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MORNING BID EUROPE - Markets pivot on technology, Mideast anxiety
Ankur Banerjee gives us a look at what the European and global markets will be like today. The latest tit for tat attacks in the Middle East were stopped, causing a nervous reaction on the markets. Persistent unease about stretched 'tech valuations' and the prospect?of higher rates for longer added to doubts over a ceasefire which has been struggling to hold. The oil prices have risen on the back of renewed hostilities, but they've also slowed down as new talks raise hopes for an interim agreement. This helped lift U.S. stock futures and European stock prices, though Asian equities remain under pressure due to investors' concerns over stretched tech valuations as well as the drag of a stronger dollar. Investors are unsure if massive investments in AI infrastructure will be a success. Apple's price increases underscored that while?Micron’s strong earnings forecast from last week indicated an insatiable desire for memory chips. The dollar was hovering near its one-year high and cast a shadow over most currencies, but none more than the Japanese yen at 161,78 per dollar. The only thing that keeps the 'fragile yen' from falling below the 40-year lows at 161,96 is the prospect of another round of intervention. The Japanese government intervened in the market in order to stop the decline of the yen in April and early May, but as with previous episodes in the years 2022 and 20,24, the intervention failed to alter the trajectory of the yen. Markets are betting that the Federal Reserve will raise rates this year. The yen, therefore, needs a dramatic move from 'the Bank of Japan' to make a real comeback. Economic events in the Eurozone: Euro zone sentiment surveys, June (By Ankur banerjee from Singapore Edited by Shri Navaratnam).
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Gold falls as new US-Iran strikes increase oil and Fed rate hike bets weigh
Gold prices?eased? on Monday, as the recent U.S. - Iran?strikes in the Gulf pushed up oil prices. Expectations of U.S. Federal Reserve rate hikes also weighed on this non-yielding material. As of 0423 GMT, spot gold was down 0.6%, at $4,062.89 an ounce. U.S. Gold Futures for August Delivery fell 0.5% to $4077.50. Metal was heading for a fourth consecutive monthly loss of 10.4%. Tim Waterer is the chief market analyst for KCM Trade. He said: "U.S.-Iran were back at it over the weekend with new military strikes reported from both parties. This casts doubt on how long oil will remain at these low?levels, and thus the outlook of inflation and interest rates." After Iran launched missiles, drones and other weapons at U.S. military bases in Kuwait and Bahrain early Sunday morning, just a few hours after the U.S. Donald Trump has threatened to eliminate the Iranian leadership, if it does not adhere to the agreement that ends their war. Axios reported that Tehran and Washington had agreed to cease recent hostilities and resume talks about their dispute regarding the Strait of Hormuz. In a high-interest-rate environment, gold loses its appeal because it is a non-yielding investment. According to the CME FedWatch Tool, traders expect three Fed rate increases this year. They are pricing in an 80% chance that a December hike will occur. Investors will be watching for the June ADP employment data and the U.S. Nonfarm Payrolls data due this week to gauge the Fed's policy stance. Waterer said that "gold could reach $5,000 again this year, but it would depend on a further de-escalation of the conflict and oil moving back to its pre-war level to reduce the inflationary impact. Silver spot fell by 1.2%, to $58.47 an ounce. Platinum rose 0.2%, to $1617.15, and palladium increased 0.4%, to $1213.60. (Reporting and editing by Sherry Phillips, Subhranshu Sahu, and Pablo Sinha from Bengaluru)
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Gold falls as new US-Iran strikes increase oil and Fed rate hike bets weigh
Gold prices?reduced on Monday, as the recent U.S. - Iran?strikes in the Gulf pushed up oil prices. Expectations of U.S. Federal Reserve rate hikes also weighed on this non-yielding material. As of 0242 GMT, spot gold was down 0.7%, at $4,061.35 an ounce. U.S. Gold Futures for August Delivery lost 0.5%, to $4076.40. Metal was heading for a fourth consecutive monthly loss of 10.4%. Tim Waterer is the chief market analyst for KCM Trade. He said: "U.S.-Iran were back at it over the weekend with new military?strikes from both parties. This casts doubt on how long oil will remain at these low?levels, and thus over the broader outlook of inflation and interest rates." Oil prices rose after Iran launched missiles & drones early Sunday morning at U.S. Military sites in Kuwait and Bahrain, just hours after U.S. president Donald Trump had threatened to wipe out Iranian leadership if it did not adhere to the agreement for the end of their war. Axios reported that Tehran and Washington had agreed to cease recent hostilities and resume talks about their dispute regarding the Strait of Hormuz. In a high-interest-rate environment, gold loses its appeal because it is not yielding. According to CME FedWatch Tool, traders are pricing in an 80% chance that the Fed will raise rates again this December. Investors will now be watching for the June?ADP Employment Data and the U.S. Nonfarm Payrolls Data, both due later this week, in order to gauge the Fed's policy. Waterer said that "Gold could reach $5,000 again this year, but it would depend on further de-escalation and oil moving back to pre-war levels to reduce the inflationary effect of the war, as well as a soft dollar." Spot silver dropped 1.1% at $58.51 an ounce. Platinum rose 1% to $1630.13 and palladium increased 0.8% to $1218.92.
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Oil prices rise after renewed US-Iran strikes in Middle East
Oil prices increased on Monday following days of titt-for-tat attacks?by the United States and Iran?in the Middle East, which highlighted the fragility of the interim peace agreement and once again slowed down energy shipping through the Strait of Hormuz. Brent crude futures rose 52 cents or 0.672% to $72.51 per barrel at 2313 GMT, while U.S. West Texas Intermediate was up 71 cents or 1.03%, trading at $69.94. Brent crude dropped 10.6% last weekend, its third consecutive weekly decline. Crude shipments through the Strait increased last week to the highest level since February, when the U.S. - Israel conflict with Iran began. Traffic has slowed since Thursday after renewed attacks against ships in the Strait, including an oil tanker linked to Qatar, which triggered strikes by the U.S. ANZ analysts wrote in a report that "the?market will likely re-evaluate their assumption of a rapid recovery of oil supplies from the Persian Gulf." Axios reported that Iran and the United States had agreed to stop recent hostilities and resume talks about their dispute over Strait of Hormuz in Qatar, in order to cap oil price gains. ? Could not confirm immediately the report. Aramco, the Saudi oil giant, resumed crude oil loadings at its Ras Tanura Terminal, west of Strait of Hormuz on Friday after they had been halted for almost four months. They joined a rush to move cargoes following a flurry of activity by Middle East producers who increased oil and gas production and exports in anticipation of an interim agreement. ANZ analysts stated that despite the U.S. Iran deal being a 'turning point' for oil markets, physical flow is constrained by damaged infrastructure, tanker backlogs and production shutdowns. It could be another year before the supply reaches pre-conflict level. Even after the crash of a company helicopter on Sunday on the east coast of the Gulf in Ras Tanura, 14 people were killed, loadings at Aramco's Ras Tanura Terminal continued. State news agency reported that the cause of the accident was unknown.
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Local officials confirm that five people were killed in Ukraine by Russians.
Officials in the region said that Russian attacks on Sunday killed at least four people. Ivan Fedorov, Regional Governor of the region, said that two people were killed and 16 injured in strikes?on Zaporizhzhia's south-eastern city. The governor posted pictures online showing a burning building and a neighborhood in ruins. Oleh Sniehubov, regional governor of Kharkiv's northeastern border region, said that a missile attack?on Zmiiv killed one person and injured eight others, including two young children. In the Kharkiv Region, police also reported that an officer was killed while he was trying organize?the evacuation residents of another community further north. The'regional governor' of the Sumy region - also near the Russian border - said that an elderly woman had been killed in the area close to the border during the day. I was unable to independently verify the accounts of either side. Both Russia and Ukraine deny that they deliberately targeted civilians during the conflict, which has lasted for more than four years. (Reporting and editing by Chris Reese, Sanjeev Miglani and Bogdan Kochubey)
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Russia's Putin acknowledges fuel supply shortages and sets up a task force to ensure supplies
On Sunday, President Vladimir Putin admitted that fuel supply issues had caused shortages in Russian regions. A task force is working to ensure sufficient quantities are provided across the country. Putin said that Russia must minimize the impact of Ukrainian drone attacks on oil installations related to shortages. He was speaking to a group of senior officials who were discussing fuel supply and distribution. He said that a ban on exports of diesel was being considered as a way to guarantee supplies for the agricultural sector. According to Russian news agencies, Putin told the group: "You know that there are still problems for both drivers and businesses." "Unfortunately, the queues at gas stations are still there." He said: "We must reduce to the minimum impact of terrorist attacks against?our infrastructure and civilian targets." Ukraine has intensified its medium- and long-range attacks against industrial targets in Russia and Russian controlled territories within Ukraine, focusing on the oil industry. Putin stated that gasoline reserves are being used, and currently stand at 1.7 millions metric tons. He also said that production in July should be higher than June's. He confirmed that a ban on exporting diesel, which has been under discussion for some time, is being considered. He told the participants that a total ban on diesel fuel exports was being considered. Interfax reported that Alexander Novak, the deputy prime minister of Russia, had said earlier that there was no need to ban diesel exports. Putin stated that a task force was working around the clock to ensure fuel supply. He added that the situation required "systemic actions" that matched the current challenges in order to maintain a reasonable price and increase the supply. He said that supplying agriculture was of particular importance. Putin stated that "we must make every effort to maintain all seasonal fuel schedules for agroindustrial enterprises because the harvest is dependent on this."
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France records 1,000 excess deaths during record-breaking heatwave
The public health agency announced on Sunday that France had recorded 1,000 "excess" deaths due to the heatwave sweeping Europe. It warned, however, that the true number was likely higher. Sante Publique, which has compiled a preliminary list of deaths, said that the majority of deaths involved elderly people. It also predicted that the mortality rate would rise as more information becomes available on deaths in residential care and homes. Europeans are suffering through a scorching heatwave, which has been linked to at least dozens of deaths. The heatwave has also caused power disruptions and damaged infrastructure. Scientists said that the heatwave which began on?June 20 was the?worst recorded in Europe where climate change is faster than global average. FRANCE EXTREME HEAT EASES Heatwaves are moving east. While France's weather agency reported that the extreme heat had decreased in most areas of the country some areas in northeast still had a heatwave warning. Stephanie Rist, Health Minister, told La 'Tribune that the effects of the heatwave may linger as long as 10 days after it has subsided. She told BFM that the episode was not over. Sante Publique reported that the majority of deaths were among people 65 and older. However, the heat's effects affected the entire population. (Reporting and editing by Helen Popper; Makini Brice)
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Thai family grieves for teen girl who was found dead in a suitcase by an Australian
A 17-year old Thai girl's?body? was found in an unlocked suitcase in Pattaya. Her family said that they were devastated. An?Australian? man has since been arrested and charged with murder. Thai police said they arrested a 40-year-old Australian at Bangkok's Suvarnabhumi Airport early Saturday morning in connection with the murder in Pattaya. Pattaya is located about 150km (93miles) east of Bangkok. Simon Peter Carman is the suspect. He faces charges for murder, concealment of a corpse, moving or destroying one, and stealing a minor to use sexually. Thai police reviewed CCTV footage showing Carman entering the condominium with a?girl and then leaving hours later alone carrying a suitcase. Police posted a message on their official Facebook page saying that he had loaded the suitcase onto his motorcycle and ridden to a grassy area near an old railway line. Carman was arrested at the airport by police after they issued an arrest warrant. Carman sent a message to his victim's family in the investigation room of the police station before being transferred to Pattaya Provincial Court. I?feel sorry for what happened to her. He said, "It was beyond my control." Thongchai Dohomla, 46, the victim's father said that he is struggling to accept his loss. "I'm deeply saddened. "My daughter was raised by a single mother. She would always find a solution for herself and she helped me as well," he said. Her stepmother, 'Oradee Bussarakum', said that she wanted to see the suspect punished harshly. "I told police that I wanted him executed. "I don't know what else to say as a (step-)mother... I just want him face the full consequence," she said. The police have not stated when Carman is scheduled to appear in court for the first time.
Sources say China is accelerating plans to launch sulphur futures contracts as the Iran war increases price swings.
Sources say that China plans to launch the first sulphur contracts this year in an effort to hedge against price fluctuations?and to increase its pricing strength in the global market for a key material used in agriculture and mining.
Two sources who are familiar with the issue said that the Dalian Commodity Exchange may?list? the sulphur contracts in the fourth-quarter of this year. However, the timeframe has not been finalised, and there are still more approvals needed.
The Dalian exchange has not responded to multiple requests for comment.
The China Securities Regulatory Commission (CSR), which usually approves?exchanges to launch futures contracts of a new product?, did not respond immediately to a'request for comments.
One source said that the exchange had long planned to introduce these contracts. However, work has increased since the Iran War exacerbated volatility and highlighted the need for an hedging tool.
China, the world's biggest consumer of sulphur imports around 50% of its supply every year. Customs data revealed that imports during the first five month period had more than halved from the previous year.
Sulphur can be used in the production of fertilisers, in nickel and copper refining and mining, and for other applications. The sulphur price had been increasing for many years prior to the war with Iran, because half of the world's seaborne shipments pass through the Strait of Hormuz.
The spot price of solid sulphur was 11,850 yuan (1,743.16) per ton in eastern China earlier this month. However, they slid to 9,043.5 yuan (?9,043.5) per ton last Friday, as sulphur transited the Strait again, according to Shanghai Metals Market data.
Prices are still 292% higher than they were at the same point last year.
Analysts at Huatai Futures stated in a Friday?note that the futures contracts could help users hedge the risk of price swings. The note did not specify a specific date but referred to the plans.
They added that the contracts will help to strengthen China's pricing strength in the global sulphur market by allowing the industry to have visible commercial inventories on the exchange.
(source: Reuters)