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Shipping snags and tariffs between China and the US limit iron ore's fall
Iron ore futures declined on Wednesday as investors worried about trade tensions between China and the U.S., the top consumer. However, shipping problems in Western Australia helped to cushion the decline. The May contract for iron ore on China's Dalian Commodity Exchange ended the daytime trading 0.99% lower, at 801 Yuan ($110.00) per metric ton. China's markets will be closed for Lunar New Year from January 28 to February 4th. By 0709 GMT, the benchmark March iron ore traded on Singapore Exchange had fallen 1.09% to $100.39 per ton. "Sentiment will likely suffer as Chinese markets reopen, and they react to the barrage on tariffs," ANZ analysts wrote in a recent note. The additional 10% tariff imposed by President Donald Trump on all Chinese imports went into effect on Tuesday. China responded quickly with tariffs on U.S. imported goods in response to new U.S. duty, reviving a war of trade between the two world's largest economies. These measures include a 15% tax on U.S. Coal, an important steelmaking ingredient. A private sector survey revealed that China's service activity expanded at a lower pace in January, but the business climate improved. A separate survey revealed that the growth of factory activity in the country slowed. Rio Tinto said that on the supply side it has begun to clear iron ore vessels from two Western Australian port as two tropical storms off-shore complicated its efforts for repair of infrastructure damaged by last month's cyclone. Rio warned in January that disruptions in rail operations due to record rainfall could affect its first-quarter shipment. Coking coal and coke both fell by 3.17% and 3.58 percent, respectively. The Shanghai Futures Exchange saw a decline in most steel benchmarks. Rebar fell 1.51%, hot-rolled coil dropped 1.64%, and wire rod lost 1.09%. Stainless steel, however, gained almost 1%. $1 = 7.2818 Chinese Yuan (Reporting and editing by Sumana Nady and Subhranshu Saghu).
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Vestas' Q4 profits beat expectations
Vestas of Denmark, the largest wind turbine manufacturer in the world, announced on Wednesday that its adjusted operating profit was higher than expected for the fourth-quarter, but warned about the uncertainty to come for 2025. The company stated that despite the ongoing geopolitical uncertainty and the trade war, it expects to see increased revenue by 2025 as a result of the completion of its record-high backlog. Vestas' analyst poll revealed that the average forecast was 672 million. The operating profit before special items increased to 759 millions euros from 191 million dollars a year earlier. The company forecasted a 2025 full-year operating profit margin of 4-7% before special items and revenues between 18 billion to 20 billion euros. In 2024 they were 4.3% and 17.30bn euros respectively. Henrik Andersen, CEO of Vestas Service, said in a press release that the year had not progressed as expected. He also noted that Vestas has been fighting rising costs for most of 2024. He said: "But, with record-high order value, a high order backlog, and an incredible turnaround in Power Solutions... Vestas will leave 2024 stronger than when we started," he added. The company proposed to pay a dividend per share of 0.55 Danish crowns. $1 = 0.9629 euro (Reporting and editing by Anna Ringstrom, Shri Navaratnam).
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Novo Nordisk, a maker of Wegovy, says that the rapid growth is driving up emissions.
The company announced on Wednesday that Novo Nordisk's emissions will grow by 23% in 2024 and continue to rise through the end decade, as the company increases production of its blockbuster weight loss drug Wegovy. As demand for Wegovy increases, the company spends billions of dollars to increase its production. In an interview, Katrine DiBona (corporate vice president for global public affairs and Sustainability at Novo Nordisk) said that "Emissions are a result of growth." The Danish pharmaceutical company said that its plans for expansion do not alter its commitment to its 2045 goal of net zero emissions, which it set in 2020. It also announced a interim goal to reduce its Scope 3 emission by 33% from 2024, in its annual report released with its financial results for the fourth quarter on Wednesday. The Scope 3 emissions, which includes all the suppliers in an organization's supply chain, account for 96% Novo's total. Novo Nordisk plans to reduce emissions include switching to lower-carbon material where possible and setting expectations that suppliers use green power to deliver. DiBona stated that some levers won't be available for a few years. The company therefore expects emissions will continue to rise until 2030. "It's going to get worse before it gets any better." It's important that we are very transparent about that. Experts claimed that the company's interim goal seemed unrealistic since it did not decouple growth from emissions. Sasja Beslik said, "Sounds a bit like a fairytale," in response to SDG Impact Japan's targets. Beslik stated that companies are not at risk of losing their reputation if they set climate targets but fail to meet them. Unfortunately, the sustainability aspect does not affect the financial results and is not included in the valuation of the stock. Novo had previously reported that emissions increased by 55% from 2022-2023. However, it revised its accounting of emissions to restate 2023 data. (Reporting from Maggie Fick in London, and Alison Withers at Copenhagen; editing by Jan Harvey).
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French and Benelux stocks: Factors to watch
Here are some company news and stories that could impact the markets in France and Benelux or even individual stocks. BOUYGUES: Amazon announced Bouygues Group & AWS have signed a strategic alliance to accelerate digitalization across Bouygues Group operations. Credit AGRICOle The second largest listed bank in France announced a 27% increase in profits, exceeding quarterly earnings expectations. THALES: Thales Alenia Space - a joint venture between Thales & Leonardo - announced that it had signed a contract for the development of an airlock module by Mohammed Bin Rashid Space Centre in the Emirates. TOTALENERGIES: Lebanon's President expressed his hope that TotalEnergies would resume oil and natural gas exploration off the coast of Lebanon soon. Pan-European market data: European Equities speed guide................... FTSE Eurotop 300 index.............................. DJ STOXX index...................................... Top 10 STOXX sectors........................... Top 10 EUROSTOXX sectors...................... Top 10 Eurotop 300 sectors..................... Top 25 European pct gainers....................... Top 25 European pct losers........................ Main stock markets: Dow Jones............... Wall Street report ..... Nikkei 225............. Tokyo report............ FTSE 100............... London report........... Xetra DAX............. Frankfurt items......... CAC-40................. Paris items............ World Indices..................................... survey of world bourse outlook......... European Asset Allocation........................ News at a glance: Top News............. Equities.............. Main oil report........... Main currency report.....
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WGC: Gold demand in India will cool by 2025, as prices soar.
The World Gold Council (WGC), which announced the news on Wednesday, said that India's gold demand in 2025 will be lower than last year's nine-year high, due to the price rally to a new record, which is expected to dampen jewellery demand. However, investment demand is likely to rise. Sachin Jain is the CEO of WGC India operations. He said that demand for gold may be between 700 and 800 tons compared to 802.8 tons last year, which was highest since 2015. Jain stated that historically, the first to be affected by rising gold prices are jewellery buyers. If prices continue to rise and remain volatile in this year's market, then jewellery demand could be negatively impacted. On Wednesday, the domestic gold price reached a new record of 84 399 rupees per 10 grams ($968.62). The price of gold has risen by 10% in 2025, after rising 21% in the previous year. Jain explained that "Households who buy jewellery have an established budget and their budget doesn't increase at the rate of the rise in the gold price when they buy jewellery." He said that the gold price surge, which is resulting in higher returns for investors, will continue to boost investment demand in 2025, after it soared 29% in 2020 to a 11-year high. India's gold demand is dominated by jewellery, which accounts for 70% of the total. Jain stated that retail investors are showing increasing interest in digital gold, gold ETFs and gold bars. Reporting by Rajendra J. Jadhav, Editing by Varun K.
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EU advisors propose plan that would reduce corporate green reporting by one third
The European Union has asked a group of experts in sustainable finance to advise them. They have proposed a change to the rules that classify climate-friendly activities. This, they claim, will reduce the reporting burden for companies by one third. The proposal for a simplified green investment rulebook is being made ahead of an extensive review of EU sustainability rules, and at a time when Brussels is preparing plans to reduce red tape in green finance. EU member countries such as France are putting pressure on the EU to simplify the rules for doing business. Meanwhile, the deregulation efforts of U.S. President Donald Trump have caused concern within the EU regarding the competitiveness of the EU. In a Wednesday paper, EU advisers suggested that to boost green investment and reduce burdens on businesses, they should ask for less information from certain companies, introduce flexibility in the use of estimates and proxy values, and take other measures, such as streamlining the EU taxonomy regulations. The EU taxonomy uses a complex classification system to determine which sectors of the economy can be marketed as being sustainable. The firms in scope are required to disclose what investments, lending activities, or shares of their business activities meet this criteria. The "Do No Significant Hurt" criteria is another change that has been proposed. This is a requirement for banks, investors, and companies to meet in order to prove their green investments or activities do not harm the environment. The EU Platform on Sustainable Finance (EU Platform), which was tasked to simplify and improve taxonomy by the European Commission, stated that the suggestions of the expert group, taken together, should reduce the reporting load on non-financial firms by a third. The proposals made on Wednesday only concern the taxonomy and not corporate reporting requirements. The paper stated that the green investments and financial arrangements will have a significant impact on banks and investment firms. It will make it easier for them to report the percentage of their assets which are green.
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Trump or BRICS? Russell: The dilemma for Africa's miner and government:
The world is likely to be splitting in two over the long-term, despite the volatility and uncertainty caused by President Donald Trump's tariffs. After removing Trump's bluster, and his often contradictory behavior, the message appears to be pretty clear. Trump's worldview is that the United States are the only ones who can be trusted. This presents a problem for the mineral-rich countries of Africa, who want to maximize their benefits from their resources but also remain neutral. It's becoming more likely that African countries will be forced to choose whether they want to work with China-led BRICS or the Trump camp. Both scenarios have their risks and rewards, and the specific circumstances of each African nation may lead to a particular outcome. The Investing in African Mining Conference, which took place in Cape Town this week, was largely a discussion about the best way forward for African miners and governments. Minerals are already abundant on the continent, but its untapped reserves will be the prize of the future, especially if energy transitions accelerate. Africa has a rich resource base, estimated at 20% of the global reserves of copper, and about the same amount of manganese, cobalt and platinum group metals. It also contains 36% chromium and reserves of gold, lithium, uranium and rare earths. The development of its mineral resources is often difficult due to political instability, corruption, poor infrastructure and lack of capital. The increasing demand for minerals in the world, particularly to support the energy transition is likely to spark a new race for Africa. This time, Africans will be able to have a greater say on how the situation unfolds. African countries face a challenge in finding the right partners. The West still has a lot to offer, including deep capital reserves and sophisticated equity markets as well as investors with skills and experience in mining. Trump undermines these advantages by threatening to withhold funding and aid, and his flip-flopping policy and habit of turning against traditional allies. Trump's main problem is that he has an apparent transactional worldview, where there must be always a winner and loser. He always wants to win. It will be harder to get a deal with the United States that is mutually beneficial while Trump is president. Not Beggars Gwede Mantashe, South Africa's Minister of Resources, said that Africa should not sell minerals to the United States if Trump reduces aid. If they don't want to give us money then let's stop giving them minerals. Mantashe said at the Mining Indaba conference that we are not beggars. Mantashe stated that "we cannot continue to discuss these minerals on the basis of the dictates from some developed nations, as if we had no aspirations for Africa to industrialise and close its development deficit." The comments made by Trump may have been unwise, as they could serve to antagonise him. However, they might also help the West to think about how to best access Africa's mineral resources. What is the best way for Africa to tap into its mineral wealth if it looks more towards China and other BRICS countries? It has been a mixed experience. China is willing to invest in mines in Africa. However, they prefer to use their own processes and people to do so. They also want to export the raw ore and beneficiate it in China. The benefits of this arrangement have been limited for African countries. However, it may be possible to adopt legislation similar to that in Indonesia to force companies to engage in domestic downstream operations to gain access to raw materials. These are the views of the columnist, who is also an author. (Editing by Kim Coghill).
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Morning bid Europe-Markets confused by Trump's Gaza plan
Wayne Cole gives us a look at what the future holds for European and global markets. First of all, no one knows what to think of Donald Trump's suggestion that the United States should take over the Gaza Strip and transform it into the Riviera for the Middle East, once the Palestinians have been relocated elsewhere. This proposal is not clear. It sounds like the idea that Trump's son in law Jared Kushner floated last summer, saying that Gaza's waterfront could be valuable and Israel should remove civilians while the strip is cleaned up. The oil price has not reacted in a noticeable way. The session in Asia has been chaotic, with share market movements that are not consistent, and the dollar slipping after a fall in Treasury yields. Nasdaq Futures have fallen about 0.5% since Tuesday's Wall Street gains, due to Alphabet's disappointing earnings and its heavy capex spending. After hours, Alphabet's shares fell 7.6%, wiping out $192 billion from its market value. Asia's share markets showed mixed reactions, with some investors relieved that China was restrained in its response to President Donald Trump’s tariffs. JPMorgan points out that China's extra levies will apply to products which accounted for only $14 billion in imports last year. Beijing set a fixed rate of 7.1693 per dollar for the yuan when markets returned after the Lunar New Year holiday, addressing concerns that it would allow a sharp depreciation in order to offset the tariff impact. The dollar rose 0.5% against the onshore currency, but this was only to catch up with where the off-shore market was already at and is still far below Monday's record high of 7.3765. The blue chips of China were down just a little, which was a good performance considering they had returned from holiday and were now in the middle of a trade war. The dollar fell 0.6% against the Japanese yen, to 153.33, mainly due to the continued increase in JGB yields, which have reached highs not seen since 2008 The Nikkei lost its early gains due to the rise of the yen. The European stock futures are modestly negative, which is not surprising given that Trump continues to warn about the European Union being in his sights for tariffs without specifying exactly what he wants. The following are key developments that may influence the markets on Wednesday. - PMIs of service for EU, Germany UK and France, EU producer prices, Philip Lane, chief economist at the ECB ADP Employment Report, Treasury Refunding Announcement - Addresses from Federal Reserve Board Governor Michelle Bowman, Vice Chair Philip Jefferson and Fed Presidents Barkin & Goolsbee
Sino-US tariffs war and rising US crude stocks cause oil prices to fall
The oil prices fell on Wednesday, as market concerns about a Sino-U.S. new trade war and rising U.S. stockpiles offset President Donald Trump’s renewed push to end Iranian crude exports.
Brent crude futures fell 39 cents or 0.51% to $75.81 per barrel at 0427 GMT. U.S. West Texas Intermediate (WTI), a crude oil produced in the United States, lost 26 cents or 0.36% to $72.44.
Oil traded across a range on Tuesday, with WTI dropping at one point to its lowest level since December 31, after China announced tariffs against U.S. imports for oil, natural gas liquefied and coal as a retaliation for U.S. duties on Chinese exports.
The prices rebounded after Trump reinstated the "maximum-pressure" campaign against Iran that he had enacted during his first term, which cut Iranian crude oil exports to zero.
The higher than expected U.S. crude inventory data over night weighed down the market, according to Jun Rong Yeap. A market strategist at IG.
According to sources citing American Petroleum Institute data, crude stocks increased by 5,03 million barrels during the week ending Jan. 31.
According to sources, API reports that gasoline inventories increased by 5.43 millions barrels and distillate stock fell by 6.98million barrels.
The official U.S. Government oil inventory data will be released on Wednesday at 1530 GMT.
Stockpiles of crude oil and fuel in the largest oil consumer country indicate a decline in consumption. This adds to investor concerns about the impact tarrifs will have on global economic growth and energy demand.
Goldman Sachs analysts said that the impact of China’s retaliatory duties on U.S. imports of energy will be limited, "since neither global demand nor supply of these commodities is changed by China’s tariffs."
The note stated that both countries would be able find other markets.
Trump re-launched his "maximum press" campaign against Iran on Tuesday, which includes efforts to reduce its oil exports to zero to prevent Tehran from acquiring a nuclear bomb.
Trump claimed to be open to a nuclear deal with Iran but signed a memorandum that reimposed Washington's strict policy against Iran. Analysts at ANZ, citing data from ship tracking, said that the plan could affect about 1.5 million barrels of oil per day that Iran exports.
Yeap, a IG analyst, said that the clampdown on Iran could be just what oil prices need to stabilize for now. There may even be room for a further recovery in the short term. Reporting by Siyi Liu from Singapore and Laila Kearney in New York, with editing by Christian Schmollinger & Kim Coghill
(source: Reuters)