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Morning Bid Europe-US takes on its largest creditor
Wayne Cole gives us a look at what's ahead for the European and Global markets. This is so unbelievable. The U.S. President threatens to impose an additional tax on American consumers to force Europe to sell him territory it can't legally offer. The tariffs could be illegal if the Supreme Court decides to rule on the matter. The fact that the tariffs are directly linked to sovereignty and the implications for the nation states makes it difficult for either party to TACO and puts all trade agreements already in place into question. The EU has already paused ratification for the U.S. EU agreement and the U.S. UK deal must be in question. Trump uses tariffs instead of a military invasion to attack a NATO member. This could lead to the end of the alliance and the loss of U.S. air bases in Europe, intelligence-sharing, billions of dollars in defence sales, etc. Market reaction was moderately risk-off. S&P futures were down nearly 1%, and EU stock futures by 1.1%. Gold and silver reached new peaks while the dollar lost ground against the Swiss franc, yen and other safe haven currencies. Analysts note that European investors have $8 trillion in U.S. bonds and stocks. Cotton, it's a brave move to start a trade conflict with your largest creditor. There will also be a few tense days in Davos, as world leaders gather for the World Economic Forum. This includes a large U.S. delegation led by Trump. All the tensions are a boon to China which has just signed a new trade agreement with Canada. Exports helped China's Q4 GDP to slightly exceed forecasts, at 4.5% for the year. However, disappointing retail sales in December highlighted the weakness of the domestic demand. If?demography determines destiny, then the latest population figures should alarm Beijing. China will have 3.4 million less people in 2025, or roughly the population of Uruguay. In Japan, at 9am GMT, Prime Minister Sanae Takaichi held a press conference to announce a likely snap election for February. She did this to capitalize on her high approval ratings, though the voters seemed to prefer her to the 'LDP. It has led to talk about reducing the consumption tax, at least on food. This would be bad for the budget. It is important to note that the budget has improved in recent years, with a nominal GDP increase of 4%. This fiscal year, it may even be in surplus. Market developments on Monday that may have a significant impact - Eurozone CPI for December. Canadian CPI Dec ECB Board Member Piero Cipollone participates in Eurogroup Meeting
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Coal India's Bharat Coking Coal unit nearly doubles its IPO price after a strong demand
Bharat coal, India's top coking coal company, saw its shares nearly double in their debut on the market Monday, as a result of the strong interest generated by the IPO. The shares were listed at a price of 45 rupees (95.7% higher than the original issue price of 23?rupees) on the National Stock Market of?India. Meanwhile, the benchmark Nifty50 was down by 0.5% for the day. Last week, the $118.7 million IPO attracted bids totaling $13?billion, making it one of most popular IPOs. Subscribe to the heavyweights In recent years, state-run services have been offered. The issue was priced fairly, especially as a low-ticket IPO. It offered an attractive risk/reward profile, said?Prashanth Tase, senior Vice President (Research) at Mehta Equities. This company was India's first major board listing since?2026. It is a subsidiary of government-owned Coal India, one of?the world's largest coal producers. According to LSEG, India will be the world's second largest primary market after the United States in 2025, with 367 IPOs that raised $21.8 billion.
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India's Reliance drops after failing to meet profit expectations on the retail slowdown
Reliance Industries shares fell by as much as 2.7% on Monday morning after the conglomerate missed their?third quarter profit estimates. The company was weighed down mainly by a slowdown in earnings growth in its retail segment. The shares of Mukesh Ambani's company were trading at $1,426, according to Reuters. As of 9:41 am, 60 rupees were among the five biggest losers in the Nifty 50 index. Reliance reported a profit of 186.45?billions rupees for the quarter October-December, which was below analysts' estimates. The average estimate was 196.44??billions rupees. UBS analysts trimmed Oil-to-Chemicals(O2C) and retail estimates slightly ?but said they still see room for a valuation re-rating, as the company's earnings before interest ?and taxes (EBIT) mix increasingly shifts toward structural growth drivers such ?as digital and retail, ?reducing dependence on the cyclical oil and gas segment. The retail unit's core margins were reduced to 8% in the first quarter of this year from 8.6% last year due to festive discounts, investments in hyper-local delivery startups and an impact from India’s new labour code. Analysts at Emkay said that the retail growth slowed primarily due to the'moving forward of the holiday season and the impact on the first month from the demerger in consumer products. The segment's core earnings grew by 1.3%, to 69.15 bn rupees. This compares with an increase of?9.5% a year ago. Reliance's Oil and Gas segment weakened because of lower production and softer price realisations? from its ageing KG D6 fields. This led to a?revenue decline of 8.4% and a 12.7% decrease in core earnings due to higher maintenance costs. Analysts at Systematix predict a 5% increase in O2C revenue, 12% growth in Retail and 9% growth for Jio during the period FY25-FY28. However, they also forecast a decline of 12% within their oil and natural gas business. (Reporting from Urvi Dugar, Bengaluru. Editing by Rashmi aich)
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China's property woes lead to a two-week low in iron ore
Iron ore futures dropped to two-week lows Monday after a number of?data points from China, the top consumer, highlighted persistent weakness on?the property markets. This raised concerns about demand for this?key ingredient in steelmaking. The May contract for iron ore on China's Dalian Commodity Exchange ended the morning trading session 2.82% lower, at 792 Yuan ($113.73), its lowest level since January 6. As of 0355 GMT the benchmark February iron ore price on the 'Singapore Exchange had fallen by 1.64% to $104.6 per ton. This was its lowest level since January 2. Official data showed that China's home prices continued to decline in December. This underscores the persistent pressures on the property market despite government promises to stabilize it. Investors also saw a decline in property?investment, and sales of properties by floor area. These are closely monitored by investors to?get hints on future steel and ore demand. China's lower crude-steel output and signs of increasing supply also weighed on the market. The crude steel production in 2025 will be below 1 billion tonnes, a 7-year low. This is due to the prolonged property market slump that has hurt demand. Steel exports however have reached record highs. The world's biggest?iron-ore consumer received its first shipment from the Simandou mine, Guinea. Beijing has heavily invested in the mine, to reduce its dependence on Brazilian?and Australian shipments that make up 80%?of?its?foreign supply. Coking coal and coke, which are both steelmaking ingredients, also declined, falling by 0.89% each. The benchmarks for steel on the Shanghai Futures Exchange are mixed. Rebar fell 1.1%, hot-rolled coil lost 0.81%, wire rod dropped 0.06% and stainless steel rose 0.03%. ($1 = 6.9640 yuan) (Reporting by Ruth Chai; Editing by Subhranshu Sahu)
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China's crude and gas production, refinery throughput in 2025 will reach new heights
Government data released on Monday showed that China's crude oil production and refinery output in 2025 will both be at all-time highs. National Bureau of Statistics reported that the world's second largest oil consumer will process?737.59 millions?metric tonnes of crude oil by 2025. Calculations showed that the figure is about 14.75 millions barrels per day. This surpasses the previous record of 14.7 million barrels set in 2023. Analyst Jianan Sun at Energy Aspects said that "Chinese refinery runs will grow by an average of 0.25 million barrels a day in 2025. This is due to capacity expansion among Chinese national oil companies as well as the ramping up of the private mega Yulong refining plant." Energy Aspects predicts that teapot runs will continue to be resilient and the start-up Huajin Aramco Petrochemical Company will support Chinese runs by increasing them by 250,000 bpd this year. China produced 4.19 million barrels per day (bpd) and processed?17.8 millions tons of crude in December 2025. Both figures are down from November. The total crude oil production grew 1.5% over the past year to 216.05 mt, or 4.32 million bpd. This was due to state oil companies increasing drilling offshore and unconventional resources. Data also showed that natural gas production increased 6.2% to a record 261.9 billion cubic meters (bcm) last year. According to Sunday's official data, gas imports – including piped gas, and?liquefied nataral gas (LNG), shipped in tankers-- dropped 2.8% on the year. This was mainly due to a 10.6% decline in LNG imports.
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NHK reports that TEPCO will delay the restart of Kashiwazaki - Kariwa nuclear power station.
NHK, the public broadcaster, reported Monday that Tokyo Electric Power has delayed its'restart of Kashiwazaki and Kariwa nuclear power plants, which was originally scheduled for 'January 20th. TEPCO would have had to restart its reactors for the first time since Fukushima Daiichi was struck by a powerful tsunami in 2011. The company planned to restart Unit No.6 in Kashiwazaki Kariwa on January 20th and Unit No. The company had planned to restart Unit No.6 at Kashiwazaki-Kariwa on Jan 20 and Unit?No. NHK, citing its sources, stated that the delay was caused by an alarm malfunction which occurred during equipment tests over the weekend. The new restart date is expected to be within the next few days. TEPCO's?spokesperson stated that the company is examining the impact?of the malfunction. The company plans to hold an official press conference on Monday. The total capacity of Kashiwazaki and Kariwa is?8.2 Gigawatts. TEPCO plans to restart commercial operations at?reactor No. On February 26, TEPCO plans to resume commercial operations of?reactor No. (Reporting and editing by Jacqueline Wong, Raju Gopalakrishnan and Jaori Kaneko)
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Shanghai Copper falls due to profit-taking and weak China demand
Shanghai copper fell for a third session in a row on Monday as profit-taking, and signs of sluggish demand in China, weighed?on the market. As of?0310 GMT, the most active copper contract at the Shanghai Futures Exchange had?dropped by 0.37%, to 101,490 Yuan ($14.574.15) per metric ton. After two sessions of decline, the benchmark three-month price for copper at the London Metal Exchange increased 1.16%, to $12,951 per ton. The traders reported that profit-taking on the Shanghai market was continuing, and that the weak demand for copper also affected prices. Yangshan Copper Premium The, which measures China's demand for imported materials, fell to $22 per ton on the Friday, showing weak demand despite a...record-setting rally of red metal. The copper stocks in the warehouses that SHFE monitors continued to increase,?up for a six-week consecutive week. This indicates a softer interest in spot purchases amid high prices. Copper inventories that are available for delivery According to SHFE's Weekly Stock Report, the stock in these warehouses increased by 18.3% on Friday to 213,515 tonnes, up from 89,389 tonnes on December 8, when it first began to increase. The red metal was still supported by mine disruptions, and fears that the supply of refined copper will be restricted due to a regional market dislocation in other countries because of tariff concerns. Stock levels at U.S. Comex warehouses On Friday, they reached 542,914 short tonnes (492523.3-metric-ton) and are close to the half-million-metric-ton level. Official data released on Monday showed that the growth of China's economy slowed down to a 3-year low during the fourth quarter. It was only 4.5% higher than a year ago. The economy grew 5.0% in 2025. This was above the 5% target set by Beijing, despite the trade tensions and weak domestic demand. Aluminium, zinc, lead, nickel, and tin all fell in value. Nickel, tin, and aluminium all rose in price on the LME. Lead and zinc also gained 0.32%. Monday, January 19, DATA/EVENTS 0430 Japan Tertiary Industrial Act NSA Nov 1000 EU HCIP MM Dec 1000 EU HCIP YY Dec
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China's crude steel production will fall to a seven-year low by 2025, despite record exports
China's crude output of steel in 2025 will be below 1 billion tons, a record low. A prolonged downturn on the property market has hurt demand. Steel exports have risen to new records. National Bureau of Statistics data released on Monday showed that the world's biggest steel producer produced 960.81 millions tons of metal in 2025. This was the lowest level of production since 2018. This was a 4.4% decline from 2024. The Chinese steel industry has been struggling to make a profit since the second half 2022 due to the "persistent slowdown in the property market". Analysts said that profitability improved in 2025 in part because producers switched to flat steel products such as hot-rolled coils, which were in greater demand. China's exports of steel, which reached a record high of?over 119 millions tons last year according to data released last week, are mostly flat steel. According to calculations based off official data, the share of steel reinforcing bars - used in the construction industry - has dropped from 23% to 13% in the first eleven months of 2025. China has yet to release a breakdown for the entire year. According to data from the consultancy Mysteel, 54% of steelmakers made a profit last year compared with 36% by 2024. Analysts predict that crude steel production will continue to fall in 2026 but at a slower rate. Ge Xin is the deputy director at Lange Steel. He forecasts a roughly 3% drop in crude steel production for 2026. Beijing said in late December it would continue to control crude steel production and prevent the addition of illegal capacity from 2026 to 2030. It did not provide any further details. Beijing stopped the growth of crude steel production in 2021, as part its efforts to reduce carbon emissions. In December, steel mills carried out annual maintenance on equipment during a time of generally low demand. This was the seventh consecutive month that output declined. The December production fell by 10.3% compared to the same month of 2024.
Gold and silver record highs after Trump's Greenland tariffs spark rally
Investors flocked to gold and silver as tensions intensified after U.S. president Donald Trump threatened additional tariffs against European countries for the control of Greenland.
Gold spot rose by 1.5%, to $4,663.37 an ounce, at 0335 GMT. It had previously reached a high of $4689.39.
U.S. Gold Futures for February Delivery jumped 1.6%, to $4669.90 an ounce.
Trump announced on Saturday that he would increase tariffs against European allies, until the United States is allowed to purchase Greenland. This escalating dispute over the future for Denmark's vast Arctic Island has escalated.
EU diplomats reported that the European Union's?ambassadors? reached a broad consensus on Sunday, pledging to increase efforts to discourage Trump from imposing tariffs against European allies. They also agreed to prepare retaliatory actions in case Trump imposes these duties.
Matt Simpson, StoneX's senior analyst, said that geopolitical tensions have given gold bulls another reason to push yellow metals to new heights.
Trump's tariffs are a clear indication that he is serious about his threat against Greenland. We could also be moving closer to the end for NATO and the political imbalances in Europe.
U.S. stocks?futures? and the dollar fell as Trump's new tariff threats stoked investors' appetites for safe-haven currencies like gold, yen, and Swiss franc. This was a widespread risk-averse movement?across all markets.
Gold that does not yield is a good investment in low interest rate environments and economic uncertainty.
After hitting a high of $94.08, spot silver rose 3.3% to $92.93 an ounce.
Christopher Wong is a strategist at OCBC. He said: "On silver, there's a medium-term narrative that remains positive, supported by persistent deficits in physical assets, resilient industrial demand, and safe-haven demands."
Wong noted that the gold/silver ratio had dropped sharply, from a high of 105 near the end of 2025, to the low 50s in the present, indicating silver's superior performance against gold.
Other precious metals saw spot platinum rise 0.9% to $2348.32 an ounce while palladium climbed 0.5% to $1808.46. (Reporting and editing by Sumana Nady and Rashmi Anich in Bengaluru)
(source: Reuters)