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Gold slams possible extension of the Lebanon-Israel ceasefire
After a U.S. Weekly Jobless Claims Data and a reversal of gains in Treasury yields, gold edged down?on Friday, erasing?the majority of the day's losses. As of 1312 GMT spot gold was down by 0.3% to $4,723.61 an ounce. It had fallen 1% earlier, reaching as low as $4683.84 an ounce. U.S. Gold Futures for June Delivery fell?0.2% at $4,741.50. "What drove bid were signs of a possible breakthrough in the Lebanon ceasefire this morning. "But that coincided with the release of economic data," said Daniel Ghali. Commodity strategist at TD Securities. On Thursday, the U.S. will host a second round of talks between Lebanese envoys and Israelis. Beirut is seeking an extension to the ceasefire after Israel's airstrikes killed at least five people, including a reporter. Ghali stated that "certainly yields and data play a role but all asset values, including gold are moving in line with headlines." After reaching a record high of over a week earlier, the benchmark 10-year U.S. Treasury Yields have lost most of their gains. This has reduced the opportunity cost for holding non-yielding gold. More Americans than expected filed for unemployment benefits last week. Initial claims for unemployment benefit rose by 6,000, to seasonally adjusted 214,000 in the week ending April 18, up from 210,000. Brent oil traded above $100 per barrel on Thursday, as the U.S.-Iran peace talks stalled. Trade restrictions through the Strait of Hormuz also continued. High energy prices are likely to increase inflation and, therefore, interest rates. Gold is considered an inflation hedge but higher interest rates reduce its appeal. Spot silver dropped 2.3% to 75.89 per ounce while platinum fell 2% to 2,032.77. Both had hit a more than one week low earlier. Palladium fell 2.2% to $1,511.17 after hitting a two-week low. (Reporting by Ishaan Arora in Bengaluru; Editing by Joe Bavier)
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Austria claims that OMV now complies with the rules regarding the reduction of petrol prices
Austrian oil company OMV brought itself into compliance with the new rules for lowering 'petrol prices, after initially not implementing 'them fully. National energy regulator E-Control announced on Thursday. The Economy Ministry, which oversees the energy policy, has asked E-Control for a review. Last week, OMV, a partially state-owned company, said it was in compliance with the rules despite reducing wholesale diesel prices by less than the required five euro cents per litre. The coalition government has enacted these rules in response to a surge in oil prices caused by the Iran War. The rules require that any increase in fuel taxes resulting from a rise in value added tax be returned to consumers through a lower fuel tax. They also cap retailer margins including OMV's. In a statement released by the regulator, Economy Minister Wolfgang Hattmannsdorfer said: "It's now crystal clear that the entire 5 cents of the margin reduction has to be passed on. E-Control made this absolutely?clear." "After intensive discussions with OMV, these 5 cents were passed on?continuously and fully in the last few days. "I am happy with this clarification, and our joint approach," he said. OMV stated that it had reached a "common agreement" with E-Control regarding the implementation of rules, and was now in compliance with them. OMV stated that "this newly established clarity?makes it possible for all participants in the market to implement applicable requirements consistently."
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IMK: Germany's recession risk increases as Iran war raises energy prices
A study from the IMK Institute, seen by?, shows that Germany's risk of slipping into a?recession is now much higher due to?the Iran war. The IMK institute released a study on Thursday that showed the risk of Germany slipping into?recession has increased sharply due to?the Iran war. The Institute for 'Macroeconomics' and Economic Research (IMK), which compiles the monthly business cycle indicators, showed a 33.5% chance of a?recession in the second quarter. This is up from 11.6% when the IMK started collecting the data at the beginning of March. For the first time since October, the indicator has shifted from "yellow green" - which indicates moderate growth - to "yellow red", reflecting increased?economic uncertainties. On Wednesday, Germany's Economy?Ministry cut its growth projections for 2026-2027 and increased its inflation forecasts. IMK stated that the worsening of the outlook was due to deteriorating financial markets and sentiment indicators. These include higher corporate credit risks premiums, increased volatility on the stock market, and changes in interest rates, which suggest investors expect a 'rate tightening' by the European Central Bank. IMK reported that the?business climate of German companies and their export expectations has also deteriorated partly due to the?hit the Iran war is having on the global?economy. Thomas Theobald, a researcher at the IMK, said that U.S. Israeli attacks against?Iran have increased the likelihood of production decreases, particularly in Germany's high-energy industries. (Reporting and writing by Klaus Lauer; Editing by Madeline Chambers).
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The biggest risk to your investment right now is ROI. Risk aversion: McGeever
Investors could be forgiven if they hunkered down in a world of increased uncertainty and minimized their exposure to the proliferating risks. Paradoxically, risk aversion may actually be the greatest risk. The 'largest energy shock since the 1970s is now entering its third month. It's stifling global growth, inducing inflation and confusing policymakers. Investors were still trying to understand the new world order, which was marked by deglobalization, dollarisation and trade wars, before the Iran War began on February 28. These are all good reasons to adopt a defensive approach and reduce exposure to "risk assets" like equities. No. Money does indeed speak. Specifically, profit. The artificial intelligence boom continues to drive U.S. company earnings. This narrative has many holes, such as the unsustainable capex spree and the high sector concentration. The fear of missing out, or "FOMO", continues to be more important than anything else. Investors who hold the line are rewarded. Since the start of the war, safe havens such as gold, U.S. Treasuries and the Swiss Franc have depreciated while Nasdaq, S&P 500 and other traditional assets have reached new highs. Since February 28, the Nasdaq has risen 9%. Investors seeking cover have found that they are not covered. Wall Street is not the only market that has risen. Other markets around the globe have also risen -- Japan's Nikkei and South Korea's KOSPI reached new highs this week. BlackRock, with its $14 trillion in assets under management, went overweight U.S. stocks last week. JPMorgan's equity analysts upgraded their S&P year-end price forecast from 7,200 points to 7,600, which is a 7% increase from current levels. The AI outlook led to an upward revision of their earnings per-share forecast to $330 – a figure that is well above the LSEG consensus estimate of $315. They believe that if a permanent ceasefire is achieved in the Middle East, the S&P 500 may reach 8000. The outlook is either excellent or very good. No Reward for Underperformance Standing on the sidelines has real costs. The U.S. remains the world's most dynamic economy - it is home to the most innovative, profitable companies and the most liquid, efficient and effective markets. The market cap of U.S. shares is over 70% of the world's shares, and U.S. stock prices have been higher than world stock prices for 24 years. Brad Setser, global capital flows specialist at the Council on Foreign Relations, says that no one has ever been rewarded for selling U.S. stocks. There is a deep reluctance among investors to underweight the U.S., and thus risk underperformance. This is similar to the narrative of "U.S. exceptionalism" that became popular in 2024. Investors can't afford to not have a large exposure to U.S. equities, particularly tech. This thesis was questioned in the past due to President Donald Trump's unorthodox and controversial policy. However, the overwhelming dominance of U.S. Hyperscalers has quelled any concerns about the current administration. Investors may be concerned about the direction U.S. foreign or fiscal policy is taking, but selling America is too risky. RUN OUT OF STEAM? The current Wall Street rally may not last forever. S&P 500 has just experienced its third consecutive week of gains greater than 3%. Jefferies analysts point out that this only happened twice over the last 75 years, in August 1982 and May 2020. Trading volume for "call" contracts - which are derivatives contracts?effectively bets on future price increases - is at historically high levels, particularly in the tech sector. There is very little room for error with this hyper-bullishness. There are other options. Investors who want to be exposed to the AI boom and?tech explosion have options in Asia. They can choose from companies like SK Hynix, Samsung, or Taiwan's TSMC. Several European firms will also benefit from the splurge in defense and tech spending that is expected in the future. Diversifying on margins is not necessarily a performance hit for investors. The big three U.S. indexes are recovering strongly from the lows they reached in March due to the Iran war, but Japanese stocks and the benchmark MSCI Asia ex Japan as well as MSCI emerging markets indices performed better so far this year. They don't have the same size or liquidity as Wall Street. In the U.S. a combination of loose financial conditions and strong earnings as well as ample liquidity continue to reduce volatility. This, in turn should attract more capital. Investors are prompted to reduce their risk exposure and leverage when volatility increases. Risk appetite can remain relatively buoyant when volatility is contained. Few can afford the risk of being cautious at this time. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. 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Dangote offers joint refinery to Kenya, Tanzania, and neighbours
William Ruto, the Kenyan President, said that East African countries were discussing plans for a joint refinery in?Tanzania’s port of Tanga modeled after Nigeria’s Dangote Plant. East Africa imports all of its refined petroleum, mainly in the Middle East. This leaves the region susceptible to disruptions of supply and price spikes, as was seen with the fallout from the Iran conflict. Ruto said at a Nairobi conference on infrastructure financing that "we're going have a shared refinery in Tanga, which will benefit us all, because this refinery will take the oil coming from DRC, the oil coming from Kenya, the oil flowing from South Sudan and the oil flowing from Uganda." Africa's richest man Aliko Dangote, who also ?attended the conference, said he ?could replicate his 650,000-barrel-per-day Nigerian refinery in East Africa, provided governments in the region supported the initiative. Dangote stated, "My commitment is to lead the way and ensure that the refinery is built in the next four or 5 years if we can agree with three or four governments about it." Uganda has announced plans to build a refinery. It hopes to begin commercial crude oil production in this year. ?In 2024, it announced a deal with United Arab Emirates-based Alpha MBM Investments to develop a 60,000-barrel-per-day ?plant. Dangote said that he also planned to set up?about twenty fertilizer blending factories across Africa by the year 2028, to meet most of Africa's needs. Dangote, when asked about the planned listing of his Nigerian refinery said that African investors should take part, adding, "All of Africa should be investing." I will pay dividends in US dollars. Reporting by Duncan Miriri, Writing by Elias Biryabarema; Editing by Bate Fenton and Susan Fenton
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Bloomberg News reported that Anglo American had at least three bidders for its Australian coal business.
Bloomberg News reported that Anglo American had at least three potential buyers for its Australian steelmaking coal business, after the deal with Peabody Energy fell through. The report was based on people familiar with this matter. The report said that Stanmore Resources of Australia, Mitsubishi Corp. from Japan, and PT Buma Internasional Grup, based in Indonesia, were among the 'bidders' for the coal assets. Stanmore, Mitsubishi, and Buma International did not "immediately" respond to the request for comment. Bloomberg reports that a deal could be announced in the coming months. Peabody retracted its $3.78billion bid in August for Anglo American’s Australian coal assets, and the London listed miner launched an arbitration against the U.S. based coal miner. Anglo plans to sell off its non-core assets, including mines located in Queensland's Bowen Basin. Anglo, who has agreed to merge Teck Resources and De Beers to create the fifth largest copper producer in the world, is currently selling its nickel assets and struggling De Beers diamonds. It sold its Platinum business in 2025.
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Copper falls from multi-week peak on Middle East insecurity
The copper price fell from a?multi-week peak on Thursday due to the stalled U.S. Iran peace talks, the continued closure?of Strait of Hormuz as well as a stronger dollar. Benchmark three-month Copper on the London Metal Exchange fell 1.4% to $13,247 per metric ton during 'official open-outcry' trading after reaching its highest since February 27, at $13,481.50. No signs of a return to peace talks between Iran and the U.S. have emerged, while Iran has tightened the grip it holds on the Strait of Hormuz. This has sent oil prices over $100 per barrel. Standard Chartered's head of base-metals research, Sudakshina UNNIKRISHNA, said that the LMEX had reached an all-time-high yesterday. The base-metals complex has pulled back on early trading due to the lack of progress in the U.S.Iran ceasefire negotiations and the uncertainty they continue to create. The LMEX Index, which is comprised of six major?base metals that are traded on the exchange has gained 11% this year. The copper price rose in the previous session, along with the equities. It then grew a little more on Thursday morning on the relief of the U.S. extending a ceasefire. Concerns about a sulphuric-acid shortage are increasing, which is pointing out copper supply constraints. China's Customs data revealed that its exports of sulphuric acids to Chile, its largest overseas acid market had dried up by March. This was even before news broke this month that China planned to ban exports in May. The Shanghai Futures Exchange's most active contract for copper closed the dayday trading session up 0.3%, at?102.780 yuan (15,046.33) per ton. This was a slight decline after it had risen as high as 1.7%. Copper prices have been boosted by the strong demand from China, the world's largest metal consumer. However, there are signs that this could be changing. The premium over SHFE price paid to 'buy copper on the spot market After commanding a premium of 115 yuan on April 15, the price has dropped to 5 yuan a ton. Nickel was the only LME material in positive territory, after French miner Eramet announced that it planned to halt production of its Weda Bay Nickel mine in Indonesia by next month. LME nickel rose 0.9% to $18,620 per ton in official activity after reaching its highest level since January 29, at $18,680. LME?aluminum fell 0.7%, to $3.588 per ton. Zinc dropped 0.7%, to $3.447. Lead was down 0.2%, to $1.960.50. Tin was down by 0.1%, to $50,395.
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Zambia's Luanshya Copper Mine will restart in August following a two-decade stoppage
The mines ministry announced on Thursday that Zambia's Luanshya Copper Mine will resume production in August, after more than a decade of idleness. CNMC purchased Luanshya and now holds 80% of the company. Zambia's mining arm ZCCM IH owns 20 percent of the mine. Production had to be halted after severe flooding destroyed infrastructure. According to the Mines Ministry, as of 'March 27, approximately 87.9 millions cubic metres of water have been pumped out of the mine. This has allowed for the development of infrastructure and construction. The ministry announced in a statement that "Luanshya Mine... will resume production at its upper mining in August 2026." The lower mine production is scheduled to begin in 2029, under the ongoing redevelopment by China Luanshya Mine. The 28 Shaft's Redevelopment represents an Investment of Around $710 Million,?covering New Shaft Systems, a Concentrator Plant, and Related Infrastructure, according to the Ministry. It said that more than 75?million had already been invested into the project. CLM is also exploring the possibility of collaborating with ZCCM Investments Holdings to develop mining opportunities within newly acquired areas in the region. Once fully operational, the Luanshya copper mine will?produce approximately 100,000 metric tonnes of copper per year by 2030. This will?boost output for Africa's second-largest producer of copper as it aims to?more than triple its production to 3,000,000 tons by 2031. Reporting by Chris Mfula and Olivia Kumwenda Mtambo, Johannesburg; editing by Joe Bavier
Sources: BHP adopts new Chinese Iron Ore Price Index in agreement to end dispute
BHP Group has agreed to use a Chinese iron ore price index for one of its flagship products as part a deal with?China that ends a long-running dispute. Three sources familiar with the matter confirmed this.
BHP, world's third largest iron ore supplier announced on Wednesday it had completed negotiations on a contract with China Mineral Resources Group. This ended the dispute resulting from the bans on BHP supplying the essential ingredient for steel production.
The agreement was not disclosed by BHP or CMRG, the Chinese state iron ore purchaser.
According to an investor, BHP executives informed them that the new contract would last until the end the financial year?2027.
Two of the three sources confirmed that the settlement for BHP's Jimblebar Fines, a medium-grade ore, would be based on the weighted average four indices, including the equivalent U.S. Dollar value of China's COREX 61 percent iron ore "portside" index. This index will have a 26% weight, they said.
The sensitivity of this issue led to all?sources requesting anonymity.
BHP has declined to comment.
CMRG didn't immediately respond to a comment request.
The Argus 61% index for seaborne fines, Mysteel's 61% index for seaborne fines and the dollar value of Mysteel's 61% index portside are also used.
BHP IS THE SECOND MINERAL TO ADOPTION COREX INDEX
BHP used to settle Jimblebar contracts for Chinese clients by using a fixed price, or a combination of Argus seaborne indexes and Mysteel.
COREX (Beijing Iron Ore Trading Centre Corp) launched their iron ore portside indicator last September to play a part in pricing iron ore imported worth $123 billion by 2025.
BHP is Australia's second miner to adopt the COREX index after Hancock Prospecting. China lifted its partial ban on purchasing iron ore from Hancock in September last year, according to reports. It did not provide a reason.
Hancock didn't immediately respond to an inquiry for comment.
Industry insiders say that global?miners have been reluctant to use COREX due to its short data history, and because it is based on portside transactions instead of the seaborne market?used in other indexes.
One source said that BHP would offer 1,8% off per iron ore ship on contracts for a term, in addition to a freight discount on certain large ships.
(source: Reuters)