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London metals drop as strong dollar clouds hopes for tariff easement
London metals declined on Wednesday, as a stronger US dollar overshadowed optimism about improving U.S. China trade relations. Investors are now looking forward to the U.S. Economic Data for clues regarding the Federal Reserve’s policy direction. As of 0408 GMT, the benchmark copper price on London Metal Exchange (LME), fell by 0.5% to $9397.5 per metric ton. As of 0408 GMT the US dollar index increased 0.2% to 99.355, making commodities priced in dollars more expensive for buyers who use other currencies. Investors await the release of U.S. This week's Personal Consumption Expenditures data is a closely-watched inflation gauge, which could have an impact on Fed policy and metals prices. U.S. president Donald Trump signed two orders to reduce his auto tariffs. This was in response to Treasury Secretary Bessent's comment that key U.S. traders had presented promising proposals for avoiding tariffs. Bessent noted that China’s recent exemptions of certain U.S. goods from retaliatory duties showed a willingness for de-escalation. The trade war tensions seem to have stabilized this week, without any major developments. There is some optimism in the meantime about a possible de-escalation of tensions between China and the U.S. "Our attention is now focused on U.S. Economic Data," said a trader. Other London metals saw aluminium fall 0.2% to $2460 per ton, while zinc fell 0.1% at $2647.5; lead declined 0.1% at $1975; tin dropped 0.1% at $31,890, and nickel increased 0.3% to 15,595 per ton. The Shanghai Futures Exchange's (SHFE) most traded copper contract fell 0.3%, to 77 390 yuan per ton ($10 647.9). Shanghai copper prices were supported a massive fall in inventories In warehouses monitored the SHFE, that dropped 32% weekly to 116.753 tons in April. SHFE aluminium rose 0.2% to 19.965 yuan per ton. Zinc fell 0.5% to 22430 yuan. Lead dropped 0.4% to 16.875 yuan. Nickel lost 0.6% to 123,750 yuan. Tin slipped 0.1% to 268,870 yuan. $1 = 7.2681 Chinese Yuan Renminbi (Reporting and editing by Violet Li, Lewis Jackson and Rashmi aich).
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Sources: Chinese sovereign fund CIC will sell US private equity investments worth $1 billion, according to sources
Two people familiar with the matter have confirmed that China Investment Corporation (CIC), a sovereign Chinese investor, is selling its PE investment portfolio worth about $1 billion on the secondary market. According to the sources, assets were held by a number funds, which are managed by eight U.S. managers, such as Blackstone Inc. and Carlyle Group. CIC has hired U.S. Investment Bank Evercore to provide advice on the sale. They aim to complete the divestments before the end of June. A third party with direct knowledge said that the total value and deadline for the sale of assets are not set and may change depending on the market and pricing. Blackstone and Carlyle declined comment. CIC and Evercore have not responded to requests for comments. Due to the sensitive nature of the issue and the need for confidentiality, all sources declined to make any comments. The first two respondents said CIC began discussing the sale in late 2024 with asset managers and advisers as part of its efforts to optimize its investment portfolio. The $1 billion of assets, which was initially invested in PE funds in 2016 and 2017 is nearing the end its investment cycle. However, the move comes at a time when geopolitical tensions and trade tensions have caused market volatility and uncertainty, particularly between Beijing and Washington. Both countries have intensified their scrutiny of certain investments made by each other's financial institutions. Financial Times reported, last week, using unidentified sources that Chinese state-backed fund, CIC included, had cut off new investments in U.S. PE companies in response to Beijing's pressure. CIC hasn't commented on the FT piece. Beijing-headquartered CIC, founded in 2007, is mandated to diversify China's giant foreign exchange holdings via overseas investments. According to previous public disclosures, the U.S. was the Chinese sovereign fund’s largest investment destination. CIC took a minor stake in Blackstone and invested in Morgan Stanley during the global financial crisis. It sold this minority stake to Blackstone in 2018. CIC is a major investor in U.S. PE Funds. Nearly half of the portfolio is made up by so-called alternative investments. PE funds have a typical investment cycle of 10 to 15 years. However, since the COVID-19 epidemic it has become more difficult for PE funds to sell their investments through initial public offerings (IPOs), or via trade sales. The person declined to provide further details. Other sovereign funds, asset managers specializing in secondary markets, and private investors, such as family offices are also potential buyers of the CIC portfolio. According to them, the portfolio can be sold in different tranches or all at once, depending on the price negotiation. CIC's most recent annual report indicates that the sovereign fund managed $1.33 trillion in assets as of December 31 2023. About 64% are managed by external managers. The annual report reveals that U.S. stocks accounted for 60.29% CIC's overseas equity market holdings at the end of 2023. The total portfolio was made up of 33.13% public equities. CIC's cumulative annualised net return over the past 10 years was 6.57% by 2023. Its cumulative annualised net return since its inception is 6.23%. (Reporting and editing by Sumeet Chaterjee, Neil Fullick and Kane Wu)
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As tariffs fuel global growth concerns, shares sway and oil prices fall.
On Wednesday, oil prices and shares were in a state of confusion as the relief from a possible easing of trade tensions around the world was countered by a worsening economy outlook and gloomy signals coming from corporations affected by Donald Trump's new tariffs. Data earlier that day in China showed that factory activity in April contracted at its fastest rate in 16 months, as U.S. tariffs halted two months' recovery, and fueled calls for Beijing to provide further stimulus. The impact of the high U.S. import tariffs has caused the index to drop back to its lowest point, COVID-19 disruptions included, since August 2012. This was said by Zichun Hua, an economist for Capital Economics in China. The sharp fall in PMIs may overstate the impact of tariffs because negative sentiments are at play, but they still suggest that China's economic growth is under pressure due to the cooling external demand. The CSI300 index rose only 0.07%, a paltry amount. Hong Kong's Hang Seng Index rose 0.2%. The yuan onshore was not much changed, at $7.2686 per US dollar. Details are scarce despite Trump's efforts to ease the impact of his auto tariffs, and signs of progress on broader trade talks. Commerce Secretary Howard Lutnick said he had made one agreement with a foreign country. Investors were also concerned about deteriorating U.S. statistics as Trump's tariffs had a ripple effect on businesses and consumers in the United States. David Kohl, Chief Economist at Julius Baer, said: "We increase the probability of an extended economic stagnation, which meets the criteria for recession, up to 50%." The rising likelihood of economic stagnation is due entirely to exogenous factors such as an erratic economic policy, disruptions in public spending, changes in incentives, and a fiscal position that cannot be sustained. The data released on Tuesday revealed that the U.S. goods trade deficit reached a new record in March, as businesses stocked up ahead of Trump's proposed tariffs. This suggests trade was the main drag on the economy in the first quarter. The first quarter GDP is expected later today. In April, U.S. consumer sentiment also fell to its lowest level in nearly five years. Wall Street Futures struggled to maintain gains made overnight during the cash session due to the precarious economic outlook in the United States and globally. In Asia, Nasdaq Futures declined 0.6% while S&P500 futures dropped 0.5%. The futures for the EUROSTOXX50 index fell 0.2% while MSCI's broadest Asia-Pacific share index outside Japan rose 0.4%. Nikkei gained 0.2%. The impact of Trump's trade conflict has been felt in the corporate world. UPS, a delivery giant, announced it would cut 20,000 positions to reduce costs. General Motors, meanwhile, canceled its investor call and lowered its forecasts. "You see companies... making statements about low transparency, the unwillingness to sign long-term agreements, or to make long-term planning - that is a slippery slope," Fabiana Fedeli said, M&G’s chief investment officer for equities and multi-asset at a Monday media roundtable. Worries about global economic growth and the impact it has on demand also contributed to the steep decline in oil prices from previous sessions. Brent crude futures fell 1% to $63.61 per barrel after falling 2.4% overnight. U.S. crude fell 1.16%, to $59.72 a barrel after a 2.6% decline on Tuesday. DATA DUMP The release of the core PCE Price Index - the Fed’s preferred measure for inflation - will also be due on Wednesday. This is before the jobs data, which are expected at the end the week. Payrolls will rise by 130,000, and inflation will ease. However, there is more uncertainty regarding GDP growth with a median forecast of a paltry 0.3% annualised. The Fed is expected to cut rates by 97 basis points in December, up from 80 bps as early as last week. This has pushed yields in the U.S. down. The two-year Treasury rate is now at its lowest level in three weeks, 3.6400%. The benchmark 10-year rate was last at 4.1580%. This is also its lowest level since early April. The dollar's performance on the foreign exchange market was set to be its worst since November 2022, with a loss of 4.65%, as Trump's erratic trade policies left the greenback vulnerable. The yen, a safe-haven currency, was on track for its biggest monthly gain since July 2024, at more than 5%. The euro is also on track for its biggest monthly gain in two years, and bought $1.1369 last. The Australian dollar last traded 0.27 percent higher at $0.6401. Data released on Wednesday revealed that core inflation in Australia had slowed down to its lowest level in three years in the first quarter. This supports the argument for another interest rate cut in the coming weeks. Spot gold dropped 0.4% elsewhere to $3,303.53 per ounce.
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LS Marine Solution Gets Cabling Job at Taiwanese Offshore Wind Farm
LS Marine Solution has secured $15.8 million subsea cable laying contract for work at an offshore wind farm being developed by Taiwan Power Company (Taipower), off Taiwan.The contract marks LS Marine Solution’s first international power grid project and is also the first overseas venture by a Korean subsea cable installation company, representing a significant turning point for expanding into the global market.The project is part of Taipower’s ‘TPC Offshore Wind Phase 2’ initiative, a 294.5 MW wind farm project. It is a core component of Taiwan’s Phase 1 offshore wind development plan, which aims to build 5.6 GW of capacity between 2020 and 2025.“As Korea’s first-generation subsea cable installation company, we’ve successfully taken our first step into the overseas power grid market based on decades of technical expertise and experience. This Taiwan project will be a springboard for further expansion into the global market,” said Kim Byung-ok, CEO of LS Marine Solution.
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Oil prices fall as global growth worries fuel tariffs
On Wednesday, oil prices and shares were in a state of confusion as the relief from a possible easing of trade tensions around the world was countered by a worsening economy outlook and gloomy signals coming from corporations affected by Donald Trump's new tariffs. The yields on U.S. Treasury bonds also remained near their multi-week lows, as traders bet that the Federal Reserve would continue to cut rates in order to support the largest economy of the world. Details are scarce despite Trump's efforts to ease the impact of his auto tariffs, and signs of progress on broader trade talks. Commerce Secretary Howard Lutnick said he had made one agreement with a foreign country. Investors were also concerned about deteriorating U.S. statistics as Trump's tariffs had a ripple effect on businesses and consumers in the United States. David Kohl, Chief Economist at Julius Baer, said: "We increase the probability of an extended economic stagnation, which meets the criteria for recession, up to 50%." The rising likelihood of economic stagnation is due entirely to exogenous factors such as an erratic economic policy, with arbitrary tariffs and disruptions in public spending. The data released on Tuesday revealed that the U.S. goods trade deficit reached a new record in March, as businesses stocked up ahead of Trump's proposed tariffs. This suggests trade was the main drag on the economy in the first quarter. The first quarter GDP is expected later today. In April, U.S. consumer sentiment also fell to its lowest level in nearly five years. Wall Street Futures struggled to maintain gains made overnight during the cash session due to the precarious economic outlook in the United States and globally. In Asia, Nasdaq Futures declined 0.6% while S&P500 futures dropped 0.4%. The futures of the EUROSTOXX50 fluctuated between gains and losses, while MSCI’s broadest Asia-Pacific index outside Japan only added 0.1%. The Nikkei gained 0.15%. The impact of Trump's trade conflict has been felt in the corporate world. UPS, a delivery giant, announced it would cut 20,000 positions to reduce costs. General Motors, meanwhile, canceled its investor call and lowered its forecasts. "You see companies making statements about low transparency, their unwillingness or inability of signing long-term contracts and to make long-term planning - this is a slippery slope", said Fabiana Fedeli at a Monday media roundtable. Worries about global economic growth and the impact it has on demand also contributed to the steep decline in oil prices from previous sessions. Brent crude futures fell 0.28% overnight to $64.07 per barrel. U.S. crude fell 0.35%, to $60.21 a barrel after a 2.6% decline on Tuesday. Spot gold remained at $3,316.11 per ounce. DATA DUMP The release of the core PCE Price Index - the Fed’s preferred measure for inflation - will also be due on Wednesday. This is before the jobs data, which are expected at the end the week. Payrolls will rise by 130,000, and inflation will ease. However, there is more uncertainty regarding GDP growth with a median forecast of a paltry 0.3% annualised. The Fed is expected to cut rates by 97 basis points in December, compared to 80 basis points early last week. This has pushed yields in the U.S. down. The two-year Treasury rate is now at its lowest level in three weeks, 3.6400%. The benchmark 10-year rate was last at 4.1580%. This is also its lowest level since early April. On the foreign exchange markets, the dollar stabilized on Wednesday as a selloff of the U.S. dollar paused as traders evaluated the prospects of a negotiated solution to the tariffs. The dollar was last seen at 142.29 yen, while the euro was still some distance from its three-year high of $1.1383. After consumer prices increased slightly more than expected, the Aussie dollar traded 0.3% higher to $0.6401 following early gains. Data from China also showed that manufacturing activity declined in April. This reversed two months of growth and kept alive the calls for Beijing to provide further stimulus. Chinese shares opened with a muted tone in line the wider market. The CSI300 blue chip index rose 0.12% while Hong Kong's Hang Seng Index fell 0.08%. The onshore yuan has slipped to 7.2736 dollars per yuan. In a note, Societe Generale economists said that, "in light of tariffs," they had revised their GDP growth estimates for 2025 and 2026 in China down to 4%. They also assumed an additional stimulus of 2.5% GDP. Now, the economists expect more deflationary pressures this year and next.
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Australia's IGO lowers its capex forecast for Greenbushes Lithium mine in Western Australia
IGO Ltd, a company based in Australia, announced on Wednesday it would reduce its capital expenditure forecasts for fiscal 2025 at its Greenbushes Lithium mine in Western Australia. The miner expects to spend between A$700 and A$800 millions, a reduction from the previous range of A$850 to A$950 for fiscal 2025. IGO announced that it would lower its forecast after a review of and optimization of the portfolio for project capital. Greenbushes Lithium Mine is owned in large part by IGO, its Chinese joint venture partner Tianqi Lithium and U.S.-based Albemarle Corp. Greenbushes, Western Australia’s longest continuously operating mining area, produced 341 kilometric tons of spodumene in the third quarter. This was a drop of 13% from the previous quarter. The miner said last year that the lithium market was troubling his firm, with the spodumene and lithium carbonate prices dropping by as much as 70% in fiscal 2024. After a 90 percent drop in lithium prices in the past two years, some mines producing the metal, which is used to make batteries for electric vehicles, have curtailed their operations or delayed expansions. Other mines, however, that are losing money, have continued production, in part because of the support they receive from Chinese battery manufacturers. In early this year, Tianqi Lithium and the miner agreed to stop all work at one of their lithium hydroxide facilities in Western Australia. IGO has decided to stop operations at its lithium hydroxide facility in Kwinana. This decision follows IGO's prior write-downs of its nickel operations. These have led to a strategic review that reassesses its resources, amid an oversupply on the global nickel market which drove down prices last year. Separately the miner reported underlying earnings before taxes, depreciation and amortization (EBITDA), which was A$34m for the third quarter. This is a significant improvement from the EBITDA loss last quarter of A$79m. As of 0058 GMT the shares of the company had fallen nearly 1.9%, while the mining index as a whole fell 0.4%.
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For now, fired US coal safety workers have been brought back.
Around 40 federal employees who were working on coal-mining safety and firefighter's safety before losing their jobs have been asked to return to their work this week. However, it is unclear whether their positions will permanently be reinstated, West Virginia senator and agency's union stated on Tuesday. Employees from the National Institute for Occupational Safety and Health (part of the Health and Human Services Department) worked on programs to prevent firefighter and coal miner fatalities and promote the health and safety of coal miners. The Trump administration reduced the NIOSH workforce by about 1,000 people earlier this month. The move was reported to have cut off key safety programs for miners who are experiencing a rise in black lung disease. The termination date was June 2. The union AFGE Local 3430 welcomed the temporary call back, which they said was focused on NIOSH units that were "currently in media spotlight". However, the union called on HHS for all NIOSH staff to be brought back, stating that their role is vital in protecting employees in high-risk industries. AFGE Local 343, the agency's union, reports that both programs had previously employed about 40 people. Regional managers have asked almost all of them to return to work this week after being on administrative leave, even though they will still be terminated by June 2. Shelley Moore Capito, a West Virginia senator, has asked HHS Secretary Robert F. Kennedy Jr. for the restoration of the programs. This includes the coal-focused activities carried out by the Morgantown, West Virginia, office. She found the news encouraging, but she wanted to know more about the future of the agency. She said, "I understand that this is temporary and my focus will be to work with @HHSGov in permanently restoring these services and personnel as efficiently and effectively as possible." HHS didn't immediately respond to an inquiry for comment. Scott Laney lost his job in NIOSH's reduction-in force as an epidemiologist for coal surveillance. He said that regional managers asked him verbally and other staff at the Morgantown Office to return from their administrative leave. He was not informed by the managers if he would be employed beyond June 2, nor did they send him a written notice, which made him wonder if the agency had reversed the job cuts. Laney stated that he would be testifying at a District Court on May 7, in a case brought against Kennedy regarding the job cuts affecting NIOSH’s West Virginia office. President Donald Trump has signed executive orders to revitalize the U.S. Coal Industry.
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Sources say that ADNOC, the UAE's LPG supplier, will supply US LPG in India after China and US tariffs.
Industry sources have confirmed that Abu Dhabi National Oil Company will begin replacing some of its liquefied gas supplies to India from June with cheaper U.S. cargoes, as U.S. China tariffs are reshaping global trade flows. ADNOC will be able to ship more LPG from its own production to China. Buyers in China are paying higher prices to replace U.S. supplies after Beijing raised tariffs on U.S. products. This move also reduces LPG costs for India. 2 importer. India imports more than 80% its LPG from the Middle East including Saudi Arabia and the United Arab Emirates. It also sources LPG through annual contracts with Qatar and Kuwait. In the first week of this month, Indian refiners asked Middle East suppliers for a very rare swap: some of their long-term supply was to be replaced with U.S. LPG. Sources said that Indian refiners requested U.S. LPG be delivered at a discount to the Middle Eastern benchmark Saudi Contract Price. ADNOC has, according to sources, agreed to supply U.S. LPG to refiners in India under annual contracts between June and July. They said that the U.S.-China conflict has widened price gaps between Middle Eastern LPG and U.S. LPG. One of the sources stated: "It's difficult to replace all volumes with U.S. LPG." LPG." June Goh is an analyst with Sparta Commodities. She said that India's LPG consumption is mostly for domestic purposes and therefore requires a higher percentage butane. She added, "India can therefore benefit from the diversion but not propane cargoes of U.S. LPG." ADNOC and Indian refiners Indian Oil Corp., Bharat Petroleum Corp. and Hindustan Petroleum Corp. did not respond to requests for comments. According to data from the government, India imported approximately 60% of its total LPG consumption in 2023/24. This equates to 29,66 million metric tonnes. Yousef SABA in Dubai contributed additional reporting; Florence Tan, Jan Harvey and Jan Harvey edited the article.
As trade tensions ease, metals are expected to rise as US data is in focus
London metals traded in a narrow range on Wednesday, as signs of an easing in trade tensions between China and the U.S. were evident. Investors awaited U.S. data to gauge Federal Reserve's outlook for monetary policy.
As of 0105 GMT, the benchmark copper price on London Metal Exchange (LME), was down by 0.4%, to $9,403 per metric ton.
This week, the U.S. Initial Jobless Claims and Personal Consumption Spending (PCE) Data are due. These data could influence metal prices as they affect Fed's interest rates decisions and economic outlook.
U.S. president Donald Trump signed two orders to reduce his auto tariffs. This follows Treasury Secretary Bessent’s statement on Monday that certain key U.S. traders had made promising proposals to avoid U.S. duties.
Bessent noted that China’s recent exemptions of certain U.S. goods from retaliatory duties showed a willingness for trade tensions to be de-escalated.
The trade war tensions seem to have stabilized this week, without any major developments. There is some optimism in the meantime about a possible de-escalation of tensions between China and the U.S. "Our attention is now focused on U.S. Economic Data," said a trader.
Other London metals include aluminium, which fell by 0.1%, to $2.462 per ton. Zinc rose by 0.1%, to $2.653, while lead dropped 0.1%, to $1.975. Tin remained unchanged at $31,919, and nickel increased 0.1%, to $15.570.
The Shanghai Futures Exchange's (SHFE) most traded copper contract was unchanged at 77 570 yuan per ton ($10 671 34).
Shanghai copper prices were supported due to a huge drop in inventories for the metal CUSTX-SGH, which fell 32% on a weekly basis in the warehouses monitored by Shanghai Futures Exchange.
SHFE aluminium rose 0.4% to 19.995 yuan per ton. Zinc remained unchanged at 22,540 yuan. Lead fell by 0.3% to 16.895 yuan. Nickel fell by 0.3% to 124.130 yuan. Tin remained at 261,160. ($1 = 7.2690 Chinese Yuan Renminbi)
(source: Reuters)