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How investors are dealing with Iran shocks using the new Trump trades
Investors are putting together a "Trump trade' playbook to?navigate market uncertainty. This includes determining whether a U.S. - Iran ceasefire will last and whether oil prices will remain high for longer. As geopolitics continue to dominate the economy, it is difficult to move money based on long-term perspectives. During the Iran War, many?investors have placed shorter-term bets instead on assets which may have been?mispriced?. Here is a list of some new Trump trades. 1/OIL PRICE WILL STAY HIGHER FOR A LONGER TIME Oil prices fell almost 15% to $100 per barrel in the wake of the ceasefire on Wednesday, but are expected to stay higher longer due to the uncertainty surrounding the Strait of Hormuz. Oil futures six-months out trade at around $79, a higher price than before the start of the war on February 28. Some analysts claim that they have been swinging too low. They tend to fall sharply when it looks like a detente is more likely. Michael Haigh, Societe Generale’s global head for commodities research, stated that even a successful ceasefire without further tensions could put an upper limit on the price of oil at $85 per barrel. He added that this would increase if more states, now concerned about energy security, began to stockpile oil. Investors who avoided energy producers for years are now 'less bearish. Bank of America's March 31 survey found that 30% of investors still have a negative view of the sector due to ESG concerns. This is down from 40% six months ago. Shell stated on Wednesday that it expects a stronger oil market in the future. 2/ CANADA AND NORWAY Investors said that the U.S. Dollar has recovered its lustre following months of doldrums. However, if the war ends and the demand for the reserve currency is reduced, while crude oil prices remain high, then some oil producing nations' currencies could shine. Van Luu, Russell Investments global head of solutions, said that it would take some time for things to get back to normal. The tankers might not travel for a few months, but oil prices could rise. If oil prices are between $85 and $100 per barrel, energy exporters from politically stable countries (you could include Norway and Canada) should perform better. BOND BOUNCE BACK? The U.S. president Donald Trump's pledge to halt the war sent British and Euro zone government borrowing rates plummeting, as fears of inflation among energy importers began to wane. Money managers have said that these yields are still too high in comparison to interest rates and inflation expectations, particularly in Britain, where the base rate is 3.75% and consumer price inflation is at 3.2%, and the yield on the 10-year bond is slightly below 4.7%. Nicolo B. Bragazza is a Morningstar Wealth Associate Portfolio Manager who is?positive about gilts. In the euro zone, German 10-year yields have a value of around 2.9% in comparison to interest rates which are at 2%. The markets now only price a 20% probability of an April European Central Bank rate hike, down from 60% prior to Trump's Iran ceasefire announcement. Hunting out anomalies Bragazza stated that investors overreact when they hear good or bad news. This creates pricing anomalies, as assets which should not be correlated swing together on markets dominated with war sentiment. Edmond de Rothschild's head of quantitative portfolio management Bruno Taillardat said: "Trading is not as evenly distributed as it should, and some sectors should be immune to this at the very least on a medium-term basis." He pointed out that global healthcare stocks, which are usually considered to be relatively defensive?during recessions have traded in line since the start of World War II with a world-index of economically cyclical companies. Investors who are able to detect the mispricing of opportunities due to daily market movements will stand out in sentiment-driven markets. Taillardat predicted that Trump's rhetoric would keep the markets volatile, and cause headlines to be overreacted to. Morningstar's Bragazza stated that "it's this type of asymmetrical behaviour that creates the right opportunity."
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Hegseth declares US military victory against Iran
U.S. Defense 'Secretary Pete Hegseth stated on 'Wednesday, that the United States a 'decisive - military?victory against?Iran. The missile program in Tehran has been functionally destroyed. Hegseth, the chairman of the Joint Chiefs of Staff and General Dan Caine spoke to reporters a day after Donald Trump pulled back from a threat of a full-on attack on Iran. Caine stated that U.S. military goals in Iran had been achieved, but the ceasefire was a pause. Forces remain ready to resume combat. Hegseth stated that the U.S. Military was "hanging out" in the Middle East?to ensure Iran complies to the two-week ceasefire and??to monitor the country?s enriched Uranium stockpile. "We're watching the uranium." We'll take it if they give it to us. Hegseth said to reporters, "We'll take it?if we need to." (Reporting and writing by Idrees Al, editing by Katharine Jackson)
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Africa pilots bond to formalise artisanal mining
The firms have announced that a Canada-based advisory firm and a Zambian mid-tier copper miner will pilot a sustainability bond this year to integrate artisanal mining into formal supply chains. Globally, artisanal mining is a source of livelihood for millions. In Africa, it is often done informally near or on company-owned mines. This reduces their profits, spreads pollution, and robs nations of revenue. Rob Karpati said that the proposed "stakeholder prosperiy bond" developed by?Veridicor and Zambia's Metalex Commodities aims to remedy this, according to its finance director. He said that the model "professionalises" the artisanal miners instead of removing them from their land. The instrument ties investor returns to predefined social and environment outcomes for workers and communities, and host economies instead of output. The first issuance will raise between $100 million and $200 million to help Metalex Commodities integrating artisanal and smaller-scale miners through regulated offtake agreement as well as shared infrastructure and investment in equipment. Potential Investors The firms stated that potential investors include European Sustainability Bond Funds, impact and Mining Investors, banks, and wealthy individuals who are focused on sustainability. Zambia, Africa's largest copper producer, is home to tens thousands of artisanal miner, many of whom are located around Metalex's permit in the northwestern part of the country. Karpati said that "large mines are usually the anchors of these, because they have to appear on someone's financial statement." The artisanal miners benefit financially from the fair price and not some predatory intermediary. Industrial mines ?would sit ?at the centre of each bond structure to support repayment, while sustainability-linked terms would adjust interest rates based on social and environmental ?performance, Karpati said. Metalex's founder and CEO Ayo Solitan stated that the bond would enable the company to run large programs integrating artisanal miners into its supply chain. He said: "We intend to source around 30% of our ore from local, trained and licensed miners." The bond allows us to do this at a larger scale than what our balance sheet would allow. Also, the bond will be introduced in Ghana and Democratic Republic of Congo. (Reporting and editing by Philippa Fletcher; Maxwell Akalaare Adombila)
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Copper jumps to a three-week high after US-Iran ceasefire
Copper prices soared to a record high of three weeks on Wednesday, after the?U.S. President Donald Trump has agreed to a?ceasefire? with Iran for two weeks, which will ease fears of an economic slowdown in the world as a result of the Middle East conflict. In open-outcry trading, the benchmark three-month copper price on?the London Metal Exchange rose 2.7% to $12650 per metric ton. It had previously risen as high as 3.6%, to $12,755.50. This was its highest level since March 18. In March, copper prices fell 7.6% due to economic concerns sparked by war in Iran. Trump stated that the?ceasefire depends on Iran's agreement to stop its blockade of oil passing through the Strait of Hormuz. Brent crude oil fell by as much as 16.1% on Wednesday. The brokerage Sucden Financial said that while the ceasefire may have a short-term impact on the energy premium, it is fragile and conditional. This suggests the markets will continue to be driven by headlines rather than a "sustained risk-on background". Discount on the cash LME copper contracts to the forward three-month contract The price of metal has risen to $98 per ton, up from $84.60 on February 2, indicating that there is not a shortage. Copper stocks at LME-approved warehouses On April 7, the number of tons was 385,275, the highest level since March 2018. This is after the influx of?10,075 tonnes to New Orleans and other locations in Asia during the Easter holiday. Prices of aluminium, which spiked after metal was unable to travel its normal route through the Strait of Hormuz from Gulf producers to export markets, have fallen 0.4%, to $3,463 per ton. Late last month, Iranians attacked and damaged smelters in Bahrain and the UAE. This took the supply off the market. Iran's Mehr agency said that reports of a U.S. and Israeli attack on Arak Aluminium?plant, in central Iran, were false. In a broad relief rally, base metals rose in price. Nickel jumped by 2.3%, to $17.345, tin was up 4.3% at $47.950, lead climbed 0.4%, to $1.953, and zinc remained flat at $3.307 (Reporting and editing by David Goodman. Additional reporting by Noel John, Bengaluru)
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Trump announces that the US will discuss sanctions with Iran and work closely together
U.S. president Donald Trump announced on Wednesday that the United States and Iran are working closely together and discussing relief from tariffs and sanctions. This follows the announcement of the two-week ceasefire. Trump backed away from a full-on attack on Iran, which he had threatened to launch 'on Tuesday night. Two hours before the deadline that he set for Tehran in order to open up the Strait of Hormuz. He stated on social media that he had agreed to many of the 15 points in his plan for Iran, but did no elaborate. In a post on social media, Trump stated that "We will talk about Tariffs and Sanctions Relief with Iran." Despite his ebullient remarks, and the widespread relief?on Iran’s streets and on global financial markets?over the ceasefire?, the main differences between Washington and Tehran are still unresolved, and the two sides continue to insist on competing demands for a possible peace deal. Trump said Wednesday that any country providing weapons to 'Iran will immediately be subject to a 50% tariff for any goods exported to America. Beijing and Moscow both assisted?Iran in building military capability to counter U.S.-Israeli pressure. They provided missiles, air defense systems, and technology to strengthen deterrence and complicate U.S. operation and increase the cost of an attack. Russia and China were restrained with their support for the U.S. and Israeli attacks against Iran. "VERY PRODUCTIVE RIGIME CHANGE" Trump praised Iran's leaders on Wednesday after U.S.-Israeli?strikes that killed several top officials, including the Supreme Leader Ayatollah Ayatollah Khamenei. His son Mojtaba has replaced him as supreme ruler. "The United States will work closely with Iran. We have determined that Iran has undergone a very productive Regime Change!" Trump wrote a post in Truth Social. The United States and Iran will work together to dig up all the nuclear 'dust' that is buried deep in the ground (B-2 'Bombers'). "Nothing was touched since the attack date." The U.S.-Israeli war has not yet deprived Iran of its stockpiles of?near weapons-grade highly-enriched uranium, or its capability to 'hit its neighbours using missiles and drones. Iran's clerical leaders, who faced a mass protest months ago, have withstood this six-week assault with no signs of internal opposition. Reporting by Doina Heavey and Susan Chiacu; Editing and production by Tomaszjanowski and Gareth Jones
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Commission finds that Norway should not be pursuing nuclear energy now
A government appointment commission stated on Wednesday that Norway should not begin a comprehensive nuclear power introduction process at this time, given the?abundant hydropower and alternative energy sources available. In?2024?the Norwegian government appointed a 12-person committee that would examine the future potential use of nuclear energy in the Nordic nation. This was the first in-depth assessment since the 1970s. The government stated that the need for more emission-free energy was necessary to meet the expected rise in demand due to electrification, and the ambitions of private companies to set up nuclear power production. The committee chair Kristin Halvorsen (a former Finance Minister) said that the Norwegian power system was not dependent on the?system properties of nuclear energy, as we have abundant hydropower here in Norway. According to Statistics Norway, hydropower will account for 89.9% of Norwegian electricity generation in 2025. Wind power will take 8.6%. Finland and Sweden, two Nordic neighbors, have built or plan to build new reactors. Other European countries are also looking at nuclear power as a way to generate electricity without emissions. The committee stated that while nuclear power would theoretically be compatible with the Norwegian system, at the moment it is not profitable. It also requires extensive work in order to develop the necessary regulatory regime. It proposed to create a 'national competence project' that would keep up with technological innovations and enable a quicker introduction of nuclear energy should it become relevant. Norway has a surplus of electricity, but demand will increase as more transport and industrial activities are electrified. Terje Aasland, Energy Minister, said that for the moment, the main levers to meet demand will be onshore wind, upgrading?of existing?hydropower, and offshore wind, but nuclear power could still play a part in the future. (Reporting and editing by Terje Solsvik, Nora Buli)
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Slovakia ends diesel fuel export ban but other measures remain in place
Prime Minister Robert Fico announced on Wednesday that Slovakia would end the temporary ban on diesel fuel exports on Friday, but will continue to implement other fuel restrictions due to 'the conflict in the Middle East. Slovakia has taken steps to deal with the soaring global oil prices, since U.S.-Israeli strikes against Iran began at the end February. The United States and Iran reached a ceasefire on Tuesday evening. The Slovakian government approved on March 19 a resolution allowing service stations the ability to limit diesel sales. It also increased prices for cars with foreign license plates in an effort to curb "fuel tourism". These temporary measures will remain in place. The Iranian crisis coincided with the interruption of Russian oil supplies to Slovakia via Ukraine. Slovnaft is the only refiner in the country, and it's owned by Hungarian Oil and Gas?group MOL. In February, when an oil emergency was declared, Slovnaft received a loan for up to 250.000 tonnes of crude oil from state reserves. Fico said on Wednesday that Slovnaft has already returned the oil loaned. The loan allowed Slovnaft to find an alternative supply after the Druzhba flow in Ukraine was stopped by what Kyiv claimed was a Russian strike which damaged a line. Slovakia and Hungary have accused Ukraine, which Kyiv has denied, of blocking flows due to political reasons. (Reporting and editing by Hugh Lawson in Prague, with Jason Hovet reporting from Prague)
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MORNING BID AMERICAS - Big relief rally for now
April 8th - Alun John gives us a look at what the U.S. markets and global markets will be like today. The markets exhaled Wednesday following the announcement of a two week?ceasefire? between the U.S.A. and Iran. This was first announced by U.S.President Donald Trump on Tuesday night, just before his deadline for Tehran to open the Strait of Hormuz. Stocks and bond prices soared on the news, and the dollar lost some of its recent appeal as a safe-haven currency. Analysts and traders will be 'wary' about the durability of the ceasefire, and whether it can lead to a lasting resolution to the conflict and energy crisis. Below, I'll go into more detail. Listen to the Morning Bid podcast. Subscribe to the Morning Bid daily podcast and hear journalists discussing the latest news in finance and markets seven days a weeks. BIG RELIEF FOR NOW Since the beginning of the Iran War, the price of oil has dominated the global markets. It's no surprise that the news of a ceasefire, which sent both Brent and WTI back below $100 per barrel, has caused some major movements around the globe. S&P 500 Futures are up by 2.5%. Major indexes in Europe and Asia posted or will post their largest daily gains since last April. Japan's Nikkei rose over 5%, South Korea's KOSPI by more than 6% and Europe's broader?STOXX600 was up around 3.5%. Travel, banks, technology, and industrials are the main beneficiaries of lower energy prices and falling yields. A South Korean standout is chipmaker SK Hynix, which rose 15%, helped by expectations high for its own quarterly results following Samsung's monster profit forecast on February 2. The energy stocks have been the worst performers?on Tuesday, but are still up a lot for the year. Meanwhile, the safe-haven dollar slid. Dollar index falls from recent 11-month-highs. The U.S. currency is retreating on all developed markets - including the Japanese yen which has been under fire. It has retreated below 160 per dollar after almost crossing this threshold on Tuesday. The announcement has boosted bond prices, and U.S. Treasury rates have fallen as traders bring the prospect of Fed rate reductions back into the discussion. The yields of euro zone government bonds also dropped as traders reduced their bets on rate hikes by the ECB. The biggest move has been in Britain where yields have fallen over 20 basis points. The traders will be hoping that the ceasefire of two weeks is effective and lasting as intended. The ceasefire is conditional on Tehran reopening Strait of Hormuz. It has said that it would do so if the attacks against Iran stopped. The markets aren't saying we're in the clear yet. Brent above $90 was a bad sign for the world's economy and stock markets just a few months ago. We are nowhere near the amount of central banks easing that was priced before the war. To keep the optimism going, U.S. - Iran negotiations, which are set to start on Friday, will have to be more positive than they were before. A number of contentious issues?will likely prove to be a problem. The news of a ceasefire is a huge improvement over President Trump's bellicose threats and rhetoric earlier in the week. Chart of the Day A temporary ceasefire and reopening the Hormuz will allow Middle Eastern oil exporters to move significant volumes of crude trapped in the Gulf since hostilities started, providing global energy markets with some 'immediate relief.' writes Ron Bousso, ROI Energy Columnist. Watch today's events * U.S. ?10-year note auction (1 p.m. EDT) Want to receive Morning Bid every morning in your email? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed by the author are their own. These opinions do not represent the views of News. News is committed to the Trust Principles and a commitment to independence, integrity and neutrality.
Russell: The ceasefire in Iran is a sign of hope, but the physical oil market will remain stressed.
The physical oil market is still in a state of turmoil despite a planned two-week stopfire between Iran and the United States.
Brent crude oil contracts plunged as much as 16% in the early Asian trade on Wednesday, after finishing at $109.27 on Monday.
The sharp drop in prices reflects relief that President Donald Trump's alarming threats against Iran civilisation to be wiped out have been postponed.
This also reflects the optimism that crude, refined products and liquefied gas (LNG), may be able to resume and continue through the Strait of Hormuz if negotiations are successful.
There is a rule that says that if the word "if", appears in a phrase, then it's the most important part of the sentence.
It's very unlikely that the peace talks in this case will result in a lasting resolution, as both sides are far apart on many key issues.
The negotiations are scheduled to start in Pakistan this Friday, and will last two weeks. An extension is possible if necessary.
Iran's 10-point plan aims at securing effective control of the Strait of Hormuz. This is where up to 20 percent of crude oil, refined petroleum products, and LNG were transported prior to the U.S.-Israeli attack against Iran on 28 February.
The market's optimism about the ceasefire could be put to the test if an agreement is not reached in the coming weeks.
There will be little difference in the immediate world of crude oil supply and demand.
Supply chains are being affected by the disruptions caused by the closure. Physical markets in Asia will be under pressure for several months, even if the strait reopens fully.
SAUDI PRICES
Saudi Aramco has increased its official selling prices for cargoes loaded in May to record levels.
The?state-controlled oil firm of the kingdom raised its OSP for its benchmark Arab Light for Asian refiners by $19.50 per barrel above the Oman/Dubai standard.
The price was $17 higher per barrel than the $2.50 increase for cargoes loaded in April. This reflects the growing desperation of some Asian refiners who are desperate to get any crude available.
Oman crude finished at $119.31 per barrel on Tuesday, and cash Dubai at $123.20. If these prices continue through May, a barrel of Arab Light Crude for an Asian refiner would cost close to $150.
Prices for grades like Oman and Dubai are likely to fall sharply if the ceasefire agreement results in a sustained reopening of Strait of Hormuz.
Refiners would still have to deal with the issue of getting enough crude oil while supply chains are severely disrupted.
The Saudi price increase may help to rebalance flows, by shifting barrels away from China, which is the largest crude importer in the world, and towards other buyers, such as Japan South Korea, and Singapore.
Kpler, a commodity analyst firm, estimates that Saudi Arabia exported 1.37 million barrels a day in April. This is up from the 1.04 million barrels bpd of March.
China receives?about 29% of the total imports in April.
The high price of Saudi crude oil for May's cargoes could encourage Chinese refiners, however, to reduce imports in favor of cheaper supplies from Russia. Africa, and South America.
It may be possible to free up Saudi cargoes so that they can be shipped to countries like Japan and South Korea. Imports from the top exporter of the world have been falling since April.
South Korea's Saudi Arabia imports are expected to fall to 520,000 bpd by April. This is the lowest level since?Kpler began collecting data in 2013 and down from January's recent high of 1,14 million bpd.
In April, Japan's imports of Saudi Arabia were estimated at 373.600 bpd, a Kpler low. This is down from the December peak of 1,41?million.
The crude oil market is likely to use prices to determine the direction of supply. Wealthy countries are likely to be able secure enough?crude to get them through this current disruption.
Fuel shortages will cause economic damage to developing countries in Asia and Africa.
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These are the views of a columnist who writes for.
(source: Reuters)