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Georgia Governor Kemp meets with Hyundai and LG officials in South Korea, reports media
The Maeil Business Newspaper reported on Thursday that Brian Kemp, governor of Georgia in the U.S., will meet with South Korean leaders of business this week. This includes executives from Hyundai and LG Energy Solution. Kemp's trip comes after U.S. Immigration authorities raided in September the construction site of an under-construction battery plant in Georgia owned jointly by Hyundai Motor, LGES and LGE. After a week-long negotiation between South Korea, the United States and South Korea, hundreds of South Koreans were arrested on suspicion of working without visas. The local public relations agency that handled Kemp's visit refused to comment. Hyundai Motors and LG Energy Solution declined to comment as well. The raid shocked the South Korean government as well as the public, and revealed the lack of access for South Koreans to visas of the right type that are needed by investment sites. In the first week of this month, The United States allowed South Koreans working on equipment in U.S. facilities under temporary visas. They also opened new channels for South Korea to send workers into the country to conduct business. Hyundai Motor and LG Energy have announced a $4.3 billion joint venture to produce EV batteries near Savannah, Georgia. Each company will hold a 50% share. The plant will provide batteries for Hyundai, Kia, and Genesis EVs. Hyundai's CEO stated that the raid will delay the startup of the battery plant by at least two or three months. Hyundai has invested $12.6 billion in the state. This includes the newly opened car factory. It is the "largest economic development project" in the history of the state. According to the Governor's Office, South Korea was Georgia’s third largest trading partner in 2018. Total trade exceeded $17.5 billion. (Reporting and editing by Christian Schmollinger; Heekyong Yahng)
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Asian markets fall on possible new US trade restrictions against China
On Thursday, Asian stocks fell a second time as Wall Street was stung by disappointing earnings reports for tech giants. Meanwhile, U.S. sanctions on Russia and China rekindled geopolitical fears. Oil prices surged. The broadest MSCI index of Asia-Pacific stocks outside Japan fell 0.3% last week, while Japan’s Nikkei225 dropped 1.5%. Chinese stocks fell 0.4% in Hong Kong following reports that the White House was considering a plan aimed at curbing a range of software-powered products exported to China as retaliation against Beijing's recent round of export restrictions on rare earths. Charu Chanana is the chief investment strategist for Saxo Bank, Singapore. "Without fresh macro data to anchor investor sentiment, investors lean defensive as Trump's Asia trip stirs up geopolitical nervousness," she said. The chatter about U.S. software import curbs to China is hurting tech sentiment. And renewed sanctions against Russia remind us that geopolitical risk will not go away. As the corporate earnings season begins, global equity markets are beginning to ease off their record highs. Investors may have been disappointed by the results and outlooks of megacap companies, but most of the companies have exceeded analysts' expectations. South Korean stocks dropped 0.2% after Bank of Korea held rates, as analysts expected. Brent crude rose 2.3% to $64 a barrel on Wednesday after U.S. president Donald Trump imposed sanctions related to Ukraine for the first in his second term. The sanctions targeted Russian oil companies Lukoil, and Rosneft. The move was made on the same day that EU countries approved their 19th package on Moscow, which included a ban of Russian liquefied gas imports. Energy Information Administration reported on Wednesday that U.S. crude, gasoline, and distillate inventory fell last week due to increased refining and demand. S&P 500 futures rose 0.1%, after the second consecutive day of stock market declines in the United States. Wall Street analysts were disappointed by earnings reports released by tech giants. Netflix shares dropped more than 10% Wednesday after the streaming giant revealed its outlook for the next quarter. Tesla shares dropped 3.8% after-hours after the company reported a profit that did not meet analysts' expectations despite a record third-quarter sales that exceeded estimates. Apple shares dropped 1.6% on Wednesday after two civil rights groups filed a complaint with EU antitrust regulators over the App Store terms and conditions and its devices. The groups claimed that Apple had violated landmark rules intended to rein in Big Tech. The yield of the 10-year Treasury Bond in the United States was last stable at 3.955%. This is a 0.2 basis points increase compared to a previous closing of 3.953%. Investors think that the Federal Reserve will continue to ease policy. Fed funds futures indicate a 96% probability that the U.S. Central Bank will cut interest rates by 25 basis points at its meeting on October 29. This is compared to a 98.3% possibility on Wednesday. The U.S. Dollar Index, which measures the strength of the greenback against a basket six currencies, last traded 0.1% higher at 99.03. In early Asian trading, gold prices were close to $4,000 per ounce as investors took profits before the U.S. inflation report due this week.
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As US sanctions Russia's Rosneft and Lukoil, oil prices continue to rise
The oil prices increased by over $1 per barrel in the last session after the United States placed sanctions on Russian oil firms Rosneft, and Lukoil for the Ukraine conflict. Brent crude futures rose by $1.76 or 2.81% to $64.35 at 0041 GMT. U.S. West Texas intermediate crude futures also increased by $1.68 or 2.87% to $60.18. The U.S. has said that it is prepared to take additional action, as it calls on Moscow to immediately agree to a ceasefire of its war in Ukraine. U.S. president Donald Trump did not impose sanctions against Russia for the war before, instead relying on trade measures. Treasury Secretary Scott Bessent issued a statement saying that "given President Putin's unwillingness to end this senseless conflict, Treasury sanctions Russia's largest oil companies who fund the Kremlin war machine." Last week, Britain sanctioned Rosneft as well as Lukoil. Separately the EU approved a 19th set of sanctions against Russia, including a ban on Russian LNG imports. The rise in crude oil prices has been modest so far, Tony Sycamore said, a market analyst with IG. "The sanctions news has boosted the crude oil price but the rise has been relatively small because previous sanction/tariff threat have been diluted or deferred and also due to the difficulty of enforcing these sanctions." Brent and WTI rose more than $2 per barrel after U.S. sanction announcements, also boosted by the growing U.S. demand for energy. The U.S. urged Japan last week to stop importing Russian LNG ahead of Trump's visit to Asia. Washington is also increasing pressure in the region to reduce Russian supply. (Reporting and editing by Florence Tan, Tom Hogue and Katya Glubkova from Tokyo)
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BHP warns of 'difficult' decisions ahead for the Australian coking coal industry
BHP Group's CEO stated at the annual general meeting that it will be forced to make "difficult" decisions for its metallurgical business in Australia, if no regulatory changes are made to help it. BHP announced last month that it would cut 750 positions and suspend operations at a Queensland coal mine, which it shares with an affiliate of Mitsubishi. It blamed low prices and high royalties from the state government for its poor returns. Mike Henry, CEO of the miner’s annual general meeting, said: "Without change there will be without a doubt more difficult decisions." The incoming chair Ross McEwan, of the largest company in Australia and the top miner in the world, said that this week's critical minerals agreement between the U.S.A. and Australia was "a good start". On Monday, U.S. president Donald Trump and Australian prime minister Anthony Albanese inked a crucial minerals agreement to counter China. "It's too early to see what I think is a positive meeting between the Prime Minister of Australia and President of the United States." McEwan stated that the meeting was "a good way to begin these conversations". BHP is more interested in producing copper, iron ore, and steelmaking coal than it is in niche markets that are critical to the economy, he said, even though copper is increasingly seen as a strategic material due to its role in energy transition. Henry, a Rio Tinto executive, and two other Rio Tinto executives, met Donald Trump and Interior Sec. Doug Burgum at the Oval Office in August. Henry was "impressed" by the intensity of the U.S. focus on getting new mines and processing plants up and running. BHP and Rio Tinto are looking to build Resolution Copper Mine in Arizona. This mine could meet a quarter of the U.S. copper demand. Henry stated that the agreement was symbolic in the sense that it showed how serious the issue had been taken and what role Australia could play in supporting the U.S. Reporting by Melanie Burton and Renju José in Melbourne; editing by Himani Sarkar, Sonali Paul and Himani Sarkar
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McGeever: Investors are hearing Powell clearly because Treasury yields have plunged.
The decline in Treasury yields against the backdrop of record stock prices, tight spreads on credit and persistent inflation suggest that investors have accepted Federal Reserve Chairman Jerome Powell's view that policy is driven by employment rather than inflation. There's even a danger that a feedback loop could take hold whereby concerns about the labor market depresses yields and exacerbates fears of an economy slowing down, which in turn could maintain downward pressure on the yields. CPI inflation, a rare indicator of economic growth, will be released on Friday to investors who have been deprived of official data for three weeks due to the government shutdown. It's just not what they wanted. The report due on Friday is expected to reveal that the core annual inflation rate remained at 3.1% for September. This is more than a point higher than the Fed's target of 2%. Since nearly five years, the annual core CPI is at 3% or more almost every month. Bond market will likely shrug this off. Last week, the yield on two-year Treasury bonds fell to its lowest level since August 2022. This reflects investors' beliefs that the Fed would cut rates again next weekend, in December and even into next year. The 10-year yield has fallen below 4.00% and reached its lowest closing daily level in over a year. Even if the inflation rate is on the higher side, it's unlikely that this will cause a spike in yields. ASSESSING THE FRAGILIOUS LABOR MARK Investors have filled in the blanks with their own doomsday scenarios, as there were no official economic statistics during the three-week shutdown of the government. The slump in employment growth is what they have been wallowing over. The dramatic decline in job creation, which has been mostly offset by the shrinking labor pool until now, is alarming. Goldman Sachs economists outlined on Monday five reasons for the rapid decline in job creation: a slowdown of immigration, a reduction in government hiring and funds, adoption of artificial-intelligence technology; tariffs and trade uncertainty as well as costs related to tariffs; and macroeconomic risk. The underlying trend in payroll growth is now 25,000 per month, 125,000 less than the projections made in January. This is also below the "breakeven pace" of job growth required to stabilize unemployment, which was estimated at 75,000. This is on the higher side of estimates for breakeven. Anton Cheremukhin of the Dallas Fed estimates it at 30,000. This is down from 250,000 just two years ago. A low level of break-even job growth can help keep the unemployment rate down, but masks an even greater fragility on the labor market. Net job growth can quickly turn into job losses if the economy deteriorates. MESSAGE IN BARREL The Fed is well aware of this danger. Chair Powell indicated last month that fear of a rapid deterioration of the labor market was the main reason for the decision to continue cutting interest rates, even when inflation exceeded the 2% target. Investors and the Fed may both have other reasons for looking past the inflation rate that is still high. One is the signals from the oil markets. The link between the crude oil price and inflation may be weaker now, but that doesn't mean it should be ignored. Brent crude is near $60 per barrel, and oil prices are at a five-month low. This is down about 15% compared to the same time last year. The majority of energy analysts, such as those at the International Energy Agency (IEA), predict a persistent imbalance in supply and demand for the coming year. This is due to both increased production and weakened demand. If Eurasia Group analysts have it right, the glut could drive prices down to $55 per barrel by the end this year. This would be a 5-year low. Oil prices that are moderate have been exerting downward pressure on the inflation rate almost all year. Although cheaper crude oil won't help inflation reach the Fed's target of 2%, it can explain why investors and the Fed have turned their attention away from inflation towards the deteriorating labor market.
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Fortescue maintains its fiscal 2026 outlook, despite a rise in Q1 iron ore shipments
Fortescue, an Australian company, reported a 4.2% increase in iron-ore shipment for the first quarter on Thursday. The firm also set a new record for the first quarter production due to higher hematite shipping. The firm's hematite operation shipped 47.6 millions metric tons (Mt) in the first quarter. This was 3.3% more than the previous year. Fortescue has announced that it has drawn the loan in yuan denominated worth 14,2 billion Chinese Yuan ($1,99 billion) it secured in August for its decarbonisation plan. The five-year term loan facility, with an interest rate of 3.8% per year, was supported by major Chinese, Australian, and international lenders at the time. These included Bank of China, ICBC, and others. The fourth largest iron miner in the world saw its production costs drop 9.9% to $18.17 per metric tonne of wet iron during the first quarter. Fortescue has maintained its guidance of 195-205 Mt for fiscal 2026.
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US sanctions Russian oil firms as Moscow conducts nuclear drills
On Wednesday, the United States imposed sanctions on Russia's largest oil companies and accused Russia of not being committed to ending the conflict in Ukraine. This was as Moscow carried out a large-scale nuclear weapons training exercise. New sanctions were announced one day after the collapse of plans for a meeting between U.S. president Donald Trump and Russian president Vladimir Putin. Trump told reporters that he cancelled the summit because "it just didn't feel right." The U.S. Treasury Department stated that Russia's largest oil companies Rosneft, and Lukoil were targeted to hinder Moscow's ability fund its war machine. This was a dramatic change for the White House. It has alternated between a conciliatory and a pressurizing approach to secure peace in Ukraine. Trump only appeared to be ready to delay any new action against Moscow last week. Scott Bessent, U.S. Treasury secretary, said: "Now is time to stop killing and for an instant ceasefire." After Bessent's remarks, oil prices rose by over $2 per barrel. Trump has been resisting pressure from U.S. legislators to impose sanctions on energy, in the hope that Putin would agree and end the conflict. Trump said that he was ready to act now, as there is no end in sight. The U.S. President said that he is not yet ready to give Ukraine the long-range Tomahawks it has requested. Trump told reporters that it would take at least six month for the Ukrainians to be able to use these missiles. He was meeting with NATO Secretary General Mark Rutte. Trump stated that he would love to see Xi Jinping use his influence to stop the fighting before a meeting with Chinese President Xi Jinping next week in South Korea. Xi Jinping and Putin formed a strategic partnership between their countries. The Kremlin has released a video of General Valery Grasimov, who is the head of the General Staff and reports to Putin about the drills. Russia claimed to have fired missiles, from aircraft and submarines, as well as intercontinental ballistic missiles capable of hitting the United States. The Russian Defence Ministry reported that its Tu-22M3 strategic Bombers, which have a long range and can fly over the Baltic Sea at high altitudes, were escorted by foreign fighter jets - most likely NATO states - in various places. Putin has warned Kyiv and Western allies of Russia's nuclear power at key moments during the war in Ukraine. NATO also conducted nuclear deterrence drills this month. The rotating Danish presidency of the EU announced on Wednesday that the EU countries had also approved the 19th package against Russia, including a ban on Russian gas liquefied imports. The Wall Street Journal reported that the United States had lifted restrictions on Ukraine's usage of long-range missiles supplied by Western allies. This would have allowed Ukraine to increase its attacks on targets in Russia. Trump denied the report in a post on social media. Sweden announced on Wednesday that it had signed a Letter of Intent to Export Gripen Fighter Jets to Ukraine. This comes as European governments work to strengthen Kyiv's defenses in a conflict that has lasted for three years, eight months, since Russia's invasion. Ukrainian pilots are in Sweden testing the Gripen. It is a rugged, low-cost alternative to aircraft like the F-35 from the United States. Volodymyr Zelenskiy, the president of Kyiv, said that the country hoped to start using Gripens in 2013 and would purchase at least 100. TRUMP DOESN’T WANT WASTED MEEEING As the U.S. led peace effort was surrounded by renewed uncertainty, Russia and Ukraine launched heavy missile attacks against each other overnight. Last week, after months of diplomatic stalemate, Putin and Trump announced unexpectedly that they would be holding a summit in Hungary. The Kremlin stated the event could happen within two weeks. The White House announced the following day, after a telephone call between top diplomats of the two countries on Monday, that Trump did not have any plans to meet Putin in the "immediate future". Trump claimed he didn't want a wasteful meeting, something that the Kremlin also said Putin wanted to avoid. Russian officials, however, said that preparations for a summit continued. Dmitry Peskov, Kremlin's spokesperson, told reporters that the dates for a summit have not yet been determined, but preparations are ongoing. Three sources said that the summit was delayed after Russia reiterated its terms to the U.S. for a peace agreement, including the requirement that Ukraine cede the entire southeastern Donbas area. This was a rejection to Trump's last-week statement that both sides must stop at the frontlines. Sergei Ryabkov, the Russian deputy foreign minister, was quoted as saying that he couldn't confirm that Moscow has conveyed their position in the report by RIA. Shares in European Defence Companies are on the Rise Trump, in the first nine-months of his second term has been pushing for an end to this conflict, which is the deadliest one Europe has seen since World War Two. He has been critical of Zelenskiy at times, but he also expressed frustration towards Putin. The delay in the Putin-Trump Summit has led to a rise in European defence shares. The majority of European governments have pledged to increase military spending in order to meet Ukraine's defence needs. On Thursday, the leaders of the European Union will discuss a plan to use frozen Russian assets in order to extend a $163-billion loan to Ukraine. Moscow has declared that the scheme is theft and has promised to retaliate. Senior Ukrainian officials told Kyiv that it should be able to decide how to spend its funds and not just buy arms from European countries.
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FirstEnergy's strong demand and higher rates helped it to beat its quarterly profit forecast.
Utility FirstEnergy on Wednesday beat Wall Street expectations for the third-quarter profits, thanks to higher electricity rates and commercial and residential demand. Data centers, which are power hungry and necessary to support artificial intelligence's boom, have been preparing the U.S. electricity industry for a surge in nationwide electricity consumption. FirstEnergy, based in Akron, Ohio, has narrowed down its adjusted earnings estimate to between $2.50 to $2.56 per common share for the current quarter. This is still within its previous view of $2.40 - $2.60. The company's quarterly performance was improved by new Pennsylvania base rates, but this was partially offset by increased operating costs. FirstEnergy, for example, uses rate cases to determine customer charges by comparing the investments they made in their transmission and electric systems. In the next five years, the company plans to invest 30% more in transmission. Utility also increased its investment programme by 10%, to $5.5 billion in the current year. FirstEnergy electric distribution companies service 6 million customers across Ohio, Pennsylvania and New Jersey as well as in Maryland, West Virginia and New York. According to LSEG, the company reported an adjusted profit per share of 83 cents for the quarter that ended on September 30. This compares with an average analyst estimate of 77. Reporting by Vallari Shrivastava in Bengaluru and Sumit Saha; editing by Shreya biswas
Britain's environment advisers urge steeper emissions cut target for 2035
Britain's climate consultants, the Committee on Climate Change (CCC), has actually suggested in a. letter to federal government that it need to devote to minimizing. greenhouse gas emissions by 81% by 2035 in its approaching budget. next month.
The brand-new Labour federal government is anticipated to reveal boosts. in public costs and taxes in its first budget plan in 14 years. next week.
The emissions cut target advised by the advisors is. greater than the existing target of a 78% reduction by 2035. compared with 1990 levels and excludes international aviation. and shipping emissions.
However, it would make a reputable contribution towards. limiting international warming to 1.5 degrees Celsius above. pre-industrial levels, the committee said.
With environment damages already probed the world,. targeting an 81% emissions reduction by 2035 sets the right. level of ambition, stated Piers Forster, interim chair of the. committee. Our analysis shows this can be achieved in a way. that benefits jobs and the economy, offered we struck the. country's 2030 target - set in line with the CCC's suggestions in. 2020, he said.
The federal government needs to set out an upgraded climate strategy and. targets for 2035 before a U.N. deadline of February 2025.
In July this year, the CCC said Britain might miss its 2030. emissions reduction target and was off track to meet a. longer-term target of net zero emissions by mid-century.
The recommendations will likewise form part of the committee's seventh. carbon budget strategy covering the years 2038-2042 which is because of. be released in February next year.
(source: Reuters)