metal Exchange fell 0.57%, to $13,806.5 per ton. This was after it hit a six-week-high on Tuesday. Copper inventories have dropped in LME-registered storage warehouses Warehouses that are SHFE monitored . The Chinese demand is strong, and the market still awaits news about potential U.S. metal tariffs. "Traders continue to deliver metal to the U.S. due to the CME-LME?arbitrage import?ahead of the 'U.S. Craig Lang, Principal Analyst at CRU said that the U.S. would decide whether or not to impose tariffs on refined copper. The Chinese market remained active. The Yangshan Copper Premium On Tuesday, the, which measures import demand, reached its highest level since December 2023, reaching $109 per?ton. Lang explained that typhoon-related maintenance at smelters and the stockpiling of scrap metal due to their impact on the supply are both affecting supply. The tight scrap supply has also increased demand for "copper cathode". The Middle East conflict is also pushing up oil prices. According to economists polled, the U.S. Federal Reserve will keep rates the same for the rest of the year. Copper became more expensive to buyers who used other currencies because the dollar was strong. Aluminium was up by 0.02% on the LME, while?zinc gained 0.23%. Lead fell 0.27%. Nickel rose 0.5%, and Tin climbed 0.2%. The SHFE saw aluminium gain 0.59%. Zinc gained 0.68%. Lead lost 0.88%. Nickel climbed 1.07%. Tin added 0.87%. $1 = 6.7722 Chinese Yuan (Reporting and editing by Subhranshu Sahu).
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Gold reaches two-week highs as Fed outlook and Mideast conflict remain in focus
Gold rose to a?high? of two weeks?on a technical basis?on Wednesday as investors assessed a deteriorating Middle East conflict. They also waited for the U.S. Federal Reserve's meeting next week, which will provide clues about the interest rate outlook. Gold spot rose 0.9% by 0705 GMT to $4,112.70 an ounce, after hitting its highest level since July 7 earlier that day. U.S. Gold Futures for August Delivery jumped 1% to $4,116.90. The escalating tensions in Middle East have pushed up oil prices, stoked inflation fears and increased expectations of interest rate increases. This has led to gold's steepest weekly decline since early June. Tim Waterer is the chief market analyst for KCM Trade. He said that buyers are stepping in to find a bargain after a recent pullback. Meanwhile, hopes of diplomatic progress between Iran and the U.S. also help price movements. Marco Rubio, the U.S. secretary of state, said that Washington was still willing to talk to Iran about a resolution to the crisis. However Tehran did not seem to be serious. After threats by the Iran-aligned Houthis of Yemen, three oil tankers carrying Saudi crude towards Asia reversed their course in Tuesday's Red Sea. This raised concerns over?energy supplies. A poll suggests that the Fed will maintain its key interest rate for the rest of 2026. However, a majority who responded to a question regarding the possibility of a hike in this year rated it "high". This is a change from last month, when the majority rated it "low". The opportunity cost of holding?bullion that does not yield increases as interest rates rise over time. Silver spot?was 0.7% higher at $59.18 an ounce, after reaching its highest level since July 10 earlier that day. Palladium rose by 1.5%, to $1300.58, while platinum jumped 1.2%, to $1649.03. (Reporting and editing by Rashmi aich and Subhranshu sahu in Bengaluru, and Pablo Sinha based in Bengaluru.
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Kyrgyzstan approves a plan to build a mini oil refinery amid Russian shortages
Kyrgyzstan agreed to build a mini-oil refinery worth $25 million in the south of the nation as part of its efforts to increase domestic fuel production and reduce dependence on imports due to tightening Russian supplies. Central Asian Energy LLC of Kyrgyzstan, who will finance the project, recently signed an agreement with the Kyrgyz company to build the refinery. The plant will produce bitumen, motor oil and gasoline that meets?K5 or K6 environmental standards. The first phase of the construction should be completed by autumn 2026. Kyrgyzstan imports a majority of its gasoline from Russia. Fuel shortages in Russia have been a problem since late May, due to production reductions following drone attacks on Russian refineries. The Association of Oil Traders of Kyrgyzstan (AOTK) reported a shortage of AI 95 and AI 98?grade gas in late June due to a lack of supplies from Russia, and a seasonal rise in demand. In recent weeks, authorities have taken a series of steps to stabilize the fuel market. These include temporary price controls and lifting state price regulation for AI-95 gasohol. They also imposed a ban on exports of petroleum products. Kyrgyzstan?also awaits fuel deliveries from China, and Belarus. Separately the energy ministry announced that it had 'agreed with Uzbekistan to refine a part of its petroleum products in Uzbek refineries, before shipping them back to Kyrgyzstan. Reporting by Aigerim Turgunbaeva; Writing by Felix Light; Editing by Louise Heavens
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Norsk Hydro's Q2 profits are the highest as higher prices and Qatar offset the lower price.
Norsk Hydro, the Norwegian aluminium manufacturer, reported a quarterly profit that was?above expectations? on Wednesday. Higher aluminium prices and higher?recycling? margins outweighed lower energy output and negative currency effects. Hydro enjoyed a windfall from the higher aluminium prices, regional premiums and disruptions in Middle East supplies during the second quarter. However, reduced production at its Qatalum Joint Venture limited this. The company's adjusted earnings, before interest, taxes, depreciation, and amortization, rose 15% year-over-year to 8.92 billion Norwegian Crowns ($927.0 million) during the April-June period, while the average estimate of analysts polled was 8.22 billion Norwegian Crowns. Hydro's Aluminium Metal division, which has an adjusted EBITDA of 6.42 billion crowns, led the improvement. It said that higher metal prices and lower costs for alumina more than compensated a?8% drop in sales volumes, as well as increased energy and carbon expenses and a stronger Norwegian Crown. Hydro's adjusted EBITDA dropped from 922 millions crowns a year earlier to 316million crowns at Qatalum due to the Middle East Crisis. Hydro ceased purchasing metals from Qatalum in the third quarter after the marketing and offtake contract with the venture expired. Hydro stated that it was in discussions with its partner about how Qatalum’s metal would be marketed and sold going forward. Aluminum prices rose to a record high of four years in June, as regional supply risk increased and physical premiums in Europe and North America strengthened. Hydro's recycling operation earned over 900 million crowns despite little improvement in underlying demand. Hydro reported that primary aluminum consumption outside China has declined from a year ago. It added that the Energy division's profits had also been cut in half due to a lower hydropower output and regional price differences.
The mine that funds Congo's rebels and feeds the tech industry
Under the watchful eyes of M23 rebels, in the hills surrounding the Congolese city of Rubaya a line men in rubber boot ferry sacks of crushed stones up winding paths cut in to the slopes.
Coltan, a mineral which powers modern technology, is being hauled by the workers. The ore is loaded onto motorbikes, and then shipped thousands of kilometers to Asia. The ore is then processed into tantalum - a heat resistant metal which fetches over $300 per kilogram. It's in demand by manufacturers of mobile phones and computers as well as aerospace components and gas engines.
Rubaya is responsible for 15% of all the coltan produced in the world. Coltan is mined by hand, and locals earn just a few dollars a day. The control of this mine is at the heart of a long-running war in this nation in central Africa.
M23, the rebel group backed by Rwanda's government, took over the area in April 2024. The heavily-armed M23 rebels, who claim to be fighting for the overthrow of the Kinshasa government and the safety of Congolese Tutsi minorities, have captured more mineral-rich land in eastern Democratic Republic of Congo this year.
M23 and DRC pledged to sign an agreement in Doha, Qatar, at a ceremony this month. The United States mediates parallel talks between Congo, Rwanda and a potential investment of billions in the event that hostilities end.
The United States Treasury sanctioned on Tuesday other alleged participants of minerals smuggling, including PARECO FF, a progovernment Congolese milita that the U.S. claimed controlled the Rubaya mine site from early 2024 to 2022, before M23 took over.
PARECO-FF was not available for comment.
A senior U.S. official was asked at a briefing by the press why Washington targeted PARECO-FF and not M23. He noted that sanctions have been placed on M23 since 2013 because it has fuelled conflict in the area.
John K. Hurley said that the Treasury Department would not hesitate to act against groups who deny the United States or our allies the access to critical minerals essential for our national security.
Jason Stearns is a former U.N. inspector in Congo. He said that the fact that M23 wasn't targeted by the new mining sanctions was surprising.
M23's advances pose the greatest threat to Kinshasa's government in the last two decades. The conflict stems from the 1994 Rwandan genocide in which around one million members of Rwanda's Tutsi group were killed by Hutu-led militias.
The Rwandan government has denied for years that it is involved in the trade of coltan, looted by its neighbor, or that it supports M23. Rwanda's ruling Tutsi majority party shares the same concern as M23 about the alleged threat of rival Hutu groups in eastern Congo. According to a U.N. document reviewed by the Associated Press on July 3, Rwanda had deployed between 1,000 and 1,500 troops into rebel-controlled Congo areas as of April.
M23 controls two important Congolese towns - Goma, and Bukavu on the Rwandan border. U.N. Investigators claim that Congolese minerals, which are often transported illegally to Rwanda through these cities, are mixed with Rwandan coltan before being exported.
M23, the Rwandan government and the Congolese government did not respond to comments. Congolese officials accuse Rwanda of fomenting conflict in order to plunder Congo’s mineral wealth.
A U.N. December report stated that the size of the trade increased after M23 captured Rubaya. U.N. report: The rebels established a parallel government that controlled mining, trade, transportation, and taxation on the minerals produced in Rubaya.
Reporters visited Rubaya, in March of this year. M23 officials told them that the rebels had levied a 15% tax on the coltan the mineral traders purchased from the informal miner's who worked the area. According to a U.N. report from December, M23 collected $800,000 per month from levies on coltan mined in eastern Congo.
MUD AND MOTORBIKES
Rubaya is a beehive of pits that are so vast and complex, it's a huge undertaking to reach them. Journalists who visited the mines in March were forced to abandon their Land Cruisers when they became stuck on a muddy road leading from Goma. The journalists walked for 5 km (3 miles) in order to get to the town, and then they hopped onto motorcycles with rebel officials so that they could reach the mines.
The activity in Rubaya starts before dawn when thousands of miner descend into the pits cut in the rolling hills of Congo’s North Kivu Province, where many work in 12-hour shifts.
Tunnels can reach a depth of up to 15 meters (49 feet). Porters transport the ore fragments to shallow basins filled with water dug by laborers. Other workers, including children and women, then wash and separate the ore from debris and sand before laying it out in the sun to dry.
The journalists were closely supervised by M23 personnel who were unarmed throughout their stay in the mining area. Reporters saw rebel officials jotting in a notebook the number of sacks that each porter, covered in fine white dust, carried to each collection point. Once the ore has dried, it's stacked onto motorbikes and transported to Rubaya where it is sold by traders.
Pascal Mugisha Nsabimana (32), a miner from Congo, was told by a M23 chaperone that it is better to work under rebel occupation than to labor under the supervision and control of the Congolese military or its allies who fled the area when M23 invaded the region last year.
In the past, "there was a lot of harassment, a lot of taxes and we, as diggers, often were not paid." The miner added that even when they did get paid, it was not enough. He said that under M23, his day rate has at least tripled.
According to over a dozen sources, including former and current smugglers as well as miners and businessmen, in the months immediately following the M23 takeover of Rubaya, Congolese troops remained along the border. Smugglers then used motorcycles to sneak ore into Rwanda by using backroads. According to two former smugglers, who transported coltan in this manner until last year, the journey could take a whole day. The two ex-smugglers said that they would load their bikes with three bags of 50 kilograms each time and receive about $34 per trip for delivering the coltan to traders.
Nine of these people stated that M23's changes have been a game changer for efficiency. Motorcycles are not the main means of transportation anymore, and they are only used to transport the coltan to Rubaya from the mine. According to the U.N. report and the people, ore is then loaded into SUVs, pickups, and other vehicles that can haul anywhere between two to twenty tons. It is also faster. Coltan trucks are now able to pass through Goma on paved roads, since M23 has taken control of the border city and driven Congolese forces out. This, according to people, has shortened transport times.
Experts at the United Nations and human rights activists warn that illegal mining profits are used to fund conflict. The trade, they say, has not brought much wealth to the locals and child labor is very common. At least 12 children were seen working in the Rubaya Mine: Boys entered the shafts and hauled out the ore, then carried it to basins where the girls washed and dried the coltan alongside the adults.
Gregory Mthembu Salter, former U.N. expert in Congo, who is now a consultant on conflict minerals said that efforts made by the mining industry and U.N. agencies, as well as non-government organisations, to clean the supply chain of the region and prevent human right abuses, which began around 2010, have failed.
Mthembu Salter, Phuzumoya Consulting's director, said: "The same thing has happened 15 years after."
U.S. INVESTORS LOOK AT RUBAYA RICHES
Some U.S. investors have also targeted Rubaya's riches in coltan as President Donald Trump tries to broker a deal to end conflict and promote the development of the mineral wealth of the region. These riches in Congo include cobalt reserves, gold, diamonds, copper, and lithium. The formal mining sector of the country is currently dominated by Chinese firms.
According to a source with direct knowledge, Texas hedge fund manager Gentry beach, who is the chairman of America First Global, and raised funds for Trump's 2016 election campaign, was part of a group that sought to negotiate the rights to Rubaya Mine. Gentry Beach's interest in Congo coltan was first reported by The Financial Times.
Sources told us that Beach's Group had proposed the Congolese Government to take a majority stake, while Kinshasa retained a 30% share.
Beach expressed his interest in a project but refused to give any additional details.
Some U.S. legislators are pushing back. In a letter sent to Trump and U.S. secretary of state Marco Rubio on August 8, more than 50 Democratic members of congress criticized the lack of transparency of the DRC negotiations by the Trump administration. The Democratic congress members also expressed concern about a possible conflict of interest if a Trump ally was angling to obtain rights to develop Rubaya Mine.
Anna Kelly, White House Deputy press secretary, said in an email statement dated 5 August that the agreement Trump arranged between Congo and Rwanda has the potential of leading to lasting peace in the region. The president's vision is a "win-win outcome where all parties benefit--economically and politically--through cooperation and shared prosperity," the statement said. She did not answer a question about the letter sent by congressional Democrats.
The U.S. State Department made no comment. In a statement released on August 1, the State Department stated that it would support efforts made by Rwanda to promote security and economic co-operation. According to the statement which didn't go into detail, heads of state will be invited to Washington soon for a summit.
The U.S.-backed agreement does not include the M23. The rebel group is a part of a parallel, separate mediation that Qatar has led to try and end hostilities. Success in the Doha talks is crucial to a lasting peace and to making Rubaya a safe place for Western mining interests.
Some analysts and diplomats are unsure about the chances of a quick resolution.
Congo and the M23 rebels agreed in Doha that a deal would be reached by August 18th. The U.N. says that the U.S. has a responsibility for the deaths of 319 civilians last month in eastern Congo.
Could not independently confirm these killings. M23 leader Bertrand Bisimwa said to the news agency that the group would investigate. He also suggested reports of atrocities were a "smear" campaign against the insurgent.
The U.S.-brokered agreement calls for Rwandan soldiers to withdraw from Congo. Last month, Rwandan President Paul Kagame stated that he wasn't sure if the agreement would stand.
Kagame stated that the Congo must first fulfill its promise to defeat the Democratic Forces for the Liberation of Rwanda, an ethnic Hutu group based in eastern Congo and linked to the Rwandan Genocide. Kigali views the FDLR as an existential danger.
Josaphat Muamba, a Congolese Ph.D. student at Ghent University, Belgium, said that suppressing the militias would be a difficult task for the DRC military, as it is not present in vast swathes M23-controlled land.
Musamba stated that it was difficult to neutralize FDLR while M23 were still in place and the Congolese Army had not been redeployed. He called both peace initiatives "piecemeal efforts" that don't deal with "the realities on the ground."
A senior diplomat, who closely follows the events in Rubaya, stated that another formidable task would be to transform Rubaya's crude system for coltan extraction.
The diplomat stated that "no one speaks about the feasibility of granting these mining concessions or running these concessions. Especially since the entire mine is artisanal" done almost exclusively by hand.
(source: Reuters)