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Wall Street futures drop, but yen is boosted by Japan's rate hike bets
The European stock market fell on Monday, and Wall Street futures indicated further losses. However, the Japanese government bond yields and the yen were boosted by comments that suggested the central bank might hike interest rates. The market was a little jittery during November but has strengthened over the last week as traders bet more on the Federal Reserve of the United States cutting rates at their December meeting. At 1249 GMT Europe's STOXX 600 fell 0.6% for the day, as markets were gripped by a new wave of risk-aversion. London's FTSE 100 fell 0.2%, while Germany's DAX dropped 1.5%. The MSCI World Equity Index fell 0.1% for the day. After U.S. officials and Ukrainian officials had what they both called productive discussions on Sunday, about a potential Russia-Ukraine deal, a drop in defence stocks contributed to the decline in European indexes. Wall Street futures also fell, with S&P500 eminis falling by 0.8% and Nasdaq minis dropping by 1.1%. The traders were waiting to hear comments from Fed Chairman Jerome Powell who will speak later today. Bitcoin was down 6.4% to $85,347.26 in a sign of increased risk-aversion. This extended losses and put pressure on bitcoin-buying firms. Gold reached its highest level in six weeks on the back of expectations that U.S. rates will be cut. It was last seen at $4,248.99. Bank of Japan to consider raising rates Bank of Japan Governor Kazuo Ueda stated that the central will weigh the "pros" and "cons" of increasing rates at the next policy meeting. This caused traders to increase their bets on rate hikes. After the remarks, the yen gained strength to a high of 155.49 dollars per dollar. The yield on the 2-year Japanese government bonds rose by 2 basis points and reached its highest level since June 2008. The dollar-yen exchange rate continued to rise during European trading and reached 154.79. Carry trades are popular because of Japan's low interest rates. Traders borrow yen for a low rate to invest in riskier assets. Fiona Cincotta is a senior market analyst with City Index. She said Monday's negative market sentiment may have been prompted by the possibility that higher rates in Japan would make this position less lucrative. "Concerns about the unwinding the carry trade had been lingering in the background for some time. But I think that comments made by Governor Ueda hinting a possible rate increase in December have really revived these concerns." The dollar index fell 0.4% for the day to 99.06 while the euro rose 0.4% to $1.1646. Investors awaited the euro zone inflation figures due Tuesday. Germany's 2-year bond yield, sensitive to expectations of the European Central Bank policy outlook, reached its highest level since March 28. The Purchasing Managers' Surveys released on Monday revealed that manufacturing in Europe and Asia's largest economies was weak in November due to subdued demand at home and uncertainty over tariffs. ECONOMIC DATA TO COMME Traders waited for U.S. data this week on manufacturing, consumer sentiment and services to set the tone before the Fed meeting on December 9-10. According to LSEG, markets are pricing a 93.9% probability of a rate cut of 25 basis points. The data this week will be the last opportunity for markets to reconsider an December Fed cut, which is already fully priced in. Although the market's dovish wagers seem too high, ING FX strategist Francesco Pesole said in a client note that the ISM figures, ADP figures and PCE numbers will validate them. Matt Simpson, senior analyst at StoneX, in Brisbane, says that if incoming data signals a slowdown, but not a recession, then the sentiment will probably remain positive, even if the U.S. Dollar weakens, as it usually does during this time of the year. Brent crude futures rose 1% to $62,99 as tensions between the U.S. and Venezuela raised supply concerns, while OPEC+ agreed not to change oil production levels for the first quarter 2026. (Reporting from Elizabeth Howcroft in Paris; additional reporting by Ankur banerjee in Singapore. Editing by Susan Fenton.)
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Barrick Mining, a Canadian company, is exploring the possibility of IPO for its North American assets
Barrick Mining announced on Monday that it is exploring the possibility of an initial public offering for a subsidiary which would hold its North American assets in gold amid a record rise in gold prices. The U.S. listed shares of the Canadian mining company rose by nearly 4% during premarket trading. Barrick would be reversing its 2019 merger with Randgold Resources. Investors are also pressing the miner to take advantage of the historic rise in gold prices in order to boost profits, while selling off riskier assets such as those in Africa, Papa New Guinea, and Pakistan's Reko Diq. The gold price has reached record highs in this year due to expectations of lower rates and the rising appeal of gold as a safe haven asset. Sources told us that in November Barrick considered splitting into entities focused on Africa and North America. The new entity is heading for an IPO and would include Barrick's joint-venture interests in Nevada Gold Mines in Dominican Republic as well as Pueblo Viejo. It would also include the Fourmile discovery of gold. Barrick and rival Newmont jointly own Nevada Gold Mines - the world's biggest gold-producing complex - and Barrick is looking to develop the Fourmile Gold Mine in the U.S. State. The Fourmile Mine test production will not begin until 2029. It said that the Canadian miner intends to retain a controlling majority while offering a minority stake. The miner stated that it will provide an update regarding the IPO evaluation in February. Mark Hill, interim CEO said: "We are focused on improving performance and shareholder values with the right team in place now to deliver on our promises." Barrick had a turbulent year. A long-running dispute over the gold mine it owns in Mali led to the write-off of $1 billion and the abrupt departure of Mark Bristow, its CEO. Barrick has mines throughout the world, including in Mali and Nevada. It also operates gold mines in Tanzania, Dominican Republic and Papua New Guinea. (Reporting and editing by Leroy Leo, Shinjini Ganuli and Vallari Srivastava from Bengaluru)
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Stellantis CEO supports German efforts to relax EU car emission rules ahead of important review
Stellantis Chief executive Antonio Filosa welcomed Berlin's request to relax European Union car emission rules on Monday, saying that Germany's proposal aligned itself with the industry's demands to revive the growth of this struggling sector. On December 10, the European Commission will unveil its proposals to support auto industry, including a review on carbon emission targets. This is in response to increasing pressure from manufacturers and governments to be more flexible. They want plug-in hybrids to continue to operate and to allow new cars powered by fuel beyond 2035. Filosa, in a press release, said that it was "grateful" for the German government to support revisions to European regulations. It added that the package of proposals from the auto lobby ACEA were "all urgently required to bring the European automotive industry back to growth". Last week, German Chancellor Friedrich Merz urged Brussels for exemptions to be granted to plug-in hybrids as well as highly efficient combustion engines. He argued that automakers needed more flexibility in order combat the slow uptake of electric vehicles and fierce competition coming from China. Stellantis, which was formed by the merger of Fiat Chrysler with PSA in the year 2021, has been a vocal proponent for changes to EU auto regulations since it fired its former CEO Carlos Tavares. John Elkann, the chairman of the automaker, warned last week that the European automobile industry would "irreversibly decline" if there were no softer regulations. Filosa stated the sector required "urgent and decisive action" in order to restore growth. Although unions share these concerns, the industry has also proposed new targets for emissions from light commercial vehicles, regulatory changes aimed at supporting small car production, and measures to speed up fleet renewal. All of this is aimed at reconciling carbonisation with jobs, affordability, and decarbonisation. (Reporting and editing by Louise Heavens, Giulio P. Piovaccari)
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Nigeria offers 50 oil blocks in the 2025 licensing round
Nigeria's upstream regulator announced Monday the start of its 2025 Oil Licensing Round, offering 50 blocks to bid as Africa's largest crude producer seeks new investment and to increase output. According to the Nigerian Upstream Petroleum Regulatory Commission, this round comprises 15 onshore blocks and 19 shallow water assets, 15 frontier assets, and one deepwater asset. The Nigeria 2025 licensing round will attract an estimated $10 billion of investment, and 2 billion barrels in oil production over the next ten years. Production is expected to reach 400,000 barrels a day when fully operational," NUPRC Chief Executive Gbenga Komolafe said to reporters. Komolafe noted that awardees of last year's licensing rounds have paid their signature bonuses and are at various stages of exploration. However, he also said new barrels can take some time to appear. He said that the fact that there was a licensing round last year did not translate immediately into more barrels. Nigeria is trying to revive its oil production in the oil-rich Niger Delta after years of underinvestment. Reporting by Camillus EBOH; Writing by Chijioke OHuocha, Editing by Kirby Donovan
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Saudi Energy Minister: New OPEC+ Production Mechanism will Help Stabilize Markets
Saudi Energy Minister Prince Abdulaziz Bin Salman stated on Monday that a new mechanism adopted by OPEC+ for assessing members' maximum production capacity will help stabilize markets and reward those investing in production. OPEC announced on Sunday that the OPEC+ group has approved a mechanism for assessing members' maximum production capacities to be used to set baselines starting in 2027 against which output targets will be set. Prince Abdulaziz claimed that the production level determination mechanism was "fair" and "transparent". He said, "Now, we have the most detailed and transparent approach to managing the market in the future, as well as how to manage production", He said, "Yesterday has been one of my most successful days personally and I'm very grateful for the support from our friends in Russia," during the launch in Riyadh of a Saudi and Russian business forum. The meetings of OPEC+ on Sunday, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies, led by Russia also agreed that oil production levels would remain unchanged in the first quarter of 2020. Sources following the meetings said that an evaluation of member's maximum production capacity will take place between January 2026 and September 2026. This will allow for output quotas in 2027. Prince Abdulaziz stated that the mechanism would reward those who invested and believed in growth. It would also put us at the forefront of other producers. OPEC+ members have been talking about production capacity and quotas for years. However, the talks were difficult due to the fact that some members like the United Arab Emirates had increased their capacity and wanted higher quotas. Some members, such as African nations, have experienced a decline in production capacity. However they are refusing to reduce their quotas. Angola left the group in 2024 due to a disagreement over its production quotas.
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Trump's call for more AI datacenters is met with opposition from his own voters
Residents wore camouflage hats, red shirts and other signs of unity to a meeting of a rural Pennsylvania planning committee. They were there to protest the proposed data center that they feared could rip up their farmland or disrupt the tranquil rhythms of their valley. The majority of the residents were loyal supporters who voted for President Donald Trump in 2024, winning their county by 20 percentage points. They were angry at Washington for its push to accelerate artificial intelligence infrastructure. This has led to the growth of data centers in rural areas across the U.S., where land is inexpensive. Residents of this county, which has 18,000 residents, stepped up to the microphone one evening in November and asked Talen Energy officials how their proposed data center would increase residents' utility costs, reduce farmland and stress local water and resources. Two women sang a riff of Woody Guthrie’s folk song “This Land Is Your Land”: "Say no rezoning so that water will keep flowing and crops will continue to grow." Politicians across the U.S. urge a rapid expansion in data-center capacity, and new energy production to keep AI competitive. Trump, a Republican politician, has urged his administration to ignore environmental regulations and permits that would give local communities a say. In Pennsylvania, Democratic Gov. Josh Shapiro (Democrat) and Republican Sen. Dave McCormick (Republican) are wooing developers to invest in the rapidly-growing industry with incentives and upgrades of infrastructure. Some communities are happy to see the economic boost. The backlash in Montour County in central Pennsylvania is a reflection of a growing coalition between farmers, environmentalists, and homeowners who are united to oppose data-center expansion. Data Center Watch published a report earlier this year that found $64 billion in data center projects were blocked or delayed due to local opposition from states such as Texas, Oregon, and Tennessee. Pennsylvania critics worry that the region will become "data center Alley" in northern Virginia, with its sprawling, vast complexes. The pushback, if successful, could slow down efforts by the administration to build AI infrastructure quickly enough to keep up with global competitors. Politicians say that anger over these projects could also add to Republicans' affordability concerns as they prepare for the midterm elections in 2026. Chris Borick is a professor of political science at Muhlenberg College, in Allentown, Pennsylvania. He added that the politics of AI infrastructure remain unresolved: "The technology is still evolving and politicians are still figuring out their position." Like social media, everyone jumped in without understanding the consequences. SAVE CULTURE Talen Energy has requested to rezone approximately 1,300 acres of land in Montour County, from agricultural to industrial uses. This is the first step towards building a large and complex data center with 12-15 buildings. The site is located in the shadows of Talen Energy's 1,528 megawatt natural gas-fired power station, nestled among farmland, dirt roads and the Amish community. Talen Energy said that the project would require 350 acres of farmland used for soybeans, livestock and corn. Residents are concerned that losing the land will weaken local agriculture, and a nearby facility that processes soybeans to produce regional food and feed. Rebecca Dressler, Republican Montour County commissioner, stated that the concerns were less about ideology and more about preserving the character of the region. Dressler stated that "small-town character is what defines our community." People aren't against development - they simply want growth that suits who we are. The county planning commission voted 6-1 against the rezoning at its November meeting. This decision was met with thunderous applause. Dressler and two other county commissioners will make a final decision on the issue in mid-December. Residents are not blaming Trump but rather the billion-dollar data-center companies that have the money to buy up farmland and reshape rural areas, leaving locals to pay higher utility bills. Theresa McCollum (70), a Trump supporter, said: "I believe it's a culture that has forgotten the little person, the people living here, the farmers struggling with the economic situation." The shift of power from Washington to a region that takes pride in local control is not well received. "Stay out. Craig High, a 39-year-old Trump supporter, said that without federal involvement, we wouldn't be having this discussion. Both (political parties) are pushing data centres and giving regulatory relief - water permits, permitting, everything. PENNSYLVANIA BOOM Pennsylvania's plentiful, stable electricity makes it a hotspot for data centers. It has attracted tens billions of dollars in investments from Amazon.com and Alphabet's Google. Microsoft is also interested, while Constellation Energy wants to use the old Three Mile Island Nuclear Power Plant to power new server farm. Residents fear that they will end up paying the price. Pennsylvania utilities predict a dramatic increase in electricity demand by data centers at the end of this decade - enough power to supply several million more homes. According to federal data, electricity prices in Pennsylvania have increased by 15% over the last year. This is roughly twice the national average. This surge has already rippled through the grid in the region. Recent auctions have seen a spike in capacity prices, which determine how much power plants get paid to supply the grid during times of peak demand. Utilities have also begun to raise rates to pay for growing infrastructure. Analysts warn of a significant increase in customer bills over the next few years. Many families are already feeling the strain. Since 2022, the amount of overdue utility bills has risen faster than the inflation rate. According to the Century Foundation a progressive research group, Pennsylvania is among the states that have the highest household energy debt. These pressures on the wallet are beginning to change politics in certain parts of America. Alicia Johnson was elected as one of only two Democrats to Georgia's utility boards since 2007, after her campaign focused on frustration with rising power bills and the unchecked expansion of data centers. She said that the issues she raised in her campaign are a preview of the challenges states such as Pennsylvania could face during next year's midterm elections in the United States. In recent years, power prices in Georgia have risen dramatically due to massive cost overruns in the new Vogtle Nuclear Plant. Johnson said that data centers and utility costs were two of the most important issues in the election. People are angry. They don't like data centers that don't have guardrails and they don’t want to pay for them. In 2026, this will be a part of the national debate on affordability. Ginny Markille-Kerslake is an organizer for Food and Water Watch. This environmental non-profit group has spent many months organizing opposition to data centres in places such as Montour County. She predicted that there would be a political reckoning in the next year. She said that "communities, red, blue and everything in-between, are united in their opposition", referring to the so-called red regions dominated by Republicans, and blue regions controlled by Democrats. This issue brings people together at a time we are so divided.
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European stocks drop, but yen is boosted by Japan's rate hike bets
The European stock market fell on Monday as it retreated from recent gains. However, the Japanese yen and government bond yields were boosted by comments that suggested the central bank may raise interest rates. The market was a little jittery during November but has strengthened over the last week as traders bet more on the Federal Reserve of the United States cutting rates at their December meeting. At 1023 GMT Europe's STOXX 600 fell 0.3% for the day, as markets were gripped by a new wave of risk-aversion. London's FTSE 100 remained flat, while Germany's DAX fell 0.9%. The MSCI World Equity Index fell 0.1% for the day. After U.S. officials and Ukrainian officials had what they both called productive discussions on Sunday, about a potential Russia/Ukraine deal, a drop in defence stocks contributed to the weakness of European indexes. Bitcoin was down 4.9% to $86,675.96 in a sign of increased risk-aversion. This has put pressure on companies that buy bitcoin. Gold reached its highest level in six weeks on the back of expectations that U.S. rates will be cut. It was last up by 0.6% to $4,254.97. Bank of Japan to consider raising rates Bank of Japan Governor Kazuo Ueda stated that the central will weigh the "pros" and "cons" of increasing rates at the next policy meeting. This caused traders to increase their bets on rate hikes. After the remarks, the yen reached a session-high of 155.49 to the dollar. The yield on two-year Japanese government bonds also rose by 2 basis points and hit its highest level since June 2008. Dollar-yen was last seen at 155.16. Carry trades are popular because of Japan's low interest rates. Traders borrow yen for a low rate to invest in riskier assets. Fiona Cincotta is a senior market analyst with City Index. She said Monday's negative market sentiment may have been influenced by the possibility that higher rates in Japan would make this position less lucrative. "Concerns about the unwinding the carry trade had been lingering in the background for some time. But I think that comments made by Governor Ueda indicating a rate increase in December have really revived these concerns." The dollar index fell 0.2% for the day to 99.258, and the euro rose 0.3% to $1.1626. Investors awaited the euro zone inflation figures due Tuesday. Germany's 2-year bond yield, sensitive to expectations of the European Central Bank policy outlook, reached its highest level since March 28. ECONOMIC DATA TO COMME Traders waited for economic data this week on manufacturing, consumer sentiment and services to set the tone before the Fed meeting on December 9-10. According to LSEG, markets are pricing in a 92.4% probability of a rate cut of 25 basis points. The data this week will be the last opportunity for markets to reconsider an December Fed cut, which is already fully priced in. Although the market's dovish wagers seem too high, ING FX strategist Francesco Pesole said in a client note that the ISM figures, ADP figures and PCE numbers will validate them. Matt Simpson, senior analyst at StoneX, in Brisbane, says that if incoming data signals a slowdown, but not a recession, then the sentiment will probably remain positive, even if the U.S. Dollar weakens, as it usually does during this time of the year. Brent crude futures rose 1.7% to $63.46 after the Caspian Pipeline Consortium halted its exports following a major drone strike and tensions between the U.S. and Venezuela raised concerns over supply. OPEC+ also agreed to maintain the same oil production levels for the first quarter 2026. (Reporting from Elizabeth Howcroft in Paris; additional reporting by Ankur banerjee in Singapore. Editing by Susan Fenton.)
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As part of an organisational review, UK-based Harbour Energy is expecting to cut 100 jobs offshore
Harbour Energy, an offshore producer with a focus on the North Sea, announced Monday that it would be cutting 100 jobs in its UK operations as part of a review of their UK organisation. Low commodity prices and a tax regime that is not competitive have put pressure on the UK oil-and-gas sector. This has led to Harbour's offshore restructuring, according to Scott Barr, Harbour's UK managing director. After a consultation phase, which is expected to end in the first quarter 2026, job cuts are planned. By 2023, 600 new jobs will be created. On top of this, the job losses announced Monday will be even more severe. The British government has one of the toughest tax systems in the world for oil and gas companies. This includes a windfall tax of 38% if prices are above government thresholds. In such cases, the total tax burden is 78%. The industry had hoped that the Energy Profits Levy would be withdrawn sooner than March 2030. The offshore reorganisation was a necessary step in order to align our operational model with the reduced production and activity levels in the UK. This was accelerated by the EPL's retention, and we maintained our commitment to safety standards and regulatory standards." Barr stated. The EPL will remain in place and Harbour's UK Business Unit is likely to continue to struggle for capital to fund our global portfolio. The government announced on Wednesday that it would allow new oil and natural gas production in or near existing fields. (Reporting and editing by Stephanie Kelly, Kirsten Doovan and Bernadettebaum)
Copper's record high is fueled by China's output reduction talk
The copper price soared on Monday to new record highs as traders cited the plans of smelters from China, the world's top producer to reduce output in 2019. A softer dollar also boosted positive sentiment.
The benchmark copper price on the London Metal Exchange remained flat at 11,189 dollars per metric ton, down from its previous all-time high of $11,294.5 at 1118 GMT. Prices for metals used in construction and power industries have risen by 28% this year.
According to a Chinese market data provider, China's leading copper smelters plan to reduce production by over 10% in 2026 in order to combat the industry's overcapacity that has resulted in increasingly distorted processing fees for copper concentrates.
The traders are skeptical about the possibility of China cutting its copper production, as plans to reduce refined metal production have not been implemented.
Britannia Global Markets said in a report that "Focus is still on tightening the copper availability after last week's meetings in Shanghai where miners and smelters expressed concerns over mine disruptions and difficult ore supply negotiation,"
The market will likely remain responsive to news about mine production, tariff policy, and Chinese stimulus signals. With the current bias for higher prices in the medium-term, the market is still highly responsive.
The high volume of copper imported into the United States is part of the reason for the shortages.
Attention has been drawn to the low zinc inventory in other places
The LME has created a premium or backwardation for contracts along the maturity curvature. The premium for cash zinc contracts over the three-month ahead
The lower dollar supported industrial metals in general.
Lead rose 0.2% at $1,985, aluminium was down 0.1%, zinc was up 0.5%, tin dropped 1.5%, and nickel CMNI3> increased by 0.1%, to $14,845 per ton.
(source: Reuters)