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Solar price rises on Monday due to a slump in supply
On Monday, a drop in solar energy generation in Germany will likely offset an increase in wind power output and cause baseload electricity prices to rise. LSEG data shows that the German and French baseload power contracts TRDEBD3,TRFRBD3 had not been traded by 817 GMT Friday. LSEG data revealed that the day-ahead contracts were closed at 88.9 euro/MWh on Thursday and at 58.1 euro/MWh. Wiulan He is an LSEG analyst. He said that a decrease in solar production is expected to increase residual load on Monday. He added that Germany will be a net buyer throughout the day. LSEG data shows that German wind power production is projected to increase by 1.1 gigawatts to 17.8 GW Monday. French wind power is forecast to grow by 6.2 GW from 9.8 GW. The data indicated that solar power in Germany is expected to drop sharply Monday. It will fall from 8.2 GW down to 5.6GW. On Monday, power consumption in Germany will fall by 540 Megawatts (MW), to 53.2 GW. Demand in France should remain stable at 43.1 GW. The French nuclear capacity remained at 75%. German power contract for the year ahead TRDEBYZ6 The price of a megawatt-hour (MWh) in France has dropped by 0.4%, to 87.75 Euros ($103.16). TRFRBYZ6 The market had not opened trading on Friday after closing Thursday at 59.75 Euros/MWh. Yesterday, the German power contracts were backed by several parties. The wind forecasts were continually lowered for the first of October. In their morning report, Mind Energy analysts noted that stronger gas prices and carbon prices also contributed to the increase. The European Carbon Market CFI2Zc1 The benchmark contract dropped 0.7% to 77.28 Euros per metric ton.
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Documents show that Singapore is reviewing a short seller claim against India’s Vedanta
Documents viewed show that the Singapore Police Force has been reviewing a complaint filed by Viceroy Research, a short seller who alleged that Vedanta Ltd, a natural resources conglomerate had improperly funded Vedanta's 2024 dividend. Viceroy's accusations were "baseless" according to Vedanta Ltd, which said it had paid out all dividends in compliance with the applicable laws. The company stated that "we maintain that the allegations contained in the dubious reports of the short seller are malicious and uninformed and we reject them unequivocally." The statement added that there was no SPF investigation in progress and the Singapore Police had not contacted it. Vedanta had previously denied separate allegations made by Viceroy back in July. When contacted, the SPF refused to comment. Accusations of boosted divison Vedanta Limited, based in India, is a specialist in exploration, extraction, and processing of mineral and oil. Viceroy, a U.S. based company, claimed in a letter to the SPF dated August 7, seen by that the company had boosted its dividend using 900 million dollars of Oaktree Capital Management's loan. Viceroy stated that Vedanta, valued at approximately $20 billion, had used accounting and loan tricks to make their reserves appear larger on paper, and to pay out investors without any real cash earnings backing them up. Later, it repaid the debt and reversed write offs via entities domiciled in Singapore. Viceroy said that it drew its conclusions primarily from public reports, forensic analysis of Vedanta Ltd’s filings and visits to the assets. In an email that was seen by Viceroy, the SPF responded to Viceroy's complaints, giving it a number as a reference, indicating they were reviewing the issue. Vedanta Limited is 56% owned by Vedanta Resource, a UK-based company. The rest of the shares are held by institutional investors. Viceroy published in July a report stating that it had taken a position against Vedanta's debt, claiming the British company was "systematically draining its Indian unit", which Vedanta Ltd denied. Vedanta Ltd also claimed that its dividend policy served the parent's financial needs and not its own cash flows. It added that billions in disputed expenditures were hidden from its balance sheet. The Indian company's spokesperson said that the report contained "selective misinformation and baseless accusations." Vedanta Ltd is under pressure after the Indian government refused to approve a plan to demerge into four separate entities, launched by chairman Anil Agarwal 2023. This was after a failed attempt three years ago to take the group privately. Vedanta Resources announced last year that it would be focusing on cutting down its debt, with a goal of reducing net debt by $1.2 billion, to $11.1 billion, in fiscal 2025. (Reporting and editing by Veronica Brown, Joe Bavier, and Florence Tan)
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Iron ore gains for the fourth consecutive week on increased steel demand
The price of iron ore futures rose on Friday. They ended the week with a higher price, boosted by a strengthening steel market and pre-holiday stocking in China, whose major consumer. The January contract for iron ore most traded on China's Dalian Commodity Exchange rose by 0.81%, to 807.5 Yuan ($113.54) per metric ton. The contract finished the week with a gain of 0.88%. As of 0716 GMT the benchmark September iron ore traded on the Singapore Exchange had risen 0.27% to $105.55 per ton, but was down 0.14% over the past week. The steel sector is benefiting from the continued support of the iron metals industry as the peak season approaches. Restocking in advance of the Chinese National Day holiday also helps to boost the demand for ferrous materials. Steel prices may rise if downstream demand is stronger than expected in October. This was predicted by broker Galaxy Futures. According to Mysteel's data, China's stocks of major carbon steels declined by 0.3% from the previous week during September 12-18 to 4,18 million tons. According to Hexun Futures, a Chinese financial information website, the average daily hot metal production, an indicator for iron ore consumption, increased by 171,900 metric tons in comparison to a year ago. The capacity of blast furnaces was also utilised at 93,35 %, up 6.29 percentage points. The National Bureau of Statistics reported that China, the world's largest producer of crude iron ore, increased its production by 8.8% in August, to 81.63 millions tons. Meanwhile, crude steel output fell for a third consecutive month due to a slowing demand. Coking coal and coke, which are used to make steel, have both gained in value, rising by 1.36% each and 0.75% respectively. The benchmarks for steel on the Shanghai Futures Exchange are mostly in positive territory. Rebar rose 0.73%. Wire rod increased 0.09%. Hot-rolled coils rose 0.18%. Stainless steel fell 0.39%. $1 = 7.1118 Chinese yuan (Reporting and editing by Eileen Soreng; Lucas Liew)
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Nikkei falls as BOJ becomes more hawkish. Asia shares to gain weekly gains
On Friday, Asian shares rose on the back of hopes for further rate cuts in the global economy. Meanwhile, the Nikkei fell from its record highs as the Bank of Japan signaled a further winding down of its massive stimulus policy. The EUROSTOXX futures were little changed, indicating that European stocks would open flat. S&P 500 and Nasdaq Futures are both flat after Wall Street closed overnight at record highs. The BOJ maintained its Friday position. Short-term interest rates Two members voted to increase the rate. The company also decided to begin selling its large holdings in exchange-traded fund (ETF) or real estate investment trusts. The data showed that Japan's core rate of inflation was 2.7% for the year ending August. This is the lowest pace in nine month, but it still exceeded the central bank's target of 2%. Stock investors were caught off guard by the surprise vote dissents and asset sales. The Nikkei, after hitting a record in early trading, reversed its gains and was down last 0.3%. This brought the weekly gain of 0.9%. The dollar fell 0.3% to 147.51 Japanese yen. The yield on the 10-year Japanese Government Bond jumped by 4 basis points to 1.635%. This is just short of the previous high for this month of 1.64%. Charu Chanana is the chief investment strategist for Saxo. This is a structural headwind, but the impact will depend on the speed and the signaling of sales. Now, the focus is on BOJ Governor Kazuo ueda's scheduled news conference at 0630 GMT. In the first part of this week, central banks were in The United States Canada Norway Cut interest rates to fan hopes of further policy easing and brighten the outlook for the global economy. Bank of England held steady. South Korea's benchmark stock index fell 0.7%, but remained near its record high. The index was up by 1.3% this week, which brings the two-week total to more than 7%. MSCI's broadest Asia-Pacific share index outside Japan fell 0.2%, but was still on track for a 0.6% weekly gain. It is not far off its four-year highs. The expiration of stock options, stock index options and futures on stock indexes occurs simultaneously every Friday, which can lead to an increase in trading and market volatility. The blue chips of China rose 0.6% while the Hang Seng in Hong Kong fell 0.1%. This is ahead of a phone call that President Donald Trump will have with his Chinese counterpart Xi Jinping later today. Investors have a lot to consider before that call. A deal on TikTok could be close, China's Huawei has announced its chip plans and Beijing has ordered tech firms to not buy Nvidia AI chips. The benchmark S&P 500 index, Dow Jones and Nasdaq closed overnight at new records, helped by improved jobless claims and the news that Nvidia would invest $5 billion into the struggling U.S. semiconductor maker Intel. Intel shares soared 23% while Nvidia rose 3.5%. The dollar recovered on the foreign exchange market after the Fed made its first rate reduction in nine months. The dollar index held steady at 97.38 after plummeting to a multiyear low of 96.224. The pound remained at $1.3546 after slipping 0.6% overnight, as the BOE left rates at 4%. The 10-year Treasury yields increased by 2 basis points, to 4,126%, for the third consecutive session. Oil prices have fallen on commodity markets due to concerns about fuel demand in America. U.S. crude fell 0.3% to $63.38 per barrel, while Brent oil was down 0.2% at $77.32. The spot gold price rose by 0.4%, to $3.658 per ounce.
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Anglo American Australia cuts a'small number of' jobs in Brisbane
Anglo American announced on Thursday that it has cut a "small" number of jobs in its Brisbane office and coal mines in the area as part of its efforts to streamline its operations, adapt to falling coal prices, and increase costs. The Queensland company has not specified the number of job cuts. This comes just a day after BHP, its larger counterpart, cut 750 jobs in a coal mine in that same region. BHP cited low coal prices as well as high royalties from the state government for hurting their returns. Isaac Regional Council is a local government organization. It reported that Anglo American Australia has lost over 200 jobs since Tuesday. ABC News in Australia broke the story first. Ben Mansour is vice president of people and corporate affairs at Anglo American Australia. He said that the majority of the reductions were voluntary. The Queensland government increased royalties in July 2022 to 20% on coal above A$175 ($115.6) per ton. A top tier of 40 percent was added for prices exceeding A$300. This put pressure on the coal miners. Prior to this, the top tier of royalty was 15% on all prices above A$150 per ton. According to its website, Anglo American has five coal mines located in Queensland's Bowen Basin that produce steelmaking coal. It sold a 33% stake in an Australian steelmaking mine for $1.1 billion last year to focus on its core copper assets. Last week, the company announced a merger proposal with Canada's Teck Resources. This will be second largest mining deal in history.
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Australian Prime Minister heads to New York and may meet Trump first
The Australian Prime Minister Anthony Albanese is leaving for the U.S. in this week. This raises expectations of the first meeting between President Donald Trump and the allies, where AUKUS partnership on defence and China will likely dominate the talks. Albanese, according to his office departs Saturday for the United Nations General Assembly, in New York. The prime minister has said that he will attend the reception hosted by Trump, on Tuesday. Australian media reported that a bilateral meeting "may" take place, even though Trump had said on Tuesday that Albanese was coming to visit him "very shortly". Michael Fullilove of the Lowy Institute, a think-tank that focuses on Australian security, stated that Australia's relationship with the United States was "currently quite thin" because Albanese hadn't met Trump in the ten months since he was elected and the U.S. Ambassador to Australia was not present. He said that Mr Albanese's main goal when he meets President Trump is to strengthen the relationship. Arthur Sinodinos said that King Charles gave AUKUS "a very strong plug" when Trump visited the UK. It will be crucial for Albanese, in order to encourage investment, to receive in principle support directly from Trump on the nuclear submarine deal. In a speech at a dinner, King Charles described AUKUS as a "vital partnership" between Britain and the U.S. AUKUS, a system designed to counter China’s rapid build-up of naval forces in the Indo-Pacific region, is currently being reviewed by the Pentagon. Sinodinos is the chairman of United States Studies Centre. He asked, "What new strings will be attached to AUKUS?" GAZA, SOCIAL MEDIA BAN Albanese, who will be speaking at the U.N. General Assembly on behalf of Palestinian statehood and Australia's ban on social media for under-16-year-olds, also spoke about Australia's new law banning social media. Trump, who has a broad criticism of foreign laws that he claims are unfair to U.S. technology companies, is at odds with both positions. Sinodinos stated that there is a common ground in the belief that Western countries must break China's dominance of the supply chain for critical minerals. This week, more than 20 Australian companies that produce critical minerals met with officials from the Trump Administration to explore possible areas of collaboration. Officials said that Australia would urge Trump, on trade, to sign a free-trade agreement with a surplus in Washington's favor. The 10% base tariff on Australia is the best deal that any country has ever struck. In response to Washington's call for increased defence spending, Australia announced on Saturday an additional A$12 billion (8 billion dollars) to upgrade a Western Australia shipyard to maintain AUKUS subs. Officials from Australia and the United States have stated that the U.S. is very interested in Australia's military strategic ties to the Pacific Islands. Australia, the region's largest aid donor, suffered a blow when it failed to sign security treaties with Vanuatu or Papua New Guinea which would have restricted China's influence during Albanese’s visits in each country earlier this month. In a Friday Facebook post, the Chinese embassy in Papua New Guinea stated that it was against exclusive treaties which "restricted or prevented a sovereign nation from cooperating" with a third-party. Sinodinos said that other players were trying to exploit any perceived lack of interest by the U.S. and Australia, as well as New Zealand, in our backyard. (Reporting and editing by Lincoln Feast in Sydney, Kirsty needham from Sydney.
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The MORNING BID Europe-BOJ is still in place, but with a hawkish spin
Ankur Banerjee gives us a look at what the future holds for European and global markets The Bank of Japan's expected hold rounded off the central bank bonanza of this week, which has seen stocks soar and the currency markets subdued. Meanwhile, the dollar remains soft as investors are still uneasy about global interest rate outlook. BOJ's decision was not unanimous, however, with two dissenting voices suggesting that policymakers disagree on when to raise interest rates next. The markets are now focusing on BOJ Governor Kazuo UEDA's press conference, where they will be looking for clues about the rate outlook as well as more information on the central banks plans to sell their holdings in ETFs and Real Estate Investment Trusts (REIT). The Nikkei fell after hitting another record high earlier during the session. Other Asian markets followed Wall Street's lead after the Federal Reserve lowered rates, as expected, earlier this week. However, comments by Chair Jerome Powell, were measured and didn't hint at a rapid reduction of borrowing costs. Don't say it to the stock market. Taiwan's benchmark stock index reached another record high Friday, after Wall Street's major indexes also scaled new records. European futures suggest a subdued opening after Thursday's strong session. The Bank for International Settlements (BIS), which is the umbrella group for all central banks in the world, has warned that the record-breaking global share prices are becoming increasingly unconnected with the growing concerns over government debt levels on bond markets. Investors expect the dollar to weaken in the short term. Remember that the U.S. dollar has fallen more than 10% in value this year, so its further decline may be limited. The focus will be on the interest rate and the reaction to the BOJ's decision throughout the session, as there is little economic data available during European hours. Nvidia, which has pledged $5 billion to Intel in support of the struggling U.S. semiconductor maker, will also be a focus for European tech stocks. The following are key developments that may influence the markets on Friday. Economic events: UK retail prices for August and Germany August producer price
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Asia shares set for weekly gains, Nikkei retreats after BOJ decision
On Friday, Asian shares rose on the back of hopes for further rate cuts in the global economy. Meanwhile, the Nikkei fell from its record highs as the Bank of Japan signaled a further winding down of its massive stimulus policy. The BOJ has maintained Short-term interest rates Two members voted to increase the rate. The company also decided to begin selling its large holdings in exchange-traded fund (ETF) or real estate investment trusts. After the decision, the dollar fell 0.4% to 147.48yen. Japan's Nikkei, after hitting a record in the early trading, reversed its gains and was down last 0.4%. This brought Japan's weekly gain down to only 0.8%. Now, the focus is on BOJ Governor Kazuo ueda's scheduled news conference at 0630 GMT. The data showed that Japan's core rate of inflation was 2.7% for the year ending August. This is the lowest pace in nine month, but it still exceeded the central bank's target of 2%. In the first part of this week, central banks were in The United States Canada Norway Cut interest rates while the Bank of England held steady. James Rossiter is the head of global macro strategy for TD Securities. We expect many central banks to cut their risk appetites at their next meeting, despite the fact that there is still a lot of uncertainty. South Korea's benchmark stock index fell 0.6%, but remained near its record high. The index was up by 1.3% this week, which brings the two-week total to more than 7%. MSCI's broadest Asia-Pacific share index outside Japan fell 0.1%, but was still on track for a 0.7% weekly gain. It is not far off its four-year highs. On Friday, stock options, stock index options, and stock index futures expire all on the same date, resulting in increased trading and possible market volatility. Nasdaq and S&P futures both remained unchanged. Hong Kong's Hang Seng remained flat, ahead of a phone call between President Donald Trump (left) and Chinese counterpart Xi Jinping expected later that day. Investors have a lot to consider before that call. A deal on TikTok could be close, China's Huawei has announced its chip plans and Beijing has ordered tech firms to not buy Nvidia AI chips. The benchmark S&P 500 index, Dow Jones and Nasdaq closed overnight at new records, boosted by improved jobless claims and news that Nvidia would invest $5 billion into the struggling U.S. semiconductor maker Intel. Intel shares soared 23% while Nvidia rose 3.5%. The dollar recovered on the foreign exchange market after the Fed made its first cut in 9 months. The dollar index remained at 97.28 after plummeting to a multiyear low of 96.224. The pound remained at $1.3557 after slipping 0.6% overnight, as the BOE left rates at 4%. The Norges Bank lowered rates overnight and indicated that rates may continue to drop. The 10-year Treasury yields remained at 4,1102% on the bond market after gaining 3 basis points over night. The yield on the 10-year Japanese Government Bond jumped by 4 basis points to 1.635%. This is just shy of this month's record high of 1.64%. Oil prices on commodity markets were stable after falling in the previous session. U.S. crude oil was barely changed at $63.60 per barrel, while Brent crude was unchanged at $67.47. The spot gold price increased by 0.4% to $3,658 per ounce.
As the festive season approaches, India premiums are at a 10-month high; China discounts are widening.
This week, physical gold premiums in India reached a record high of 10 months as investors continued to buy bullion because they expected further gains. Discounts in China also increased to their highest level in five years.
The price of gold in India was around 109.500 rupees (1,240.09 dollars) per 10 grams, after reaching a record high earlier this week at 110,666.
A bullion dealer in Chennai said, "The rally made people more certain that gold would keep rising. So they snapped up coins and bar."
This week, the dealers quoted a premium
A Mumbai-based dealer for a private bank said that retail buyers were waiting on a price adjustment before finalising their purchases.
In October, Indians celebrate Dussehra (Diwali) and Diwali (Diwali), when gold is considered auspicious.
Dealers in China, the top consumer of gold, offered discounts of between $21 and $36 per ounce compared to global benchmark spot prices
Analyst Ross Norman, an independent analyst, said that "gold premiums have fallen in China over the past 6 months due to weak domestic demand. Investors are now focusing on equities and risk-on investments as they pivot to equity investing."
Swiss Customs data released Thursday shows gold exports from Switzerland to China increased 254% between July and August, reaching their highest level since the beginning of May 2024. Analysts attribute this increase to the expected rise in demand at the end of September.
Gold in Hong Kong
Japan's bullion
(source: Reuters)