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Asian shares and gold rise amid US shutdown fears; crude oil falls
On Tuesday, shares in Asia rose and gold's record rise continued as markets assessed the prospects of a U.S. shutdown that could delay closely-watched jobs data. The Australian dollar gained before the Reserve Bank of Australia meeting, where they are expected to maintain their current policy. Oil prices fell due to the prospect of increased production by OPEC+. Meanwhile, China's manufacturing activity declined for a sixth consecutive month in September. After little progress was made in budget negotiations between Donald Trump and Democratic opposition, U.S. vice president JD Vance stated that the government "seemed to be headed for a shutdown". The government shutdown would prevent the publication of important employment figures later this week. Instead, the Labor Department will release its JOLTS report for August job openings on Tuesday. Ray Attrill said in a podcast that it appears the markets are preparing for the possibility of a shutdown. If we don't get payroll numbers, we can focus on what we have. MSCI's broadest Asia-Pacific share index outside Japan rose 0.5% at the start of trading. This would make it the best month in a decade, with a gain of 5.6%. Japan's Nikkei index fell 0.3% for the third consecutive day. After a 0.6% drop on Monday, the dollar was unchanged at 148.62yen. The euro remained unchanged at $1.1723. The Australian dollar rose 0.2% against the greenback, to $0.6587. SHUTDOWN COULD LEAVE FEED WITHOUT KEY DATA The Federal Reserve uses the U.S. JOLTS Report as the first indicator to be considered before the Friday employment report. This report is crucial in determining the timing for rate cuts. If the Fed is left in the dark about the economy, it could be difficult for them to make decisions at their October 29 meeting. Analysts expect JOLTS data to show that job openings remained stable at 7.18 million jobs in August. Capital.com analyst Kyle Rodda said in a recent note that the shutdown could delay the release certain data. This includes the important non-farm payrolls reports. The primary focus of market participants at the moment is the future path for U.S. Interest Rates. Asset prices are supported by the idea that there will be a reduction in interest rates and it could be relatively deep. A U.S. shutdown without a deal would start on Wednesday, the day that new U.S. Tariffs were supposed to take effect for heavy trucks, patented medicines and other items. White House announced new tariffs for furniture and cabinets on Monday night. They are set to take effect on October 14. China's purchasing manager's index (PMI), a measure of economic growth in Asia, rose to 49.8 from 49.4 in august, just below the 50-mark that separates growth and contraction. This suggests that producers are waiting on further stimulus measures to boost domestic demand as well as clarity regarding a U.S. Trade Deal. Gold reached a record high of $3,843.49. The oil price remained lower due to the anticipated increase in production by OPEC+, and the resumption from Iraq's Kurdistan Region of oil exports. U.S. crude oil fell 0.6%, to $63.07 per barrel. Brent crude dropped 0.6%, to $67.51 a barrel. Early European trading saw the Euro Stoxx futures down 0.11% to 5,524, German DAX Futures down 0.07% to 23,890 and FTSE Futures down 0.06% to 9,355.
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Shares of China's Zijin Gold surge 66% on Hong Kong debut
The shares of China's Zijin Gold International soared as high as 66% on their Hong Kong debut after the company raised $3.2 Billion in its initial public offering (IPO), which was the largest in Hong Kong for four years. The company is a unit of China's Zijin Mining, which operates all the gold mines of the group outside China. It sold 349 millions shares at HK$71.59 per share. Early trading saw the Hang Seng Index rise 0.8% to $HK119. As of 0123 GMT, gold prices reached a new record of $3,842.76 an ounce. Bullion is up 11.4% in September so far, and on course to have its best month ever since August 2011. It has also risen by 42% over the past year due to global political uncertainty and lower interest rates. According to filings with the regulatory authorities, Zijin Gold’s retail tranche was 241-times oversubscribed and the institutional tranche was 20-4 times oversubscribed. Dealogic data shows that the IPO raised $3.6 billion and was the biggest in Hong Kong since JD Logistics flotation in May 2021. If the Zijin deal is subject to an overallotment, this would be the biggest since Kuaishou Technology raised $6.2 billion back in January 2021. According to the prospectus, Cornerstone Investors, led by Singapore's wealth fund GIC, and private equity firm Hillhouse purchased shares worth $1.6 billion. Schroders, BlackRock and other firms also took part in the transaction. (Reporting and editing by Christian Schmollinger, Neil Fullick and Scott Murdoch from Sydney and Hong Kong).
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Alcoa will close Kwinana Refinery and take a $890 million loss
Alcoa Corp, an aluminium producer in Australia, announced on Monday that it would permanently close the Kwinana Alumina Refinery. The closure will cost $890 million to Alcoa in the third quarter. Alcoa stated that the refinery's workforce, which currently numbers about 220 people, will continue to shrink through 2026. Some employees will remain on site in order to prepare for a future redevelopment. The U.S. Aluminum Producer announced in January of last year that it would stop production at its loss-making refinery due to the challenging market conditions, and the age of the facility. Matt Reed, Alcoa's Executive Vice President and Chief Operating Officer, said: "Alcoa operated Kwinana Refinery in a challenging and difficult environment for many years and had to make the hard decision to permanently shut the facility. We explored multiple options but were unable to find a viable path for restarting the plant." Alcoa said that the closing of Kwinana will reduce its annual global consolidated refinery capacity to 11,7 million metric tonnes. The Australian metals industry is being squeezed by high energy and labor costs. Meanwhile, the oversupply of top Chinese producer continues to lower prices. Glencore requested support for its Mount Isa Copper Smelter, located in the Queensland state. Rio Tinto, on the other hand, has consistently warned of a difficult outlook for its Tomago Aluminium smelter, which is New South Wales's largest energy consumer, due to its high-cost power.
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The Green Energy Pact has reduced fossil fuel funding
A group of NGOs revealed on Tuesday that the public funding of international fossil fuel deals dropped by as much as 78% in a coalition of over 35 countries last year, even though the members of the group - including Germany and the United States - approved new projects. At the UN climate talks of 2021, countries agreed to stop the practice by 2022. They will instead prioritize investment in clean energy. The Clean Energy Transition Partner agreement covers export financing, development financing and official development assistance. The report released by the International Institute for Sustainable Development and the NGOs Oil Change International, Friends of the Earth U.S. on Tuesday said that trade wars, increasing geopolitical tensions, and the United States decision to withdraw and prioritise the production of oil, coal, and fossil gas put future efforts in danger. The report states that "Multilateral cooperation in climate and energy issues is more fragile than it has ever been." "Furthermore the significant reduction of support for international fossil energy has not led a corresponding rise in support for cleaner energy technologies." Before the signing of the agreement, in 2024, foreign fossil fuel funding had declined by as much as 78% or between $11.3 and $16.3 billion compared to 2019-2021 levels. The report also stated that Germany, Switzerland, and the United States will jointly approve $10.9 billion of new fossil fuel financing between 2023 and 2024. Reporting by Virginia Furness, editing by Barbara Lewis
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NextEra extends license for Wisconsin nuclear plants by 20 years
NextEra Energy announced on Monday that U.S. Nuclear regulator approved the renewal of two units at its Point Beach Plant in Wisconsin for an additional 20 years. Nuclear Regulatory Commission has approved the extension of operations at Units 1, 2 and 3 through 2050 and 2030, respectively. After years of stagnation in the U.S., nuclear power is now gaining momentum. This is due to the surge in electricity demand for energy-hungry data centres and the electrification and transportation industries. On his first day in office, President Donald Trump declared an energy emergency. In late May, he signed executive orders that directed the NRC, to ease regulations, and speed up licensing processes for power plants and reactors. NextEra reported that the two units began operating in the early 1970s and provide about 14% Wisconsin's total power, enough to run nearly one million homes, businesses, and other buildings. The site is 1,200 acres along Lake Michigan. The Turkey Point Nuclear Power Plant in Florida, operated by NextEra’s sister company Florida Power & Light Company(FPL), received license renewal approval at the end of last year. Meanwhile, FPL’s St. Lucie Nuclear Power Plant has begun the renewal process. (Reporting from Katha Kalia, Bengaluru. Editing by Sahal Muhammad)
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As a possible US shutdown looms, stocks rise, the dollar drops, and gold soars.
Investors prepared for the possibility of a U.S. shutdown, which would delay the publication of September payrolls and other important data due this week. Gold surged to record levels, fueled by the drop in the dollar as well as investor fears about the potential ramifications of an U.S. Government shutdown. Donald Trump is scheduled to meet with Democratic and Republican leaders of Congress on Monday evening to discuss the extension of government funding. A shutdown will begin on Wednesday if there is no agreement. This coincides with the day that new U.S. Tariffs are implemented for heavy trucks, patented medicines and other items. Analysts attribute investors' optimism about a U.S. shutdown to the memory of the recent shallow drop in the equity markets. The Dow Jones Industrial Average rose by 0.2%, while the Nasdaq Composite Index gained 0.5%. This helped the MSCI All-World Index gain 0.4%. In Europe, the STOXX 600 index rose by 0.2%. It is on track to increase by 1.1% in September, marking its third consecutive month of gains. The longest shutdown (34 days) occurred under Trump's initial administration. The S&P 500 fell initially by 2.1%, but recovered quickly," said Nicole Inui of HSBC Global Research, who is the head of equity strategy for Americas. Alastair Pinninger, global equity strategist and head of emerging markets, also commented. If the Federal Reserve meets on October 29, it could be blinded by the economic situation if the Federal Reserve closes the market for a long time. Analysts at BofA wrote that if the shutdown continues beyond the Fed's meeting, it will be the Fed who relies on private data to make policy decisions. On the margin, this could lower the probability of a cut in October, but only marginally. The markets indicate that there is a 90% probability of a Fed rate cut in October and a 65% chance of another one in December. Analysts at BofA estimated that a shutdown would only subtract 0.1 percent from the economic growth each week, noting in the past the minimal impact it had on the financial markets. They warned that if the government used the closure as an excuse to permanently lay off workers, it could have a greater impact on consumer confidence and payrolls. The outcome of a meeting between U.S. Generals and Admirals, convened by Defense Secretary Pete Hegseth in Quantico on Tuesday is uncertain. Trump is expected to attend. Q4 IS GOOD FOR STOCKS Analysts expected that equities would be supported by a new quarter of buying, which is historically a good one for stocks. Bond markets saw 10-year Treasury yields drop, dropping 4.6 basis points, to 4.1406%. Investors were pushed last week to lower their expectations of how low Fed rate could go. This week's calendar is packed with central bank speakers, including at least five each from the Federal Reserve and the European Central Bank. The dollar index fell 0.2% to 97.945 after benefiting last week from a batch of positive economic news. The MUFG strategist Lee Hardman stated that "our forecast for the U.S. Dollar to weaken even further heading into the year-end assumes the Fed will deliver another two 25-basis point cuts by the year's end as the labour markets remain weak." The euro increased by 0.2%, to $1.17255. It is still at the lower end of its recent range between $1.1646 and $1.1918. The dollar dropped 0.6% to 148.6yen after a rally of just over 1% the previous week. It has also moved away from its September low at 145.50. Gold prices on commodity markets reached an all-time record high of $3,833.37 per ounce before retracing slightly to $3,828.17, a 1.8% increase. Crude oil prices dropped as the pipeline that connects the semi-autonomous Kurdistan Region in northern Iraq with Turkey began to flow crude for the first time since 2-1/2 years. OPEC+ is expected to approve an increase in oil production of at least 137,000 barges per day during its next Sunday meeting. Brent fell by 3.5% to $67.68 per barrel while U.S. crude dropped by 3.8% to $63.21 a barrel.
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CenterPoint announces $65 billion in capital expenditures over the next 10 years
CenterPoint Energy, a U.S. gas and electric utility, announced on Monday that it plans to invest $65 billion between 2026 and 2035. Utilities are planning to increase spending on power infrastructure in order to meet the rising demand. CenterPoint has also increased its forecast for annual adjusted earnings per shares to between $1.75 to $1.77, up from $1.74 and $1.76 previously. The new range has a midpoint that is 9% higher than last year According to data compiled and analyzed by LSEG, analysts estimate $1.76 a share. The company targets a 2026 adjusted earnings per share (EPS) of at least $1.89 per share, or the midpoint between $1.89 and $1.91. According to a report by the Lawrence Berkeley National Laboratory, the power demand of U.S. data centres is expected to triple over the next three to four years. This could consume up to 12% the total amount of electricity produced. The company stated that "continued economic growth is expected to drive significant demand for electric power over the next decade," especially in Texas. Texas has one of the fastest-growing markets for data centers. The business-friendly state is also attracting industries that are energy-intensive, such as the manufacture of computer chips. CenterPoint provides electricity and natural gas for more than 7,000,000 customers in Indiana, Louisiana and Mississippi.
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Grossi: Ukraine's Zaporizhzhia Nuclear Plant now without offsite electricity for six days
Rafael Grossi, chief of the U.N. Atomic Watchdog, said that Zaporizhzhia Nuclear Power Plant has been without power offsite for six days. Since the beginning of the conflict, the plant in southeast Ukraine was under Russian control. Both sides have accused each other of shelling the facility and compromising nuclear safety. Grossi, the director general of International Atomic Energy Agency (IAEA), wrote on X about his meeting with Ukrainian Foreign Minister Andrii Sbiha and their exchange of views regarding the plant. He also said that the IAEA is working to restore power. UKRAINE WANT TEMPORARY IAEA STEP-IN FOR PLANT Oleh Korikov is the head of Ukraine’s State Nuclear Regulatory Inspectorate. He said that the absence of external power posed “major threats to nuclear safety and radiation safety” and called on efforts to restore this quickly. IAEA reported that the external power lines to the plant fell last week, for the 10th consecutive time during the conflict. Emergency diesel generators have been put into operation. These lines provide electricity that is vital for cooling the fuel in its reactors and preventing a nuclear meltdown. Sybiha wrote about his meeting on X with Grossi, saying that Russia "stole the Ukrainian nuclear plant and is now trying to forcefully integrate it into their grid despite growing risks of a nuclear accident." We all agreed that this is something the world can't allow. He stated that the "only real option" would be to give the IAEA temporary control over the plant. (Reporting by Shubham Kalia in Bengaluru. (Editing by Ron Popeski, Mark Potter and Mark Potter).
Sources say that the Mali mining dispute was the last straw for Barrick’s ‘Mercurial Mark’ Bristow.
Four people who are familiar with this development claim that Mark Bristow’s handling of Barrick Mining’s flagship asset in Mali was the final straw for the board, which led to a change of leadership.
Barrick Chairman John Thornton announced on Monday that Chief Executive Bristow will step down immediately. He appointed Chief Operating Office Mark Hill as interim CEO. Barrick did not give a reason for Bristow’s departure but said that it had begun an executive search. It will announce the permanent CEO at a later date.
According to a person familiar with board thinking, the discussion about replacing Bristow began six months ago when the company's Mali situation deteriorated under his leadership.
Barrick has lost control of its Loulo-Gounkoto complex of gold mines in Mali over the past nine months. The government seized 3 metric tonnes of gold.
The company wrote off $1 billion and sold two mines in Canada and the U.S. Barrick's future is uncertain in Mali, as its mining license expires in February 2026. If an agreement cannot be reached by then, Barrick may lose the asset.
Barrick or Bristow did not respond to requests for comments on this article.
Bristow's Mali history and Barrick's are interconnected. Randgold Resources was founded by the South African Randgold, and its assets were mainly in Mali. It was acquired by Barrick in 2018.
The military coup of 2021 led to a regime wanting more mining revenue. Barrick's refusal last year to adopt the new mining code of the country led to the arrests of four employees, the seizure by the government of gold worth $300 million, and the temporary taking over of the mines by Mali’s military government.
Barrick's performance has lagged behind its peers in the past five years, which is another reason why the board decided to replace Bristow, according a source who had been briefed about the reasons for Bristow’s departure.
Barrick shares have increased by 37% in the last year, while Agnico Eagle shares have grown 110%. The gold price has roughly doubled over the last five years, reaching record highs.
According to an ex-Barrick executive who didn't want to be identified, the tension between Thornton and Bristow was also a factor in Bristow’s demise.
Bristow’s sometimes abrasive manner led to some of his peers in the industry calling him Mercurial Mark. Bristow was known for taking key decisions by himself, and he did away with a weekly meeting of staff.
Jefferies analysts stated in a report that some investors had expressed concerns about the company's risk profile. This included its exposure to Africa and the planned investment in Pakistan for the Reko Diq Project.
Barrick shares closed down by 4% at the Toronto Stock Exchange Monday. (Divyarajagopal, Toronto; Clara Denina, London; Editing and Caroline Stauffer & Lincoln Feast)
(source: Reuters)