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Gold prices rise as tariff worries boost demand for safe-havens
Gold prices rose on Monday, as investors sought refuge in gold bullion due to the escalation of the Russian conflict in Ukraine and President Donald Trump’s threat to double tariffs against imported steel and aluminium. As of 0204 GMT, spot gold rose 0.5% to $3,305.85 per ounce. U.S. Gold Futures increased 0.4% to $3329.80. Tim Waterer is the chief market analyst for KCM Trade. Gold is being supported by a drop in the dollar and a decline in risk assets. Trump announced on Friday his intention to increase tariffs on steel and aluminum imports to 50%, up from 25%. The European Commission warned that Europe was prepared to take retaliatory action. Ukraine and Russia intensified hostilities in advance of their second round peace talks in Istanbul. The wave of attacks included one of Ukraine’s most daring strikes of the conflict and an overnight drone attack by Russia. Bullion is now cheaper for foreign buyers due to the 0.2% decline in the U.S. Dollar index. The markets are waiting for clues from the Federal Reserve's officials on the outlook of monetary policy. Fed Chair Jerome Powell is scheduled to speak at the end of the day. Fed Governor Christopher Waller stated that rate cuts are still possible this year, despite the Trump Administration's tariff regime likely to temporarily increase price pressures. In an environment of low interest rates, gold, which is regarded as a safe haven asset in times of geopolitical or economic uncertainty, thrives. According to Treasury Secretary Scott Bessent, Trump and Chinese president Xi Jinping will likely speak soon in order to resolve trade issues, including a dispute about critical minerals. Other than that, silver spot was unchanged at $32.99 per ounce. Platinum was down 0.6% to $1,049.72, and palladium was down 0.5% at $965.77.
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London copper prices rise on weaker dollar but US-China Trade Conflict caps gains
The London Metal Exchange saw a rise in copper prices on Monday due to a weaker US dollar. However, renewed U.S. China trade tensions have raised concerns about the supply chain and limited any further gains. As of 0135 GMT, the benchmark three-month price for copper on London Metal Exchange (LME), was up by 0.7% to $9,561.5 a metric tonne. China's commodities markets were closed Monday due to the Dragon Boat Holiday. As markets assessed potential inflation and growth risks posed by U.S. President Donald Trump’s latest tariff policy, the dollar edged down, paring its gains from last week. Trump's announcement on Friday that he would increase import tariffs from 25% to 50% on steel and aluminum increased tensions. A survey released on Saturday showed that China's manufacturing sector contracted for the second consecutive month in May. This fueled expectations of more stimulus measures to help support the economy during a prolonged trade war with the United States. The official purchasing manager's index increased slightly from 49.0 to 49.5 by May, but it remained below the 50-mark that separates growth from contraction. This is in line with an average polled forecast of 49.5. LME aluminium rose 0.1% to $2.446 per ton. Lead increased 0.6% to $1.970. Zinc grew by 0.7% to $2.638.5, tin was up 0.2% at $30.456. Nickel was up 0.9% to $15.375. Click or to see the latest news in metals, and other related stories. Data/Events (GMT, may) 0600 UK Nationwide House Prices MM,YY 0750 France Mfg HCOB PMI 0755 Germany Mfg HCOB PMI 800 EU Mfg HCOB Final PMI 830 UK S&P Global Manufacturing PMI 1345 US S&P Global Manufacturing PMI Final 1440 US ISM manufacturing PMI
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BlueScope, Australia's steel company, surges after Trump's announcement to double tariffs.
BlueScope Steel shares soared to their highest level in over three months on Monday after U.S. president Donald Trump announced he would double the tariffs on steel imported from other countries. Early trade saw shares of BlueScope, a company that operates five businesses across North America, including the North Star Mill in Ohio, up by as much as 9,4% to A$24.88. The ASX 200 benchmark was down by 0.4%. Trump said on Friday that he would double the tariffs on import steel and aluminum to 50%. This will increase pressure on steel producers around the world and intensify his trade war. Grady Wulff is a Bell Direct market analyst. He said that these proposed tariffs would be good for BlueScope as they could increase steel prices in the U.S. and thus drive tailwinds for their company. Mid-February saw the stock rise 12%, after chief executive Mark Vassella stated that Trump's tariffs could be beneficial to the business. The shares, however, have fallen by nearly 10% since Vassella made his statements. Wulff stated that the uncertainty of a recovery in China's demand for steel and ingredients for steelmaking has affected all companies exposed to this market. Tariffs are also increasing the uncertainty surrounding a recovery of steel-related materials. BlueScope is the biggest victim of low iron ore prices. They have dropped 3.5% this year. North America was BlueScope’s largest revenue-generating segment for the six months ending December 31, 2024. It accounted for 42% or A$309 ($199.77) million of all earnings before taxes, interest, depreciation, and amortization. Australia accounted for 39% or A$288 millions. (1 Australian dollar = 1.5468 dollars) (Reporting and editing by Sherry Jacobi-Phillips, Rashmi aich and Nikita Maria Jio in Bengaluru)
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Ministry of Trade and Industry says South Korea will minimise the impact of a 50% tariff on steel products.
The South Korean Industry Ministry announced on Monday that it would respond to the imminent 50% U.S. steel tariff as part of its ongoing trade negotiations with Washington to minimize the impact on the industry. U.S. president Donald Trump announced on Friday that he would increase tariffs for imported steel and aluminium to 50%, up from 25%. This will put more pressure on steel producers around the world and intensify his trade war. In a press release, the ministry said that it held an urgent meeting with officials of major steelmakers in the country, including POSCO, and Hyundai Steel. In morning trading, shares of South Korean steelmakers fell on Monday. POSCO and Hyundai Steel both dropped 3% while SeAH Steel Corp was down 6.3%. According to data from the American Iron and Steel Institute, South Korea was the fourth largest exporter of steel into the United States last year behind Canada, Mexico and Brazil. South Korea, an important ally of the United States, demanded that tariffs be removed from steel, automobiles, and other items during discussions with the United States. Seoul agreed to create a trade package before the 90-day period of Trump's reciprocal duties in July. However, due to the lack of political leadership in the country, it has been hard for negotiators make major decisions. Hyundai Steel announced in late March that it would build a $5.8 Billion factory in Louisiana as a response to U.S. Tariffs. However, the factory won't open until 2029. Hyundai Steel's larger rival POSCO made a preliminary agreement to invest in the factory. (Reporting and editing by Jack Kim, Hyunjoo Ji and Ed Davies)
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OPEC+'s crude production hike comes amid tepid Asian demand for oil: Russell
The crude oil markets pay attention to what OPEC+ has to say, but less so to what they actually do when it comes down to supplying the world's biggest commodity. Eight members of a wider group who had implemented voluntary production reductions met over the weekend to decide on a rise in output of 411,000 barrels per daily (bpd) for July, which would be the third consecutive month of this increase. Saudi Arabia, Russia, and the United Arab Emirates will each receive more than half the increase in production. There are still two questions to be answered. Will the eight parties to the agreement increase their output by the agreed-upon volumes? And if so, will they be able to find buyers for this additional oil? It's important to note that OPEC+ and most of the market talk about production. However, the key metric for setting the price is the export volume of crude oil. Saudi Arabia's exports were actually lower in April, at 5.75 million barrels per day, compared to March's 5,80 million barrels per day, according data collected by commodity analysts Kpler. Kpler data shows that Saudi Arabian exports jumped to 6.0 millions bpd by May and are expected even higher in June. This suggests that there's a delay between the output agreements and exports. The Russian crude oil exports by sea were 5,07 million barrels per day in March. They remained relatively flat at 5,12 million barrels per day in April before dropping to 4,82 million in late April. This shows that the increase in production agreed upon did not translate into increased shipments. INVENTORIES and DEMAND It is still unclear whether additional oil will be needed in Asia, the region that imports most oil. In a statement released after the May 31, OPEC+ reiterated that it believes the global oil markets have "healthy" foundations, "as reflected by low inventories." They have maintained this position since April, when they began to ease the voluntary production cuts of 2.2 million bpd. The Organization of Petroleum Exporting Countries' monthly report for the month of May shows that crude inventories rose by 21.4 millions barrels in March to 1.323 trillion barrels. This is 139,000,000 barrels less than the annual average between 2015 and 2019. The Organization for Economic Cooperation and Development inventories are below pre-COVID levels, and were rising even before OPEC+ began increasing output. Inventories are not as visible outside of the OECD, especially in China. China is the largest crude oil consumer worldwide. Although China does not disclose its commercial and strategic stocks, it is possible to estimate the surplus crude by subtracting the volume of refined oil from the total domestic production and inventory. China's oil surplus has risen in recent months. It reached 1.98 million barrels per day in April, its highest level since June 2023. This is up from 1.74million barrels per day in March. China has increased its oil imports since March and April, as it procured discounted cargoes of Iranian and Russian crude. But it seems that China's appetite has waned for crude in May, despite lower global prices. Kpler estimates that China's seaborne exports were 9.43 million barrels per day in May, down from 10.46 in April and 10.45 in March. ASIA IMPORTS China's lower appetite in May led to a decline in arrivals in Asia. Kpler estimates 24.2 million bpd. This is down from 24,85 million bpd. in April. Asia's crude oil imports by sea are estimated to be 24.45 millions bpd for the first five month of this year. This is down 320,000 bpd compared to the same period in the previous year. The demand for oil in Asia has not increased despite the drop of Brent crude futures by nearly 30% between mid-January to the lowest price this year, $58.50 per barrel on May 5. The impact of lower oil prices is still being felt. While demand could rise in the coming months due to lower prices, it's possible that economic uncertainty caused by President Donald Trump's tariff war has crimped fuel consumption. Brent futures rose by over $1 on Monday to $63.84 per barrel. The increase in prices indicates that the market was expecting a higher output from the OPEC+ eight-member group for July. The Trump trade war has created distortions that have a significant impact on the outlook for demand. There is uncertainty about the future of supply and whether OPEC+ top producers will seek to increase export volumes or compete for market share. These are the views of the columnist, an author for.
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ASX-listed James Hardie secures $3.5 billion credit to fund AZEK deal
James Hardie, listed on the ASX, announced Monday that it had obtained new senior credit facilities totaling $3.5 billion from a wide range of banks. This will support its operations as well as AZEK's acquisition in the United States. The multi-billion loan facility is divided into a revolving loan of $1 billion and a senior secured term loan (A) of $2.5 billion, which are split into two tranches. In March, the fibre-cement manufacturer offered to purchase the U.S. artificial flooring maker for $8.75billion. At the time, markets were worried about a slowdown of the U.S. residential sector. The new credit facilities have reduced the commitments to bridge facilities with certain lenders for the pending acquisition from $4.3 billion down to $1.7 billion. The U.S. housing stock is at a record high. A crackdown on immigration under President Donald Trump and tariffs are expected to further slow down construction. The building materials firm reported a decline in profit for the year, despite forecasting tepid growth of earnings. North America is the biggest market and profit generator. Investors raised concerns about the AZEK transaction in Australia. James Hardie announced that it had terminated the American Depositary Shares (ADS) Program, believing the program would be rendered unnecessary once the company listed its shares on the New York Stock Exchange. James Hardie ASX listed shares rose as much as 3.2%, to A$36.57. This was their highest level for over a week. They were trading at a 2.9% gain last time. Since the announcement of the March buyout, shares have lost over 8%.
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Soul Patts, a company from Australia, will take over Brickworks for $9 billion in a merger
The companies announced on Monday that the Australian investment company Washington H Soul Pattinson would buy out Brickworks, its building products subsidiary. This will create a new business worth A$14 Billion ($9.03 Billion), they said. Corporate governance experts in Australia have long criticised the complex ownership structure of both companies, which has existed for more than 60 years. Brickworks shareholders receive 0.82 shares of the new company with a value implied at A$30.28. This is a 10.1% increase over the closing price of the stock on Friday. The building products manufacturer will be valued at A$4.62billion ($3billion). Soul Patts' stock rose 9.2% in the early trading on Monday, but Its shares gained 17.7%. Brickworks, the largest gainer in the ASX200 index (down 0.1%), was on track to have its best single-day performance since September 2009. Soul Patts will own 72% of this new company. Brickworks shareholders would own 19% of the new company, with the rest being offered to new investors. Soul Patts shareholders will receive a share of the new company in exchange for each existing share. Soul Patts owns 43% of Brickworks and Brickworks 26%. Todd Barlow, the Chief Executive of Soul Patts, told investors at a Monday investor briefing that Soul Patts will see its free float increase from A$8.4 to A$12.6 Billion. Aitken Mount Capital has fully guaranteed the A$550,000,000 in shares that were pledged by Aitken Mount Capital. The deal will be approved by shareholders later this year. (1 Australian dollar = 1.5499 dollars) (Reporting and editing by Scott Murdoch and Rishav chatterjee, both in Sydney; and Cynthia Osterman and Stephen Coates in Bengaluru)
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Oil prices rebound after OPEC+ maintains same production increase in July versus the previous month
Monday, oil prices rose by more than $1 a barrel after OPEC+ announced that it would increase production in July in the same proportion as in the two previous months. This was in line with expectations on the market. Brent crude futures rose $1.19 or 1.9% to $63.97 per barrel at 0044 GMT, after closing 0.9% lower Friday. U.S. West Texas Intermediate Crude was $62.09 per barrel, up $1.30 or 2.14% after a 0.3% drop in the previous session. Both contracts were lower than 1% over the past week. The Organization of the Petroleum Exporting Countries (OPEC) and its allies have decided to increase output by 411,000 barges per day for July. This is the third time the group, known as OPEC+, has increased production by the same amount. The group was expected to discuss an increase in production. Harry Tchilinguirian, an analyst at Onyx Capital Group, wrote on LinkedIn that if they had gone with a larger surprise amount then Monday's opening price would have been very ugly. Brent and WTI oil futures already reflect the increase of 411,000 bpd in production. Analysts said that low fuel stock levels in the United States have caused supply concerns ahead of an expected hurricane season above average. In a recent note, ANZ analysts noted that the surge in implied demand for gasoline was "more encouraging" as it coincided with the beginning of what is considered the U.S. summer driving season. They added that the increase of almost 1 million bpd marked the third highest weekly gain in the past three years. The impact of the lower crude oil prices in the United States, which have hit production levels, is also being closely monitored by traders. all-time high 13 49 Mbpd was produced in March. Baker Hughes' weekly report said that the number of oil rigs operating in the U.S. dropped for the fifth consecutive week. It fell four to 461 - the lowest level since November 2021.
South African rand stable, markets focused on Trump steel tariff impact
The rand of South Africa was flat on Monday as traders assessed the impact of U.S. President Donald Trump’s tariffs on imports such as steel and aluminum, which could spark a multi-fronted trade war.
The rand was trading at the same level as its previous closing price of 18.45 USD/Rand.
Trump increased tariffs on imports of steel and aluminum to 25%, "without exceptions or exclusions", on Monday. The aim was to boost production in the largest economy.
ETM Analytics stated in a research report that South Africa will be "minimally affected".
The note stated that "for now, USD-ZAR is likely to trade with caution and lack of direction until Trump's policy is understood and its implications can be quantified."
Data from the Statistics Agency showed that South Africa's manufacturing production fell by 1.2% in December compared to last year after a decline of 1.9%, but with a revised downward revision in November.
The yield on South Africa's benchmark government bond for 2030 has increased by 5 basis points to 9.15%.
The blue-chip Top-40 Index closed down 0.2% on the Johannesburg Stock Exchange. Reporting by Sfundo parakozov and Bhargavacharya, Editing by Tannur anders, Ed Osmond and Mark Heinrich
(source: Reuters)