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Markets take stock of Trump’s U-turns and the relief rally is stuttering
Investors struggled to sort through the noise of the Trump administration, its erratic stance on tariffs, and the Federal Reserve leadership. This week, U.S. president Donald Trump attacked Fed chair Jerome Powell. He then retracted his calls for the resignation of the chair, leaving investors in the dark about the final state of tariffs against China, despite the many headlines. A source said on Wednesday that, in the event of talks with Beijing, the Trump administration may consider lowering tariffs for imported Chinese products. This follows a Wall Street Journal article which stated that Trump's White House was considering reducing tariffs on Chinese imports. Treasury Secretary Scott Bessent said later that such a step would not be taken unilaterally. He was echoing remarks made by White House spokesperson KarolineLeavitt. I don't believe you'll ever be able to get used the flip-flopping and haphazard behavior we've seen. Tony Sycamore is a market analyst for IG. He said that it was extreme. "I think Trump is like that - he wants the best levers and he doesn't fear trying anything. He's not afraid to walk it back either if it fails." MSCI's broadest Asia-Pacific index outside Japan fell by 0.17%. This was in contrast to the Wall Street trend, which saw stocks rise on Wednesday amid hopes of a de-escalation in Sino-U.S. tensions. The Nasdaq 500 and S&P500 futures each rose by about 0.2%. The EuroStoxx 50 futures rose 0.16%. Japan's Nikkei gained 0.86%. NHK reported that the Trump administration informed Japan's trade delegation it couldn't give Japan a special treatment in regards to its tariff measures. This was in response Tokyo's demand for a revision during this month's ministerial talks. Salman Ahmed is the global head of strategic asset allocation and macro at Fidelity. He said: "Short-term volatilities are quite extreme. This high volatility will continue. You have elevated volatility moving forward because the fundamental rules of the game, the economic world, are changing." Ahmed said this on the sidelines the IMAS Investment Conference 2025 and Masterclass in Singapore. Investor confidence in U.S. asset prices remained fragile, and the dollar dropped on Thursday after a week of gains on Trump's U turn on firing Powell. The dollar dropped 0.15% against the yen to 143.24. The euro rose 0.15%, to $1.1331. Meanwhile, the Swiss franc increased by 0.2%. The 30-year yield was little changed, at 4.3675 percent. Trump's change of heart on Powell appeared to lessen the threat to the U.S. fiscal and monetary credibility. The benchmark 10-year rate was down by about 2 basis points, to 4.3675%. Beth Hammack, President of the Federal Reserve Bank of Cleveland, said that on Wednesday there is still a lot of uncertainty about the future. She urged the central bank to be cautious in its monetary policy and to monitor the economy's performance. The markets are expecting a rate cut of about 80 basis points by December. Oil prices have stabilized in other markets after a drop in the previous session. Sources said that OPEC+ will consider accelerating their oil production increases in June. Brent crude futures rose 0.2% to $66.26 per barrel while U.S. Crude also increased 0.18% to 62.38 per barrel. Gold continued its march towards a new record high. The yellow metal rose 1.2% to $3,329.03 per ounce.
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Oil prices steady after 2% decline on possible OPEC+ production increase
Oil prices rose early on Thursday, after falling by nearly 2% the previous day. Investors weighed a possible OPEC+ production increase against contradictory tariff signals from White House as well as ongoing U.S. Iran nuclear talks. Brent crude futures gained 6 cents or 0.09% to $66.18 per barrel at 0038 GMT. U.S. West Texas Intermediate Crude rose 7 cents or 0.11% to $62.34 per barrel. The previous trading session saw prices fall 2% after it was reported that three sources familiar with OPEC+ discussions said several OPEC+ member countries will suggest to the group that they increase oil production for a second consecutive month in June. The members had a dispute over the production quotas. Prices rose on signs that U.S.-China trade talks could be nearing completion. The Wall Street Journal reported the White House was willing to reduce its tariffs against China by as much as 50% to start negotiations. Scott Bessent, U.S. Treasury secretary said that the current tariffs of 145% for Chinese products and 125% for U.S. goods were not sustainable. He did not give a specific number but he stated that they would need to be reduced before any trade talks could take place between both sides. White House Press Secretary Karoline leavitt told Fox News in an interview on Wednesday that the tariffs on Chinese goods would not be reduced unilaterally. Rystad analysts believe that a prolonged U.S. China trade war would cut China's growth in oil demand by half, to 90,000. barrels per day. The Financial Times reported that Trump was also considering tariff exemptions for imports of car parts from China. The U.S. will meet with Iran for a third round this weekend to discuss a possible agreement that would impose restrictions on Tehran's nuclear enrichment program. This could put downward pressure on the oil price. The market is looking for signs that a U.S. and Iran rapprochement may lead to a easing of sanctions against Iran oil, which would boost supply. The U.S. imposed new sanctions on Iran's oil sector on Tuesday, a move that was criticized by the Iranian foreign ministry as demonstrating a lack of "goodwill and seriousness" in regards to dialogue with Tehran. (Reporting Colleen Waye; Editing Sonali Paul).
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Albanese, an Australian company, pledges to establish a strategic reserve for critical minerals
The Australian centre-left Labor Government pledged on Thursday an initial investment A$1.2 billion (roughly $763 million) in order to establish a strategic reserve for critical minerals. It is looking to create a different supply chain within a Chinese dominated market. The Prime Minister Anthony Albanese said that the reserve, which is expected to be established in nine days, would use the mineral deposits of the country and increase its economic resilience. Albanese stated in a press release that "we need to do more" with the natural resources needed by the world, which Australia can provide. After President Donald Trump imposed tariffs against Chinese goods, China placed restrictions on exports of minerals that are vital for everything from smartphones to EV batteries and infrared weapons. This has squeezed supply to the West. China is the top producer in the world of 30 out of 50 critical minerals, according to the U.S. Geological Survey. Australia also has some of its largest deposits of critical minerals. Albanese stated that the government will buy minerals critical to commercial projects, or create an option for a set price and hold security over assets. The government will establish stockpiles for some minerals produced in accordance with offtake agreements. Albanese stated that "it will allow us to deal with market and trade disruptions in a stronger position, as Australia will have access to a significant amount of resources for global demand." Minerals from the strategic reserve will be available to key domestic and international partners. Albanese stated that a task force would be formed to finalise and consult on the scope and design for the strategic reserve. This reserve is expected to become operational in the second quarter of 2026.
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Petrobras Board approves agreement with Unigel for fertilizer plants
Petrobras, the state-run Brazilian oil company, said that its board of directors had authorized it to sign a settlement agreement with Unigel Chemical Company to settle a legal dispute over two fertilizer factories in northeastern Brazil. Petrobras stated in a filing of securities that the agreement would restore Petrobras ownership over two fertilizer factories located in Sergipe state and Bahia state. Petrobras announced that the plants would resume operations after a process of bidding to contract for services to operate and to maintain them. The deal, however, still needs to be approved internally within Unigel, and it must also meet certain conditions before taking effect. Unigel didn't immediately respond to an outside of normal business hours request for comment. Petrobras leased two nitrogen fertilizer factories to Unigel under a 10-year contract in 2019. Unigel has shut down both plants since 2023 citing high gas prices as the reason for their closure. Both companies are involved in arbitration related to their lease agreement, which includes disagreements about the shutdown of the operations, Unigel’s investments and gas supply terms. Announcement comes after Report on Friday According to sources, the Petrobras board approved plans to select partners to restart operations at fertilizer plants. (Reporting andre Romani, additional reporting by Roberto Samora).
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The rosy outlook of chipmaker TI soothes tariff concerns for the moment
Texas Instruments announced a second-quarter revenue forecast that was above Wall Street expectations on Wednesday. The company attributed this to a robust demand for analog chips, despite the fact that the threat of U.S. Tariffs has created uncertainty in the semiconductor industry. TI shares rose more than 5% after-hours following the announcement. This was the first major U.S. semiconductor company to provide an outlook this earnings season. The stock price had dropped over 17% this year due to macroeconomic worries and trade tensions. LSEG data shows that TI estimates revenue for the quarter ending June between $4.17 and $4.53 Billion, compared to analysts' average estimate $4.10 Billion. The earnings per share is projected to be between $1.21-$1.47, which is also higher than the average estimate. Kinngai Chang, senior analyst with Summit Insights Group, says that the positive forecast is driven by "cyclical demand recovery" and possible tariff pull-ins. Haviv Ilan, the CEO of Haviv Group, sounded a cautionary note. On a call after earnings, Haviv Ilan said, "We'll have to wait and see" what happens in the second half 2025, as well as into 2026. He cited ongoing uncertainty regarding tariff policy. According to an April notice by the Chinese main semiconductor association, while President Trump has exempted for now semiconductors from further levies and tariffs, Beijing has imposed high tariffs on U.S. made chips. Analysts asked Ilan if customers were stockpiling the chips in anticipation of expected taxes. I would guess that in a time of uncertainty, you might want to stock up on a bit more inventory. He said. Tore Svanberg, Stifel's analyst, noted that it may be too soon to determine the impact of the increased tariffs and escalating Sino U.S. Trade tensions on the chip company and the industry as a whole due to the ongoing tariff negotiations. CHINA WORRIES TI, a company with significant manufacturing capacity in America, derives about a quarter of its revenue annually from China. This makes it vulnerable to ongoing tit for tat tariffs between Beijing & Washington. Ilan stated that the company could use its manufacturing facility in China to meet any needs. Since years, the legacy chipmakers have worked to adopt a “China-for China” policy. They set up fabs to meet domestic demand in the face of escalating tensions. TI is facing stiff competition in China, where state subsidies have boosted the production of mature-node chips. Ilan stated that "the competition in China has intensified." (Reporting by Arsheeya Bajwa in Bengaluru; Editing by Tasim Zahid)
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Gold sinks and stocks rise as US tariffs on China are not sustainable
The dollar rose against the euro, and other currencies on Wednesday. Meanwhile, gold-backed safe-havens fell as the Trump Administration signaled its willingness to deescalate the trade war. U.S. Treasury secretary Scott Bessent stated that the high tariffs between China and the United States are not sustainable. Meanwhile, U.S. president Donald Trump indicated he would be open to easing the trade tensions. Persons familiar with the discussions said that the White House was open to a rate reduction on Chinese imports to help advance the negotiations with Beijing, but would not be doing so alone. Trump, who had threatened to fire Federal Reserve Chairman Jerome Powell on Tuesday evening, has now backed down from his threats. The market is looking for a softer stance towards China on trade and tariffs. It would also be nice to see a sign of a willingness to negotiate, and to ease off from the current high tensions. Investors have been concerned about U.S. assets due to Trump's tariff war. Stocks rose on Wednesday as well, thanks to some positive earnings reports in the U.S. Boeing shares rose 6.1% after the company reported a smaller-than-expected quarterly loss. The Dow Jones Industrial Average rose by 419.59, or 1.07 percent, to 39.606.57. The S&P 500 gained 88.10, or 1.67% to 5,375.86. And the Nasdaq Composite increased by 407.63, or 2.50 percent, to 16,708.05. Tesla shares rose 5.4% despite the fact that company results were below analyst expectations. Elon Musk, the Tesla CEO, said in a conference call with analysts that he will significantly reduce his work at the Department of Government Efficiency starting next month so he can focus on his companies. Tech and consumer discretionary accounted for the largest percentage gains among the 11 major S&P 500 sectors, while consumer staples, energy, and other areas lagged. The MSCI index of global stocks rose by 11.95 points or 1.50% to 808.21. The pan-European STOXX 600 ended up 1.78%. Spot gold fell 3% after hitting record highs recently, to $3,281.6 per ounce. The dollar rose 1.27% to 143.435 yen. The dollar last gained 1.32% against the Swiss Franc at 0.8298. The euro fell 0.86%, to $1.132. This is a drop from $1.15 earlier in the week. That was a 3-1/2 year high. Benchmark 10-year rates, which move in the opposite direction to prices, declined on Wednesday. This was a partial relief for investors who had been concerned about Trump's new trade and economic policies. The bond rally lost steam as the economic data released Wednesday was mixed with some surprises on the upside. One of them was a reading of the U.S. Department of Commerce for home sales in March that was higher than expected. The benchmark 10-year Treasury yields last stood at 4.385%. This is a little lower than Tuesday. The 30-year yields fell by five basis points, to 4.83%. Citadel's CEO and founder Kenneth Griffin warned that Trump's government must be cautious about the potential damage done to U.S. Treasury bonds. The price of oil ended lower. U.S. crude fell $1.40, settling at $62.27 per barrel. Brent crude dropped $1.32, settling at $66.12. (Analysts Amanda Cooper and Wayne Cole, Sydney, and Lewis Krauskopf, New York, and Bernadette, Baum, Gareth Jones and Mark Heinrich in New York, and Sandra Maler, Cynthia Osterman, and Sandra Maler, contributed to this report.)
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FirstEnergy's profit beats estimates for the first quarter on higher electricity prices
FirstEnergy, a utility company, beat Wall Street expectations for its first-quarter adjusted profits on Wednesday. The utility was helped by a rate increase. U.S. Electric utilities are investing more in infrastructure as a result of extreme weather and a growing demand. This is to meet the demand, but also improve resilience. Rate case proceedings are used by utilities to calculate the cost of electricity, natural gases, private water, and steam according to investments made by customers. As the demand for electricity from AI data centres, domestic manufacturing and electrification of industry increases, power bills will rise. The company reported that its total quarterly distribution deliveries increased by more than 4% in comparison to last year when the weather was mild. The adjusted quarterly profit for its integrated and distribution segments increased by 10 cents each from the previous year. FirstEnergy provides electricity to about 6,000,000 customers in Ohio, Pennsylvania and New Jersey. It also serves West Virginia, Maryland, West Virginia, and West Virginia through its three segments: distribution, integrated transmission, and stand-alone. According to data compiled and analyzed by LSEG, the Akron, Ohio, based company posted an adjusted profit per share of 67 cents in the first three months, compared to analysts' estimates of 61 cents. Reporting by Tanay and Pooja in Bengaluru, editing by Alan Barona
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GM will increase production at Ohio transmission plant
General Motors confirmed on Wednesday that it is increasing the production of transmissions in its Toledo, Ohio plant, and shifting away from manufacturing EV drive units to parts for gasoline cars. Transmission plant is used to support the production of light trucks in Fort Wayne, Indiana. First reported that GM was going to increase production in the Indiana assembly plant after U.S. president Donald Trump announced 25% auto import tariffs. A spokesperson from the automaker stated that the shift in production at Toledo was not due to tariffs. General Motors is revising production plans for Toledo Propulsion in order to accommodate additional capacity of ICE propulsion units, in line with the current market demand. When GM After a $760-million investment, Toledo became the first U.S. factory to produce EV powertrains. The automaker still hasn't produced retail drive units at the Toledo facility. In a memo to workers, Rob Morris, Toledo's plant director, explained that the company has decided to increase capacity in order to meet the current demand for ICE products. The memo stated that the second drive-unit production line would not be updated, and one of the production lines for drive units in the facility will be converted into a transmission. GM made some other changes to its EV plan, including delaying the start of EV production at Orion Assembly Plant in Michigan. It failed to meet its EV production target of producing and wholesale 200,000 EVs across North America by 2024. Instead, it ended up with 189,000 units. Separately, Trump's Tariffs The automakers have changed their ways or expedite investment plans. Some automakers and suppliers are seeking to increase investment in the U.S., to avoid the steep duties. Others are waiting to see whether the duties will stick. Center for Automotive Research Analysis Find out Trump's 25% tariffs on autos, imposed by him in early April, will cost automakers in the U.S. $108 billion in 2025. Import taxes on auto parts are still scheduled to be implemented by May 3. (Reporting and editing by Diane Craft in Detroit, Kalea Eckert and Nora Eckert)
How huge fossil-fuel-producing countries export emissions abroad
Black dust coats streets and gathers on rooftops in the area adjoining a vast cement factory in the Egyptian city of Alexandria.
Activists and regional citizens accuse the plant run by the Alexandria Portland Cement Business (APCC), a subsidiary of Greece's Titan Cement, of fouling the air by burning coal.
Every night, we see particles falling from their chimneys. Under street lights, you can plainly see the dust drizzling down, stated Mostafa Mahmoud, a supermarket owner in the Wadi al-Qamar area.
Reuters could not individually confirm the assertion. Titan Cement says the plant's emissions are within legal limits, and it prepares to minimize its use of coal in coming years.
Like many cement makers in Egypt and across North Africa, the factory uses imported coal to fire its kilns. Lately, a growing number of the region's coal is coming from the United States, according to U.S. export data.
Fossil fuel exports have been a hot subject at the United Countries climate conference in Baku this year, with activists and delegates from some climate-vulnerable countries arguing countries must be held liable for the contamination they send out overseas - typically to poor establishing nations - in the type of oil, gas and coal. Some are looking for to get the question of how to do this onto the program at future environment tops.
A landmark arrangement reached in Paris in 2015 to combat environment modification needs countries to set targets and report on development reducing nationwide levels of planet-warming greenhouse gas emissions. But it does not impose such requirements for emissions generated from fossil fuels they drill, mine and ship somewhere else.
That has actually permitted nations like the United States, Norway, Australia and others to state they are making development toward international climate goals while likewise producing and exporting fossil fuels at breakneck rate, said Bill Hare, co-founder of Environment Action Tracker, an independent clinical project that tracks government environment action.
Most of these fossil-fuel-exporting countries can get to look good with their domestic environment action, he stated on the sidelines of the COP29 conference in Baku today. Their. exported emissions are someone else's problem.
U.S. nonrenewable fuel source exports-- including coal, oil, gas and. refined fuels-- caused over 2 billion lots of carbon dioxide. equivalent emissions in other countries in 2022, according to a. computation carried out by Climate Action Tracker and confirmed. using data from the International Energy Company. That. is equivalent to about a 3rd of U.S. domestic emissions, the. information showed.
A years-long drilling boom has made the U.S. the world's top. oil and gas producer, while robust demand has actually lifted its coal. exports for 4 years running, according to data from the U.S. Energy Details Administration (EIA).
Asked how Washington squares its climate ambitions with its. nonrenewable fuel source production and exports, President Joe Biden's. environment advisor, Ali Zaidi, said strong energy output was needed. to keep customer prices low during a transition to cleaner. fuels.
I do not believe there is social license for a decarbonisation. playbook that puts upward price pressure for retail customers in. the market, Zaidi informed Reuters.
Inbound president Donald Trump, a climate modification sceptic,. has said he wishes to even more enhance the country's fossil fuel. production.
For other manufacturers, greenhouse gas emissions from fossil. fuel exports in some cases exceed domestic emissions, Environment. Action Tracker said.
That held true for Norway, Australia and Canada in 2022, the. newest year for which data is available for all countries. evaluated. Reuters got special access to the computations.
Norway's Ministry of Climate and Environment said it is. approximately other nations to manage their own carbon footprints.
Each nation is responsible for lowering its own. emissions, the ministry stated in a statement to Reuters.
Authorities at the environment and climate ministries of. Canada and Australia did not comment.
Addressing the top in Azerbaijan, host President Ilham. Aliyev implicated some Western politicians of double requirements for. lecturing his federal government about its oil and gas usage, saying,. They better look at themselves.
CEMENT AND BRICKMAKERS
A lot of U.S. gas exports now go to European countries looking for. to minimize reliance on Russia, while China has actually become one of. the leading purchasers of U.S. crude and coal, according to the EIA. figures. America's greatest development market for coal, however, is. North Africa.
U.S. coal mines exported around 52.5 million short lots. globally in the very first half of 2024, up almost 7% from the exact same. period a year earlier, the information revealed.
Much of the boost was driven by cement and brickmakers in. Egypt and Morocco, which together took in more than 5 million. short loads over the period, the EIA stated in a current report.
These clients value the high heat content of U.S. thermal. coal, which makes their production operations more. efficient, the report stated.
On the other hand, U.S. domestic coal usage has actually been sliding as cheap. gas and aids for renewables like solar and wind. drive coal-fired power plant closures, extending a more than. 15-year decrease in greenhouse gas emissions.
Egypt's cement market has depended on imported coal for. nearly a years, because consistent natural gas scarcities forced. many factories to search for alternatives, stated Ahmed Shireen. Korayem, vice chairman and board member at the Arab Union for. Cement and Building Products, a regional industry body.
The U.S. is Egypt's largest provider, accounting for 3.1. million of the 6.6 million metric lots of coal imported this. year, according to data from the London Stock Exchange Group.
Russia supplied most of the rest, 2.1 million metric lots. Its environment ministry referred questions to the foreign. ministry, which did not immediately comment.
Activists argue that the Egyptian federal government's choice to. lift a longstanding ban on coal imports in 2015 to support an. market central to its financial development strategies is harmful to. the environment and health of communities like Wadi al-Qamar.
Using information from the Alexandria plant's emissions-monitoring. system, researchers from Egypt's Al-Azhar University, Cairo. University and environment ministry simulated the dispersion of. polluting dust and poisonous gases in between 2014 and 2020.
The study
, published in the Journal of Environmental Health Science. and Engineering in 2022, concluded that the shift from using. gas to coal as the dominant fuel cause increased. emissions and concentrations of overall suspended particulates. ( TSP), nitrogen dioxide and sulfur dioxide. The concentrations. were mainly within legal limits, nevertheless.
Egypt's greenhouse gas emissions from burning fossil fuels. increased by more than a fifth in the years ended in 2022, hitting. 263 million metric lots of carbon dioxide, according to information. from the International Carbon Budget, a task led by Britain's Exeter. University.
The majority of these emissions originated from gas and oil, which stay. Egypt's main energy sources. Coal accounted for 3.4% of the 2022. overall, 9 million metric heaps.
The federal government devoted in 2021 to phase out making use of. coal and has actually asked companies that utilize it to introduce more. eco-friendly sources into their energy mix. But Heba Maatouk, a. representative for Egypt's environment ministry, stated there was. insufficient supply of alternatives, such as refuse-derived fuel. ( RDF) made from combustible garbage.
If business can not get the RDF, they will not stop running. and will use coal to avoid losses, Maatouk told Reuters.
LEGAL BATTLES
Decarbonising the cement industry is a difficulty,. especially in poorer developing nations like Egypt, due to the fact that it. requires huge amounts of energy, and technologies to keep. emissions from the environment are pricey.
In his COP29 address recently, Egyptian Prime Minister. Mostafa Madbouly said his nation's strategies to enhance eco-friendly. energy to 42% of its power mix by 2030 depend on foreign. assistance.
Homeowners in the Wadi al-Qamar neighborhood have been. participated in a prolonged legal fight with the Alexandria cement. factory, APCC, submitting several claims, stated Hoda Nasrallah, a. legal representative for the Egyptian Effort for Personal Rights (EIPR).
In 2016, community members backed by EIPR asked an. administrative court in Alexandria to overturn amendments to the. country's ecological policies that allow heavy markets. to use coal on health and ecological premises, according to. the rights group.
APCC officials did not react to an ask for remark made. through a legal representative.
Titan Cement verified that the factory sources coal from. the U.S. however did not elaborate.
In a statement issued by its group business interactions. director, Lydia Yannakopoulou, the company said the plant had. not violated any laws, had actually made 40 million euros in investments. in pollution controls because 2010, and prepared to reduce its use. of coal in coming years as it increases use of alternatives.
She stated a court-appointed committee of experts from. Alexandria University concluded there were no environmental. violations arising from the company's emissions or functional. procedures, and the emissions were within legal limitations.
Nasrallah stated legal representatives representing the community. believe the committee was headed by a company employee and have. taken their case to Egypt's greatest administrative court in. Cairo.
Neither side supplied a copy of the committee's report, and. Reuters could not separately confirm their assertions.
A ruling in the case is expected in December.
Meanwhile, frustration is building amongst nearby. locals like Hisham al-Akary, who says his family has lived in. Wadi al-Qamar for generations and can not afford to move.
This factory shouldn't be here, he told Reuters. We. need to remain, and they must leave..
(source: Reuters)