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Gold prices jump on dollar weakness and Middle East peace hopes
The gold price rose by 2% Wednesday due to a weaker dollar. Meanwhile, lower oil prices eased concerns about inflation and interest rates that would be higher for longer, in anticipation of an agreement between the U.S. and Iran. As of 0415 GMT, spot gold was up by 2% to $4,647.09 an ounce. U.S. Gold Futures for June Delivery rose 2% to $4 658. U.S. president Donald Trump said Tuesday that he will temporarily halt an operation to help escort vessels through the Strait of Hormuz. He cited progress towards a comprehensive deal with Iran. The gold price rose as oil prices fell on the back of a reduction in the geopolitical risks premium after the U.S. confirmed the fragile ceasefire that has been ongoing between Iran and the United States is still intact despite the "skirmish" that occurred at the beginning of this week, said Kelvin Wong, senior analyst?at OANDA. After Trump suggested that a peace agreement could be reached with Iran to end the conflict, crude oil and U.S. dollars prices fell. Marco Rubio, the U.S. Secretary for State, told reporters Tuesday that "operation Epic Fury has concluded." He added that "we don't cheer on an additional situation." Wong said that if there are signs of tensions between the two countries, gold prices will be affected by profit-taking or a move to reduce short-term speculators' net long positions in gold. The dollar is weaker, and metals priced in dollars are cheaper for holders of other currencies. The dollar price of metals is cheaper for holders other currencies. ]USD/] Increased crude oil prices can cause inflation and increase interest rates. Gold is seen as an inflation hedge, but high interest rates can make other assets that yield more attractive. This reduces its appeal. Investors are waiting for the U.S. Non-farm Payrolls to be released later this week. This will determine if the economy is resilient enough to keep the Federal Reserve's policy on hold. Silver spot rose by 3.4%, to $75.62 an ounce. Platinum gained 2.4%, to $1,999.95. Palladium was 2.6% higher, at $1,524.59. (Reporting and editing by Rashmi Dhaniwala and Mrigank Aich in Bengaluru)
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Lynas CEO: US and European rules influence buyers away from Chinese rare Earths
The chief executive of Australia's Lynas Rare Earths?said that new government?regulations?in the U.S.and Europe?are helping to?push customers?to buy rare earth products?from suppliers?outside China?. China has been the world's leading and cheapest producer of metals and magnets, which are used in industries ranging from automotive to defense. It is also the default supplier for many years. Last year, China's restrictions on some exports in response to U.S. Tariffs left automakers and other industries vulnerable. Washington has since pledged to support higher?earths prices for its top rare?earths producers to spur non-Chinese supplies, but convincing customers to pay more, when there are cheaper Chinese alternatives, has proven difficult. Next year, the U.S. will introduce new procurement?regulations that include restrictions on the purchase of certain magnets and tantalum, while the European Union is bringing in sourcing restrictions for these supplies under its framework of critical raw materials, Lynas' CEO Amanda Lacaze stated. She said that in both cases we're observing consumers making different purchasing decisions to comply with regulations. Lynas of Perth, with a processing facility in Malaysia, is world's largest producer of rare Earths outside of China. Lacaze called on governments to intervene more to help the rare earths industry flourish outside of China. This included?for countries other than the U.S. or Japan to set floor prices. The Australian Resources Minister said in March that the country is revising policies regarding building a strategic reserves, which "no doubt," will have an element of a?floor?price. This comes as Australia looks to cement its position as a major supplier to its allies. Reporting by Melanie Burton, Melbourne Editing done by Alasdair pal and Lincoln Feast.
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BHP CFO: New investors are buying into copper exposure and AI demand
Vandita Pant, BHP's Chief Finance Officer, said on Wednesday that generalist investors are buying into the company as AI demand makes its exposure to copper more valuable. BHP shares, the largest listed copper miner in the world, reached a new record on March 2, but then dropped amid a sector-wide selloff when the war with Iran began. They have since recovered some of their losses. She told the Macquarie Australia Conference that she has seen a?growing?interest since half results. We also see more generalist international investors in our register. BHP Group reported a ?stronger-than-expected half-year underlying profit driven ?by copper, which for the first time surpassed iron ore in the company's earnings, as prices for the red metal surged on AI-fuelled demand. They don't like to choose winners. They're?going downstream and asking where the bottleneck is? Copper is a bottleneck. We want to invest in companies where we can reduce the downside risk, but still have exposure to this upside. BHP is a good option for them." Investors told last month that major fund managers were 'heralding' a sustained rally for mining and metals as the money poured into the sector in the fastest rate in years. This was driven by a buildout of AI infrastructure, increasing defence spending, and a shift away expensive tech stocks.
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Iron ore prices jump as China resumes trade after the holiday
Iron ore futures rose on Wednesday, as China returned from its May Day holiday break. Demand for steelmaking feedstock is expected to increase in the summer when construction activities will re-start and blast furnaces will resume production. As of 0221 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange was up 2.33% to 812 yuan (US$119.08) per metric ton. The benchmark June Iron Ore at the Singapore Exchange is 1.19% higher, $109.8 per ton. Galaxy Futures, a Chinese broker, said that after the five-day holiday, steel demand will likely pick up in China. After completing maintenance over the holidays, blast furnaces are expected to restart operations. Galaxy Futures reported that iron ore prices were 'also supported by an increase in volatility of coking coal and?coke?prices as summer approaches. This was driven by a higher?energy?demand, Galaxy Futures added. However, high ore imports, and a weaker overall steel demand, weighed down on price gains. According to Mysteel, the number of iron ore arriving at Chinese ports has increased from April 27 to may 3, by 2,15 million tonnes week-on-week. Liu Huifeng is the chief researcher for ferrous metals and futures at Donghai Futures. He said that although steel prices have "rebounded", surging energy prices and raw materials are putting pressure on the "already decreasing steel mill margins". Coke and coal, which are used in steelmaking, both grew by 2.57% and 2.04% respectively. The benchmark steel prices on the Shanghai Futures Exchange increased. Rebar jumped 1.25%. Hot-rolled coil climbed 1.9%. Wire rod soared 5.26%. Stainless steel grew 1.49%. ($1 = 6.8187 yuan) (Reporting by Ruth Chai; Editing by Subhranshu Sahu)
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Gold prices jump on dollar weakness and Middle East peace hopes
Gold prices increased by more than 1% on Tuesday, boosted by a weaker dollar. Meanwhile, lower oil prices eased concerns about inflation and interest rates that would continue to rise, in anticipation of an agreement between the U.S. and Iran. As of 0225 GMT, spot gold rose 1.7% to $4,633.31 an ounce. U.S. Gold Futures for June Delivery rose 1.7% to $ 4,643.20. U.S. president Donald Trump announced on Tuesday that he will temporarily pause an operation in order to help escort vessels through the Strait of Hormuz. He cited?progress towards a comprehensive deal with Iran. According to Kelvin Wong of OANDA, senior market analyst, "oil prices declined on reduction in the geopolitical risks premium" after the U.S. confirmed the fragile ceasefire that has been ongoing between Iran and the United States is still intact despite the skirmishes that were seen at the start of this past week. After Trump's announcement that a peace agreement could be reached with Iran to end the conflict, both the U.S. Dollar and crude oil prices fell. Dollar-priced materials become cheaper for holders of currencies other than the U.S. dollar. ]USD/] While crude oil prices are rising, they can also increase the probability of interest rates increasing. Gold is considered a hedge against inflation, but high interest rates can make other assets with higher yields more appealing, which reduces its appeal. Marco Rubio, the U.S. secretary of state, told reporters that "operation Epic?Fury" is over. He added that "we don't cheer for another situation to occur." Wong explained that if there are any signs of a resurgence of tension, gold prices will be affected by profit-taking or short-term traders unwinding their net long positions in 'gold'. Investors are now awaiting the U.S. Non-farm Payrolls Release later this week. This will test whether or not the economy is resilient enough to maintain the Federal Reserve's monetary policies on hold. Silver spot rose by 2.7%, to $74.80 an ounce. Platinum gained 1.7%, to $1,986.25, while palladium increased 2.1%, to $1,516.44. (Reporting and editing by Rashmi aich in Bengaluru)
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Rivian develops variants of the R2 EVs that are more affordable
Rivian's CEO revealed that the company is developing undisclosed versions of its R2 electric vehicle, just days after it began mass production of "the smaller, more affordable SUVs". Rivian is known for its R1 SUVs and pickup trucks. The company plans to begin delivering R2 SUVs in June. Analysts say that a successful launch will be critical to the expansion of the company's mass market. When asked about the pickup version of R2, CEO RJ scaringe replied in an interview, "There are other variations of R2, that we haven't showed." "What we are building in Georgia allows different variations," said he, referring to a new factory where Rivian plans to expand production of R2 cars. Scaringe didn't disclose any details on what the other variations would look like. The demand for EVs in the United States has been hit by the elimination of 'key tax credits,' although the high price of gasoline has sparked some interest in battery powered vehicles. Affordable EVs have been hailed as a bright spot for the electric vehicle sector, since borrowing costs are still high. Rivian announced in March various trims for the?R2 crossover. The launch will start with a R2 priced at $58,000, and then other versions that are cheaper will be released later this year or in 2027. By late 2027, Rivian will release a $45,000 trim that has a range of over 275 miles. This trim is expected to broaden the customer base for Rivian. Rivian launched first its R1T pick-ups in 2021, followed by the R1S SUVs. Rivian announced R2 SUVs with the mid-size platform. They also have a smaller R3 crossover and the R3X performance variant. Scaringe stated that "clearly?there could possibly be an R2X." He continued: "There will be combinations." "I want to be careful not to announce the program." Rivian’s forecast for a 53% increase in deliveries this is due to the rollout of?R2 cars and implies approximately 22,000-23,000 R2 deliveries assuming steady demand and a smooth ramp up. Cantor Fitzgerald's?Andres?Sheppard wrote in a note to clients following?Rivian’s quarter earnings last week that the R2 will "materially boost" sales and "capture more EV market shares," thanks to its lower price point and autonomy features. Uber will also deploy 10,000 R2 fully autonomous vehicles in 2028 as part of a $1.25 billion robotaxi agreement with Rivian. (Reporting and editing by Christopher Cushing in San Francisco, Abhirup Roy from San Francisco)
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Asia markets reach record highs on AI euphoria and Iran peace hopes
In the morning of Wednesday, the Asian session, stocks soared, oil prices fell and the dollar dropped after U.S. president Donald Trump hailed "great progress" toward a "final deal" with Tehran, while momentum for AI-driven trading accelerated. Trump said he would temporarily pause an operation of escorting ships through the Strait of Hormuz. The Strait of Hormuz carries a fifth of all global oil, and Iran has blocked it since late February. This has triggered a global energy shortage. Brent crude fell 1.2% to $108.51 per barrel on the news, while S&P500 e-minis futures rose 0.3%. MSCI's broadest Asia-Pacific index outside Japan rose 2.3%, setting a new record. The surge was led by the 5.1% increase in South Korea's Kospi which cleared the 7,000-mark for 'the first time'. Analysts from Westpac stated that "markets have embraced a calm and stable environment overnight. The risk of an escalation of the Middle East conflict has been reduced after U.S. Defense Secretary Pete Hegseth made sure the ceasefire remained in place despite U.S. trading blows with Iran yesterday." This boosted risk sentiment and supported a recovery in stocks across the U.S., Europe, at the same as crude oil prices "partially unraveled yesterday's rise." The S&P 500 and Nasdaq Composite both hit new records on Wall Street on Tuesday. Chris Weston is the head of research for Pepperstone Group Ltd. in Melbourne. "Investors continue to add to their positions in 2026 winners," he said. There has been some purchasing in S&P500 materials stocks. However, it is tech stocks that continue to attract the majority of flows. This includes Apple and memory plays. Samsung Electronics, which reopened the Seoul stock market after a long holiday, jumped by 12%. It now has a market capitalization of $1 trillion, surpassing Berkshire Hathaway, and is closing in on Walmart. Rushil Khanna is the head of equity investments in Asia for Ostrum, an affiliate of Natixis Investment Managers. He said that "this capex will lead to the creation of material value in Asia, as we are the providers of the 'picks and shovels' for the AI ecosystem." The shares of Advanced Micro Devices rose 16.5% during extended trading on Tuesday as the company announced second-quarter revenues above Wall Street expectations. This was aided by strong demand for its dead-centre chip as cloud computing companies increase spending on AI infrastructure. The?U.S. dollar index, which measures the greenback's strength against a basket of six currencies, snapped a three-day winning streak. It slipped 0.1% to 98.236. The dollar index, which measures greenback strength against six currencies, ended a three-day streak of gains, slipping 0.1% to 97.236. The dollar was $1.1724, and the pound sterling $1.3577. Both were up 0.3% on this day. The Australian dollar was trading at $0.7227. It rose about 0.6% to the highest level since June 2022. This was due to improved risk appetite, and a third consecutive interest rate hike that took place a day before. The yield of the 10-year Treasury Bond in the United States was unchanged at 4,424%. Gold rose 1.2% to $4,609.59. Bitcoin was down by 0.9% to $80,881.12 while ether fell 1% to $2,358.09. (Reporting and editing by Shri Navaratnam.)
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Oil prices drop by over $2 after Trump suspends Strait opening to possible deal
?U.S. Oil futures dropped on Wednesday morning by over $2 after U.S. President?Donald Trump announced that an operation to reopen Strait of Hormuz would be paused temporarily to determine if an agreement could?be finalised. As of 2326 GMT, U.S West Texas Intermediate fell $2.23 or 2.18% to $100.04 a barrel. Trump stated on Tuesday that while the operation to reopen?the Strait?of Hormuz would be paused,?the?blockade would?remain? in force. WTI fell 3.9% on Tuesday, after the ceasefire was maintained despite reports of exchanges. Brent dropped 4% and closed at $109.87. Market sources cited American Petroleum Institute figures on Tuesday, which showed that U.S. crude inventories had?fallen for the third consecutive week. Gasoline and distillate stock also 'declined. Sources who spoke on condition of anonymity said that crude stocks dropped by 8.1 million barges in the week ending May 1. The sources reported that gasoline inventories dropped by 6.1 million barrels and distillate stocks by 4.6 million barrels in comparison to a previous week. Helen Clark (Reporting; Chris Reese, Editing)
Simandou aims to leverage global high-grade ore with Guinea's launch
Guinea wants to maintain high prices on premium iron ore, according to senior officials, as the giant Simandou Project, which is expected to reach a peak of 120 million metric tonnes per year, enters the market in this month.
This may cause a conflict with China, the main customer and owner of the mine, who has taken steps to centralize imports in order to drive down prices.
Simandou has 75% Chinese ownership, which means that three quarters of the company's output will be shipped to China.
Bouna Sylla, Guinea's Mines Minister, said in Conakry that "our main interest is to maintain high prices." He did not give any details but said that Conakry would tap Rio Tinto expertise.
The ownership of Simandou has been split between a Singaporean consortium and a Chinese consortium, WCS. WCS is owned by Chinese state-owned Baowu, which also has indirect ownership in Rio's joint venture Simfer.
This week, iron ore prices fell to their lowest level since the beginning of July as fears about China's demand and swollen inventories dampened prices. The prices also highlighted fragile fundamentals despite temporary support from supply problems.
GUINEA TAKES ON THE GREEN STAINLESS MARKET
Sylla stated that Guinea is looking to bypass China by selling its high-grade Simandou iron ore to Europe and the Middle East.
Simandou ore with a 65% iron grade targets the premium segment for green steels that are less carbon intensive.
Erik Hedborg is the head of raw materials at CRU Group, a metals consultancy. He said that Guinea will receive 15% of the total output of each of Simandou’s two mining blocks. This gives it a rare advantage in a market for green, sustainable steel, which is dominated by Australia, and Brazil.
Rio Tinto, which operates the blocks 3 and 4, will be in direct competition with Brazil’s Vale.
"In Australia, there is no premium." This gives Rio the chance to sell both Pilbara's 62-grade ore and Simandou premium ore to European steel mills, and possibly the Middle East for green steel.
Rio has stated that it will not comment on any commercial issues. Vale didn't immediately respond to an inquiry for comment.
Hay suggested that one way Guinea could possibly increase prices is by working with other major producers to manage their collective export rate.
Hay explained that Guinea's pricing strength is somewhat diminished because China is the primary target market for Simandou ore.
"Simandou ore will almost certainly be shipped by Chinese ships, and it represents only 1% of seaborne trade that is dominated primarily by China."
Hedborg said that China will continue to rely heavily on Australia and Brazil. However, Simandou’s mid-cost product is competitive enough for it to replace more expensive supply and change the market dynamics.
The Simandou Project has been delayed for decades
Simandou's production, which was originally planned for 1997, is now years behind schedule. Guinea's ruling party ordered that development be stopped in 2022. It said it wanted to clarify how the interests of Guinea would be protected.
Guinea holds 15% of the mines, infrastructure and future steel plants in this $20 billion project.
Officials claim that this model of co-development reduces costs and provides long-term revenue to the state.
Guinea will also build pellet and direct-reduced iron plants in Europe and America to meet the demand for green steel. By leveraging its close proximity, it can reduce costs.
Djiba Dikite, Guinea's chief staff said: "Simandou's not just a mine project. It's a geopolitical tool and an economic one." "We are pro-African, defending Guinean interests." Maxwell Akalaare Adombila, Veronica Brown and Jan Harvey (Reporting)
(source: Reuters)