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Gold prices near two-week high as Fed rate cuts fuel bets on tepid US economic data
Gold prices rose by more than 1% on Wednesday to a two-week-high after positive U.S. data boosted expectations for a Federal Reserve rate cut in the coming month. This supported non-yielding gold. At 1208 GMT spot gold rose 1% to $4,172.18 an ounce, its highest level since November 14. U.S. Gold Futures for December Delivery were up 0.7% to $4,168.70 an ounce. Market participants are beginning to price again a U.S. interest rate cut for December," stated UBS analyst Giovanni Staunovo. Bullion is a non-yielding investment that tends to do well in environments with low interest rates. Staunovo stated that "we continue to see more upside in the short term. We have a forecast for year-end of $4,200/oz, and $4,500/oz by mid-next year." The data released on Tuesday revealed that U.S. retailer sales rose less than anticipated in September, but producer prices were within estimates. In November, U.S. consumer sentiment also declined as consumers became more worried about their finances and jobs. These data were released in response to a recent series of dovish remarks from Fed policymakers. The CME FedWatch tool shows that traders now expect an 83% probability of a Fed rate reduction next month, up from 30% one week ago. A report that White House economist Kevin Hassett is the frontrunner for the position of the next Fed Chair has also added to the support for the metal. This confirms expectations about a dovish approach in policy, as favored by Donald Trump. Investors are now awaiting the U.S. Weekly Jobless Claims Report due later on Wednesday. This report is a crucial gauge of labor market health and Fed policies. Deutsche Bank has raised its gold forecast for 2026 to $4450 per ounce, up from $4,000 citing stable investor flows and persistent demand by central banks. (Reporting by Noel John in Bengaluru Editing by Mark Potter) Reporting by Noel John, Bengaluru Editing Mark Potter
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JSW's voluntary job reduction plan attracts high interest among workers, CEO claims
Boguslaw Olesky, the acting CEO of Polish coal miner JSW, said that an internal survey showed that more than 6,000 workers were interested in the planned reduction in workforce. This is almost twice the number eligible to participate. Oleksy stated that the plan is contingent on a newly enacted mining law and aims to reduce jobs in two ways: "mining leaves", which are state-funded furloughs leading to retirement for more than 3,100 workers; and voluntary severance package for 700 others. JSW is facing a cash crunch. Oleksy said that the stabilization fund of the company was "on its way to depletion", which forced it to look for new external funding as it continued to report quarterly losses. The company also said that the broader cost-cutting plans include selling non-core assets and merging mines to create two "mining centers" in order to improve efficiency. It also removes a 10-year guarantee of employment for 1,000 administrative staff. Oleksy stated that negotiations with unions regarding cuts to other benefits were "extremely hard." JSW employees are represented by over 80 unions. The unionization rate is nearly 170%, as many of them belong to more than one organization. This complicates the negotiations. (Reporting and editing by Milla Nissi - Prussak. Additional reporting by Rafal nowak.
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Mamdani faces a test after NYC comptroller's push to drop BlackRock
Brad Lander, New York City Comptroller, is urging officials of the city pension funds to rebid the $42.3 billion managed BlackRock due to climate concerns. This is the first major step taken by a Democrat in order to counter the pressure from Republican allies who support the fossil fuel industry on financial firms. Lander's tenure ends on December 31. His recommendation, which will be announced on Wednesday, puts Mayor-elect Zohran Mdani on the spot when he assumes office in five weeks. Mamdani’s appointees are in key positions and will have some influence over the pension boards, which decide where to invest retirement money for 800,000. Lander, in a memo he sent to other trustees of pension funds on November 25, urged them to re-evaluate their contracts with New York's BlackRock. BlackRock is the largest asset manager in the world and also the largest manager of retirement assets for the city. Lander pointed to what he described as "BlackRock’s restrictive approach to engaging" with approximately 2,800 U.S. firms in which the company owns more than 5 percent of the shares. 'Abdication of Financial Duty' BlackRock, under pressure from the Trump Administration in February, said that it would not try to control businesses through its discussions with executives. This was contrary to Lander's and other investors who were environmentally conscious, as they wanted to pressure executives to disclose emissions. Lander stated in an interview that the change is "an abdication from financial duty" and makes them incapable of meeting our expectations regarding responsible investing. The pension boards, which traditionally follow the lead of the comptroller’s office, must still approve his recommendation. Mamdani's representatives and those of Mark Levine, the incoming New York Comptroller in New York, did not answer questions on Tuesday. Lander, who was a rival of Mamdani's during the mayoral race, but became an ally, suggested that the pension funds continue to use BlackRock for the management of non-U.S. index mandates, and other products. Lander recommended that the three pension plans continue to use State Street for managing $8 billion of equity index assets and drop deals with Fidelity Investments or PanAgora. He also said they did not push companies enough on environmental issues like decarbonization. WASHINGTON PRESSURE A number of Republicans, some from fossil-fuel-producing states, have withdrawn money from BlackRock and other money managers, accusing them of basing investment decisions on social or environmental issues. New York City funds are the first major asset owners with a liberal or Democratic leaning to do so. Environmental activists want Lander, and other public officials, to adopt a more aggressive stance by supporting shareholder resolutions which push corporate boards towards policies that combat climate changes. Richard Brooks, director of climate finance for Stand.earth advocacy group, stated that dropping major asset management companies "will be one the first tests to see the climate credentials of incoming mayors and comptrollers." I hope that they will take the initiative to get these recommendations passed. (Reporting and editing by Dawn Kopecki, Thomas Derpinghaus and Ross Kerber)
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Mitsubishi Materials will reduce primary copper smelting volumes by 30 to 40 percent by 2035
Mitsubishi Materials, a Japanese company, said it would shift its focus to secondary smelting in order to increase profitability. Due to a tight supply of concentrates and the expansion of smelting capacity by China, Japanese copper smelters face a tumbling treatment charge and refining charge (TC/RC) as well as shrinking smelting profits. Mitsubishi Materials announced in October it would cut the refined copper production at its Onahama Smelter & Refinery in the period October-March by a quarter. It plans to integrate its copper products sales and procurement of copper concentrates with rival Pan Pacific Copper owned by JX Advanced Metals Mitsui Mining and Smelting and Marubeni. Mitsubishi Materials announced a new three-year business plan beginning in April. The company said that it would shift its primary copper operations into secondary smelting by using electronic waste. It will also explore the possibility of building new secondary melting plants in Europe and America to boost growth. The secondary smelting process produces copper by recycling materials, rather than mining ore. Tetsuya Tanahka, President of Japan, said at a press conference that the low TC/RCs will continue. This makes the move to profitable eScrap processing vital for our sustainable growth. E-scrap is electronic waste, such as old computers, smartphones, and home appliances. He said: "We will quickly shift our focus from volume to quality. We'll transition our revenue structure from processing copper concentrate to secondary smelting, and optimise production systems and business portfolio." Tanaka stated that the company plans to double its secondary smelting capacities by 2035. However, it expects to see a drop of 20-30% in its annual refined copper production from around 400,000 metric tonnes due to a reduction in primary smelting. Mitsubishi Materials is also expanding its global tungsten business by increasing recycling capacity in Europe, and constructing new U.S. recycling facilities for the rare metal used in batteries and defense. Tanaka stated that by achieving a 100 percent recycled material rate in our tungsten production sites outside China, we will meet the rising demand and increase profitability. (Reporting and editing by Kirsten Doovan; Yuka Obayashi)
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South Sudan shakes up its petroleum ministry again, adding to the constant turbulence in government
Chol Thon Abel has replaced Deng Lual Wold as the undersecretary of the Petroleum Ministry. This is the fourth time that Salva Kiir, President of South Sudan, has moved the position from one man to another in less than two weeks. Kiir has fired and reinstated senior officials repeatedly without explanation. Analysts believe the tactic was used to reward loyalists and maintain control in light of the increasing conflict between government forces and militias this year, as well as speculation regarding his succession. As is customary with personnel changes, the state broadcaster did not provide any explanation for the change at the Petroleum Ministry on Tuesday evening. A government spokesperson was not available for immediate comment. South Sudan earns most of its revenue from crude oil, but the exports have plummeted due to the damage caused to pipelines by the civil conflict in Sudan. Kiir replaced Thon, who was responsible for the financial transactions at the Ministry, with Lual, the undersecretary. On November 3, he reinstated Thon, before replacing him again with Lual one week later. Kiir dismissed Ayuel Kacgor, the managing director of state-owned Nilepet oil company on Tuesday. Gizam Moses is an independent policy analyst specializing in governance and natural resource. He said that the constant turnover in government ministries encourages corruption, as officials will seek personal gain when they feel their tenure at a ministry may be limited. U.N. inspectors stated in September that the political elites are engaged in "systematic looting" of the nation's riches for private gain, with little of government revenues going to food security, health or education. The government denied certain specific allegations of corruption and said that the report was based upon faulty data. Kiir, who was widely believed to be Kiir's preferred successor for nine months, sacked Bol Mel and appointed his immediate predecessor. (Editing by George Obulutsa and Aaron Ross)
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UK shares rise as banks and miners gain ahead of Budget
UK stocks rose on Wednesday led by financials and mining shares, as investors prepared for a tax-heavy budget. Blue-chip FTSE 100 gained 0.2% at 10:55 GMT. The domestically focused FTSE 250 rose by 0.3%. Gold prices reached a two-week high following positive U.S. data that reinforced expectations for a Federal Reserve rate cut in the next month. Hochschild grew 4.4%, Endeavour Mining rose 3.6% and Fresnillo gained 3.9%. Copper prices rose, causing industrial miners to gain about 1%. Anglo American rose by 1.4%, while Antofagasta grew by 1.8%. After media reports that tax increases in the budget would be reduced, banks advanced by 0.5%. Standard Chartered rose 1.6% while Barclays gained 0.8%. Investors are now awaiting the autumn budget where Finance Minister Rachel Reeves will outline tax increases of tens and tens billions of pounds. Matthew Ryan, the head of market strategy for global financial services company Ebury, said in a report that any significant spending increases, possibly to welfare, coupled with increased borrowing would be a huge red flag for markets. Sterling and gilts are likely to sell off hard. The UK government approved a 4.1% increase in the minimum wage by 2026 on Tuesday despite some employers' complaints that it would push prices up. A survey revealed that the British public had lowered their expectations of inflation in the coming 12 months. U.S. Bank Citi said the results could increase the likelihood of a rate cut from the Bank of England by December. A Russia-Ukraine deal was also in the spotlight after Ukrainian President Volodymyr Zelenskiy indicated his willingness to move forward with a framework backed by the United States to end this war. Trump's decision to retract the deadline for the agreement left some uncertainty. BAE Systems, which is part of the Aerospace and Defence sector, increased by 1%. Diageo, the spirits company, lost 1.4%. Reporting by Utkarsh T. Hathi, Sukriti. Gupta and Rashiki Singh in Bengaluru, Editing by Tasim Z. Zahid
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J.P. Morgan estimates that tax breaks and rate cuts could boost India's Nifty50 to 30,000 by the end of 2026.
J.P. Morgan reported on Wednesday that India's Nifty 50 benchmark index could reach 30,000 by the end of 2026. This would represent a 15% increase from its current level, thanks to steady fiscal and monetary policies, which are expected to boost demand. The Nifty, and its counterpart Sensex, are currently at 26,205.3, and 85,609.51, respectively, just short of the record highs reached in September 2024. Earnings have improved against a background of steady growth and benign inflation, and robust domestic flow. According to a poll of economists, the Nifty is expected to reach 28,500 by 2026's end and 28,850 in mid-2027. The Nifty gained almost 11% in this year, but it still trails Asian and emerging markets peers. This is a soft spot for India following more than a years of low earnings and sustained outflows from abroad. Analysts Rajiv Batra & Rushit Mehta say that while market valuations remain higher than other emerging markets they are now below their long-term mean after 14 months underperformance. They said that the recent drop in inflation due to tax cuts and the steep rate reductions by central bank will likely boost domestic demand. The brokerage expects Reserve Bank of India will reduce rates another 25 basis points by December, amplifying tax cuts that have already boosted consumption, credit growth, and auto sales. J.P. Morgan said it preferred domestic sectors to exporters and that an U.S. India trade agreement could lead to a near-term rating re-rating. Analysts believe that the likelihood of a resolution to the U.S. penal tariffs on India is very high. The additional 25% tax will likely be removed. They said that this would boost investor confidence, bring in foreign capital, strengthen the rupee, and help a recovery in IT and Pharma stocks. The brokerage is "overweighted" in materials, financials and consumer sectors. It is "underweighted" in IT and pharma.
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Copper prices rise above $11,000 as US rates are likely to be cut
The copper price rose on Wednesday to its highest level in nearly a month, on the back of growing expectations that U.S. Federal Reserve would cut interest rates by December. Prices are also expected to rise after the outflows from U.S. stock markets. The benchmark three-month price of copper at the London Metal Exchange rose 1.6% to $10,993.50 per metric tonne by 1033 GMT. It had previously reached $11,025 – its highest level since October 30. On October 29, the metal used for power and construction reached a record high at $11,200, boosted by concerns about a tighter supply of copper from the Grasberg Mine in Indonesia in this year and next. Ewa Mannthey, ING commodities analyst, said that "upside risks" for copper were increasing, as the balance would tighten into 2026 due to supply challenges, low inventory levels and continuing trade distortions. Data on Tuesday showed that U.S. Retail Sales rose less than anticipated and that consumer confidence declined, which boosted expectations of a Fed rate cut soon. Lower interest rates are expected to support the demand for metals that depend on growth. Nicholas Snowdon said that the global copper cathode markets are facing a surplus between 350,000 and 400,000 tonnes this year. However, there will be a deficit next year of 500,000 tones of copper concentrate. Snowdon, an influential copper bull, stated that the LME copper price would have to increase to bring metals back from the United States to global markets. The United States currently holds 70% of all global copper cathode inventories. Snowdon estimates that this could reach 90% by the first quarter 2026. Stocks of copper in LME registered warehouses Copper stocks on the Comex are down 42% in value this year. . Other LME metals include aluminium, which rose 1.6%, to $2,845.50 per ton. Zinc also increased by 1%, to $3,022.50. Lead gained 0.3%, to $1,986, while tin grew 0.8%, to $37,735; and nickel remained unchanged at $14,870. (Reporting and editing by David Goodman Additional reporting by Dylan Duan)
ASIA COPPER WOEEK-Sources say Codelco's record China offer sparked threats to walk out.
Amy Lv, Tom Daly and Lewis Jackson
SHANGHAI/LONDON - Codelco, the Chilean copper giant's offers to Chinese copper purchasers are so high that some have declared they will not sign the term contracts for next year as the significance of the benchmark to Chinese buyers is becoming more and more questioned.
Codelco's premium is often used to reference global copper supply contracts. Codelco is by far the world's biggest copper producer, and China is its largest consumer.
According to two sources with knowledge of the situation, Codelco offered Chinese buyers an additional $350 per ton over London Metal Exchange rates. This is a significant increase from the $89 per ton that was agreed upon during negotiations last year.
Sources familiar with the situation say that at least three Chinese customers of Codelco are willing to opt out of term contracts and instead sign spot deals this year.
When asked about the premium, a fourth customer who has not yet received an offer said: "Who would buy at this price?"
Codelco didn't immediately reply to questions emailed about the offers.
The willingness of delegates to forgo the closely-watched term deals highlights growing questions among delegates gathered at the World Copper Conference Asia in Shanghai about the benchmark's relevancy for China.
According to two traders, who spoke under condition of anonymity, the premium for Codelco's copper is partly due to how cargoes can be delivered to the U.S. Comex, where prices are soaring this year. However, for some Chinese customers, that factor may not be as important.
Third trader: The current offer is suited to big trading houses that have easy access to U.S. and can take advantage of arbitrage, which some Chinese traders may struggle to do.
Chinese customs data show that China's imports from Chile of refined copper have been steadily declining since 2023, both in absolute value and as a percentage of total imports. In the first 10 months of 2018, imports reached 255,334 tonnes, which is half the amount of last year.
Fears of a copper shortage next year led to a spike in LME copper prices to peaks of up to $11,200 per ton at the end of October. As of 0703 GMT, the metal was trading at $10 868 per ton.
Codelco is the largest copper miner in the world. It has offered to pay its European customers a record-high premium of $325 per ton for 2026. This represents a 39% increase year-on-year.
Four traders and analysts believe that some Chinese buyers may eventually accept the premiums on bets resulting from a wider arbitrage between London Metal Exchange (LME) and Comex.
One source said, "That level is far above the level that Chinese consumers will accept. Those who accept this level are likely to re-transport their products to Europe or the United States in order to take advantage of the lucrative arbitrage."
(source: Reuters)