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Copper continues to be steady despite data from China and the US
The copper price remained stable on Wednesday, as the market awaited data on loans from China's top consumer and U.S. Inflation numbers that may determine the direction in which U.S. Interest Rates will move. The benchmark copper price on the London Metal Exchange was 0.10% higher, at $9.929 per metric ton of official rings. Traders reported that volumes were low as consumers and producers were absent. The market was dominated by funds, which reacted to macro-factors. China's loan data is due on September 10-15. Analysts will focus on the total social finance numbers, which they use as a gauge for industrial metals demand. They expect that August's figures are higher than July's. Financial markets expect a quarter point cut in interest rates from the Federal Reserve, with a slight chance of a half point cut. The report on U.S. Consumer Inflation on Thursday may influence the possibility of a bigger cut. The U.S. Dollar would fall when the Fed rate falls, making dollar-priced precious metals more affordable for holders of other currencies. This could increase demand. Ed Meir, Marex analyst, said that "the dollar's weakness will likely provide some support, at least in the early part of September." If the Fed catches the markets by surprise, a stronger currency could lead to a downward trend in prices for the rest of the month. A temporary halt in mining at Freeport McMoRan’s Grasberg mine, one of the largest copper mines in the world, was a major factor supporting copper. Zinc stocks are also a focus In LME-registered warehouses, the 50,825 tonnage has dropped by nearly 75% from mid-April. The LME system is expected to lose another 15,375 tonnes of zinc due to cancelled warrants and/or zinc that was earmarked for shipment. Concerns about zinc availability on the LME have led to a premium or backwardation with the forward cash contract for the next three months. The current price of a ton is around $18. Lead was unchanged at $1,977. Tin rose 1% to $35,350. Nickel was slightly lower at $15,090.
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Russia considers a moratorium on the bankruptcy of metal giants with indebtedness
A government document published on Wednesday showed that Russia was considering a moratorium for bankruptcies within the metals sector. This is a sign of increasing concern over a struggling industry battling with falling demand and high interest rates, as well as a strong rouble. In the document, which was a protocol of the meeting held by the Financial Stability Commission on August 28, the ministry of economy and the ministry for industry were asked to submit proposals on October 28 regarding the feasibility of a ban on bankruptcy in the sector. Kommersant was the first to report on this news. This move is part of a wider package to support the industry. It follows similar measures taken to assist the struggling coal sector. These included tax deferrals, limiting bonuses and dividends for top managers, and even deferring taxes. The Economy Ministry declined comment. Russia will be the fifth largest steel producer in the world by 2024, with a production of 71 million tonnes. Severstal, one of the country's leading steelmakers estimated in July that steel demand had fallen by as much as 15% during the first half due to high interest rates. This, combined with low prices, caused a 55% drop in the net profit of the company in the second quarter. On September 12, the central bank board will meet to determine the key interest rate. The analysts polled expect a 200 basis point cut as the economy has slowed faster than expected and inflation is declining. The Russian economy will slow down to 1.2% from 4.3% growth last year. In a January research note, a think-tank that advises the government stated that Russia may face a wave corporate bankruptcies as the percentage of companies with high levels of risky debt will double by 2024. The central bank and government dismissed these warnings by saying that the situation was in control. (Written by Gleb Brynski; Additional Reporting by Darya Korsunskaya; Anastasia Lyrchikova; Gleb Stolyarov, Editing by Guy Faulconbridge & Jan Harvey).
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Sources say that Zijin Gold aims to raise the Hong Kong IPO valuation above $30 billion.
Two people who have direct knowledge of this matter said that Zijin Gold International is planning to begin bookbuilding next week for its Hong Kong IPO, with a target valuation of more than $30 billion. One source said that Zijin Gold plans to open its books September 19 and aims to raise over $3 billion. According to LSEG, if the listing were that large, it would rank as Hong Kong's second largest listing of this year after Chinese battery company CATL raised $4.6 Billion in its May offering. Sources who refused to name themselves because the information is confidential said that Zijin Gold will price its offering on September 24, with the debut scheduled for September 29. According to the other source, Zijin Gold is valued between $30 and $40 billion based on the estimated range of prices. Sources said that the market or unforeseeable events could affect the timing, size of the offering, and valuation of a company. Zijin Gold - which owns all the gold mines of Zijin Mining outside China - did not respond immediately to comments. Zijin announced in late April that it would spin off Zijin Gold International, and list the company on the Hong Kong stock exchange as part of an overhaul of its overseas assets. This was done to reflect its confidence about stepping up its investment in gold. The eight gold mines that will be listed in the proposed listing are located in South America and Central Asia. They also have operations on Africa, Oceania, Africa, and Oceania. Gold prices are on a record-breaking rise, reaching $3,673.95 an ounce Tuesday. This is due to growing geopolitical uncertainties, expectations that the U.S. will cut interest rates this month, and central bank purchases in several countries, including China. Goldman Sachs said last week that prices could rise well above their $4,000 base by mid-2026. Laopu Gold shares, a Chinese luxury jewellery brand that specializes in gold, closed Wednesday at HK$755 apiece, nearly doubling their HK$40.50 IPO value from June 2024. Zijin Gold was incorporated in Hong Kong, in 2007. It reported revenues of $1.8billion, $2.3billion and $3billion respectively for the last three years. This information was provided in a filing made to the Hong Kong Stock Exchange in June. Zijin Gold failed to disclose in its filing the purpose of the IPO proceeds. In the half-year reports, its parent stated that Zijin Gold’s listing was of strategic importance in order to achieve its goal of mining between 100 and 110 tons gold by 2028.
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Sources say that Brazil will propose a new forum for climate and trade complaints.
Brazil will propose the establishment of a forum where governments can discuss the impact climate policy has on trade. This is an issue that both the U.N. Climate talks and the World Trade Organization have failed to address, according to three officials who are familiar with the plan. The European Union has been accused by emerging economies such as Brazil, South Africa, and India of restricting the trade with its environmental policies. One example is a December ban on imports that are linked to deforestation. The EU said that trade discussions should take place at the World Trade Organization. Brazil, the host of COP30 (the U.N. Climate Summit) in November, wants to break this impasse. One official said that Andre Correa do Lago, the Brazilian COP30 president who will be making the proposal next week at the WTO annual public forum, is expected to make it during the WTO Forum. Source: The goal is to get enough support for the forum so that it can be launched at the COP30 summit, in November, with the members already in place. Officials declined to identify themselves and refused to comment publicly. Brazil's COP Presidency did not respond immediately to a comment request. One official expressed concern about the impact on international trade of two EU environmental policies: the EU’s anti-deforestation legislation and its carbon border tax, which will begin imposing pollution fees on imported cement and steel in January. The official, who is Brazilian, said: "We are worried about the growing trend to limit trade by using climate change as a justification. Today we don't have an appropriate forum to discuss this." The WTO does not have the capacity to deal with climate change. Source: The new forum may also provide solutions, such as tools for tracking deforestation which are affordable to producers and acceptable to buyers in Europe. A spokesperson from the European Commission didn't immediately respond to an inquiry for comment. The EU has been claiming that its carbon border tax is not a measure of trade, but rather a way to bring foreign producers up to par with European manufacturers who pay for CO2 emissions. The draft EU negotiating mandate for COP30, which was seen by, stated that the bloc is open to discussing international impacts of its climate policies in "bilaterally, and within the context of WTO, Paris Agreement context, and other appropriate forums." According to sources, the Brazilian forum's proposal would include at least two groups: one for climate and trade and another on energy transition. The sources added that they wanted to have representatives from both the trade and climate sectors meet every few months.
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Austria loses its legal challenge against EU 'green gas' and nuclear rules
Austria lost its legal challenge to European Union rules classifying nuclear energy and gas as climate-friendly investment on Wednesday. Europe's second highest court sided with the EU in the case. Austrian government challenged the European Commission decision to include nuclear and gas in the EU "taxonomy", which is a list of investments that are able to be marketed and labeled as sustainable. The court agreed with Brussels in a ruling that said the EU Commission was "right to believe that certain economic activities within the nuclear energy sector and the fossil gas sector can, under certain circumstances, contribute significantly to climate change adaptation and mitigation." The Austrian Ministry for Environment said that the decision was "very regrettable". "We have always believed that nuclear energy does not meet environmental sustainability criteria. The role of fossil gas in the energy transformation will be temporary. The company said that it will now review the decision and decide on any possible next steps, including whether or not to appeal. Gas and nuclear will be included in the EU taxonomy in 2022, causing a deep divide between countries on which energy source to use in order to achieve climate change goals. Spain and Denmark, among others, had said that it was not credible for gas, which is a fossil fuel emitting CO2, to be labelled as climate-friendly. Poland and Bulgaria sought to support gas investments as a way to get rid of more polluting coal. Austria's legal case, filed to the EU general court by an earlier coalition government where the Greens controlled the environment ministry, argued that Brussels should annul rules because nuclear energy can't meet the requirement of "doing no significant harm" in the environment due to concerns about radioactive wastage. Austria has long been against nuclear energy. The European Commission didn't immediately respond to a comment request. (Reporting and editing by Charlotte Van Campenhout, Sharon Singleton, Francois Murphy, Vienna)
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China's inflation figures are weak and iron ore prices have fallen due to profit-taking
The iron ore futures fell on Wednesday due to profit-taking, and lower-than-expected data for inflation in China, the top consumer. However, bets that demand would pick up, along with a resumption of production among mills, helped limit losses. As of 0913 GMT, the benchmark October iron ore traded on the Singapore Exchange had fallen 0.33% to $107 per metric ton after reaching its highest level since 25 February at $107.65. The January contract for iron ore on China's Dalian Commodity Exchange closed daytime trading 0.25% higher, at 805 Yuan ($113.03), after reaching its highest level since July 25, at 814 Yuan. Steven Yu, senior analyst at Mysteel, explained that traders have been liquidating some long positions in order to cash in on profits. This has led to a softening of prices. It's not easy to predict the direction of the market and prices were largely driven by expectations. Therefore, it is normal to see a downward correction after a price rally. China's consumer price index in August was down 0.4% compared to a year ago, which missed the poll prediction of a drop of 0.2%, and weighed on sentiment. The Brazilian miner Vale announced on Tuesday that the fire at its maritime terminal Ponta da Madeira, which had damaged an auxiliary tower, was put out. The fire had no impact on the miner's schedule of iron ore shipments, nor on the volume of steelmaking materials it expected to ship. Ore demand is expected to increase after Chinese steelmakers resume production following the military parade in Beijing. This will limit price losses. Coke and other steelmaking materials, such as coking coal, fell by 1.93% and 0.7% respectively. The benchmarks for steel on the Shanghai Futures Exchange have fallen. The price of rebar fell 0.73%. Hot-rolled coil dropped 0.39%. Wire rod was down 0.3%. Stainless steel declined 0.12%. ($1 = 7,1218 Chinese Yuan) (Reporting and editing by Amy Lv, Lewis Jackson)
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Israel will kill Hamas leaders if they survive the Qatar attack next time, an Israeli official claims
The Israeli ambassador in the United States stated that if Israel didn't kill Hamas leaders during an air strike against Qatar on Tuesday, it would be successful the next time. This operation raised concerns about it torpedoing efforts to secure ceasefires in Gaza. "Right away, we might be the subject of some criticism. They will get over it. Yechiel Leiter said late Tuesday on Fox News' Special Report that Israel was changing for the better. "The region will change for the better when we take away these enemies of peace, and these enemies to Western civilization's ability to commit terrorism." Israel's attack on the Qatari capital Doha Tuesday was an attempt to kill Hamas political leaders. The attack escalated its military action in Middle East, which the U.S. called a unilateral strike that did not advance American or Israeli interests. This operation was particularly sensitive, as Qatar is hosting negotiations to secure a ceasefire for the Gaza War which has raged for almost two years. Leiter said, "We'll try again next time if we don't succeed this time." Hamas confirmed that five members of the group were killed, including the exiled Gaza chief Khalil al Hayya and his top negotiator. Hamas political Bureau member Suhail al-Hindi said to Al Jazeera TV that the top leadership of the group survived the attack. On Wednesday, a senior Israeli official stated that optimism over the outcome of the strike had turned into doubt. The official expressed concern that so many hours had passed without a conclusion, especially in a country as orderly as Qatar. Qatar, who said that one of its security personnel was killed in the attack said Israel is treacherous and engages in "state terror." Qatari Prime Minister Sheikh Mohammed bin Abdulrahman al-Thani claimed that the airstrikes could derail peace talks Qatar is mediating between Hamas & Israel. Israel had warned Palestinians to leave Gaza City - a city that once housed about a half million people - as it sought to eliminate what was left of Hamas. The group has been decimated since October 2023 by Israel's army. Donald Trump, the U.S. president, said that he was "very unsatisfied" with every aspect of the Israeli attack. When asked how the failure to kill Hamas leaders in the attack on Qatar would affect the ceasefire negotiations by the U.S. Mike Huckabee, the Ambassador to Israel, told: "The truth is that we don't really know." Hamas rejected all offers so far. "They reject all offers that are put forward." He then reiterated the U.S.-Israeli position that Hamas militants should "go" and have no future running Gaza. The militant group that has controlled Gaza for almost two decades, but now controls only parts, said on Saturday, once again, that it would free all hostages, if Israel agreed end the war and remove its forces from Gaza. Benjamin Netanyahu wants a deal in which all hostages are released immediately and Hamas is forced to surrender. He has ignored the global condemnation for operations such as the one which struck Doha, Qatar on Tuesday. He is extending military operations throughout the Middle East ever since Hamas launched an attack against Israel in 2023. Business as usual On Wednesday, Doha's schools and businesses were open as usual. In the Legtafiya district, where the attacks took place, a petrol pump was cordoned-off and schools closed. The International School of Choueifat, located nearby, was closed but offered online classes. Trump said that he thought it was a good idea to hit Hamas, but regretted the fact that the attack occurred in the Gulf Arab State, a non-NATO major ally of Washington, and the place where the Palestinian Islamist movement has had a political base for many years. Al-Udeid Air Base is the largest U.S. military base in the Middle East. Israel has killed top Hamas leaders in the years since the Palestinian militants attacked Israel, October 2023. They are believed to have killed 1,200 soldiers, civilians, and taken 251 hostages. Israel's military action in Gaza has killed more than 64,000 people according to local authorities and left the Palestinian enclave in ruins. A humanitarian crisis, including widespread starvation, has shocked the entire world. (Writing and editing by Sharon Singleton; Michael Georgy)
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Gold nears record high ahead US inflation data
The gold price hovered at a high level on Wednesday. This was due to expectations that the U.S. Federal Reserve will cut interest rates this month. Market participants were also awaiting U.S. inflation figures for clues about its monetary policy. As of 0821 GMT spot gold was up 0.5%, at $3,643.78 an ounce. It had hit a record high on Tuesday of $3,673.95 per ounce. U.S. Gold Futures for December Delivery were flat at $3.682.30. Ricardo Evangelista is a senior analyst with ActivTrades. He said that gold's gains are due to expectations of Fed rate reductions, and signs of cooling on the U.S. labor market. This has weakened the U.S. dollar. The Fed's policy meeting in September was prompted by the weakening of the labor market. The U.S. government reported on Tuesday that the economy probably created 911,000 less jobs than originally estimated in the year through March. This suggests that the job growth had already slowed before President Donald Trump imposed aggressive tariffs on imported goods. The independent analyst Ross Norman stated that "the outsized revisions to jobs in the U.S. almost certainly add to the pervasive sense of economic unrest and such unexpected economic shifts highlight the role of Gold as a safe haven asset." According to CME's FedWatch Tool, the markets are pricing in 92% of a rate cut of 25 basis points, and 8% of a more significant 50 basis point cut. Watch closely the U.S. consumer price inflation and producer price inflation figures on Thursday, both due at 1230 GMT. These will provide more clues about the Fed's rate path. Gold that does not yield is usually a good investment in an environment with low interest rates. The gold price has risen 38% this year after a 27% increase in 2024. This is due to a weaker dollar, central bank accumulations, dovish monetary policies and increased global uncertainty. ANZ Group increased its gold price forecast for the year to end on Wednesday from $3,800 to $4,000 per ounce. Silver spot increased by 0.4%, to $41.06 an ounce. Platinum rose by 0.2%, to $1 387.45, and palladium increased 0.2%, to $1 1450.73.
Barclays raises its 2025 S&P500 target for the second time in three months
Barclays on Wednesday raised its 2025 year-end target for the S&P 500 to 6,450 from 6,050, its second in three months, on stronger-than-expected corporate earnings, resilient U.S. economic growth and optimism around artificial intelligence.
The British brokerage has joined a list of global firms, such as Citigroup and HSBC, that have increased their targets for the benchmark index.
S&P 500 rallied steadily after hitting a low in April due to President Donald Trump's "Liberation Day", tariffs. It has gained about 30%, boosted by strong earnings and investor excitement around the AI boom.
The new target, however, is only slightly lower than the last closing index of 6,512.61, which indicates labour market risks.
Data released on Friday revealed that the U.S. unemployment rate increased to 4.3% in August, a four-year high. This slowed the pace of the economy.
Barclays strategists said that while global GDP growth has stabilized, US labor market risk is increasing.
It noted that the AI-centric narrative of growth, rate cuts in the short-term and seasonality favoring equities after the quarters of July-September will support equities until year's end, adding that this expectation was probably already priced into markets.
The brokerage says it expects the U.S. Federal Reserve to cut rates three times before year's end, which will help reduce labor market risks.
The S&P 500's 2025 earnings per share (EPS) was also increased to $268, up from $262.
It also raised its target for 2026 to 7,700 from 6,700 and projected EPS at $295 from $285.
Barclays upgraded its view of the U.S. technology sector to "positive", citing high data center demand, and eased concerns about AI disruptions in software.
The company downgraded U.S. Healthcare to "neutral", citing regulatory concerns, and upgraded the Materials sector to "neutral", citing improved outlooks for metals as well as agricultural chemicals.
Investors will closely watch the Fed's meeting on policy next week to get clues about the path of rate cuts and the direction of the market. (Reporting and editing by Janane Vekatraman in Bengaluru)
(source: Reuters)