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Asian stocks are choppy after commodities rally as they catch their breath. The yen is in focus
The Asian stock market limped into the weekend on a weak footing, as Wall Street's declines continued through early trading. Commodity markets also took a break after their recent surge. The regional markets are on track to have one of the best years they've had in a decade. They outpace their U.S. counterparts, as President Donald Trump’s economic policies and tariffs trigger a surge of order across the region. Chris Weston of Pepperstone Group Ltd, Melbourne, said that the U.S. session was the moment when a number "well-subscribed and high-momentum" trades, including gold, cryptocurrency, silver, and a large part of the S&P 500, "finally displayed signs of exhaustion." The MSCI broadest index for Asia-Pacific stocks outside Japan fluctuated in gains and losses. Its gains for the past week were still up for grabs, as U.S. stock markets ended their previous session with modest declines. Hong Kong's shares fell the most by 1.1%. The Australian market, however, slid only 0.1% in the face of volatile commodities markets. Stocks in South Korea surged by 1.7%, continuing the gains of the region's top-performing index. The U.S. Stock Futures have reached a bottom, ahead of the Wall Street earnings season which begins next week. S&P 500 E-minis rose 0.2% while the U.S. Dollar Index, which measures greenback strength against a basket six currencies, remained near its two-month-high at 99.37. The yield on the benchmark 10 year Treasury bond dropped to 4.1384% from its U.S. closing of 4.148% Thursday. FedWatch, a tool of the CME Group, shows that traders' expectations remain strong. Fed funds futures are pricing in a 94.1% chance of a rate cut by 25 basis points. TAKAICHI WALKS a Tightrope The Nikkei index fell 0.7% after a week of sharp gains, including Thursday's record-breaking closing high. The data earlier in the morning showed that wholesale prices had risen 2.7% over the past year, a sign of cost pressures persisting. This will keep the markets prepared for a rate hike possible by the Bank of Japan at its meeting on October 30. The dollar fell 0.1% to 152.96 yen, the lowest level since February for the Japanese currency, after Sanae Takaichi, the leader of the ruling party, said that the central bank was responsible for determining monetary policy, but that all decisions made by the central bank must be in line with the government’s goals. However, traders say that her promise to reassert the government's control over the central banks may be tempered by a weakening yen as well as domestic political considerations. In a recent research report, Bank of America analysts wrote that the market expects Japan to adopt fiscal expansionary policies. "However there is considerable uncertainty about the details of the policies under discussion, as well the extent of fiscal expansion." Focus on Commodities Gold continued to decline, after it snapped a four-day streak of gains on Thursday. This was shortly after the metal broke the $4,000 barrier for the first. The ebullience spread into other precious materials. Gold spot was trading at $3,971.93 an ounce down by 0.1%, while silver rose 1% to $49.62. Silver has now retested the $50 barrier after breaking through it for the first-time on Thursday. Chinese stocks fell after ETFs that track large-caps in Wall Street declined overnight. Beijing had tightened its control over the rare earths sector on Thursday. Brent crude rose 0.1% on the energy market to $65.27 a barrel after Israel's government approved a ceasefire Friday with Hamas, paving the way for the suspension of hostilities in Gaza and the release of Israeli hostages there within 24 hours.
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US deploys 200 troops to Gaza Task Force without any operations on the ground
Two senior U.S. government officials announced on Thursday that the United States would deploy 200 troops to Gaza as part of a task force for stability. There will be no Americans present on the ground. According to the officials, who spoke on condition of anonymity with reporters, the 200 people would form the core of a taskforce that would also include representatives of the Egyptian military, Qatar and Turkey, as well as the United Arab Emirates. Officials said that the exact location of U.S. forces had not yet been determined. They would create a joint command center and integrate the other security forces in Gaza that will be working to coordinate with Israeli troops to avoid clashes. One of the officials said, "No U.S. soldiers are planned to go into Gaza." Officials said they hoped that the Gaza deal would, once implemented, cool tensions in this region and provide a basis for further negotiations between Israel and Arab countries on normalization. In his first term, U.S. president Donald Trump brokered the Abraham Accords - normalization agreements between Israel and Bahrain and the United Arab Emirates as well as Morocco and Sudan. Officials said Saudi Arabia, Mauritania Algeria, Syria, Lebanon, and Indonesia are all candidates for such an agreement. (Reporting by Steve Holland and Ismail Shakil, editing by Diane Craft & Cynthia Osterman).
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Stocks drop, Argentine peso increases with US Treasury move
The major stock indexes slipped on Thursday. Meanwhile, the dollar rose to its highest level since mid-February against the Japanese yen as the newly elected leader for Japan's ruling political party failed to instill confidence in the market about the currency’s direction. The local peso and Argentina's dollar-denominated bonds strengthened on Thursday night after the U.S. Treasury participated directly in the foreign exchange markets. Scott Bessent, U.S. Treasury secretary, made the announcement following the close of the market as part of the previously pledged support to Argentinean President Javier Milei’s reform programs. All three major U.S. indexes finished lower and European stocks also ended in the red. The stock market has been largely rising in recent sessions, despite the ongoing U.S. shutdown and political risks in Japan and France which have made investors nervous. Oil prices dropped as investors weighed the potential benefits of a ceasefire in Gaza, which could reduce tensions in the Middle East, against the stalled peace negotiations in Ukraine. Spot gold also fell after demand for safe havens pushed the metal to above $4,000 per ounce this week. Sanae Takaichi said that she didn't want to cause excessive declines in Japanese currency. This led to a short-lived fall in the value of the dollar against the yen, before it reversed. This week, the yen fell on fears that Takaichi would introduce fiscally expansive policies. The dollar last rose 0.27% to 153.09yen, after reaching its highest level since February 13 earlier. The peso ended the day at 1,425 to the dollar, an increase of 0.8%, after a series of sessions in which the local Treasury intervened and managed the weakness. It makes sense that the Argentinian Peso has jumped as high as it did after a $20 billion currency swap to ease the financial crisis Argentina faces. This is in line with the U.S. government's policy to aid those who align with its agenda, whether it be on trade, diplomacy or other American interests, said Juan Perez of Monex USA, Washington. The U.S. federal government shutdown, which began last week, has left investors with no access to key economic reports. Adam Sarhan of 50 Park Investments, New York, stated that despite Thursday's decline, the stock market is still buoyant. He added that stocks may weaken if there is a prolonged government shutdown. He said: "We are in a very solid bull market which refuses to fall meaningfully." "I expect a pullback to happen at some point, but the market is strong for now." JPMorgan Chase CEO Jamie Dimon stated that there is a greater risk of a significant stock market correction in the U.S. within the next 6 months to 2 years. Dimon cited factors such as geopolitical tensions and government spending, along with remilitarization across the globe. The Dow Jones Industrial Average dropped 243.36, or 0.5%, to 46,358.42. The S&P 500 declined 18.61, or 0.2%, to 6,735.11 while the Nasdaq Composite lost 18.75, or 0.8%, at 23,024.63. Sunday marks the third anniversary of the current bull market in the United States. On October 12, 2022, the benchmark S&P 500 reached its nadir in this current market cycle. The pan-European STOXX 600 ended 0.43% down, dragged by steep losses at HSBC and Ferrari. The dollar and euro were down against each other again on Thursday. Since Monday, when French Prime Minister Sebastien lecornu resigned and his government with him, the currency has fallen. The office of French President Emmanuel Macron said that he would appoint a prime minister in 48 hours. The currency fell 0.61% to $1.1555, its lowest level since August 5. On the back of the belief that the country will avoid an early election, French bonds maintained gains from the previous day. France's 10-year yield increased by 0.2% on the day to 3.529%. Brent crude fell by $1.03 and settled at $65.22 a barrel. U.S. crude futures declined $1.04, settling at $61.51 per barrel. Spot gold fell by 1.56% to $3,975.04. The yields on U.S. Treasury bonds have remained relatively unchanged as the shutdown of the federal government continues. The yield on the 10-year bond was marginally higher at 4.142%.
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IAEA: Process started to restore external electricity to Ukraine's Zaporizhzhia Nuclear Plant
The U.N. nuclear watchdog announced on Thursday that the process of restoring external power had begun at the Russian-owned Zaporizhzhia Nuclear Power Plant in southeast Ukraine. This plant has been cut off from electricity for over two weeks. Rafael Grossi said that the process began after consulting with the authorities of Ukraine and Russia who are blaming each other for the destruction of external lines. In the first few weeks of the Kremlin invasion of Ukraine in February 2022, Russian forces captured the largest nuclear plant in Europe with six reactors. Although the plant does not produce electricity, both sides accuse each other of military action that compromises nuclear safety. Grossi stated in a website statement that "the process leading to the establishment of off-site electricity...has begun" following intensive consultations. While it will take time for the Zaporizhzhia Nuclear Power Plant to be connected back to the grid, both sides have worked with us constructively in order to achieve this crucial objective. This is important because of nuclear safety and security. Since the last external connection went down on 23 September, the plant relies on emergency diesel generators in order to cool the fuel inside the reactors and prevent a meltdown. Grossi stated that IAEA observers stationed in the plant heard five explosions in succession Thursday "occurring near the site and shaking the windows in their building". Grossi said that the decommissioned Chornobyl Nuclear Power Station, the site of the worst nuclear accident ever in 1986, still lacked an external powerline. Ukraine claimed that the plant is now powered by alternative sources of energy, but lost its power line due to a Russian attack against an electrical substation near a town. Interfax reported that the Russian Deputy Minister of Foreign Affairs Sergei Ryabkov had said earlier there was no reason to restart the Zaporizhzhia Nuclear Plant in the absence external energy sources. Rosatom, the Russian state-owned nuclear corporation, was quoted as saying that it was planning to restart this plant. (Reporting and editing by Toby Chopra in Bengaluru, Ron Popeski, Alistair Bell).
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US refuses to sign joint statement of World Bank Directors on Climate Agenda
The World Bank's executive directors, 19 of them, issued a statement last week expressing their support for its continued efforts to combat climate change. They did so in defiance of the United States, the largest shareholder and other countries. Sources familiar with the situation said that the executive directors of the U.S. and Russia as well as Kuwait, Saudi Arabia, and Japan, who are both negotiating deals with the U.S. on trade, abstained from signing the document. After a meeting with World Bank management the directors, who represent over 120 countries, released a statement highlighting their expectations that the bank would adhere to its goals for climate change action plans, including its pledge to dedicate 45% of annual financing to climate related projects. This document, which was seen by, shows the deep divisions between the U.S., and a few allies, over climate change. The document comes just days before the World Bank's and the International Monetary Fund's annual meetings. The U.S. has the largest stake in both institutions, and it plays a major role in determining their agendas and work. This week, it was reported that the European Union would double its support to reform global development banks in order to combat climate change. Scott Bessent, U.S. Treasury secretary, called for both institutions to refocus their mandates in April at the IMF/World Bank meeting. He said that they were spending too much time and money on topics such as climate change. Since Donald Trump became president, both institutions have been largely silent about climate change. The issue will not be highlighted on the agenda for next week. Trump dismissed climate change last month as a "con-job." In addition, the statement called for the alignment of the bank's activities with the Paris Climate Agreement that President Donald Trump of the United States withdrew from shortly after assuming office in January. The statement also called on the bank to continue to include climate change in its core diagnostic work. The statement stated: "We reaffirm that we support the World Bank Group in its leadership role within the (International Financial Institutions), advocating and supporting the countries' demands for low-carbon, climate resilient and nature positive paths. The directors called for more work to be done in certain areas of the current Climate Change Action Plan. This includes supporting workers who are transitioning their countries away from coal. The letter also said that more work was needed to help countries design and implement national climate and development programs, as well as develop effective carbon markets. The bank's climate change plan does not cover several areas, such as pollution, nature, scaling up adaptation and resilience. (Reporting and Editing by Marguerita choy)
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Dollar gains against the yen and euro; stock indexes decline
Investors weighed the prospects for Japan's fiscal policy as major stock indexes slid on Thursday. The S&P 500 closed at a record high on Wednesday despite the ongoing U.S. shutdown, political risks in France and Japan, and investor anxiety. On Thursday, the euro fell again against dollar. Investors weighed a Gaza ceasefire agreement that could ease Middle East tensions with the stalled peace negotiations in Ukraine when oil prices dropped. Gold prices rose above $4,000 per ounce this week due to safe-haven demand, a weaker US dollar and the desire for a haven. Last week, spot gold fell 1.6% to $3,973.10. Sanae Takaichi said that she didn't want to see the Japanese yen fall too much. After the comments, the dollar briefly weakened against the yen. The dollar was up by 0.24% to 153.04yen, after reaching a high of 153.21 earlier. This is the highest level since February 13. The U.S. federal government shutdown that began last week has prevented investors from receiving key economic reports. Adam Sarhan of 50 Park Investments, New York, stated that despite Thursday's decline, the stock market is still buoyant. He added that stocks may weaken if there is a prolonged government shutdown. He said: "We are in a very solid bull market which refuses to fall meaningfully." "I expect a pullback to happen at some point, but the market is strong for now." The Dow Jones Industrial Average dropped 297.20, or 0.63 percent, to 46.306.65, while the S&P 500 lost 27.40, or 0.40 percent, to 6,726.41, and the Nasdaq Composite was down 62.14, or 0.27 percent, to 22981.65. JPMorgan Chase CEO Jamie Dimon stated that there is a greater risk of a major correction in the U.S. Stock Market within the next 6 months to 2 years. He cited factors such as geopolitical tensions and government spending. The MSCI index of global stocks fell by 4.38 points or 0.44% to 917. The pan-European STOXX 600 Index The market closed 0.43% lower. Drag down French bonds maintained gains from the previous day on the optimism that the country will avoid a snap elections. The office of French President Emmanuel Macron announced on Wednesday that he will appoint a prime minister in the next 48 hours. The 10-year French bond yield increased by 0.2% on the day to 3.529%. The euro last fell 0.64% to $1.1552. Brent crude fell by $1.03 and settled at $65.22 a barrel. U.S. crude futures declined by $1.04, settling at $61.51 per barrel. The yield on the benchmark U.S. 10 year notes increased by 1.5 basis points, to 4.146% from 4.131% at late Wednesday.
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Grain prices fall due to profit-taking and China trade concerns
U.S. soybeans futures fell on Thursday, after two days of gains. Profit taking and technical sales were a factor as well as growing concerns over a promised package for farmer assistance and the breakthrough in U.S. China trade negotiations. Corn futures fell alongside soybeans as U.S. harvesting accelerated. Wheat futures were a little bit mixed. The federal government shutdown delayed the release of the U.S. Department of Agriculture's monthly supply and demand report for Thursday. Analysts said that the shutdown prevented traders from getting the latest information on corn and soybean production. Plant diseases and dry conditions in late season likely affected yields. Details of the possible $10 billion-$15 billion package of farmer aid promised by U.S. president Donald Trump last week are still unknown. USDA Secretary Brooke Rollins stated that the administration would be able to deliver the aid as soon as the government reopened. Jack Scoville is an analyst at the Price Group. He said, "I think that farmers will have to sell some of their production to raise some money, and we're beginning to factor that in." China's decision to expand export controls on rare-earth metals raised concerns about a resolution of the U.S./China trade dispute ahead of a later meeting between President Trump and Chinese president Xi Jinping. The two leaders are expected to discuss China’s lack of U.S. purchases of soy. Scoville explained that "soybeans have rallied recently and that I believe that this was due to hopes that Trump and Xi will come to a type of deal by the end of the Month." Chicago Board of Trade December corn fell 3-3/4 Cents to $4.18-1/4 per bushel, while November soybeans dropped 7-1/4 Cents to $10.22-1/4. CBOT December Wheat fell 3/4 cents to $5.06-1/4 a bushel.
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Silver eases off record highs, gold falls below $4,000/oz
Gold prices dropped 2% on Friday, falling below $4,000/oz for the first session since the milestone was breached. The dollar rose and investors in gold made profits after a ceasefire agreement between Israel and Hamas. Silver also slipped from its record high $51.22 an ounce, under pressure from the same factors that impacted gold. Gold spot fell by nearly 2%, to $3.959.48 an ounce at 01:53 pm. ET (17:53 GMT). U.S. Gold futures for delivery in December fell 2.4%, to $3,972.6. Silver was unchanged at $48.93 an ounce. Dollar-priced gold is now more expensive to overseas buyers due to the 0.5% increase in the dollar index. As the Gaza ceasefire comes into effect, speculators will be taking gold chips off of the table. This is because it lowers the temperature within a historically volatile area," said Tai Wong. Israel and Hamas have signed a cease-fire agreement, which is the first step in President Donald Trump's initiative for ending the Gaza war. Wong stated that "gold and silver need to consolidate, but the primary factors driving the rally remain the diversification of reserves and the large global sovereign debt growth, which keep the bullish outlook in tact." On Wednesday, the price of gold surpassed $4,000 an ounce for a first time, hitting a new record high at $4,059.05. This non-yielding investment, which is traditionally used as a hedge in times of geopolitical or economic uncertainty, gained 52% so far this year. The rally was fueled by geopolitical uncertainty, central bank purchases, ETF inflows on the rise, and expectations of U.S. interest rate cuts. The minutes of the September meeting of the U.S. Central Bank, released on Tuesday, revealed that Fed officials agreed that the risks to the U.S. employment market were sufficiently high to warrant a cut in interest rates, but they remained cautious due to stubborn inflation. In September, the Fed began a new cycle of rate cuts with a reduction of 25 basis points. The traders see a 25-basis point reduction in October, and another one in December with 95% and 80% chances, respectively. Silver's rise this year has been driven by the macroeconomic forces that have propelled gold's rally, and the tight supply on the spot market. A precious metals trader stated that "Liquidity is low in the London Silver Market due to ETF purchases and metals still being shipped to the U.S." India's Kotak Mahindra has temporarily halted new investments Silver ETF despite a shortage Palladium fell 1.7% to 1,425.36 and platinum dropped 2.4% to $1622.25 (Reporting and editing by Arun K. Koyyur and Kirby Donovan in New York; Additional reporting and editing by Sarah Qureshi, Anjana Anil, and David Gregorio; and Anushree. Mukherjee and Kavya Balaraman, Bengaluru.
Argentina mining investment paused as midterm elections approach
The main mining industry group in Argentina warned on Thursday that political uncertainty and unclear policy signals are holding back project development.
No one will make any decisions today. It's very clear," Roberto Cacciola said, President of the Argentine Chamber of Mining Companies.
Argentina is set to hold midterm elections on October 26, a crucial test for President Javier Milei as he enters the second half of his term amid falling approval ratings and stalled legislation in an opposition-controlled Congress.
Cacciola said that the national government should resume dialogue with provincial governors – who, under Argentine laws, control mineral resources – to restore investor trust and ensure governability.
Argentina is one of the world's leading producers of lithium, gold and silver. It also has significant reserves of copper that are still untapped.
CAEM estimates that Argentina will record record mining exports in 2025 of $5.09 Billion, representing an 14% increase over 2024. Of this, 80% is gold, followed by lithium at 14% and silver at 12%.
The gold production is expected to drop by 10% on a year-on-year basis and 39% from 2018.
The lithium industry is expected to grow 54% by 2025. Exports are also set to increase 43%. However, global oversupply, as well as rising costs at home, have slowed down some projects.
Cacciola stated that the price drop was delaying some of the planned construction projects. There are no major layoffs but there are signs of restructuring.
Cacciola called for the government to abolish export duties on lithium, gold and silver as well as withholding taxes. She also urged the government to clarify the law that defines the extent of the glaciers to protect and to invest in infrastructure to boost the sector's competitiveness. (Reporting and editing by Marguerita Choy)
(source: Reuters)