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Gold recovers from index rebalancing losses, but remains steady ahead of US employment data
Investors weighed geopolitical factors against the ongoing rebalancing?commodity?indices. They also focused on the U.S. Non-farm Payrolls Report due later that day. As of 0848 GMT spot gold was down 0.2% to $4,465.96 an ounce, but still on course for a weekly gain of more than 2%. Bullion reached a record-high of $4,549.71 in December. U.S. gold futures for delivery in February rose 0.4% to $4477.70. Tim Waterer, KCM Trade’s chief market analyst, said that gold has recovered from the index rebalancing wobbles. Investors are keen to add more gold to their portfolios in light of recent increased geopolitical risks. After a week-long chase, the U.S. seizes a Venezuelan-linked oil tanker on Thursday. The country has also arrested and prosecuted Nicolas Maduro, now former President of Venezuela. The Russian military announced that it had fired its hypersonic Oreshnik rocket at a Ukrainian target on Friday. HSBC has said that gold prices could reach $5,000 per ounce by the first half 2026 due to rising geopolitical risk and debt. In a low interest rate environment, gold, which is considered to be a safe haven asset, tends also to perform well. Investors will be watching for the non-farm payrolls data, due at 1315 GMT. Economists expect modest job growth (60,000) and a slight decrease in unemployment to 4.5%. Waterer said that if we see a jobs report below 70,000 in the coming year, the Fed will continue to cut rates. This week, India saw a spike in physical gold prices. Meanwhile, dealers in China raised premiums above international rates to rekindle retail interest after the holiday period. Silver spot also rose 0.6%, to $77.37 an ounce. It had reached a record high of $83.62 per ounce on December 29. The white metal was on course to register a weekly increase of more than 6%. The spot platinum price was up by 0.4% to $2,276.15 following a record high of $2,478.50 on Monday. Palladium rose 3.1% to $1,840.26 per ounce. Both metals are expected to gain weekly as well. Ishaan Nandy reported; Sumana Nandy and Ronojoy Mazumdar edited. Harikrishnan Nair was the editor.
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M&A boom unlikely to be disrupted by Japan's increased oversight of foreign investment
Experts say that the Japanese plan to grant authorities the authority to order foreign investors retroactively to divest acquisitions aims to protect major companies and supply chains. However, it is unlikely to curb increased M&A activity, they add. Japan proposed Wednesday amendments to its foreign investment screening laws that would give authorities the option to force foreigners into selling investments they deem to be a risk to national or economic security. The proposals are part of a push by the Japanese government to reduce risks associated with a?an?inflow?of foreign money into Japan's economy and to maintain control over its key supply chains. Currently, foreign investors who wish to purchase stakes in Japanese firms outside sectors critical to national or economic security do not have to notify the government beforehand, allowing officials no opportunity to intervene. Investors who are classified as high-risk are targeted by the new powers, which include those who might work with foreign powers in order to gather intelligence. Since 2017, Chinese companies are required to work with the country's spy agencies. The period in Japan during which transactions may be reviewed retroactively is around five years. Nicholas Benes, founder of Board Director Training Institute of Japan, said that Japan would like to prevent Chinese companies from purchasing top-quality Japanese technology and companies. A government source stated that the proposed changes include stricter requirements on indirect investments made by foreign parents in Japanese companies. This is to bring Japan up to par with its allies, such as the U.S.A, Britain, and Germany, in terms of security oversight. According to documents issued by the Ministry of Finance, these countries can order divestitures of stakes retroactively. Benes, a corporate governance expert, said that "in principle, this doesn't stand out as a sore finger because it is similar to other countries' practices." FIRST MAJOR OVERHAUL EVER SINCE?2019 The first major revision to Japan's foreign investment screening laws since 2019 has been made. This is because the threshold for reviewing stock purchases by foreign entities, which was previously 10%, has now been lowered to just 1%. The Japanese government will have to review roughly 10 times as many pre-transaction documents than any other country, even though the revisions will limit the number of companies that can be reviewed. Yohsuke Higashi, a partner and M&A attorney at Mori Hamada and Matsumoto said that the scope of requirements for prior filing should be significantly narrowed in order to strike a balanced, as post-closing interventions will be permitted and requirements will be introduced for indirect investment. He said that Japan should also?invest more resources in enforcing conditions for risk mitigation attached to approvals, and catching risky transaction through post-closing intervention. The review team was overloaded. I understand the need to prioritize more important cases. Another lawyer who worked on inbound investments declined to be named as they weren't allowed to speak publicly. Foreign investment rules were changed in response to corporate governance reforms that the Japanese government implemented. These reforms sparked an increased interest from overseas investors and helped the stock market reach record highs. According to LSEG, inbound M&A activity jumped 45% compared to a year ago to $33 billion. Experts say that the proposed changes will not have a significant impact on foreign investment. Higashi stated that the changes will not discourage M&A aimed at Japanese companies or other direct investments in Japan. Yuki Kanemoto is a senior researcher with the Daiwa Institute of Research. She also predicts little impact. He said that the relatively low number of cases that were formally rejected could lead some to believe Japan was more permissive at the moment than Europe or the United States. "But I suspect that there are a number of cases where an effective rejection was made behind the scenes." Japan has only rejected one deal in 2008 under its Foreign Investment Screening Law - the attempt to purchase Electric Power Development by London's Children's Investment Fund. (Reporting and editing by Sam Nussey, Thomas Derpinghaus, Anton Bridge)
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Sources say that China has imposed import quotas on crude oil to ex-Sinochem refining plants
Two trading sources familiar with the matter confirmed on Friday that China has granted crude oil import quotas to three'refineries' in Shandong Province, which were sold last year to independent operators by'state-run Sinochem Group. One source said that the quotas were given to Zhenghe Group, Huaxing Petrochemical and Shandong Changyi Petrochemical. The total annual volume was around 12 million metric tons (240 000 barrels per day). The quotas were not clear whether they covered the "full" annual amount or only a portion of it. Changyi, Zhenghe and Huaxing are now controlled by Shandong Qicheng Petrochemical. The new quotas require that the three independent operators purchase crude oil on their own, instead of purchasing through Sinochem. The Chinese Ministry of Commerce - responsible for the issuance of quotas - did not respond immediately to a request for comment. China issued a new batch of crude oil import quotas for 2026 to the majority of its independent refiners at the end of 2025. Volumes?traders estimate to be 70% of their annual allowances, including the first smaller issue. (Reporting and editing by Michael Perry; Additional reporting by Sam Li)
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Copper and Nickel poised to finish the week higher despite a sell-off
Nickel and copper are expected to finish the week higher, due to supply concerns, despite recent selling by investors who booked profits following a rally. The Shanghai Futures Exchange's most active copper contract closed?daytime trades down 0.45% to 101,410 Yuan ($14.526.16) per metric tonne, finishing the week with a gain of 1.60%. The benchmark copper for three months on the London Metal Exchange rebounded however by 1.20%, reaching $12,873 per ton. This represents a 3.24% gain in a week. This week, Shanghai copper reached a new record of 105,500 Yuan per ton. London copper topped out at $13,386.50. Profit-taking is largely responsible for the copper's decline since Wednesday. Prices were supported by mine disruptions, and tight availability of refined copper?outside of the U.S. amid uncertainty over tariffs. Global miners also explored ways to increase their exposure to copper, a metal that?is expected to benefit from the global energy transition and electricification. Glencore and Rio Tinto have reopened merger talks that could create the largest mining company in the world. The announcement follows the nearly completed merger between Anglo American Resources and Teck Resources to create a major copper producer. Shanghai's nickel, the most traded in Shanghai, closed at 139,090 Yuan per ton. The week ended with a gain of 2.36%. This week, it reached its highest level since June 2024 of 149.600 yuan per ton. The London benchmark nickel rose 1.87%, to $17 475 per ton. It is expected to gain 3.86% a week after reaching its highest level since June 2024, at $18,800 per ton. The loss was reduced from the 'Thursday selloff' after Indonesia's Mining Ministry did not give any further details about its plan to reduce nickel mining quotas in 2026. In a Thursday press conference, the mining minister reiterated that quotas will be adjusted in order to meet local smelter demand. Other SHFE base metals saw a rise of 1.42% in aluminum, a drop of 0.31% in zinc, a decline of 0.94% for lead, and tin fell by 0.08%. Aluminium, zinc, lead, and tin all rose in price on the LME.
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ASIA GOLD-Higher prices in India are affecting retail demand; China's gold premiums are widening
This week, India's gold prices increased further. In China, dealers raised premiums over international rates to rekindle retail interest after the holidays. Indian dealers have charged a premium this week Up to $6 per ounce above official domestic prices, inclusive of 6% import duties and 3% sales taxes. This is below the last week's up to $15 premium. On?the day the domestic gold price was trading at around 138,000 rupees for 10 grams, which is not far off from the record high of 140,465 rupees. The rising prices are affecting the jewellery market. "Retail buyers are delaying purchases," Ashok Jain, owner of Mumbai-based wholesaler Chenaji Narsinghji said. A Mumbai-based dealer of bullion with a private banking company said that jewellers reported?very low footfall' and "only marginal demand" for coins and bars. Bullion traded in top consumer China at a premium of up to $21 per ounce over the global benchmark spot price This week. This compares to the $3 per ounce premium charged last week. Bernard Sin, Regional Director, Greater China at MKS PAMP, said: "Physical Gold demand in Asia is showing renewed strength, especially in China and Hong Kong. This is due to tighter supply and retail interest after the holiday season." The Chinese central bank’s "accumulation" continues to support the market and reinforce the perception that Chinese demand is both cyclical and structural. In Singapore Gold was sold for a premium of between $1.20 and $2.50 per ounce. In Hong Kong, gold Bullion is traded in Japan at a premium of $2 to $3. Discounts of up to $6 or a premium of $1 are available. The benchmark spot gold price for international markets fell on the day but was headed to a weekly increase of over 3%. "We estimate jewelry?demand dropped by double-digits in 2025, and we suspect that there?will only be a tepid recover at best in the years 2026 and 2027," HSBC's James Steel stated. He added that "with prices over $4,000/oz the demand has further eroded." Even a significant retracement of prices may not be enough to stimulate significantly more demand, as the trend towards lighter items and substitution to platinum jewellery is likely to continue. $1 = 90,1250 Indian Rupees (Reporting from Ishaan Jadhav and Rajendra Jadhav respectively in Bengaluru and Mumbai; Additional reporting provided by Swati verma; Editing done by Sumana Niandy).
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Coal India's Bharat Coking Coal unit's IPO is fully subscribed on the first day of auction
Bharat coal Coking Ltd (BCCL)'s $118.65m IPO was fully subscribed at the opening of bidding Friday. Exchange data shows that the Coal 'India' unit, which is the country’s largest producer and exporter of coking coal, a vital steelmaking fuel, received bids of 913.5 millions shares at 11:24 am IST, against 346.9million shares offered. BCCL is going public because India, which is the second largest crude steel producer in the world, wants to?reduce its import dependency amid increasing demand and efforts?to secure?new sources of supply. Coal India has decided to sell all of the shares, which is equivalent to a 10% stake. Retail investors bid on 504.1 million shares -?about 3.64x the number of shares allotted to them. The offer comes at a time when the Indian government is working on divestment strategies to unlock the value of state-owned companies, with public sector energy and banks leading the way. Data compiled by LSEG revealed that India would be the second largest?primary equity issuance markets in 2025. It will raise $21.8 billion in 367 deals. According to BCCL's prospectus, its revenue fell by 3% in fiscal 2025 to 138.03 bn rupees and its net profit dropped by 20% to 12.4 bn rupees. The company operates mines in Jharkhand, West Bengal and other eastern Indian states. As of March 31, 2025, the company had total reserves of approximately 1,495.4 millions?tonnes. ICICI Securities and IDBI Capital Markets and Securities will be the book-running leading managers of the offering.
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Gold drops as US jobs data weighs ahead of commodity index adjustments
As commodity index readjustments, and a strong dollar kept the pressure on prices. Investors were positioning themselves ahead of important U.S. Non-Farm Payrolls Data due later that day. As of 0536 GMT spot gold was down 0.2% to $4,469.03 an ounce, but it still had a weekly gain of more than 3%. Bullion reached a record-high of $4,549.71 in December. U.S. gold futures for delivery in February rose 0.4% to $4 477.70. The U.S. Dollar strength is a major driver of gold prices at the moment, ahead of the NFP data, said Ross Norman, an independent analyst. The U.S. Dollar advanced to a near-month high as traders prepared for the U.S. Supreme Court's decision on President Donald Trump using emergency tariff powers. The stronger dollar makes bullion priced in greenbacks more expensive for other currency holders. The economists predict modest growth in non-farm payrolls of 60,000 jobs and a slight decrease in unemployment to 4.5%, down from 4.6%. The Bloomberg Commodity Index Rebalancing, a periodic adjustment to commodity weightings in order to align the index with market conditions, begins this week. "At the start of the new year, several indexes reweight the amount of gold and precious metals in their portfolios. Norman said that, although there is a certain amount of weakness in the index rebalancing process, things are still largely positive. HSBC has said that gold prices could reach $5,000 per ounce by the first half 2026 due to rising geopolitical risk and debt. In a low interest rate environment, and during economic uncertainty, non-yielding investments tend to perform well. Silver spot fell 0.1%, to $76.83 an ounce, after reaching a record high of $83.62 per ounce on December 29. The white metal was expected to post a weekly gain of more than 6%. After reaching a record $2,478.50 per ounce on Monday, spot platinum fell 0.8% to $2250.30. Palladium remained steady at $1,785.25 an ounce. Both metals are also set to make weekly gains. Ishaan Nandy reported; Sumana Nandy and Ronojoy Mazumdar edited. Harikrishnan Nair was the editor.
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Fuel oil prices in Asia are higher than those in the West as more Venezuelan oil is diverted to the US
Friday, the premium for high-sulfur fuel oil in Asia over the West reached its highest level in eight months as traders expect more Venezuelan crude oil and fuel oil to be shipped to the United States than to Asia in the coming months. LSEG data show that the East-West 380cst HSFO swap for the first month of 2026, a measure used to compare HSFO prices in Asia, Europe and America, has risen above $27 a barrel, a price last seen in May 2025. This value has nearly doubled since the beginning of 2026. It is more profitable for traders to send fuel oil to Asia when the price differential widens. Last week, Donald Trump, the U.S. president, seized Venezuelan President Nicolas Maduro and declared that the U.S. would control Venezuela's oil industry. Secretary of State Marco Rubio stated that the U.S. will refine and sell 50 million barrels Venezuelan crude on Wednesday, while continuing to seize Venezuelan linked tankers. BEARISH US OUTLOOK Royston Huan is a fuel oil and feedstocks expert at Energy Aspects. He said that the increased availability of Canadian heavy crude for U.S. locations would add to the pressure on the U.S. Gulf Coast's HSFO market. Analysts at a U.S. refining company said that traders increased the East-West spread as U.S. market sentiment has turned negative due to the possibility of diverting more Venezuelan fuel and crude oil with high sulphur content into U.S. refueling stations, thus reducing the supply for Asia. VOLATILITY OF ASIAN RESIDENTS The volatility of HSFO future prices has been caused by the uncertain outlook for Venezuelan crude oil supplies in Asia. Singapore's balance-January/February spread flipped into backwardation ?on Wednesday, before swinging back into contango on Thursday. Backwardation is a market structure in which the current prices are higher than the future ones. This indicates a tighter supply. Contango is the opposite. According to LSEG and market sources, the spread flipped backwardation in early trading on?Friday. Some traders say that for now, the fuel oil price gains in Asia will be tempered by the large inventories in tanks on land and aboard ships. Due to Western sanctions, Chinese independent refiners are a major outlet for Venezuelan crude oil and fuel oil. Emril Jamil is a senior oil analyst with LSEG. He said that the loss of Venezuelan feedstock at a low price will affect refiners’ profitability and force them to reduce their refining rates or find alternative residual feedstocks.
China restricts rare earth exports after dual-use ban to Japanese companies, WSJ reports
The Wall Street Journal reported Thursday that China had begun to restrict exports to Japanese firms of rare earths, and powerful magnets that contain them, after Beijing banned the exports of dual-use items to Japanese military.
Journal reported that China's restrictions are not only limited to defence industries, but apply to a wide range of Japanese industries. China's Commerce Ministry said Thursday that the export ban for dual-use products to Japan would only affect military companies.
"Civilian users won't be affected," said He?Yadong to reporters.
China announced on Tuesday a ban?on exporting to Japan so-called dual use goods that could have military applications.
The Wall Street Journal reported on Tuesday that China has begun restricting the exports of "heavy rare earths" to Japanese companies, as well as powerful magnets that contain them. Two exporters from?China were cited.
The Journal quoted another unnamed source familiar with Chinese government decision-making as saying that the review of export license applications across Japanese industry had been halted, and didn't just target Japanese defence firms.
Dual-use products are software, goods or technologies with both civilian and military uses. Some rare earth magnets are used to power motors found in car parts like side mirrors and speakers.
The report could not be confirmed immediately. The Chinese commerce ministry and the foreign ministry didn't immediately respond to requests from the Journal for comments.
Beijing and Tokyo's relations have deteriorated since Japanese Prime Minister Sanae Takayichi stated in November that a Chinese attack against Taiwan could lead to a military response. Beijing called this remark "provocative".
China has a list of about 1,100 dual-use products and technologies for which manufacturers need a license to export overseas, regardless of the final user. (Reporting and editing by Susan Fenton in Bengaluru, Mihika Sharma from Bengaluru)
(source: Reuters)