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Botswana's interest rate is on hold with inflation within target range
Botswana’s central bank left its monetary policy rate?unchanged?on Thursday.?Saying that inflation was projected to remain within its target range, as a depressed diamond market continues to wreak havoc on the economy. The Bank of Botswana kept the rate at 3.5% for the second time in a row. In January, the annual inflation rate was 4.1%. This is near the middle of the 3-6% target range set by the central bank. According to the latest forecasts of the bank, inflation will average 4.5% in 2026 and 4.7% in 2027. Governor Lesego Moseki has, however, warned of inflationary risks, including the proposed increases in electricity tariffs and an outbreak foot-and mouth disease that could increase food inflation. He echoed in a press conference the economic growth projections given in this month's budget, predicting 3.1% growth following two consecutive years of?contraction. The growth in this year is expected to come mainly from non-mining sectors as the country in southern Africa looks to diversify its economy away from diamond exports. The diamond industry accounts for about a third (or a quarter) of the revenue of Botswana and three-quarters of its earnings in foreign currency. (Reporting and writing by Brian Benza, Anathi Madubela, Alexander Winning & David Goodman).
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Denmark will hold parliamentary elections as Frederiksen Bets on Greenland Crisis Boost
Mette Frederiksen, the Danish Prime Minister, announced that a parliamentary vote would be held in Denmark on March 24. She was hoping to capitalize on the?surge of support for her defiant?stance towards U.S. pressure on Greenland. Frederiksen'spent the last few months' rallying European leaders to oppose President Donald Trump’s renewed interest in annexed Greenland. This effort has been credited with boosting her popularity following public dissatisfaction about rising living costs and pressures placed on welfare services. "This election will be decisive, because in the next four-years we will have to stand up on our own as Danes and Europeans. Frederiksen stated that we need to clarify our relationship with America and that we must re-arm in order to ensure peace on the continent. "We must stay together in Europe and secure the future for the Danish Commonwealth,"?she said. She was referring to the Danish kingdom, which includes Denmark, Greenland, and the Faroe Islands. Frederiksen has been elevated to a higher profile internationally due to the Greenland Crisis. She was praised for her quick response and building of European support for Ukraine. Election to?TEST THE PM LEADERSHIP IN AMID DOMESTIC DISSATISFACTION The election will determine whether voters reward her for her leadership in defending Danish sovereignty and her international position or punish her government, which critics claim has not paid attention to domestic problems. The current Danish government is a cross-partisan coalition consisting of Frederiksen’s Social Democrats, Troels Lund-Poulsen’s centre-right Liberal Party, and the Moderates led by Lars Lokke Rasmussen – the Foreign Minister who has twice been Prime Minister. According to opinion polls the coalition, which was formed in 2022 to serve as a crisis-resolution government, is likely to lose its majority as parties realign themselves to more traditional left/right lines. Social Democrats suffer a major defeat at the 2025 municipal election, as they lose the Copenhagen'mayoralty' for the first time in 87 years. The party's popularity dropped to just 17% when polls were conducted in December, but it has now rebounded to 22 % as Frederiksen received a boost from her handling of the Greenland issue. The party received?28% in the general election of 2022. The 2023 government decision to abolish the Great Prayer Day Public holiday to fund increased defence spending Unpopular The public is not in favor of military investments, even though they are widely supported. Some economists believe that scrapping the holiday is unnecessary given the recent strong economic growth in the country. The Green Left, an ally of the Social Democrats who are currently in opposition has pledged that they will reinstate the holiday, something the Social Democrats still haven't ruled out. Reporting by Stine Jacobsen. Editing by Terje Solsvik.
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MORNING BID AMERICAS - Nvidia's damp squib
What's important in the U.S. and international markets today by Mike Dolan Editor-at-Large of?Finance and Markets Nvidia beats the street once again, but this time there was no market fireworks. The AI giant's stock soared 3% in a matter of hours after?surpassing analysts' revenue forecasts for the last quarter and the one to come. But, they've since given most of this back. Questions continue to be raised about the narrowness of customer base and rising competition for the chip giant. Below, I'll go into more detail. Check out my most recent column about the main obstacle to deeper EU-China trading ties. Listen to the Morning Bid podcast. Subscribe to the Morning Bid daily podcast and hear journalists discussing the latest news in finance and markets seven days a weeks. NVIDIA DAMP SQUIB Nvidia's stock is already priced to take advantage of the AI boom, even though the overall AI infrastructure is clearly increasing. This is evident in the booming Asia markets, where major chipmakers and computing hardware sellers are dominant. The South Korean Kospi index rose by nearly 4% Thursday. Seoul's benchmark index is up 50% this year and has doubled within six months. The tech world wasn't all sunshine and roses, though. Salesforce, a software company, fell 4% after its latest results on Wednesday. Workday, a HR software firm, also dropped 8%, to a five-year low. S&P 500 futures held their gains before Thursday's bell. Stocks in Europe were higher during a busy day of earnings. Meanwhile, Japan's Nikkei index rose slightly as the Bank of Japan was in focus. This week, the focus has been on the nomination by Prime Minister Sanae Tachichi of two dovish candidates to the BoJ Board. Some have compared this to the Federal Reserve Independence concerns in the U.S. On hearing that news, the yen initially fell. Many investors have however downplayed their impact, as the two new nominees are both dovish, and the BoJ's independence from the government was always much more tenuous. As a result, the yen gained a foothold today against?the US dollar. China's currency, the yuan is unstoppable. It has not only risen to its highest levels in nearly three years against the dollar, but also reached its highest level in nine months against the Euro today. Energy?markets have also turned their focus to Geneva where the U.S.-Iran nuclear talks resume on Thursday. The betting markets continue to?see more than a 50 percent chance?of a limited U.S. strike in the next month. Crude oil prices are calm. This is helped by reports that OPEC+ may consider boosting production during its next meeting. Chart of the Day After Nvidia's positive earnings announcement overnight, the latest surge in?South Korean stocks on Thursday was led mainly by Samsung Electronics and SK Hynix. The Korean market boom has been fueled by the governance reforms spearheaded President Lee Jae Myung. On Wednesday, parliament passed a 3rd revision to Commercial Act in order to better protect shareholder?interests. Watch today's events * U.S. Weekly Jobless Claims (8:30?a.m. EST) * U.S. 7-year note auction * U.S.-Iran nuclear talks resume ?in Geneva Want to receive Morning Bid every morning in your email? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed here are the author's. These opinions do not represent the views of News. News is committed to the Trust Principles and to integrity, independence, freedom from bias, and impartiality.
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Engie shares rise on a 'transformative,' $14 billion UK power grid contract
Engie's largest acquisition to date is UK?Power Networks Engie is less exposed to fluctuating natural gas price fluctuations Engie to sell 4 billion Euros in order to finance acquisition By ?America Hernandez PARIS, February 26 - 'Shares of French utility Engie reached a '17-year high on Thursday after the company announced that it will buy UK Power Networks, HK-listed CK Infrastructure Holdings, for 10.5 billion pound ($14.21 billion), which is its largest acquisition so far. Analysts at Jefferies said that the deal would be "transformative", as it would give Engie a piece of the increasing income from Britain's biggest power distributor, which is pushing for greater electrification in order to achieve a net-zero target by 2050. The company follows the Spanish counterpart Iberdrola Purchase The European energy companies are increasingly focusing on 'grid investments, which offer more predictable and regulated revenue streams in the face of volatile energy prices. Engie shares were up nearly 8 percent at 29.7 euros ($32.7) as of 1119 GMT. This is their largest single-day gain since March 2017, and the highest since February 2009. Analysts at Jefferies said that UKPN supplies the south-east, east and London of England, with an asset base expected grow by 5% per year through 2028. The utility stated that the UK will be Engie's 2nd largest market and the acquisition is expected to immediately boost earnings. Catherine MacGregor, CEO of Engie, told analysts that the UKPN's net zero target for 2050 was legally binding. A VALUATION THAT IS REASONABLE Engie's price implies a multiple of 1.5 times UKPN’s regulated asset values, which is in line with similar transactions in the industry, but lower than what was offered. Alpha?Value Analyst Pierre-Alexandre Ramondenc stated that t He was a "reasonable" valuation. MacGregor stated that Engie was looking to dispose of 4 billion euros in assets to fund the acquisition. The company had already disposed of 1.5bn euros worth of non-core assets last year. It is also considering opening some assets up to minority ownership.
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Redeia, the Spanish grid operator, will invest $7.7 Billion through 2029
Spain's 'Redeia', owner of the power grid operator Red Electrica plans to 'invest' 6.5 billion euro ($7.67billion) by 2029. This will be used primarily to upgrade and expand the country's electricity network. Redeia has been blamed by utilities for the blackout that occurred in Portugal and Spain in April last year - Europe's biggest outage in over two decades. Redeia - in which the government holds a 20% stake - has also blamed them. Redeia senior management said that the company adhered to all "procedures" and "rules". The power outage has been the subject of multiple investigations, including by the Spanish government. It concluded that "both Redeia" and the power generators were at fault. Red Electrica is responsible for a transmission network spanning over 46,000 km (28 600 miles) while power companies such as Iberdrola, Endesa, and others control and invest in a less extensive local distribution grid that carries?electricity?to the final consumers. Redeia announced on Thursday that it will invest approximately 6 billion Euros in Spain's grid. This leaves around 500 million euro for investments in other businesses such as its international operations, technology, and fiber-optic businesses. The company said that it did not set aside any provisions for possible claims related to the blackout, as it thought it would be unlikely to have to pay out in the future. However, the investigations are ongoing and this could change. The 'power grid operator' increased its use of stable sources of energy, like gas plants, after the 'outage. Although they are more expensive and not carbon-free, they can help balance the grid better than intermittent renewable energy. According to Redeia, as the share of electricity generated by wind and sun declined from 56.8% to 55.5% in 2024, average prices?of electricity?on the Spanish spot market?rose by around 9%, to 83.45 Euros per megawatt-hour. It said that the net profit for last year rose by 37%, to 505.6 millions euros.
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Russian rouble weakens after government flags budget changes
MOSCOW, February 26. The Russian rouble fell against the U.S. Dollar on Thursday but rebounded against China’s yuan after a swoon the day before when the government announced changes in the current budget because of?falling energy revenues. Finance Minister 'Anton' Siluanov announced on Wednesday that more money would be diverted into the fiscal reserves fund to avoid its depletion. This move implies that the state will reduce the sales of foreign currencies, which has supported the rouble. The?rouble has weakened sharply in the second half on Wednesday. This movement was primarily driven by statements regarding plans to lower cutoff prices in the budget rule. According to budget rule, oil tax collected above a certain price cut-off, currently $59 per barrel is stored in the National Wealth Fund in foreign currency. The money can also be used to cover deficits above the planned levels. Russian oil has been selling below this price for several months due to the sanctions-related discounts of up to $20. This means that the fund is not being replenished. In the over-the counter market, the rouble fell by 0.4% against U.S. dollars despite some support coming from the sales of foreign currencies by exporting companies at the end the month in order to pay their tax. The rouble gained 0.6% against the yuan after a weakened by more than 1% following Siluanov’s statement on Wednesday. Exporters were rushing to purchase yuan to stock up for their tax obligations on Thursday. The?rouble has gained 2.3% since the beginning of the year after a rally of more than 45% in 2023. (Reporting and editing by Gleb Brynski)
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Europe becomes subdued as world shares reach record highs
The world stock market was at its highest level on Thursday, as the fears of AI disruption began to subside. Meanwhile, the yen recovered its footing following its latest flop. Gold also ticked up ahead of upcoming talks between?the U.S. ?and Iran. After Nvidia's overnight results, the Nikkei and KOSPI in Asia reached record highs. However, Europe's relaunch was muted due to mixed news. London Stock Exchange Group shares, which had been beaten down by the market, rose over 5% after it announced a buyback program of $4.1 billion. Meanwhile, Syensqo chemicals' shares in Belgium plummeted almost 22% following disappointing earnings. The world's most valuable firm, Nvidia, had given a first-quarter revenue forecast of $78 billion. Traders bet on Big Tech spending unabated on AI processors. The initial positive reaction of the U.S. stock market faded after the conference call, which provided limited details on revenue forecasts and brushed aside talk?of a return in cash. Jim Reid, a Deutsche Bank analyst, said that the reaction could be "a sign of increased investor anxiety about AI valuations", especially since Nvidia has delivered 73 percent revenue growth year-over-year with 74 percent gross margins. Back?In Europe, the pound fell to $1.35 on the currency market as voting began in a election for a vacant parliament seat. Acid test Keir starmer, the struggling Prime Minister of the country. Starmer's party won the seat in the recent national elections with ease, but recent blows have put it in a fight to retain it against the right-wing populist Nigel Farage and his Reform UK -party, as well as left-leaning Greens. Kit Juckes, of Societe Generale, said: "You don't come across many people who ask if they should buy the pound." He said that Labour had a large majority, and that a national vote was unlikely. The focus should be on the economic growth rate in Britain. Push and Pull After comments by Bank of Japan Governor, the yen jumped 0.3% off its recent lows. Kazuo Ueda The prospects for a BOJ rate increase in the near future seemed to be alive. This came just days after it was reported that Prime Minister Sanae Takaichi expressed his reservations over further rate increases during a meeting Ueda. The BOJ board has just been nominated by the government for two academics who are pro-stimulus. David Chao is Invesco's Asia Pacific global market strategist. He added, "However we still believe the central bank is likely to hike rates twice this calendar year and that the yen will be among the top performing currencies." Nikkei, the Japanese stock market index, also ended marginally higher after setting its latest record in Tokyo. South Korea's KOSPI jumped more than 3%. This was mainly due to chipmakers Samsung, SK Hynix. According to Reid of Deutsche Bank, this brought the KOSPI gain for this year just short of 50%. The oil markets were jerky, however, as fears remained over the potential threat of a military conflict between Iran and the U.S. On Thursday, the sides will meet in Geneva to discuss their long-standing nuclear dispute. They hope to resolve it and avoid a new U.S. strike on Iran after a massive military buildup. Brent crude futures rose to $71.20 per barrel in Asia, but dropped to $70.40 per barrel in London. U.S. crude was also down about 0.5% at $65.09. Safe-haven Gold ticked up by 0.5% to $5,190 per ounce. However, it is still below its record highs of late last month. The uncertainty around the global economy due to (President Donald Trump's) tariffs, and the persistent tensions between Iran and the United States are bullish catalysts," said Carlo Alberto De Casa.
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US seeks agreement to prevent Iran from acquiring nuclear arsenal
Donald Trump has gathered forces in the Middle East in order to put pressure on Iran to reach an agreement. What is at stake? Iran has developed a large-scale and advanced uranium enrichment program over the past decades. At varying purity levels, enriched uranium is suitable for power plants. However, at higher levels of purification it can be used to?make nuclear weaponry. Iran had been enriching uranium up to 60% purity before Israel and the U.S. struck its nuclear facilities in June last year. This is a small step away from the 90% of uranium that can be used for weapons. According to the International Atomic Energy Agency, it had enough material that was enriched up to this level to make 10 nuclear weapons. It also had more material at lower levels. IAEA, U.N.'s nuclear watchdog hasn't been able, however, to verify the amount of uranium that remains. Iran has not yet declared 'what happened' or allowed the agency to inspect their bombed nuclear facility. The attacks on Iran's nuclear enrichment facilities resulted in their destruction or serious damage, though the exact situation, such as the stock of uranium, is yet to be confirmed. What do both sides want? The two sides had different demands after the June bombings: the U.S. wanted Iran to stop enrichment and Iran refused. Iran is a signatory to the Nuclear Non-Proliferation Treaty and has the right enrich uranium, as long as they do not use them to make nuclear weapons, something that they say will never happen. There are only limited options for Iran in terms of the deal it might strike, including a phase where they would suspend their enrichment programme. Other ways to enrich your life In previous talks, the idea of a regional consortium for enrichment was floated. This would involve establishing a joint venture with another country from the Middle East. Tehran has rejected this as an alternative for enriching on Iranian soil. * Enrich other purposes The centrifuges that enrich uranium can also be used to produce stable isotopes. These are useful in medical research and for scientific purposes. Trump's withdrawal from the landmark 2015 agreement between Iran and major countries, which allowed centrifuges to be used at Iran's underground Fordow facility only for production of stable isotopes. Iran's response to Trump's withdrawal included the start of enrichment at Fordow which was bombed by the U.S. in June. * Enhance to a low-level The more highly enriched the uranium that you begin with, the easier it is to enrich to weapons grade. Once you've enriched uranium to 5% purity, you're more than halfway there in terms of effort. Limiting the amount of uranium that Iran can accumulate and its purity will help keep it at bay. Iran was allowed to enrich up to 3.67% purity under the 2015 agreement. Diplomats joked that Trump will only accept 3.67% enrichment now, because he rejects the 2015 deal. What else needs to be addressed? A deal would require a thorough accounting of Iran's enriched uranium stock. Any doubts about that could lead to a new conflict. A deal in 2015 would have required the removal or dilution of enriched Uranium and a limit on the number and location of centrifuges. Iran is able to enrich using advanced centrifuges and it has an unknown amount of these centrifuges in unknown locations. This could make any future agreement vulnerable. Verification, likely by the IAEA is therefore a key issue. (Editing Timothy Heritage)
Mexico's Cemex will buy US stucco manufacturer Omega in a US building materials push
Mexico's Cemex announced on Thursday that it would?buy U.S. based stucco producer Omega Products?International, as part of a broader push to?offer additional building materials in its largest market.
Cemex said that Omega, a privately-held firm with four locations in western U.S. generates approximately $23 million in core earnings a year, but did not reveal the purchase price.
The transaction is expected to close during the first quarter.
The CEO of Cemex, Jaime Muguiro, said that the purchase was in line with the company's U.S. Growth Strategy. He added that the acquisition would complement Cemex's existing operations because Omega's plants are located in the same Western states as Cemex, where it already sells aggregates, additives, and cement.
Muguiro took over the role of CEO last year and promised to trim the fat off one of the largest cement producers in the world. This included cutting workers and non-core operations, while doubling down on growth in the U.S.
Cemex anticipates that Omega's value will be less than seven times core earnings, as defined by EBITDA. If you have an annual EBITDA of only $23 million, then the enterprise value would be less than $161 million.
Cemex increased its stake in Couch Aggregates (which produces sand and gravel) to a majority last October. (Reporting and editing by Janane Vekatraman; Kylie Madry)
(source: Reuters)