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French utility EDF is facing difficulties in funding $542 billion nuclear project, according to auditors
The French Court of Auditors stated on Wednesday that EDF, a French utility, will have to invest 460 billion euro ($542.39billion) by 2040. This investment is primarily in its nuclear fleet at home, but the rising debt and cash-flow issues are major obstacles. EDF is planning to build six new reactors in the coming decades, but nearly all of France's nuclear reactors are older than 30 years. They require extensive maintenance for them to operate. Ines Mercereau said that "everything related to...preserving the competitiveness of France's economy" involves energy bills at an hearing before the National Assembly. The Court of Auditors stated in a recent report that a fifth of all investments needed will be spent on keeping the nuclear fleet operating until it reaches 60 years of age. This would cost between 5 and 6 billion euro per year. Utility is expected to finalise their plans for the EPR2 new reactors by year's end, which will allow them to evaluate costs and make a final decision on investment by the second half 2026. The court estimates that the cost of the six first reactors will be 75 billion euros. EDF'S SUCCESSIVE DEBT IS A DIFFICULTY FOR FUND RAISING The report stated that Enedis's electricity network will require modernisation and reinforcement, which is why it expects to spend another 100 billion euro on the project. The report stated that EDF will have difficulty raising capital for these investments alone due to its debt which exploded in 2022, during the European Energy Crisis, and its cash-flow trajectory. EDF has had difficulty implementing a new scheme of long-term contracts to replace its old system, which contracted out a third or so of its annual production. The report stated that the plummeting prices on the market have affected EDF's capacity to attract clients. In order to address these concerns, the court encouraged the utility to continue monitoring the profitability of its investments in renewable energy and to ensure a clear division of costs and risk between the French government, EDF, and its customers. "This alone will not solve the EDF group debt situation," said Mercereau.
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Stocks fall as the dollar increases after Powell's Fed; Europe gains in defence after Trump's Ukraine remarks
The dollar grew after Federal Reserve chair Jerome Powell failed to confirm investors' expectations of U.S. rates falling sharply in the coming months. After U.S. president Donald Trump stated that he believes Ukraine can retake the land it has been occupied by Russia in a dramatic shift of rhetoric, in favour of Kyiv, European defence stocks rose. After seeing the economic trouble that the war is causing Russia I believe Ukraine with the support from the European Union is in a good position to fight and win all of Ukraine in its original state," he wrote in a post on social media. However, there were no signs of a change in U.S. policies. Defence stocks like Rheinmetall, Hensoldt, and SAAB rose between 2 to 4.8%. However, losses in the financial sector kept the STOXX600 down by around 0.4% for the day. Trump, in a somewhat rambling speech at the U.N. General Assembly where he rejected allies' attempts to recognize a Palestinian State, criticized Western nations over their approach to immigration and climate change, telling leaders, "Your countries are going into hell." Investors focused on Wednesday on the U.S. economic outlook and the path that interest rates are likely to take in the U.S. The dollar rose, with the euro, pound, and yen all in negative territory. This pushed the U.S. Dollar up by 0.35% against a basket that included six other currencies. Powell's remarks on Tuesday were largely in line with the language used by the central bank last week, when it cut its benchmark interest rate by a quarter percentage point. Powell was attempting to emphasize the need for policymakers in the future to balance competing risks such as high inflation and an eroding jobs market. Powell's comments were not very exciting for the markets, given that traders have already priced in a rate reduction in October. Chris Scicluna, economist at Daiwa Capital, said: "We'll need to wait and see the pace of the cuts." He said that "all markets, whether you are looking at the fixed income side or the equity, take comfort in the expectation that Fed will ease for the remainder this year and next year, and they basically move from a restricting stance to a non-restrictive stance." The CME Group’s FedWatch tool shows that traders have increased their bets for further rate cuts in the United States. Fed funds futures now indicate a 91.9% probability of a rate reduction at the central banks October meeting. This is up from an 89.8% chance on Tuesday. The longer-dated U.S. Government bonds attracted buyers. This pushed the yield on 30-year Treasury Bonds down by 2.1 basis point on the day, to 4.717%. Meanwhile, the benchmark 10-year bond eased 1.4 basis points to 4.106%, and the rate sensitive two-year yield remained at 3.565%. The U.S. economy data released Tuesday has stoked concerns about growth. S&P Global's purchasing managers' index data shows that business activity in the U.S. slowed down for a second consecutive month in September. Citi analysts stated in a note that "the S&P PMIs are softer than the preliminary September release but remain in expansion, and both are within the ranges of the past few months." They said that the details were weaker than the headlines. Analysts said that the composite output price index had fallen to its lowest level since April. Anecdotes indicate that companies are finding it difficult to pass on higher costs to customers due to a weaker demand and increased competition. Gold, a commodity, bucked the trend of a stronger dollar and rose 0.25% to $3,772 per ounce on Wednesday, just below the record high set Tuesday at $3,790. Brent crude oil rose 0.3% at $67.86 per barrel after an agreement to resume exports out of Iraq's Kurdistan fell through. This helped calm investor fears that a restart could exacerbate global oversupply.
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Rate-cut betting, geopolitical tensions and gold hold near record highs
Gold prices increased on Wednesday, trading near the record high reached in the previous session. Growing expectations of more interest rate cuts in America and heightened geopolitical uncertainties boosted demand for this safe-haven. As of 0743 GMT spot gold was up 0.4% to $3,778.78 an ounce after reaching a record-high of $3,790.82 earlier in the day. U.S. Gold Futures for December Delivery declined by 0.1% to $3.812.10. After Jerome Powell, Federal Reserve Chair, made cautious remarks about further monetary easing on Tuesday, the S&P 500 fell 0.6%. This was its largest one-day drop in three weeks. Ole Hansen is the head of commodity strategy for Saxo Bank. He said that "the rally is fuelled by lower U.S. financing costs along with a cocktail investor concerns including overvalued stocks, Fed independence and mounting geopolitical risk." Powell stated that the central banks would continue to balance the concerns about the weak labour market with the rising inflation concerns, while Fed officials expressed their views on both sides of monetary policy's path. Investors are now looking ahead to the U.S. The Personal Consumption Expenditures Index, the Fed’s preferred inflation indicator, will be released on Friday. This index is a good gauge of future rate cuts. According to the CME FedWatch tool, market participants have priced in two additional 25-basis point cuts for this year. One each in December and October, with 93% probability and 79% respectively. In a low interest rate environment, gold, which is considered a safe haven in times of uncertainty, performs well. NATO also warned Russia that it will use "all necessary non-military and military tools" to defend themselves, while U.S. president Donald Trump changed his rhetoric, claiming Ukraine can recover all the territory occupied or seized by Russia. Gold (should) be able to consolidate above 3,750 in the near term. There is a possibility of a new barrier around $3,900, said Ricardo Evangelista. Senior analyst at ActivTrades. Silver spot rose by 0.5%, to $44.23 an ounce. This is a close 14-year-high. Palladium rose 0.3% and platinum 0.4%, respectively, to $1225.46. (Reporting by Ishaan Arora in Bengaluru; Editing by Subhranshu Sahu)
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The water crisis in Iraq has affected the bees that once buzzed in honey-producing Basra.
The Shatt al-Arab riverbank, where Iraq's Tigris River and Euphrates River meet, was once home to a thriving bee population. But drought has decimated the trees, and the life within the apiaries, which dot the riverbank, is in danger. Beekeepers in Basra are struggling with the production of honey due to the rising salinity levels of the water in Shatt al-Arab, extreme heat, and persistent droughts. "Bees require clean... water." "The lack of clean water will lead to their death," Mahmoud, 61, professor at Basra University, who owns his own apiary, said. BASRA WAS KNOWN AS A HONEY-producing region The banks of Shatt al Arab were once a lush forest where bees would feed, producing honey of high quality that was a source of income for Iraqi apiculturists in southern city. The bee population is at risk because of decades of conflict, and climate change. Fewer than a quarter (of the 16 million palm trees that once lined the Shatt al-Arab riverbanks) have survived. Mohammed Mahdi Muzaal Al-Diraoui (assistant director of the Basra agriculture ministry's Basra office) said that there were at least 263 apiaries in the city with more than 4,000 hives. He said that due to the conflict and harsh environmental conditions around 150 apiaries were damaged and at least 2,00 hives had been lost. "Environmental factors and saltwater have caused significant losses to bees." Al-Diraoui stated that some beekeepers had lost their entire apiaries. Al-Diraoui stated that honey production is expected to drop by as much as 50% in this area compared to last year. He said that at its peak, Basra honey production was 30 tons per year. However, this has declined sharply since 2007-2008. It fell to 12 tons over the last five years. This season, production is expected to be just 6 tons. DECADES OF WAR AND NOW, A WATER CRISIS Iraq has been a victim of war for decades - the first being the war against Iran in 1980, followed by the Gulf War in early 1990s and the U.S. invasion in 2003, which was then followed by the rise and fall and insurgent violence of the Islamic State. The latest threat to Iraq's ecology is the water shortage. The oil-rich nation has a pressing concern about water security as the levels of Euphrates River and Tigris River have dropped sharply. This is exacerbated by dams upstream, mainly in Turkey. Shatt al Arab was affected by a flood of seawater into the waterway from the Arabian Gulf, which increased salinity levels to an unprecedented level. Shaker stated that the riverbanks of Basra, which were once lined with groves full of nectar and flowers have been destroyed by the rising salinity. Bees are also struggling with the extreme heat in summer, when temperatures reach 50 degrees Celsius. Al-Diraoui stated that the bee population is at risk as the salinity in the water of Shatt Al-Arab increases. Some areas along the southern Basra riverbanks have stopped producing. Honey production could be completely halted if water crises continue at the current rate in the coming year, particularly if areas of northern Basra are affected by salt water. (Reporting from Mohammed Atti, Basra; Writing by Nayera Abedallah; Editing by Ros Russel)
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Saudi stocks soar after foreign ownership cap is lifted
Saudi stocks rose in the early trading on Wednesday, after the Capital Market Authority announced that it will ease foreign ownership limits on listed companies. UAE markets continued to lose money due to a general sector weakness. Bloomberg News reported that Saudi Arabia's benchmark index soared by 4.9%. It is on course to be its biggest single-day gain since over eight years. This was driven by the broad sector strength after Capital Market Authority announced it's close to easing current foreign ownership restrictions of 49%. Al Rajhi Bank shares, the largest Islamic lender in the world, surged by 10%, marking the sharpest gain of nearly two decades. They reached the daily limit for trading. Saudi National Bank's shares also rose 10%, its biggest gain since it was listed in 2014. Saudi Aramco, the oil behemoth, added 0.8%. Aramco has been unable to reach an agreement with Repsol Renewables, a Spanish energy company, over the potential investment of 1 billion euros ($1.2 billion). Dubai's main stock index fell 1% and is poised to continue the losses of the previous session, with most sectors in negative terrain. Both Emaar Properties and Emirates NBD Bank fell by 1.4% after Emaar Properties ended its three-day winning streak on the previous day. National Central Cooling's shares fell nearly 2.5% when the stock began trading ex-dividend. ADNOC Drilling, which saw a drop of nearly 2%, was the main culprit for the 0.8% decline in Abu Dhabi's benchmark index. Modon Holding announced on Tuesday that it had sold its entire 17,45% indirect stake in Aldar Estates, to Aldar Properties. The shares of Aldar Properties fell by 1.5%. Orascom Construction, newly listed on the stock exchange, fell 0.4%. This is a continuation of yesterday's losses. Traders continued to lock-in profits after recent gains. Qatar's stock market index recovered 0.2% on its way to ending three consecutive sessions of decline as investors purchased recently sold-off share. Estithmar Holding, the largest lender in the region, grew by over 4,6%. Qatar National Bank, which is the largest lender in the region, increased by 1%.
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Cnergyico, Pakistan's Cnergyico, orders a second US oil shipment and looks to more
Cnergyico, Pakistan's biggest oil refiner, has placed a second order for U.S. crude, after determining that its first purchase was commercially viable. Its vice chairman announced this on Wednesday. This opens the door to more imports. Vice Chairman Usama Qureshi announced that Vitol would deliver a cargo of 1 million barrels of West Texas Light crude (WTL) in November, under Cnergyico’s agreement with the European trader for a term supply. Qureshi stated, "This is our 2nd cargo. Our trading team evaluated crudes for November and found WTL crude's gross refinement margin to be slightly higher than (Gulf crude). If economic conditions remain favorable, we plan to continue importing. Ship-tracking data provided by Kpler revealed that the decision was made just weeks after the first ever U.S. crude oil cargo bound for Pakistan sailed from Houston aboard the Suezmax Tanker Pegasus chartered to Vitol. The ship will dock in Karachi at the end of October. In August, Pakistan and Washington signed a landmark deal that allowed the U.S. to import energy in exchange for lower tariffs for Pakistani exports. Donald Trump has encouraged foreign partners to increase U.S. oil purchase under such agreements. The Middle East has been the main source of crude oil for most of the country's history. Qureshi stated that Cnergyico - which operates Pakistan's single-point mooring facility capable of handling large tanks - is looking at additional U.S. purchases if the market conditions remain supportive. The arbitrage opportunity for U.S. crude cargoes loaded in November to Asia is threatened by a rise of shipping costs and spot premiums on West Texas Intermediate crude. This benchmark U.S. stream has risen. Cnergyico will also expand capacity by building a second terminal offshore and investing in long-term upgrades. Qureshi is betting on an increase in the domestic fuel demand. Reporting by Ariba Shehid in Karachi, and Sudarshan Varadhan in Singapore. Additional reporting by Arathy Sommesekhar in Houston. Editing by Florence Tan & Christian Schmollinger.
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Shanghai copper rates little changed amid US rate cuts uncertainties
The copper price was little changed on Tuesday as traders were cautious about when the U.S. would cut rates again, and doubts persisted about whether China will provide more stimulus in order to boost its economic growth. As of 0800 GMT, the most traded copper contract on Shanghai Futures Exchange was 0.04% higher, closing daytime trading at 79.970 yuan (11,233.32 dollars) per metric tonne. London Metal Exchange's benchmark copper for three months fell by 0.1%, to $9.965 per ton at 0804 GMT. Jerome Powell, the chair of the U.S. Federal Reserve, said that on Tuesday it was important for central banks to balance competing risks such as high inflation and an eroding job market. The Fed's policy divisions are evident in the arguments of other officials, which has led to uncertainty about future rate cuts. The U.S. Dollar strengthened, which weighed on the market. The dollar is stronger, making commodities that are traded in the greenback costlier for investors who use other currencies. China's key lending rate remained unchanged on Monday for the fourth consecutive month, following a U.S. interest rate cut. This left investors wondering if Beijing would implement more stimulus measures, and kept sentiments cautious. Galaxy Futures analysts said that the wet material incident at Freeport’s Grasberg mine operations remained unresolved and was affecting supply of raw copper concentrate. Aluminium rose by 0.1% among other SHFE base-metals, while zinc fell by 0.46%. Nickel increased 0.2%. Lead declined 0.32%. Tin rose 0.52%. $1 = 7.1190 Chinese yuan renminbi $1 = 7.1190 Chinese Yuan Renminbi (Reporting and editing by Dylan Duan, Lewis Jackson and Janane Vekatraman).
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Asian stocks recover as China's tech sector roars back
The stock market in Asia recovered on Wednesday after Wall Street's losses. A renewed interest in artificial intelligence and semiconductors fueled China's tech rally. MSCI's broadest Asia-Pacific share index outside Japan reversed an earlier decline by as much as 0.5% in the morning session, to be up by 0.1% at mid-afternoon. Chinese stocks were the leaders, with the STAR 50 Index up 3.6% and a measure of Hong Kong listed companies rising 1.5%. Alibaba's Hong Kong listed shares increased by up to 7.8% following the announcement on Wednesday of its largest AI model ever, the Qwen3 Max. UBS analysts stated in a research report that "the upward trend for A shares has accelerated since August, with major indexes breaking through October 2024's highs." This has led to a positive money-making impact that is slowly attracting investors from the sidelines. After two days of declining, the dollar index was up 0.2% to 97.438. The dollar rose 0.3% against the yen to 148.05. U.S. Stock Futures rose 0.2% last, following a decline on Wall Street Tuesday. After remarks made by Federal Reserve chair Jerome Powell, the S&P 500 fell 0.6%. This was its largest one-day drop in three weeks. In a recent note, DBS analysts noted that "U.S. equity and bond yields fell because Fed Chair Jerome Powell explicitly described equities in his speech as being 'fairly valued' and acknowledged there was no policy with a 'risk-free' path." "He didn't commit to aggressive rates cuts due to the difficult situation of balancing upside risks to inflation and downside risks to employment," DBS analysts wrote in a note. Asian stocks remain near their four-year highs and are on track to have the best month in a long time this month, thanks to a weaker dollar, an increase in regional technology shares, and the Federal Reserve's policy of easing. Australian shares were the main drag on Asian benchmarks on Wednesday. They fell by 0.9% and extended losses following a higher-than-expected increase in consumer prices for August. Capital Economics analysts stated in a recent research note that, "Although it won't give much attention to the rise in headline inflation rates, the strength of core inflation rates will make the RBA pause and think." The Nikkei index of Japan was up 0.3% last time, reversing previous declines. The CME Group’s FedWatch tool shows that traders have increased their bets for further rate cuts in the United States. Fed funds futures now indicate a 91.9% probability of a rate reduction at the central banks October meeting. This is up from an 89.8% chance on Tuesday. The yield on the benchmark 10-year Treasury note fell to 4,1042% from its U.S. closing of 4.118% Tuesday. The yield on the two-year bond, which increases with traders' expectation of higher Fed fund rates, dropped to 3.5673% from a U.S. closing of 3.57%. The U.S. economy data released Tuesday has stoked concerns about growth. S&P Global's purchasing managers' index data shows that business activity in the U.S. slowed down for a second consecutive month in September. Citi analysts stated in a note that "the S&P PMIs are softer than the preliminary September release but remain in expansion, and both are within the range of recent months." They said that the headline figures were misleading, and the actual numbers showed more weakness. Analysts said that the composite output price index had fallen to its lowest level since April. Anecdotes indicate that companies are finding it difficult to pass on higher costs to customers due to weaker demand and increased competition. Brent crude oil prices were last up 0.1%, at $67.71 a barrel. This was after an agreement to resume exports out of Iraq's Kurdistan fell through, which calmed some investor fears that the restart could exacerbate concerns about global oversupply. After hitting a record-high on Tuesday, spot gold was up by 0.3% to $3,773.36 an ounce.
Australia's "maze of uncertainty" scuppers $40 billion in M&A and clouds outlook
In Australia, the biggest buyouts in 15 years have failed this year. Misaligned valuations and regulatory risks are adding to the challenges of navigating a regulatory environment that is becoming increasingly strict.
The ADNOC-led group's decision to withdraw from its bid of $18,7 billion for Santos (Australia's second-largest gas producer) is the latest high-profile deal to fail in Australia in this year.
Sources reported that the ADNOC bid, via its investment vehicle XRG was shelved because of disagreements between the parties on potential capital gains taxes relating to a Santos property.
Analysts said that the deal would also have had difficulty being approved by Australia’s Foreign Investment Review Board. Analysts said that the bid, including Santos's debt, was the largest cash offer ever made in Australian history.
According to LSEG, the collapse of the deal has pushed up the value of failed transactions to its highest level since 2010. This raises questions about the feasibility and viability of large-scale deals in Australia.
Advisors say that the lengthy approval process, which includes reviews by the Australian Competition and Consumer Commission, FIRB and various government agencies, makes it difficult to complete deals in Australia.
Garren Cronin is a managing director of Cadence Advisory.
He said that factors such as technological changes disrupting multiple industries, and the new ACCC regulations effective Jan. 1, which require regulatory pre-approval for most deals, had made deal conditions more difficult.
Cronin stated that "Regulatory overreach by the ACCC has created a maze-like uncertainty." "The ACCC has successfully pushed for a mandatory review process... which has added a significant burden to the deal activity."
In the past, companies were able to seek ACCC approval voluntarily in order to reduce the chance of the regulator interfering with deals they deemed anti-competitive and enforcing them.
'MORE STRESS, TENSION'
ACCC spokesperson said that the new regime is designed to "strike the right balance" between preventing and detecting anti-competitive purchases, while still allowing those acquisitions which are unlikely to cause competition issues to be completed with certainty.
This includes a provision that allows low-impact acquisitions to request a waiver to remove the notification obligation.
However, advisers said that the longer timelines to complete the regulatory process and finalise large ticket transactions increase the risk of the deal.
Lance Sacks is a corporate partner with Baker McKenzie. He said: "Time kills deal, whether it's private M&As or public M&As. Losing momentum in the current M&A climate."
There's a valuation gap. The funding is available, but it has to make sense.
"Buyers (and) corporate boards are much more thoughtful, diligent and cautious before they make a decision."
Peabody Energy pulled out of its $3.8 billion offer for Anglo's Queensland assets in August, while Brookfield & Bain withdrew their $2.5 billion bids earlier in 2025 for Insignia Financial.
The Australian financial services company signed a $2.2 billion purchase agreement with New York-based CC Capital in July.
David Eliakim, KWM's M&A practice leader, said that some bidders who were considering complex deals tried to anticipate future regulatory issues which could arise from the FIRB or ACCC.
This has led to some more difficult issues being discussed and addressed before the bid documents are signed. This creates more tension and stress than would otherwise be possible, and this in turn affects whether or not transactions are completed. (Reporting and editing by Scott Murdoch, Sumeet chatterjee, Kim Coghill).
(source: Reuters)