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Gulf stocks rise on hopes for renewed US-Iran diplomacy
Gulf stock markets were up in the early trade on Thursday. This was boosted by the hope that diplomatic efforts between Iran and the United States could resume after the two sides had exchanged recriminations earlier this week. Qatar's "prime minister" is scheduled to visit Tehran Thursday to try to revive diplomatic relations after Washington announced that it would increase economic pressure against Iran by targeting its trading partner with sanctions. A senior Iranian source revealed on Wednesday that Iran and Oman were finalising the details of an agreement?on control of Strait of Hormuz. Iran's Revolutionary Guards claimed that the two countries agreed to share management of the strategic waterway which connects Gulf oil producers with global markets. Dubai's main stock index rose 0.4% with the majority of its constituents. Etihad Energy increased by 2.9% while Emirates Central Cooling Systems gained?1.3%. Abu Dhabi's benchmark rose 0.3%. This was supported by an increase of 1.3% in Alpha Dhabi Holding, a conglomerate, and a rise of 1.2% in First Abu Dhabi Bank, the United Arab Emirates largest lender. Qatar's index rose 0.5%, with communication and energy stocks leading the way. Qatar Gas Transport and Telecoms Operator?Ooredoo both rose 1.9%. QatarEnergy issued a spot bid to sell full-range and light-range naphtha cargoes free-onboard from Ras Laffan Port, located "inside" the Strait of Hormuz. The tender was confirmed by a document that traders reviewed on Wednesday. Saudi Arabia's benchmark Index?edged upward by 0.1% with the majority of stocks showing positive returns. National Industrialization Company gained 3.6% while Saudi Aramco gained 0.5 percent. Saudi Aramco offered more?crude to be loaded outside the 'Strait of Hormuz in September, according to four sources familiar with the situation on Wednesday. This comes after the oil producer sold 4 million barrels of crude oil this month. (Reporting and editing by Mrigank Dahaniwala in Bengaluru)
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Government data shows that 45 Indian coal-fired power plants are running on low fuel.
Government data shows that 45 power plants are operating in India with a critical shortage of coal. This is due to the fact that monsoon rains have disrupted supplies, and electricity demand has risen amid hotter than usual weather linked to El Nino. Data as of August 25, showed that the number of plants with coal stock levels below 25% of required inventories or with stocks so low they could not generate electricity for more than three days had increased dramatically from 31 at the beginning of July. According to data on the website of Central Electricity Authority - a think tank affiliated with the federal power ministry - 40 of the affected plants are domestic coal plants. Industry sources claim that heavy rains in coal-rich states like Odisha, Jharkhand, and Chhattisgarh have?hit the mining industry and slowed down the transportation of fuel to power plants. BigMint, a commodities consultancy, said that there had been a "significant (inventory drawdown), particularly in?August. This resulted in stocks dropping 19% from their end-July level. BigMint reported that coal stocks at power plants were at 30,95 million tons. This is equivalent to about 10 days' worth of operating requirements, as opposed to 12 days in July. Lower coal stock levels come as South Asia is heading for its weakest Monsoon in 2009, and uneven El Nino rainfall has been driving up the electricity demand across the country. The uneven monsoon is driving power demand, especially for air conditioning. "But coal supplies are in short supply," said an official from the country's biggest?thermal energy producer, NTPC. The NTPC official stated that "there is a requirement for 5 to 6 rakes in?some plants but we only receive half of this number." India has experienced 12% less rain than normal this monsoon, which is causing a greater reliance on coal-fired electricity generation, especially at night, when cooling demands remain high. A senior official in the ministry said that the ministry had subsequently asked some coal-fired power plants to delay maintenance plans until the situation with the supply is clarified. Sources could not be identified because they weren't authorised to talk to the media. Reporting by Sethuraman N.R.; Editing by Nidhi V.R. and Alexandra Hudson
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Zinc snaps six-day winning streak as industrial metals tumble
Zinc prices dropped - and were about to end a six day winning streak on Thursday. A firm dollar weighed down the support of a 'thin supply outside China', while also pulling other industrial metals down. The benchmark three-month price of zinc at the London Metal Exchange fell by 0.96%, to $3.855.5 per metric ton as of 0700 GMT. The most traded zinc contract at the Shanghai Futures Exchange was down by 0.44% to 26,140 yuan (US$3,889.71) per ton. As the market prepares for U.S. Federal Reserve Chair Kevin Warsh's awaited speech in Jackson Hole, the U.S. Dollar Index has?gained 0.33% during this week. A stronger dollar weighs on greenback-denominated commodities by making them ?more expensive for buyers using other currencies. Zinc's fall would cap off an impressive rally which had pushed the metal up to its highest level in the LME for more than four years on Wednesday. The LME has a large cash-to-3-month backwardation due to concerns about the availability of this metal. Prices have been supported by data that showed the refined zinc supply moving into deficit in June. The total LME stocks on Wednesday were? At 97,325 tonnes, the supply was nearly triple what it had been in October. This led some analysts to minimize the impact of the?supply shortage and instead point to the support of speculative positions?on the LME. Sandeep Daga is the head of research for Metal Intelligence Center. He said that there was a physical tightness in China but it wasn't as bad as last time and didn't justify current prices. Copper was stable, aluminum dipped by 0.2%, and lead dropped by 0.37%. Nickel was little changed -?down just 0.04% - while tin was up 0.15%. Copper?lost 0.46 %, aluminium fell 0.21% and lead dropped 0.03%. Nickel lost 0.65 %, tin dropped 1.57 %. $1 = 6.7223 Chinese Yuan Renminbi (Reporting and editing by Mrigank dhaniwala, Devika Syamnath).
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OPEC+ loses influence in Iran War as China gains influence
Six months after the 'Iran War,' the world’s most powerful oil coalition, OPEC+ finds itself in a new position. It is unable to influence a marketplace it?once shaped. The war has eroded OPEC's share of the market and its ability to influence prices. The group's policy decisions and statements barely affect oil markets any more. Analysts describe the worst ever supply disruption as a major factor in balancing oil markets. OPEC+, the Organization of the Petroleum Exporting Countries (and its allies, including Russia), accounted for 40% of the global oil production in July. Calculations based on data from the International Energy Agency? were used. This is down from 48% in February before Israel and the U.S. attacked Iran. However, four to five percentage point of that decline was due to the United Arab Emirates withdrawing from OPEC. OPEC+’s core group, which includes Saudi Arabia and Russia as well, accounted only for a quarter (25%) of the world's oil production in July. The war has?reduced OPEC+’s ability to quickly increase or cut supply, by effectively closing the Strait of Hormuz. This is a major export route for Saudi Arabia, OPEC's top producer and other members like Iraq and Kuwait. OPEC was founded in 1960 and expanded to OPEC+ in 2016, when Russia and other oil producers joined forces with the group to counter its declining?share of global oil production. OPEC's global crude oil output peaked in the 1970s at around 50%. By the mid-1980s, however, the share had dropped to 30% as the North Sea and Alaska production increased. OPEC has not responded to a comment request. OPEC+ claims that its decisions aim to support market stability, and do not target a particular oil price. OPEC has experienced supply disruptions during wartime before, including in Kuwait during the 1990-1991 Gulf War and Iraq after the 2003 U.S. led invasion. The scale of this outage is unprecedented, as it affects multiple producers at once, making it difficult for OPEC to compensate for losses elsewhere. Since March, the core OPEC+ has announced six increases in oil production. The Hormuz Blockade has kept most of these decisions on paper. They have had little impact on oil prices except for a brief U.S./Iran ceasefire in July that sparked hopes that Hormuz might reopen. The contrast between 2019 and 2018 is stark. The contrast with 2019 is striking. The key question at that time was how much oil OPEC+ decided to pump. The focus now is on how much oil can be physically produced and exported during a Middle East conflict. The steep drop in Chinese oil imports has been one of the major price drivers for this year. China has purchased roughly 400 million barrels less oil since the start of the war than it did during the same time last year. The decline is due to a ban on fuel imports, lower refining production and the increasing use of electric vehicles. This?trend highlights China's increasing role in balancing the oil markets. A?role that was once almost exclusively associated with OPEC+, as the world's pivotal producer. China's lower demand for oil this year has contributed to a price ceiling. In contrast, China's buying spree in the past year, which could have accounted up to half of the global growth in oil demand, has helped support the market. June Goh is an analyst with Sparta Commodities. She said, "They have become the swing centre for demand."
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Asian stocks are up for a third day after Nvidia beats expectations
Stocks rose on Thursday in Asian trading as 'Nvidia’s' earnings report exceeded estimates. This boosted tech hardware manufacturers, and revived investor confidence. MSCI's broadest Asia-Pacific index excluding Japan gained 0.2%. This extended its gains for a third day in a row after Nvidia announced that its quarterly revenue had more than doubled, and forecasted third-quarter revenues above Wall Street expectations. In after-hours trades, the AI chipmaker's stock jumped by 4.7%. This lifted S&P 500 futures by 0.3%. Chris Weston, Head of Research at Pepperstone Group Melbourne said that the business is in "absolutely rude health". It's going wake people up, and they'll wonder what they missed. This is a very bullish story, and anyone who supplies Nvidia via the supply chain today will probably see the benefits." South Korea's KOSPI increased 1%, reversing gains made earlier after the Bank of Korea increased interest rates by 25 basis point to 3%. This was in line with expectations on the market, which were narrowly expecting a rise. Taiwanese stocks rose by 0.3% while Nikkei fell 0.3%. The S&P 500 closed flat overnight, with Wall Street stocks edging up 0.2% after the PCE index increased 0.2% from the previous month to July. This followed a 0.1% drop a month prior. Analysts from Societe Generale wrote: "July core PCE was broadly in line with expectations but the details were more firm." The inflation outlook therefore appears to be firmer going into the September FOMC Meeting. The yield on the 10-year Treasury bond in the United States was down one basis point to 4.652%, as markets awaited Fed chair Kevin Warsh's Friday speech at Jackson Hole, Wyoming for more clues about the direction of U.S. rates. Brent crude futures are down 0.8% to $87.11 and the benchmark is on course to drop for a 'fourth consecutive day' as Qatari Prime Minister prepares to travel to Tehran on Thursday to re-launch the peace talks between the U.S. Westpac analysts noted that "Crude Oil prices continued to ease, despite the highly uncertain outlook regarding the management of the Strait of Hormuz as well as the current state of global oil supplies. This is especially true in light of new threats of escalation by Putin in the?Russia-Ukraine War. After a slight pullback on Tuesday, gold rose 0.3% to $4.604.27 per ounce. Bitcoin was up 0.5% to $78,824.80 while ether rose?0.9% at $2,493.41. The three companies are all benefiting from the revival of "dollar debasement" trades after the U.S. Treasury Department intervened last week in the bond markets, and they are now up by 14%, 25% and 34% for the month. The U.S. Dollar Index, which measures the strength of the greenback against a basket six currencies, is currently at 99.16. This is near its highest point in the last week. (Reporting and editing by Thomas Derpinghaus; Reporting by Gregor Stuart Hunter)
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How financial markets have been affected by the Middle East conflict in six months
The U.S.-Israeli bombings of Iran six months ago triggered a global conflict that disrupted energy supplies and sent ripples throughout global financial markets. Below are charts that show the impact of the conflict on?oil prices, food prices, safe-haven assets, and equities. 1 COSTLY ENERGIA As Gulf production was disrupted, and shipments through Strait of?Hormuz were curtailed, oil prices soared. Brent crude briefly reached $120 in April, and will still average about $90 by 2026. This is up from $70 in the previous year. The biggest impact was on refined fuels. Diesel prices are rising more rapidly due to a shortage of middle distillates and Russian refinery shutdowns caused by Ukrainian attacks. The Gulf was a major source of jet fuel, but a surge in U.S. exports and refinery production helped to ease the supply concerns. The upcoming winter in the northern hemisphere could see further disruptions to Hormuz shipments, along with threats to Russia's energy grid. This would likely increase heating oil prices and inflationary pressures. 2 AI BOOM STOCKS The AI sector, which has received trillions of dollars in investment, has helped to boost global stocks. The MSCI 47-country index of world stocks has reached a record high of $105 trillion this month. It is up almost $7 trillion or 9% since the outbreak in war. However, the Gulf region's stocks have not performed as well. Fidelity Analyst Pranav Aggarwal stated that the rally was a sign of investors taking a more "relaxed" view and expecting the war to be over this year. He said, "Equities have had a pretty good year." "They are up about 14% (for the year). "If we expect 8%-9% growth in a normal year, 14% through August is pretty impressive." 3 GOING IN SEARCH OF SAFETY The traditional safe-haven assets, like highly rated government bond, gold, and the US dollar, have not consistently performed as such. Analysts said that the dollar's?rise of 1.4% against a basket major currencies has occurred since?the beginning of the war, but much of this is due to the Japanese yen’s weakness. U.S. Treasuries, a mainstay of portfolios for decades, have fallen 3.5% in total returns as inflationary pressures have shattered U.S. rate-cut bets. Recent concerns over the new Federal Reserve Chief Kevin Warsh's plans to buy back debt and Washington’s recent surprise debt buyback plan have also weighed. The price of gold fell by nearly 25% from the beginning of the conflict to July, despite the fact that it had tripled since 2022, when Western powers frozen Russia's central banks reserves due to the invasion of Ukraine. Gold prices have risen by more than 15 percent this month amid renewed fears about the devaluation of the dollar. Food and Fertilizers Fertiliser, an important input in global food production, has been affected by the closure of Strait of Hormuz. Analysts say that the shock is a threat to agricultural production, especially when combined with the strong El Nino weather pattern and the recent disruptions in grain shipments due to the conflict in Ukraine. According to the U.N. Food and Agriculture Organization, food prices increased in July by more than 3 years. Experts warn that the full impact of this is still to come. FAO warned that the world may be headed towards another bout of inflation. JPMorgan estimates a strong El Nino could increase global food inflation to 0.7% at its peak. Impacts are likely to be most acute in Asia, Latin America, and Africa, where households spend more of their income on food, and policymakers are wary of new price pressures. 5 GULF CLUBBED The Gulf region has suffered a direct blow. Saudi Arabia's exports dropped by 10% between the first and second quarters. JPMorgan believes that Dubai's real estate sales have plummeted by 70% to 80%. Oxford Economics predicts that Qatar's economy is going to shrink by almost 30% this year due the damage done to its Ras Laffan Gas Facility. Qatar and UAE stock prices have both fallen around 14%, a drop of more than 20 points compared to world stock prices. Both countries' insurance costs against default have also increased, but Bahrain is the hardest hit as its credit default swaps prices are up by almost 40%. Reporting by Karin Strohecker & Marc Jones. Mark Potter edited the article.
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South Africa's Harmony increases dividends after profit surge
Harmony Gold posted an 87% increase in its annual 'profit' on Thursday. Higher gold prices helped to 'offset the impact of lower output and grading, allowing it to pay out a record-breaking dividend. Harmony, South Africa’s largest gold producer with a stake in copper, reported that its headline earnings per shares were 43.63 rands ($2.73) for the year ended June 30. This is up from 23.37 rands in the previous?year. The company said that it would pay a dividend of 7.50 rand per share, which is nearly five times the payout last year. The company was able to benefit from a 35% rise in the average gold price. This helped to soften the impact on the lower gold production, which dropped 3% to 1,43 million ounces compared to last year's financial year. Gold price XAU= has risen sharply this year. This is due to central bank purchases, increased investor demand and heightened geopolitical tensions. Harmony's new CSA mine, which it acquired in Australia, produced 18,207 metric tons of copper. This was above its target. Harmony?acquired?the CSA mine in October 20, 2025. This acquisition expands its copper portfolio which includes the Eva copper project?in Australia and the Wafi -Golpu?project?in Papua New Guinea that is jointly owned by Newmont. Harmony has diversified into the copper industry, a critical metal for electric vehicles and power grid infrastructure. This is to capitalize on a growing global demand. Reporting by Olivia Kumwenda Mtambo, Nelson Banya and Rashmi?Aich; Editing Muralikumar Anantharaman
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Morning bid Europe-Jensen on the market: we're back!
Gregor Stuart 'Hunter' gives us a look at what lies ahead for the European and Global markets. It's Nvidia now. We just live there. The chip designer has forecast a 70% increase in revenue for the next fiscal year. This is a rare announcement from the largest?company? of sales that far in advance. CEO Jensen Huang also expressed confidence that the demand for AI chips would continue to grow until early 2028. The stock rose almost 5% after hours, with little sign that it would slow down. This was after The Information reported that Nvidia had?agreed' to pay $12.9 Billion to purchase AI platform Hugging face. According to an independent investigation, OpenAI hacked into this open-source platform last month, creating a swarm consisting of 700 AI agents who tried to hide their tracks. OpenAI has revealed more details about its rogue agents. One of these is that the bots they created later broke into their own networks during tests that went wrong. All of this is good news for Asian chipmakers who are part of Nvidia's supply chains, however unsettling it may be to humanity. MSCI's broadest Asia-Pacific index outside Japan rose 0.5%. The KOSPI, the largest component of the index, grew 1.8%, despite a Bank of Korea rate hike of 25 basis points. S&P 500 e-mini futures climbed 0.5%. Brent crude oil was down 0.5% to $87.40 in the oil markets. It is expected to continue to drop for a 4th consecutive day, as Qatar's Prime Minister heads to Tehran to try to restart peace talks between Iran and the U.S. Gold rose 0.7% to $4,624.14 following a Wednesday 'pullback'. In cryptocurrency markets, Bitcoin was up 0.5%, at $78,822.84, while Ether climbed 0.8%, to $2,492.30. The three companies are all benefiting from a revival of so-called "dollar?debasement trades", after the U.S. Treasury Department intervened last week in the bond?markets. This month, they have risen by 14%, 25% and 34%, respectively. Early European trades saw pan-regional futures up 0.4%. German DAX 'futures' edged higher by 0.1%, while FTSE?futures?were down by 0.4%. The following are key developments that may influence the markets on Thursday. Earnings announcements Marvell Technology, Royal Bank of Canada and Pernod Ricard Economic Events Germany GfK/NIM consumer sentiment for September France: Producer Prices and Unemployment Data for July Euro Zone Money-M3 Annual growth for July (Reporting Gregor Stuart Hunter, Editing Saad Sayeed).
Singapore's oil product inventory reaches highest level in three weeks
Government data released on Thursday showed that oil product inventories in Asia’s fuel trading hub, Singapore, had rebounded to three-week highs, with stocks increasing week over week.
Enterprise?Singapore data showed that combined onshore inventories reached?39.18m barrels for the week?ended august 26. This was?up 4.0% compared with a week before. The markets remained attentive to Middle East discussions around the Strait of Hormuz, which transported oil and LNG equal to about one fifth of global consumption prior to the U.S./Israeli war against Iran.
The RESIDUAL FUEL STOCK RETURNS TO A MASS OF 19 MILLION BARRESLS
The residual fuel stockpiles rose for the?second week in a row, reaching a new three-week record of 19,24 million barrels (3.03 millions tons), an increase of 4.4% from week to week.
Recent trading sessions have seen spot fuel oil premiums begin to fall as traders anticipate more arbitrage supplies.
Fuel oil imports onshore have slowed down for now as there are still some cargoes on the way.
The total imports dropped by 31.8%, to 509,000 tonnes, in the week ending August 26. Bahrain and Belgium were the two top suppliers.
The total exports fell?6.5% compared to the previous week, to 326,000 tons. Most of the products were shipped to New Caledonia.
The MIDDLE and LIGHT DISTILLATE Stocks Reach a Two-Week High
Despite a drop in weekly net exports, the Middle Distillates Stockpiles (which include both jet fuel and diesel) rebounded to nearly 8.5 millions barrels, a new two-week record.
The net exports for both fuels increased significantly, while the total imports fell.
Net exports of diesel and gasoil rose more than 10 fold from a few weeks ago. Imports fell by nearly 100% in the same time period.
Exports to Malaysia and Indonesia grew by 44%.
According to multiple sources of?trade, the number of barrels that will be shipped from India in the next few weeks is expected to remain low, because arbitrage margins on markets west-of-Suez are more lucrative.
Exports of jet fuel and kerosene increased 3% while imports fell 100%.
Stocks of light distillates rose to over 11.5 million barrels - a new two-week record.
The main countries of origin for gasoline imports during the week? were China, South Korea?and Taiwan. Naphtha was imported from Argentina?, Malaysia?and China?
Exports were mainly headed for Indonesia and Malaysia. The majority of naphtha was also destined for Indonesia.
(source: Reuters)