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Will they or will they not?
Ankur Banerjee gives us a look at what the future holds for European and global markets. Investors wore their 'risk-on' hats on Monday as the prospect of an 'end to the Iran war, and opening the Strait of Hormuz was ever closer. Stocks in Tokyo and Taipei reached record highs and oil prices and U.S. dollars fell. There are also doubts, particularly after U.S. president Donald Trump downplayed hopes of an imminent breakthrough. He noted that he had instructed his representatives to not rush into any deal with Iran, even though pressure is increasing to find a resolution. Liquidity will be low as traders focus on the headlines. Investors are jittery over the will-they-won’t-they saga, but?in the end, it is a question of when and not if a settlement is reached to end this nearly three-month conflict. Shipping data revealed that two liquefied gas tankers were exiting the Strait of?Hormuz. Meanwhile, a supertanker carrying Iraqi crude bound for China had left the Gulf after being stranded in the Gulf for almost?three months. The reality is, a resolution will not 'push oil prices?back to the levels before the war. And the energy supply chain may take some time to recover. So inflation concerns are going nowhere, and neither are calls for rates that are higher, longer. The U.S. Federal Reserve is expected to increase interest rates by 25 basis points in January 2027. This would be a "stark reversal" from the two rate reductions that were anticipated this year, before the war started. Market developments on Monday that may have a significant impact U.S.-Iran talks
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Chinese coking coal prices jump as a deadly mine accident tightens the supply outlook
Prices of Chinese coking coal soared to their highest level in almost two weeks on Monday, after a 'wave' of safety checks in coal mines in response to a fatal mine accident that occurred in a key production hub. This triggered expectations for a tightening in supply. The gas explosion that occurred at the Liushenyu Coal Mine in the northern province of Shanxi on Friday night has claimed the lives of 82 people. This is the deadliest mining accident to have happened in the country since 2009. Local officials announced at a Sunday news conference that the mine belongs to Shanxi Tongzhou Coal?Coking Group. All four mines of this group have been shut down and their?executives arrested. The People's Daily, a state-run newspaper, published an editorial about the accident in its front page Sunday morning. It called for more attention to safety and "completely reversing the tendency" to prioritize development over safety. The price of the?most traded coking coal contract at the Dalian Commodity Exchange has risen by 7.97%, to $1266.5 ($186.78 per metric tonne), its highest level since last May 12. The DCE coke contract with the highest volume surged 7.99%, to 1,879 Yuan per ton. This is its highest level since May 6. Mysteel, a consultancy, found that other coal mines have stopped production in Shanxi for a period of?three to five? days due to safety checks. This would result in reducing the raw supply of 'coking coal' by 288,000 tons / day. The iron ore price also increased, with the DCE contract at 0345 GMT up 0.5% to?796.5 per tonne. By 0335 GMT, the benchmark?June Iron Ore traded on the Singapore Exchange had risen by 0.96% to $107.2 per ton. The Shanghai Futures Exchange steel benchmarks gained on the higher raw materials costs. Rebar grew 1.45%; hot-rolled coil climbed 1.39%; wire rod jumped 1.19%; and stainless steel grew 0.3%. $1 = 6.7806 Chinese Yuan (Reporting and editing by Subhranshu S. Sahu; Amy Lv, Lewis Jakcson)
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Indian retailers increase fuel prices for the fourth time in a row to curb losses
Dealers said that India's state-owned fuel retailers raised diesel prices by 2.71 rupees ($0.0283) and petrol by 2.61 rupees per litre, marking the fourth increase in a month to recover some losses caused by higher crude oil costs as a result of the Iran War. Indian state fuel retailers who control 90% of the Indian market began increasing pump prices on May 15, after elections were completed in certain key states. Since then, the state companies have increased?the price of petrol and diesel by approximately 7.8% and 8.6% respectively. New Delhi petrol will cost 102.12 rupees per litre, and diesel 95.20 rupees. India, which is the third largest oil consumer and importer in the world, has been hit by rising crude prices as well as supply disruptions following the closure of Strait of Hormuz. New Delhi also implemented austerity measures in order to curb fuel consumption and control its oil import bill, as policymakers prepare for a prolonged shock. Prices vary across states because of local taxes. State retailers have also suffered a rise in?fuel losses as customers switch to retail pumps that are cheaper, leading to shortages. IOC said in a statement on Saturday that its retail sales for the period of May 1-22 were up?by 18% compared to a year earlier and petrol sales had increased by 14%. $1 = 95.6890 Indian Rupees (Reporting and editing by Christian Schmollinger, Sonali Paul and Nidhi Palyekar from New Delhi)
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Russell: China's thermal coal production drops, but prices of imported coal in Asia rise amid the Iran war.
Although the Iran war has impacted crude oil and natural gas prices, its impact on coal has been muted. Prices for thermal grades are quietly rising to multi-year heights. The conflict between the United States of America and Iran has led to the loss of about 10% of world crude oil, and a fifth of LNG, but thermal coal supplies remain largely unaffected. Even though the cost of shipping and producing has increased due to higher fuel prices. Coal prices are not solely driven by the?Iran War. Other factors, such as low Chinese production and Indonesian regulations, may be more influential. According to commodity analysts Kpler, Asia's seaborne thermal coal imports are expected to have their best month since December in May. The imports of thermal coal in Asia are expected to hit 76.26 millions metric tons by May, up 23 percent from April. This is also higher than the 72.83 million that were imported in May 2012. All of the top buyers in the region have seen gains. China, the largest coal importer in the world, is on course to receive 22.63 millions tons of seaborne thermal coal, up from 16.3 million tons in April, and the highest since January. China's appetite to import is driven by a weaker domestic production. April production was 385.63 millions tons, down from 440.62 in March and also 1% lower than April of last year. China's first four-month output fell by 0.1%, to 1.58 billion tonnes. The fact that China's thermal electricity production, which is largely coal-fired?rose by 3.6% during the first four month of the year suggests that the supply-demand balance in China has been tightened, encouraging imports. The Shanxi coal mine disaster, the worst in 17 years at a metallurgical mine that killed 82 people last Friday may cause a further shortage of coal as authorities increase safety inspections in both thermal coal and coking coal mining. China's increasing import demand has helped to lift prices?of grades it seeks. The commodity price reporting -agency Argus assessed Indonesian coal, which had an energy content 4,200 kilocalories/kilogram (kcal/kg), at $64.43 a tonne in the week ending May 22. This was a three year high and up by 42% from the end of last. Kpler predicts that India, as the second largest importer of thermal coal, will see arrivals of 13,78 million tons in May. This is the highest since June last years and 7.3% more than the 12,84 million recorded in April. Last week, heat waves drove electricity demand to new records. This boosted demand for coal-fired generators. INDONESIA CHANGES The world's largest coal exporter, Indonesia, announced regulatory changes last week that will have a significant impact on the way cargoes are traded. Indonesia intends to "take control" of the coal trade, by directing exports via a state-owned company that will control contracts and price. The government has said that it will honor existing long-term agreements, but it has also stated it reserves the rights to review the prices of such deals. By implementing a state control on exports, the government hopes to?stop under-invoicing' and collect more revenue. It's possible that the trade flow will be affected if there is still uncertainty about how the new system works in practice. Japan's thermal coal imports are expected to increase from 6.63 millions tons in April to 7.59 million tonnes in May. South Korea's arrivals will be 6.73 million tons, which is the highest since January, and up from 4.79 million tons in April. Both countries in North Asia are among the top four coal importers, and they are also the best positioned to switch from LNG imported natural gas to coal-fired electricity generation. Due to the Iran War, both spot and contract LNG prices are likely to rise sharply. Japan and South Korea may therefore seek ways to maximize coal-fired power generation. The price of high grade Australian thermal coal has risen as a result. The weekly assessment of Newcastle?Port rose to $133.09 per ton during the week ending May 22. This is up from $131.80 and only slightly below the 18-month-old high of $140.53 set in early April. Australia is the second largest coal exporter and may be in a better position to capitalize on any disruptions to Indonesian coal shipments due to regulatory changes. Its lower-grade coal could replace Indonesian coal. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X. These are the views of the columnist, an author for.
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New Zealand Pro surfers halted by 'wildlife injury' to photographer
The World Surf League event was put on hold for several hours after a photographer who was shooting the event suffered an injury from what organizers believe to be a shark or sea lion bite. The WSL announced that the New Zealand Pro semi final between Brazilian world champions Yago Dore and Italo Fereira in Raglan had been halted because the in-water camera needed medical attention after suffering puncture wounds. Renato Hickel, WSL Tours and Competition Vice President said that "this morning one member of the water photography group suffered a wildlife injury." He's fine, he is on his way to a hospital. He is in stable condition. We're in constant contact with him." Hinkle told the?event broadcast earlier that they weren't sure what type of animal caused the injury. At this point, we are not sure if it was a sea-lion or a shark. He said that the doctor who was on scene was inclined to believe it was a seal instead of a large shark. "Nevertheless, it was very frightening." The organizers will assess the situation on Monday and aim to resume competition at 1 p.m. (0100 GMT). Animal attacks at surf events are not uncommon, but they do happen. In 2015, world champion Mick Fanning famously wrestled with a shark during the final of WSL event in South Africa's Jeffreys Bay. Raglan, which hosted a world championship tour event for the first time ever, was short of its famously long left hand point break waves?for the majority of?the ten days leading up to the event. Monday's conditions were some of the best during the waiting period. Dora was ahead with a 6.33 to Ferreira's 3 pointer when their match was stopped. Morgan Cibilic, an Australian, had earlier defeated Griffin Colapinto of California with a total of '15.34' to a score 12.20. This earned him a place in the finals. Carissa Moore, Hawaii's Olympic champion and five-times world champion will face California's Sawyer Lindblad for the women's title. (Reporting and editing by Nick Mulvenney; Lincoln Feast)
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Oil and dollar decline on Middle East Peace Hopes
U.S. Stock Futures climbed on Monday, while oil and the dollar fell. The prospect of an agreement to end the Iran War boosted risk appetite. However, a lack of clarity about when the 'Strait of Hormuz' would open kept enthusiasm in check. Energy prices have soared in response to the nearly three-month war in the Middle East. Worries about inflation and the closure of the Strait of Hormuz, through which most world energy passes, has impacted global rates. Donald Trump, the U.S. president, said that he told his representatives on Sunday not to rush any deal with Iran. His administration also played down expectations of an imminent breakthrough. Trump said just a day before that Washington and Iran had "largely" negotiated a peace agreement that would reopen this waterway that, prior to the conflict, carried about one-fifth the global oil and LNG shipments. Brent crude futures fell over 4%, to $98.83 per barrel. U.S. West Texas intermediate CLc1 also dropped over 4%, to $92.03 per barrel. The euro rose 0.37% to $1.1646 while the Japanese yen climbed to 158.85 U.S. dollars in early trading, as the safe-haven dollar lost some of its recent gains. Nasdaq and S&P were both up 0.6%. Nick Twidale is the chief market analyst for ATFX Global. He expects that on Monday, investors will embrace more risk, but they won't surge higher until it has been confirmed that reopening of?the Strait?of?Hormuz. He said, "We need to reach an agreement in the next sessions because we know that there are still major sticking points." Nikkei, the Japanese stock market index, was positioned for a strong opening to Monday's trading session. Commonwealth Bank of Australia's strategists stated in a recent note that the most important issue for financial markets is when the Strait of Hormuz will reopen. They asked: "Under which conditions will the?Strait reopen, and how long will it take to repair production and infrastructure in order to ramp up energy production and other goods back to pre-war level?" (Reporting and editing by Stephen Coates in Singapore, Ankur Banerjee)
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Oil drops to 2-week lows as US-Iran is seen moving closer towards peace deal
Oil prices fell to a 'two-week low' on Monday, despite the fact that U.S. President Barack Obama and Iranian President Hassan Rouhani remain at odds on key issues. These include the blockades of the Strait of Hormuz which continue to limit oil supplies from the Middle East. Brent crude futures fell $4.71 or 4.55% to $98.83 per barrel at 2234 GMT. U.S. West Texas Intermediate was $92.03 per barrel, down $4.57 or 4.73%. Both contracts reached their lowest levels since May 7 earlier in the session. On Saturday, U.S. president Donald?Trump stated that Washington and Iran had "largely" negotiated a memorandum of agreement on a deal to reopen Strait of Hormuz. Before the conflict, the Strait of Hormuz carried one-fifth of the world's oil and LNG shipments. Trump said on Sunday that he told his representatives to not rush into any Iran deal. MST Marquee Analyst?Saul Kavonic? said: "Despite all the caveats, risks, and concerns that remain with the peace deal, and Strait of Hormuz?there is some light at?the?end of?the tunnel, which may bring some relief to oil prices in the near future." Analysts 'expect it to take months for oil flow through the strait to return back to normal, and for damaged oil-and-gas facilities to be repaired. Reporting by Florence Tan, Editing by Cynthia Osterman & Edmund Klamann
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There are 21 missing people in the Philippines after a building collapse that has left at least one person dead.
Authorities confirmed that at least one person died after a building collapsed on Sunday in the Philippines. Rescuers were searching the rubble to find 21 people listed as missing. Officials have launched an investigation into the collapse of a multi-storey structure in Angeles, north of the capital, Manila. Rescuers were seen scrambling over concrete slabs and mangled metal as they searched for survivors. The sifting was done with the help of'rescue dogs', heartbeat detection devices, and heavy equipment. RESCUE EFFORT CONTINUES The authorities confirmed that the 65-year old Malaysian had died. His body was recovered from the neighbouring hotel, which had also been damaged by the collapse. Maria Leah Sajili told a media briefing that five of the 21 people reported missing were trapped. The status of two of the five was immediately unclear. Sajili warned, however, that the operations will become more difficult after dark. Officials informed reporters that the building's planning records indicated that it was to be a "nine-storey condominium-hotel" under the permit approved, but that a swimming pool was being built on the 10th floor. (Reporting and editing by Christian Schmollinger; Additional reporting and Eloisa Loza; Editing and rewriting by William Mallard, Helen Popper and Christian Schmollinger)
QUOTES - Trade and labor associations, analyst on Trump's reciprocal duties
Donald Trump announced on Wednesday that he will impose a baseline 10% tariff on all imports into the United States, and higher duties for some of the biggest trading partners. This could lead to a trade conflict and upset the global economy.
Countermeasures from trading partners could result in a dramatic increase in prices of everything, including bicycles and wine.
Trump has already levied 25% on automobiles and auto parts.
SCOTT WHITAKER, CEO, ADVAMED
"This type of tariff would be similar to an excise duty." R&D would be the most immediate and direct victim, as it threatens America's leadership in medtech innovation. Tariffs would cost U.S. workers, increase health care costs and hinder future medical progress."
RYAN ORABONE MANAGING CONSULTANT BEARINGPOINT
"Diversification (of the supply chain of an apparel retailer) and manufacturing is a moot issue because tariffs impact every major geographic facility where we produce clothing."
Brands need to be more strategic than ever before and plan everything with precision. "There is no room for errors anymore, including assortment, allocation and pricing."
DAVID SWARTZ ANALYST MORNINGSTAR FOLLOWING FITNESS
The huge tariffs on imports from Vietnam are clearly a negative for Nike Adidas and other sportswear companies. Due to the difficulty of manufacturing, athletic footwear can't be easily produced in other countries. Tariffs are also being levied on other Asian nations.
The industry will not react in a panic. If the tariffs remain in place, sportswear prices will rise and margins could be affected.
The chances of significant footwear and apparel manufacturing in the US being a result of any of these initiatives are virtually zero.
MARI SHOR SR., EQUITIES ANALYST AT COLUMBIA TREADNEEDLE INVESTIMENTS, WHICH HOARDS NIKE STOCKS
"The announcement of the tariffs is much worse than expected." Nike and other footwear companies will find it difficult to avoid a 46% tariff against Vietnam. The companies will try to fight back against vendors but tariffs are likely to drive up inflation in many categories and pressure consumer discretionary spending."
CHRIS VITALE, UAW VETERAN WHO RETIRED FROM STELLANTIS, ATTENDED TRUMP'S TARIFF ANNOUNCEMENT IN PERSON
"You know what's amazing is that an announcement about trade policy could become emotional."
"These are the things we've been preaching about for years. We've watched our factories and our capabilities being hollowed-out. To see a President address this and use some words and thoughts I've used, was incredible."
LIZ SHULER PRESIDENT AMERICAN FEDERATION of LABOR and CONGRESS INDUSTRIAL ORGANIZATIONS
The Trump administration's attacks against the rights of union workers at home, the gutting of government agencies that work to discourage outsourcing of American jobs, and efforts to erode crucial investments in U.S. Manufacturing take us backward.
RICHARD CAPETTO, SENIOR DIRECTOR, NORTH AMERICAN GOVT. AFFAIRS IPC
"A strong U.S. electronic industry requires a holistic approach - one that combines targeted investments and incentives, with policies that promote mutually beneficial trade partnership. Trade is crucial to innovation, cost-competitiveness, and supply chain resilience. Tariffs could increase costs for American companies and drive production overseas.
ZOLTAN VAN HEYNINGEN EXECUTIVE DIRECTOR, U.S. WOOD COALITION
We welcome President Trump's measures and the focus of his administration on Canada's unfair trading practices. We are especially pleased that the President has launched the Section 232 Investigation under the Trade Expansion Act of 1964 focusing on the imports of softwood lumber.
MARK COMPTON EXECUTIVE DIRECTOR THE AMERICAN EXPLORATION & MINING ASSOCATION
We are encouraged that the Trump administration is prioritizing the production and processing of domestic minerals so we can have the raw materials our manufacturing base, and society needs. We are looking forward to working together with the administration in order to ensure that the domestic mining industry can meet this challenge.
TONY REDONDO, FOUNDER AT COSMOS CURRENCY EXCHANGE
Intel is not immune to the cost increases caused by imported chips. Semiconductor giants such as Nvidia are also affected. China's retaliation against rare materials may worsen shortages.
PC makers (Dell and HP) may face cost increases of 10%-25%, which could add $200-$500/unit to the unit price, causing margins to be squeezed or prices to rise.
The cost of chips and steel may cause delays for AI server companies (Nvidia and Amazon).
Construction and retailers like Walmart could also be affected.
"Short-term, higher costs and chaos." "Long-term, maybe more U.S. Manufacturing but labor and infrastructure are lagging."
Consumers will face higher prices by 2025, unless companies absorb the costs. This is not common.
BERNSTEIN ANATOMY
"We are concerned that the vehicle and part tariffs will be here to stay, and they will add a significant cost burden to this sector." We see more downside risk for automotive stocks if automotive tariffs do not get reversed, but are instead extended.
TOM MADRECKI VICE-PRESIDENT OF SUPPLY CHAIN RESILIENCY CONSUMER BRANDS AFFILIATION
The majority of consumer packaged goods are already manufactured in the United States. There are some critical inputs and ingredients that must be imported because they are scarce in the United States. Tariffs alone will not bring these ingredients back to the U.S.
"Reciprocal Tariffs that don't reflect the availability of ingredients and inputs will increase costs, limit access to affordable products for consumers and unintentionally hurt iconic American manufacturers." We urge President Trump and his advisors to refine their approach to exempting key ingredients and inputs, in order to prevent inflation and protect manufacturing jobs.
LENNY LARCCA, KPMG U.S. AUTOMOTIVE LEADERS
"U.S. Automakers are looking for steps they can take to mitigate tariffs in the short term, such as working on items that can be shipped to the U.S. rapidly without major investment." Massive longer-term investments require more time and clarity."
The current playbook of the U.S. automobile industry is insufficient, and it's a momentous time for them. Automakers have an opportunity to change the way they do business. Leverage emerging technologies like AI in all areas of their business. Explore and make alliance decisions faster. "Speed up the vehicle production cycle time."
This watershed moment presents an opportunity for mergers and purchases.
DAVID McCALL, PRESIDENT UNITED STAINWORKERS INTERNATIONAL
We must make sure that our trade policy is aimed at cheaters and not trusted economic allies such as Canada. We should work to build relationships, not barriers, with partners who have shown their commitment to join us in tackling the global overcapacity.
The administration must also take measures to prevent companies using tariffs to increase prices on consumers.
MIKE HAWES is the CEO of UK's Society of Motor Manufacturers and Traders.
The tariffs cannot be absorbed, and the U.S. consumer may pay more for British products, while UK producers could have to reduce production due to a constrained market.
SETH GOLDSTEIN MORNINGSTAR ANALYST FOR U.S. SETH GOLDSTEIN, MORNINGSTAR ANALYST ON U.S.
"I expect lower volumes due to tariffs." Tariffs are likely to be passed on to the consumer in order to increase prices of products. "I expect that consumers will buy less goods."
Due to the high fixed costs of chemical production, lower volume would have a large impact on profits. We could also see another year with declining profits if tariffs are widely implemented. Many chemical producers manufacture their products in the U.S. for domestic sales, so there is less direct impact.
DAVID FRENCH EXECUTIVE V.P. OF GOVERNMENT RELATIONS AT THE NATIONAL RAILWAY FEDERATION
"More Tariffs = More Anxiety and Uncertainty for American Businesses and Consumers. Tariffs represent a tax that is paid by U.S. importers and passed on to the final consumer. No foreign country or supplier will pay tariffs. "We encourage President Trump, to hold trading partners responsible and restore fairness to American businesses without creating uncertainty or higher prices for American consumers."
ART WHEATON DIRECTOR, ILR SCHOOL CORNELL UNIVERSITY, LABOR STUDIES
It will take years and billions to bring new manufacturing jobs online. However, expansions in existing factories can happen much faster. Companies prioritize stability. Frequent policy changes can slow down investment decisions, as businesses wait to see clearer long-term signals.
MICHAEL ASHLEY SCHULMAN IS A PARTNER AT RUNNINGPOINT CAPITAL ADVISORS AND THE CIO.
"Trump may be trying not only to bring manufacturing back to the U.S. but also to increase the economic instability of China by putting tariffs on Chinese goods. Tariffs of 34% on Chinese products could force Chinese manufacturers to shut down, leading to increased unemployment and social unrest in China.
If these tariffs are imposed, they will have a significant impact on the PC, server, and semiconductor manufacturers.
Investors, analysts and politicians will all be watching with bated breathe to see what happens after this 'Liberation Day volley' from the administration. The announcement today is likely to be a worst case scenario. Hopefully, any negotiations will lead to improvements. Reporting by Juby B. Babu from Mexico City; Vallari Srivastava in San Francisco; Abhirup Roy and Caroline Humer at New York City; Nick Brown, Shounak D. Dasgupta, and Alan Barona for the editors.
(source: Reuters)