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Constellation's executive claims that grid operator told the company Three Mile Island cannot be connected until 2031
The U.S. grid operators PJM and Constellation Energy have told Constellation Energy the 'former Three -Mile Island nuclear /power?plant' in Pennsylvania will likely not be able connect to the grid before 2031. This is four years later than originally planned. Constellation is working to restart operations at its nuclear power plant, which will be renamed Crane Clean Energy Center to "feed Microsoft data centres". Constellation's chief?external and growth officer, David Dardis said that the company will be ready to produce electricity at the plant before its goal of 2027. It is also in talks with the grid operator PJM interconnection about reducing the timeline. Constellation, America's largest independent?power company, announced that in 2024 it had?contracted Microsoft to reopen a nuclear power plant. Three U.S. nuclear plants are in the process of restarting their reactors, as a result of a growing demand from Big Tech data centers,?electrification and transportation?, and other?data center-related projects. Reporting by Laila KEARNEY in Houston, editing by Lisa Shumaker
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Oil price spikes as Iran crisis causes a drop in stocks and bonds
Oil surged over 5% on Thursday, and Iran's denial that it had held any talks with the U.S. heightened doubts about the prospects of a rapid ceasefire for the Middle East conflict which has lasted nearly a month. The conflicting signals about the'scope of contact', as well as reports that thousands of U.S. troops were being sent into the region, halted the three-day recovery in the world?stocks? and reignited the selling on global debt markets. Germany's central banking head stated that an ECB interest rate hike next month is "an option". Norway also said they are likely to raise rates this year. The U.S. president Donald Trump warned Iran to "get seriously" about a cessation of hostilities. Oil and European Natural Gas prices rose more than 5% and 4%, respectively. Brent reached just over $107 per barrel, and gas rose to 54.9 euro per megawatt-hour. Their gains for the month were an eye-watering 45% & 70% respectively. This has fueled policymakers' fears of another inflation spike similar to that seen in 2022. Joachim Nagel, the German central bank's chief, said in an interview that he believes there will be enough data to decide by April whether or not we should take action. He said that it was only one of many options available to the ECB, but added "we shouldn't be afraid just because it is still early." Trump said again on Thursday that Iran is "begging" for a deal in order to end the conflict. Abbas Araqchi had said earlier that Tehran was'reviewing a U.S. offer but did not intend to hold talks. The U.S. and Israeli strikes against Iran in late-February shook global markets, and shut down the Strait of Hormuz – a conduit that carries a fifth of global oil and gas flows. The first economic forecast by the Paris-based OECD after the crisis erupted predicted that it would suppress the global GDP growth and keep it below 3% in this year. After falling by 4 basis points on Wednesday, the yield of Germany's 2-year bonds, which is sensitive to expectations about interest rates from the European Central Bank, increased 8 basis point to 2.68 percent. Bond yields are inversely related to bond prices. As traders bet on a Bank of Japan rate increase as soon as next month, the U.S. 2-year yield reached 4%. Japan's two-year yield hit its highest in 30 years, at 1.33%. Pascal Koeppel is the chief investment officer at Vontobel SFA. He said that a prolonged disruption could cause energy prices to rise and inflation to increase, which would force central banks into tightening. On Thursday, the central bank of Norway said that it expects to increase its rates due to an increase in energy prices and wages this year, after initially indicating it might cut them. Koeppel, Vontobel's Koeppel, added: "I would be more nervous if we saw ground troops (of the U.S.) in action." If this happened, "we'd trim the risk... and invest more in short-term government bond and gold, obviously." STRUCTURAL CHANGES Wall Street's main markets opened about 1% lower and the Asian markets fell overnight. Japan's Nikkei ended down 0.3% while concerns over rising energy prices hammered South Korea KOSPI which fell 3.2%. Hong Kong's Hang Seng dropped by 1.9%, and China's blue-chips fell by 1.3%. This puts MSCI's Asia-Pacific index outside Japan on course for its biggest monthly drop since October 2022, 9.5%. The dollar is gaining 2% this month and has been near its recent highs. This will revive the safe-haven appeal of the currency after last year's over 9% decline. Traders have priced out the possibility of a Federal Reserve interest rate cut in this year due to fears of an inflation shock similar to that of 2022. This has further supported the dollar. Gold, a traditional safe-haven, has fallen more than?16% in the last month, on track for its steepest drop?since Oct 2008. Gold was down 2% on Thursday at $4,421, but still nearly?50% above where it was a year earlier. It will be difficult to reconcile the goals of the U.S., Israel, and Tehran, said Matthias Scheiber. He is the senior portfolio manager at Allspring Global Investments and head of their multi-assets team. "We think that there are still arguments to be made for higher energy prices at the moment."
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Fuel prices spike in Chile: a political test for Kast
Chileans were apprehensive as they saw empty gas stations and price boards that still displayed pre-hike prices. The steep increase in fuel prices announced by the government went into effect on Thursday. This immediately tested the strong public support that had propelled the right-wing president?Jose Antonio Kast to office. The new administration inaugurated on March 11, activated a fuel stabilization clause to bring domestic rates in line with the surging international prices linked to the conflict in Middle East. Officials said that the government was under pressure to absorb the rapidly increasing cost shock. This is what led to the sudden adjustment at petrol pumps in the country. The central Santiago gas stations were deserted on Thursday morning, after the long queues of the previous night. Premium fuels had been sold out. "I came to purchase 'gold'," said driver Valentina Orega. She was referring to gasoline which is a commodity in high demand. "Honestly, this is terrible." "It's only been a few days, and he is already doing things that affect the middle class and the lower class. But nothing is known as to what he will do for the upper class," said she about?Kast. Diesel prices will increase by 60% and 93-octane gas by 30%. After the announcement on Monday, lines began to form and some stations were out of stock. Gas prices are always a source of concern for people in any country. It threatens his short-term popularity and can create?governance issues depending on the length of time prices are high, said Cate Klemme from Latin America advisory firm Southern Pulse. According to a survey conducted by Cadem, Kast's approval rating dropped four points from 59% to 47%. Meanwhile, 59% of respondents said the increase could have been avoided. For the first time ever, disapproval exceeded approval in a poll conducted by Cadem. 54% of respondents expect fuel prices to continue increasing. Francisca Alfaro said that she had already prepared for a rise in gas prices. "Everything will go up, because everything in Chile is transported via land." "Food, produce, and vegetables will all become more expensive," said she. Jorge Quiroz, the Finance Minister, said that future price changes would be gradual. JP?Morgan's analyst note says that the government has announced measures to ease the impact. These include freezing the public transport fares until?December. This will help?to offset part of the fuel price shock. According to the firm, a rise in gasoline and diesel prices could still lead to nonlinear inflation. The central bank of Chile?revised their inflation forecast one day earlier. They now predict that the country will experience a significant rise in prices during the second quarter, with figures reaching around 4% per year. Kast, Chile’s most right-leaning president since the return to democracy in Chile, blamed former leftist Gabriel Boric for strained finances. He said that he would lead an “emergency” government focused on recovery. Guillermo Holzmann?a political specialist at the University of Valparaiso?said Kast was "paying an important political-social price given the rejection of a measure of such nature. Yet, they hope to reap at the end of the crisis, a more favorable position in the eyes of their public." Analysts said that the hikes could fuel social unrest, and even protests by public transport operators. (Reporting and editing by Cassandra Garrison, Hugh Lawson, and Fabian Cambero)
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EU legislators advance US trade agreement with multiple safeguards
After months of uncertainty due to 'President Donald Trump’s tariff threats and the 'new import levy', European Union lawmakers advanced legislation Thursday that would fulfill the bloc's part of the trade agreement it has with the United States. The EU assembly, by a vote of 417 to 154 with 71 abstentions in favor, voted for the legislation, but with additional safeguards. This reflects concerns that Washington might not adhere to the agreement reached in Turnberry, Scotland last July. These safeguards include, among other things, a possible suspension clause. Also, lawmakers insist that the U.S. remove the 50% duty imposed on products like wind turbines and motorbikes containing steel and aluminium a month following the Turnberry agreement. Maros Sefcovic, European Trade Commissioner, called the vote "a crucial step",? delivering certainty to EU businesses. The U.S. Mission in the EU welcomed the vote. The European Parliament is debating proposals to remove EU import tariffs on U.S. industrial products and improve access for U.S. agriculture produce, which are key parts of the agreement, as well continuing?zero duty for U.S. Lobsters initially agreed with Trump by 2020. The vote of the Parliament on Thursday does not mark the end of the process. Starting on April 13, representatives of the parliament and EU governments will begin to negotiate final texts before a vote by EU legislators is expected in June. EU governments approved legislation in November, with less protections. Concerns of Parliamentarians The U.S. will be the EU's biggest trading partner in 2025, with EU exports reaching a record of 555 billion euro ($641 billion). Many parliamentarians expressed their disapproval of the deal in a discussion before the vote. The EU was required to reduce most import duties, while the U.S. stuck to its 15% general rate. Bernd Lange is the chairman of the trade committee in the parliament. He said that the agreement was not a real one. Kathleen Van Brempt, a Belgian Social Democratic, called it a bad deal. It does not bring stability. She said that it does not protect against tariffs, threats or coercion. The EU assembly was due to vote on a?legislation? at the beginning of the year. However, work was halted after Trump threatened to impose new tariffs? on European allies who did not support his acquisition of Greenland proposal and launched an import surcharge. There are also additional safeguards, such as a'sunset' clause that ends the tariff concessions on March 31, 2028 and a clause which suspends the agreement if Washington violates the terms of this deal or there is an increase in U.S. imports. Reporting by Philip Blenkinsop. Editing by Inti landauro Timothy Heritage Mark Potter
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WTO chief calls on trade reform to meet the new world order
WTO chief demanded on Thursday that countries re-examine global trade rules. He said the old order was 'gone for good' after a year of turmoil caused by U.S. Tariffs and geopolitical tensions. Ngozi Okonjo Iweala outlined a number of issues facing the World Trade Organization, including the paralysis in its dispute-settlement mechanisms. This was at the beginning of a four day meeting of the organization held in Cameroon. "The world order, the multilateral system that we knew has irrevocably changed." "We will never get it back... we must look forward to the future," said the WTO Director General. Some diplomats and officials from the trade sector warned ahead of the session that countries would abandon the ideal of an international trade system based on rules if they failed to reach an agreement. They could also start setting their own regulations. The Yaounde meeting comes amid growing concerns about the impact of U.S. and Israeli war on Iran. Okonjo Iweala stated that the problems with decision-making in the organization needed to be addressed. Its current consensus model is regularly held up by the objections of some countries. Some delegates want the organization to allow groups of members to form agreements. She said that there was also a lack transparency in determining which countries used subsidies. Okonjo Iweala, who addressed delegates at the conference, said: "Lacking transparency breeds distrust and suspicions about unfairness and anticompetitive behavior." She added that this contributed to a “vicious cycle” of mistrust, which held back members from agreeing on new rules and reforms. Internal reform documents seen by?by reveal that the U.S. is in favor of reforms, but does not want a detailed plan. The EU, Britain and China, however, support a single reform document. Before the session, Swiss Ambassador Erwin Bollinger stated that "if we don't accomplish anything concrete, then the WTO loses its?attractiveness and relevance". UK Trade Minister Chris Bryant warned that a deal could lead to fragmentation. Bryant stated that he was worried about a disorderly collapse in the WTO, and some people writing new rules. India will oppose U.S. efforts at the meeting to extend a worldwide ban on cross-border ecommerce duties. New Delhi believes that developing nations should have the right to impose such a ban. U.S. Trade Representative Jamieson Greer is expected to inform members that the U.S. "is not interested" in temporary extension of the ban. Only a permanent extension is desired. Reporting by Olivia Le Poidevin, Editing by Chris Reese and Lincoln Feast; Andrew Heavens.
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Zelenskiy comments on US Donbas stance pleased Russia
A senior Kremlin representative said that Russia was pleased with the remarks made by Ukrainian President Volodymyr Zelenskiy, who claimed Washington had tied its offer of?security guarantee to Kyiv's surrender of eastern Donbas. Kirill Dmitriev, the Russian special envoy, told reporters that Zelenskiy’s comments, made in an article, “can't but make us happy”. Dmitriev stated that "he said an important thing...he finally understood the U.S. stance, which is?that they will only support security guarantee if Ukraine leaves Donbas." Zelenskiy said that President Donald Trump is applying pressure on Kyiv to end the four-year conflict triggered by Russia’s 2022 invasion. Zelenskiy acknowledged the U.S. position on Donbas but said Washington needs to do more. Understand "that the eastern part of our country is a part of our?security guarantees". He wants strong security guarantees from international partners in order to make sure that Russia doesn't restart hostilities after any peace agreement is reached. US-RUSSIA TALKS TO CONTINUE The Russian enemies are 'in a mad state' because the negotiations between Moscow, Washington and other countries on economic cooperation continue. He stated that the topic of raising money for reconstruction in areas devastated by war was being discussed. He cited as an example the U.S. playing a "positive" and "constructive" role in the European Union deciding last year to not seize 210 Billion Euros ($240 Billion) worth of Russian sovereign assets to pay for a Ukrainian loan. Dmitriev said that despite the ongoing negotiations with the U.S., Russia could still take tough action elsewhere, citing the "provocations" from the EU, Britain and other countries against the Russian fleet. Russia also informed the U.S. of recent drone attacks by Ukraine against Russian energy infrastructure. He called it an attempt to worsen the global energy crises,? he said. Calculations show that at least 40% of Russia’s oil export capacity has been halted following drone attacks by Ukraine, an disputed attack on major pipelines, and the seizure or tankers. This is the worst oil supply disruption that Russia has ever experienced. (Written by Gleb Brynski, edited by Andrei Khalip).
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After talks with regional leaders, the PM said that Iran allowed Malaysian vessels to cross in Strait.
Malaysia's Prime Minister Anwar Ibrahim announced on Thursday that he had met with the leaders of Egypt, Iran, Turkey and other countries in the region. He said Malaysian ships were now allowed to cross the Strait of Hormuz. Anwar thanked the Iranian president in a televised speech for allowing passage of 'Malaysian vessels. He said, "We're now working on releasing the Malaysian oil tanks and their workers so they can continue home." Anwar stated that he spoke with Iran and other countries in order to facilitate peace in the Middle East. He said: "But it's not easy. Iran feels deceived and finds it hard to accept peace steps without a clear, binding security guarantee for its nation." Malaysia will maintain its oil subsidies, but is taking steps to reduce the impact of supply disruptions. He said: "We are compelled now to manage?the?situation because of the effects of the?blockade in the Strait of?Hormuz; the war and the?halted?supply of?oil?and gas," he added. (Reporting and writing by Ashley Tang, Editing by Martin Petty).
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Aluminium gains, copper falls as Iran rejects talks to end the conflict
Aluminium rose to its highest level in nearly a week after Iran denied talks to 'end the Middle East conflict. The benchmark three-month price of copper at the London Metal Exchange fell as much as 1.7% in the previous session. The metal, widely used in construction and power, closed up 1.8% Wednesday, thanks to dip-buying by Chinese consumers who were looking to replenish their stock. Copper, which is considered to be a bellwether of global economic health, has been under pressure because there are fears that the U.S. and Israeli war against Iran will hurt the growth. Copper?stocks are also available in LME-approved warehouses The remaining stocks are at an eight-year high, with 360,000 tonnes. They have increased by around 150% from the beginning of the year. John Meyer, SP?Angel's analyst, said: "I believe copper was under pressure even before the conflict began. This is because there was a build-up of copper in the warehouses." Donald Trump, the U.S. president, said Iran is desperate to reach a deal that will end four weeks of fighting. This contradicted the Iranian foreign ministry, who stated his country would only'review' a U.S. offer but had no intention to hold talks. Aluminum meanwhile rose by 1.5%, to $3,290.50 per ton. It reached its highest level since March 20, on fears that Middle East smelters, who account for 9% of the global supply, would not be able to deliver metal to world markets or bring in raw materials. Zinc rose 1.1% to $3.112, lead fell 0.9% to $1.894, nickel dropped 0.6% to $17.235, and tin fell 0.7% to $44,195. (Reporting and editing by Sonia Cheema, Rashmi aich and Sonia Cheema; Additional reporting by Amy Lv; Keith Weir Editing)
Oil shock, war, and uncertainty: McGeever: Time to increase US equity outlook
It might seem odd to get more bullish about stocks at a time when the U.S. economy is so obscured by the "fog" of war and oil priced at $100 per barrel. From a valuation perspective, earnings and growth are compelling.
Barclays strategists emphasized it when they increased their S&P 500 price and earnings predictions this week, and they are?not alone in the bullish camp. They argue that corporate America will not escape the economic impact?of?the Iran War and energy shock. However, it is still relatively well-positioned.
Take technology, the engine that has driven Wall Street's recent boom. Recent concerns that firms overspend on artificial intelligence have caused the market to sputter. Concerns about AI disruption has also roiled software company shares.
The "Big Tech' selloff was pretty large. Roundhill's "Magnificent 7" ETF is down 10%, which is three times more than the S&P 500. The tech sector, measured by the 12-month forward price-earnings ratio, is now cheaper than it was during the "Liberation Day' turmoil?a year earlier.
This multiple hovers around 21, which is the lowest it has been in three years, and is down by a third since last October. This is a remarkable turnaround of a key sector in a short period of time.
The valuation premium tech enjoyed in the past over the broad stock market is almost gone and now at its lowest level in seven years. According to Jefferies equity strategists, a narrower measure of this premium - "Mag Six" over the S&P 500 – is the smallest in seven years.
The Re-Rating Game
It is reasonable to argue that a major reset of the market was overdue, because tech stocks had become far too costly. The current valuations are simply back to their long-term mean.
These companies' future earnings projections make tech look even cheaper.
The LSEG consensus estimate for tech earnings growth during calendar year 2026 has increased to 42.5% from 30.8% at the beginning of January and is nearly twice as high as it was six months earlier.
Barclays strategists said this week that they believe the U.S. will continue to grow faster than other major economies, and technology is a growth engine with a long-term outlook.
The S&P 500's earnings per share for this year were raised to $321, up from $305. They also increased the price target of the index to 7650, up from 7400. This would mean gains of about 16% since Wednesday's closing.
They added that "the road is likely to remain bumpy until the 'corner', but we are incrementally bullish about U.S. stocks."
OVERWEIGHT AND SEE
It's notable that U.S. consensus earnings estimates have been steadily rising over the past two months, while the S&P 500 continues to fall. Does this indicate an unjustifiably positive outlook for U.S. corporations, or a market overly pessimistic reaction to external factors?
It looks as if it might be the former.
Wall Street has performed better than its global counterparts in the four week period since the Middle East war broke out. This is partly because of the relative strength in the U.S. for growth, technology, earnings and energy.
This situation is unlikely to drastically change in the near future.
In their outlook for the second quarter, HSBC Private bank analysts stated that they remain "overweight on U.S. equities" due to resilient growth and solid corporate earnings.
The fear of rising U.S. prices, which are already at a rate of 3%, shouldn't be a deterrent for America Inc., as higher prices should increase nominal earnings, particularly in sectors that have strong pricing power.
Holding an over-weight position in the equity markets is fraught with risks, but it's the safest place to be if that's what you want to do.
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(source: Reuters)