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Slovakia prepares final unit of Mochovce Nuclear Plant for production
Slovenske Elektrarne, the Slovak utility, has begun fuel loading on the fourth 'unit' of the Mochovce Nuclear Power Plant, nearing the?start of production after almost four decades of construction. The fourth unit, a 471 megawatt unit, will be the last unit to go online at the second nuclear power plant in the country after the grid connection of its third unit is completed in 2023. When the project was restarted last in 2008, it was originally planned that the fourth unit would be completed in 2013. The start-up of the nuclear power plant in Slovakia will mean that it has the highest percentage of nuclear energy in Europe's national power mix. Slovenske, which is majority owned by Czech investor Daniel Kretinsky’s EPH, has said that nuclear power will?cover 77.5% the country's need, ahead of France in terms of percentage. The completion of the project comes at a time when global?interest is growing in nuclear power amid a push to reduce carbon?emissions, and to ramp up production to meet the demands of electrified economies. This includes the surging demand for data centres. Branislav Stycek, CEO of Mochovce, said at a live news conference that the fourth unit would supply 13% to Slovakia's demand for electricity and solidify Slovakia's position as an electricity exporter. Officials said that after the fuel loading, a series tests will be conducted before the reactor and the turbine begin supplying fuel to?the power grid. Strycek stated that the unit would reach its full capacity at the end of this year. As with other nuclear power plants in Europe, the completion of Mochovce started in 1980 based on a Soviet design. However, it has run into a number of?delays and cost overruns. Fico stated that the government is interested in increasing the 34% stake it holds in "Slovenske Elektrorne" in a window for talks with the major owner following the commissioning of Mochovce's final unit. Separately, the government plans to build a 1,200 MW power plant with state oversight. (Reporting and editing by Jan Lopatka, Prague)
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Oil and stock prices rise as investors focus on Iran. The yen hits a 40-year low against the dollar
Investors tracked the implementation of the interim peace agreement between the U.S. and?Iran, while oil prices climbed?after tit for tat attacks highlighted the risk of escalation. European stocks edged down, but Wall Street led the gains. Technology shares rebounded after last week's saleoff, driven by concerns about AI spending. After several days of strike activity in the Middle East, both sides have accused each other of violating an interim ceasefire after an Iranian projectile struck a cargo ship in the Strait of Hormuz. The oil prices fluctuated, Brent and WTI both up by more than 1% in a single day but were still down sharply for the entire month. Recent U.S. attacks and Iranian attacks highlighted the fragility of interim agreement, while expectations of a recovery of energy shipments via the Strait of Hormuz cap gains. Mohit Kumar said that the market could benefit from the drop in oil prices, and the impact it has on the global economy. Lower oil prices will lead to diversification of trade, and sectors that are growth-sensitive should perform better. U.S. crude oil rose by 1.7%, to $70.41 per barrel. Brent increased to $72.88 a barrel. The Dow Jones Industrial Average rose by 302.53 or 0.58% to 52,175.22. The S&P 500 gained 37.66 or 0.51% to 7,391.68. And the Nasdaq Composite rose 205.04 or 0.79% to 25,497.22. The MSCI index of global stocks rose by 4.41 points or 0.38% to 1,107.01. There have been a number of false starts with?peace talks. Peter Andersen of Andersen Capital Management said that I expect the majority of market participants to "remain in a 'holding pattern' for the remainder of this week." The pan-European STOXX 600 fell by 0.1% while Europe's FTSEurofirst 300 fell by 2.18 points or 0.09%. The Nikkei 225 rose by 107.23 or 0.15 percent to 69.468.11 while the emerging market stocks gained 1.00 points or 0.06%. WAGE WAGERS FOR RATE INCREASE The dollar has risen as expectations of an upcoming Federal Reserve rate increase have boosted the dollar. Oil prices fell sharply over the past few weeks, but inflation measures have soared in the U.S. The dollar index which measures the U.S. against other currencies was slightly lower last week at 101.25. This is just below the 13-month peak it reached last week. The oil market is still a risky place. Participants still appear to be... focusing their attention on the impact of a continued rise in oil flow on global balance, according to ING analysts in a Monday note. This week, the U.S. economic focus will be on Thursday's June jobs report. Three consecutive months of stronger-than-expected payrolls have reinforced the ?Fed's hawkish shift, though any cooling ?in the labor market could prompt a more dovish reassessment. Investors have priced in at least one Fed rate hike this year. This is a dramatic change from the expectation of two rate reductions before the Iran War. Marc Chandler, Bannockburn Global Forex's chief market strategist, said that the labor market has accelerated. "The doves' concerns about the labor market slowing down seem to be over." The Japanese yen has hit its lowest level in 40 years, 161,97 per dollar. This is the weakest it's been since 1986. The Bank of Japan’s 25bp rate increase to 1.00%, which was long overdue, has not been able to reduce the interest?rate gap with the United States. This is especially true after the Federal Reserve maintained its hawkish stance by signaling that rates will likely remain high for longer. Gold was down by 1.3% to $4,034 an ounce, as the dollar rose. The yellow metal will experience a decline of 13% in the second quarter. This is its largest quarterly drop since 2013. Reporting by Ankur Baerjee from Singapore, Harry Robertson from London and Rodrigo Campos from New York. Karen Brettell, Alex Lawler and Karen Brettell contributed additional reporting. Editing by Aidan Lewis (with Andrew Heavens, Mark Potter and Aidan Lewis).
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Gold falls as tensions between the U.S. and Iran spark inflation and rate hike concerns
Gold prices fell on Monday as fresh tensions between the U.S. and Iran pushed up oil prices, fueling inflation fears. This boosted expectations for higher interest rates. By 8:51 am, spot gold had fallen 1.03% per ounce to $4 045.95 ET (12:51 GMT) while U.S. Gold Futures for August Delivery fell. Prices fell to a seven-month low last week. The market is still adjusting to the Fed's more hawkish stance, said Peter Grant. Iran launched drones and missiles on Sunday at U.S. military bases in Kuwait and Bahrain. This was shortly after U.S. president Donald Trump had threatened to eliminate the Iranian leadership for failing to adhere to the terms of the final agreement. Brent crude futures rose after the attacks. Gold is traditionally a safe-haven metal, but the higher energy costs due to war have led to concerns about inflation and rising interest rates. This would put pressure on gold, a non-yielding material. The U.S. Federal Reserve kept interest rates steady this month. However, policymakers are expecting a rate hike in the second half of this year due to growing concerns over inflation that is above the 2% target set by the U.S. Central Bank. The U.S. dollar is on track to post its largest monthly gain since nearly a year. A stronger dollar makes gold expensive for foreign buyers. The market participants are now awaiting the ADP employment data, which will be released on Wednesday, and the U.S. nonfarm payrolls on Thursday to get more clues about the monetary policy stance of the Fed. Grant said that "(Gold's) price could fall to new lows, if employment data continues to look strong. This would support the Fed's higher-for longer stance." The traders are estimating that there is a 60% chance of a rate increase by September. (Reporting by Sukanya Mitra in Bengaluru; Editing by Joyjeet Das) (Reporting by Sukanya Mitra in Bengaluru; Editing by Joyjeet Das)
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Aluminum prices fall to a four-month low amid Middle East supply concerns
Aluminum prices dropped to a four-month-low on Monday as traders said that fears had eased about the possibility of a larger conflict arising from the weekend's tit-fortat strikes between Iran and the United States. Benchmark aluminium prices on the London Metal Exchange were down 1.9% to $3,119 per metric ton, from $3,104 earlier. The Strait of Hormuz talks between Washington and Tehran, which is a major shipping channel, will be resumed on Tuesday in Qatar. Britannia Global Markets stated in a report that "the situation is still fluid, and any new disruption could quickly tighten the availability of... aluminum." The suspension of the trade across the Strait caused a'significant disruption to the aluminium market. The Middle East is home to 9% of the global aluminum smelting capacities. This month, due to disruptions in supplies, prices reached $3,787.50, their highest level since March 2022. Prices of metals used in construction, transport and packaging have fallen by 16% since then. The 'premium' for the LME cash aluminium contract has fallen from its 19-year-high over the 3-month forward. Support for aluminum is at the 200-day moving median, which is currently around $3.160. On the upside, resistance is found at the 100-day Moving Average around $3.410. Metals prices in other markets are more expensive because of the dollar strength. The dollar is on track to achieve its biggest monthly gain in over a year. This is due to the growing likelihood of higher interest rates in the United States in order to curb inflationary pressures. Alastair Munro is a senior base metals analyst at broker Marex. He said that a hawkish U.S. rate backdrop first drove the selloff in energy and precious metal markets, before the industrial metals suite was under pressure last week. Lead?retreated by 0.1% to 1,901 while tin was little changed at $50540. Nickel lost 1.3%. This week, the manufacturing PMIs of China's top consumer will provide clues about demand for industrial metals. Reporting by Pratima Dasai, Editing by Mark Potter and David Goodman. Shreya biswas is the editor.
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The US is also facing soaring temperatures.
Italy and the Balkans were affected by a record-breaking, heatwave on Monday. The heatwave has been causing hundreds of deaths in excess and disrupting daily life for over a week. There are growing concerns about the spread of wildfires. The National Weather Service in the United States warned of "dangerous temperatures" in central and eastern U.S., with temperatures in the 90s to lower 100s degrees Fahrenheit. This was in the days leading up to the celebrations of July 4, the 250th Anniversary of the Declaration of Independence. The National Weather Service warned that "the combination of prolonged daytime heat and limited nighttime cooling will increase the risk for heat-related illness, especially among vulnerable populations and those who lack adequate cooling." The National Weather Service warned that temperatures in Western Europe have dropped from June's record highs. However, the heat is expected to return next week. On Monday, 22 Italian cities were under a heat warning. These ranged from Bolzano to the north of the country all the way down to Palermo at Sicily's southern tip. On the Feast Saints Peter and Paul in Rome, pilgrims used fans to cool off and umbrellas to provide shade. Pope Leo gave his Angelus from a balcony and the crowd below was able to hear it. WILDFIRES IN WESTERN BALKANS The Croatian weather service issued an alert for the red zone on Monday, including for the capital Zagreb as well as the tourist destinations Split and Dubrovnik. Four aircraft and dozens of firefighters battled a forest fire on the tourist island of Vis, in the Adriatic Sea. This is about 55 km (34 miles) south of Split. The State Hydrometeorological Service of Serbia (RHMZ), a neighbouring country, has warned that temperatures will reach 39 degrees Celsius on Monday. Albania also contained a wildfire that consumed many hectares near the village of Klos in the south over the weekend. The heatwave that began on 20 June set records for the early summer. It damaged infrastructure, disrupted power production, and overwhelmed the healthcare system. France reported that the heatwave was responsible for 1,000 extra deaths. French public health officials said that the majority of heat-related deaths involved older people, and warned that the number would likely rise. The French media reported the funeral homes of Paris and its surrounding areas were overrun by the bodies. Scientists say that the heatwave would be "virtually unavoidable" if it weren't for climate change. CYPRUS: YOUNG BOYS DIE INSIDE CARS Daniele Mocio is a meteorologist for the Italian Air Force. He said that the heatwave would continue in Central and Eastern Europe for a few more days, with temperatures 8-10 degrees Celsius higher than average. The relief that comes further west in Europe is likely to be short-lived. Luca Mercalli is the president of 'Italy Meteorological Society'. He said that temperatures will soar from July 5 or 6 onwards. Mercalli said that the areas affected by the second wave of flooding are similar to the areas that were hit in the first. These include France, Spain and Germany as well as Italy, Switzerland, Britain, and Switzerland. "With the extreme heat, forest fires are more likely to occur, but there are also a lot of storms which mitigate that risk,"? he said, adding that because storms can be localised, rainfall amounts may vary widely. At the weekend, there were reports of more tragedies relating to heat. Police said that two boys, aged 8 and 10, from Bulgaria were discovered dead in a hot vehicle?in Cyprus Sunday afternoon. Cyprus is experiencing temperatures around 38 C. This is not a heatwave for this time of the year. On Sunday, two cyclists, one aged 30 and the other 71, were killed while participating in an event of the Poland Bike Marathon Series in Marki, near Warsaw.
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Aluminum prices fall as Middle East fears about supply ease
Aluminum prices fell on Monday due to a easing in fears that the weekend tit for tat strikes between Iran and the U.S. would escalate and cause a larger conflict and disrupt Middle East shipments, traders reported. The benchmark aluminium price on the??London Metal Exchange was down 0.2% at $3,164 per metric ton. The Strait of Hormuz is a major shipping channel. On Tuesday, Washington and Tehran will resume their talks. Britannia Global Markets stated in a report that "the situation is fluid, and any new disruption could quickly tighten the?availability of... aluminum". The suspension of the trade through the Strait caused a significant disruption to the aluminium market. Middle East is home to 9% of the global aluminum smelting capacities. This month, due to disruptions in supplies, prices reached $3,787.50, their highest level since March 2022. Prices of metals used in construction, transport and packaging have fallen by 16% since then. The premium for the LME cash aluminium contract has fallen from its 19-year-high over the next three months to a discount. Support for aluminum is at the 200-day moving median, which is currently around $3.160. On the upside, resistance is found at the 100-day Moving Average around $3.410. Metals markets in other countries are influenced by the strength of the U.S. dollar, making metals priced in dollars more expensive for those with currencies other than the U.S. dollar. The dollar is on track to?have its biggest monthly gain in over a year. This is due to the growing likelihood of higher interest rates in the United States in order to curb inflationary pressures. Alastair Munro is a senior base metals analyst at broker Marex. He said that the initial sell-off in the energy and precious metals markets was due to a hawkish U.S. rate backdrop. The industrial metals suite then came under pressure the following week. Lead gained 0.2% and tin 1.4%, while nickel fell 0.4%. This week, the manufacturing PMIs of China's top consumer will provide clues about industrial metals demand. Reporting by Pratima Dasai, Editing by Mark Potter & David Goodman
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Martin Marietta to buy Lhoist North America in $13.5 billion deal
Martin Marietta Materials announced on Monday that it will merge with Lhoist North America, a limestone supplier in North America, through a cash and stock deal valued at $13.5 billion. The building materials firm is looking to tap into the growing demand for lime-based products. The shares of the Raleigh, North Carolina based company fell about 3% during premarket trading. The company stated that Martin Marietta would?use a combination of $7 billion cash and $6.5 billion worth of shares to fund the deal. The company expects to achieve annual cost synergies of about $85,000,000. Martin Marietta CEO Ward Nye stated that the demand for high quality lime products will'remain resilient in decades to come due to investments in infrastructure, advanced manufacture, energy development, and industrial expansion. The building products industry in the United States has seen a boom in recent years, as new housing, repairs, and renovations have all boomed. Last week, Ireland’s CRH announced that it would acquire Arcosa for $8.5 billion in an all cash deal. This was done to take advantage of the rising demand in U.S. 'energy and utility infrastructure. Lhoist’s Berghmans Family – which owns privately held Lhoist Group, a Belgian industrial company – would own approximately 15% of Martin Marietta at the close of the deal. Martin Marietta would gain 2 billion tons worth of limestone reserves, production facilities, distribution terminals, and quarries in the Sun Belt metro corridors. Lhoist North America produces hi-calcium limestone, dolomitic liming, and industrial mineral products that are used for?domestic?steel manufacturing, infrastructure, and heavy non-residential?construction across North America. The deal should be completed by the end of 2026 if regulatory approvals are granted. (Reporting and editing by Shashkuber, Devika Syamnath and AnshumanTripathy in Bengaluru)
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US futures rise as Middle East attacks stop, keeping oil prices muted
U.S. Stock Futures rose on Monday, after the U.S. agreed to halt recent hostilities with Iran and resume talks. This helped oil prices drop after they spiked earlier due to renewed attacks between both sides. After a sell-off last week triggered by fears about AI spending, European stocks were flat. However, tech was outperforming on both sides. The STOXX 600 index in Europe was not changed, but the S&P 500 futures in the U.S. rose 0.8%. Futures on the Nasdaq, which is a tech-heavy index, rose by 1.1%. This puts the U.S. Index back on track to recover after it fell more than 4% in the previous week. The STOXX technology?index rose 1.2%. After several days of strikes, both sides have accused each other of violating an interim ceasefire after an Iranian projectile struck a cargo vessel in the Strait of Hormuz. After the U.S. and Iran exchanged strikes over the weekend the oil price spiked initially on Monday, but then fell to its lowest level since the conflict began. Brent crude oil was up 0.7% last week at $72.50 per barrel. This is down 22% from the previous month. Mohit Kumar said that the market could benefit from the drop in oil prices, and the impact it has on the global economy. Lower oil prices will lead to diversification of trade, and sectors that are growth-sensitive should perform better. Asian markets have pared their earlier losses. South Korea's KOSPI is down by 0.2%, and Japan's Nikkei is up 0.2%. Investors are worried that AI-related companies' valuations have risen too high after dramatic gains. However, markets were set to recover some ground on Monday. The Bank for International Settlements warned against the sustainability of the current AI investment boom, citing supply bottlenecks as well as intense competition that could lead to the same overinvestment seen during previous boom and bust cycles. WAGE WAGERS FOR RATE INCREASE The oil prices have dropped sharply over the past few weeks, but inflation measures have?risen in the U.S. The dollar has risen due to the rising odds of a rate hike. The dollar index (which measures the U.S. currencies against other currencies) was slightly lower last week at 101.25. This is just below its one-year high reached last week. The Japanese yen fell slightly to 161,80 per U.S. Dollar as fears of further intervention by Tokyo prevented the fragile currency breaking its lowest level in 40 years. Investors have priced in at least a Fed rate hike this year. This is a dramatic change from the expectations of two rate cuts before the war began. BofA's strategists expect?three increases, reflecting a more hawkish outlook that is partly influenced by?strong U.S. job growth. Gold was down by 1.3% to $4,034 an ounce, as the dollar rose. The yellow metal will experience a 13% drop in the second quarter. This is its largest quarterly decline since 2013.
Volkswagen CEO targets power switch alongside deep cuts
Volkswagen CEO Oliver Blume’s plan to close German factories and 'cut up to 100,000 jobs' is more than just a cost-saving measure. It could also be an attempt to change a corporate structure that has held back progress for years.
Sources say that Europe's largest?automaker? is considering its biggest-ever restructuring. This includes doubling the planned job cuts, and closing four German factories. It does this to combat tariffs, rising costs, and increasing competition from Asia.
The company is also considering plans to separate passenger cars and parts into separate divisions. This could be a test of the limits of the Volkswagen Law, which entrenches both the influence of workers and Lower Saxony as the second largest shareholder.
The law limits the ability of management to "close" plants. The law only applies to VW AG, which controls six of the core German factories in the VW Group. Creating separate entities would allow a way to circumvent these?constraints.
Three legal and financial sources have said that spinning off the passenger vehicle division - which is heavily exposed to tariffs and weak European demand, as well as a price battle in China - could be an important step in this process.
This would lead to a confrontation with powerful political and union stakeholders. The IG Metall has already said that the carve out plans are an "attack on VW?law", signaling Blume is in for a fight.
Investors say that with the crisis in the industry, Volkswagen's share price near 16-year lows, and rising internal tensions, management is forced to change.
Ulrich Hocker of shareholder lobby group DSW said that labour's influence is "excessive", and it has its roots in an old era. Volkswagen has a long history of failed compromises, with Lower Saxony and labour holding a majority in the supervisory board.
He said: "At some stage, everyone will realise that major changes are needed to ensure this company's survival."
SPINNING THE "BAD BANK"
In practice, any spinoff would require shareholder approval over 80%, under the VW?law. This effectively gives Lower Saxony, with 20% voting rights, a blocking stake.
One of the sources stated that "Lower Saxony will never support a vote aimed to diminish its own power."
UBS anticipates a deal, and warns that any restructuring is likely to come with provisions as well as a downgrade in Volkswagen's outlook for 2026.
Olaf Lies is the Lower Saxony premier and a member of the supervisory board. He said that the state would not accept measures which would weaken workers' influence, which he described as "an integral part of Volkswagen’s success story".
Instead, he has suggested that production of models aimed at China be moved to Germany in order to support underutilized plants -- an idea Blume also floated.
Investors, including Porsche SE, have criticized Volkswagen SE's complex structure that spans 10 brands.
The company could take a leaf out of Siemens’ playbook and streamline its empire in order to close the gap that has existed for a long time between its market value and what analysts attribute to its assets.
Volkswagen's stakes in the truck unit?Traton, and Porsche sports cars are worth more than 50 billion euros (EUR44 billion) - this is over twice as much as the market value of the entire group.
Citi analysts believe that carving out core operations could unlock value. They compare this move to creating a "bad-bank" which would isolate weaker businesses and leave behind a holding company with a smaller footprint, less vulnerable to geopolitics or weak growth.
(source: Reuters)