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Stocks rebound from AI-led damage; US inflation eases
Investors digested central bank decisions that highlighted divergent monetary policies around the world. Global shares rose Thursday, after?benign U.S. data on inflation. U.S. consumer prices rose less than expected during the year ending November. This initially hurt the dollar, but lifted equities on the hope of U.S. interest rate cuts in 2019. The pound rose after the Bank of England reduced interest rates, but indicated that further easing was unlikely. As expected, the European Central Bank left euro zone rates unchanged and took a more optimistic tone about the economy. Bank of Japan expected to raise rates on Friday. However, traders are still uncertain about the rate of tightening in 2026. STOCKS GET DATA-DRIVEN BOOST European stocks rose, with the STOXX600 up 0.3%. U.S. futures increased 0.7%-1.4%. This suggests a respite from Wednesday's tech led selloff. The U.S. The Labor Department reported that the Consumer Price Index increased 2.7% on an annual basis in November. This was below the economists' expectations of 3.1%. Import tariffs are partly to blame for affordability concerns, but the technical moderation is still evident. Some people may dismiss this report because it is less reliable than usual. But ignore it at your own risk. Brian Jacobsen is the chief economist at Annex Wealth Management. He said that other indicators such as rent prices and used car values are in line with the idea that old inflation drivers are not the current sources of inflation. Federal Reserve Governor Christopher Waller said that the central bank could cut rates if it saw signs of weakness in the labour market. Donald Trump, the U.S. president, said on Wednesday that the next Fed Chair would be someone "who believed in lowering rates by a lot." The Fed has indicated that it will only make one rate reduction next year. BOE CUTS AND ECB HOLDS The BoE reduced rates by 25 basis point in a vote that was narrower than expected. "There are enough people on the rate-setting panel who think: 'I don't want this to be a trend'. Chris Beauchamp is the chief market analyst at IG Markets. He said: "I'd rather wait and see if this turns into a trend." "I believe the reasoning is there? Probably, but you need to be patient for it to turn green. "I suppose you're only getting the amber light right now," he said. As ECB president Christine Lagarde started her press conference, the euro rose 0.12% to $1.1752. Treasuries firmed up, with yields on two-year bonds down by 2 basis points to 3.464%. Yields on 10-year bonds were also lower by 1.8 basis points to 4.133%. The price of oil rose for the second consecutive day, as Trump's blockade on Venezuelan exports continued and there were reports of new U.S. sanction against Russian oil. U.S. crude oil rose by 0.6% to $56.12 per barrel while Brent crude climbed 0.4% to $59,93. (Additional reporting by Stella Qui in Sydney. Kate Mayberry, Mark Potter and Kate Mayberry edited the article.
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Cannabis stocks increase ahead of possible Trump order to relax marijuana restrictions
Stocks of cannabis companies rose on Thursday in premarket trading, fueled by expectations that U.S. president Donald Trump will sign an executive order easing federal regulations on marijuana. The debate about marijuana regulation is dominated by calls to reclassify marijuana as a safer drug. This would be the "most significant" change in marijuana policy ever since 1970. This reclassification would not legalize marijuana, but it could reduce tax burdens on firms, speed up research, allow for standard drug development, and improve access to capital. Tilray shares listed in the U.S. gained?nearly 5%. SNDL rose 3%. Canopy grew more than 5%. AdvisorShares Pure US Cannabis ETF rose 6.5%. Reclassification of marijuana would shift it from Schedule I (which includes substances like heroin, ecstasy, and peyote) that are not accepted for medical purposes to Schedule?III which covers substances with a moderate or low?risk?of physical or psychological dependency. According to reports, Trump is considering a Medicare Pilot Program?that could provide seniors with?access CBD. Rearranging Medicare coverage and attracting investments from other investors and financial institutions would be likely.
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EDF France raises the maximum cost estimate of six reactors from 62 billion to 72.8 milliards euros
EDF, France's largest utility, said that the construction of six new nuclear reactors would cost a maximum of?72.8 billion euro ($85.29billion) based on values in 2020. This is higher than the 52 billion euro estimate made when the plans for a new fleet was first announced. Macron announced in early 2022 plans for'six new nuclear reactors, with a production capacity totaling?about ten gigawatts. This will partly replace older plants and secure future energy supplies. France produces about 70% of its electricity from nuclear power. EDF aims to reduce its costs by building reactors in a series. The costs will drop by 30% when the last one is completed, Xavier Gruz said at a press briefing. EDF will be given a loan to cover 60% of the construction costs. Contracts for Difference?on power generated are used?to repay the loan. Gruz said that a final investment decision will be made on the project by the end 2026.
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Silver nears record high as gold falls on dollar firmness ahead of US inflation data
Silver hovered at record highs, as gold prices fell on Thursday. The dollar strengthened, and investors were 'cautious' ahead of U.S. inflation figures that could influence the Federal Reserve policy. As of 1210 GMT, spot gold was down 0.4% at $4,323.57 per ounce. U.S. Gold Futures fell 0.4% as well to $4,356.10. Dollar index increased after reaching a near-one-week-high on Wednesday. This made greenback-priced gold more expensive for foreign buyers. Spot silver dropped 0.1% to $66.19 per ounce after reaching a record high at $66.88 the previous session. The slightly stronger dollar is a headwind to both gold and silver )... Some cautious investors prefer to be on the safer side and avoid 'running into the inflation report with an opened position,' said UBS analyst Gian?Staunovo. White metal has, however, increased 129% this year due to a stronger industrial demand as well as a continuing supply deficit. Donald Trump, the U.S. president, said that the next Fed chair will be someone with a "significant" belief in lower interest rates. Trump will announce his choice to replace current Fed chair Jerome Powell early next year. Fed Governor Christopher Waller said that the Fed still has the ability to "cut interest rates" in light of the deteriorating job market. Data released earlier this week showed that the U.S. unemployment rate increased to 4.6% in the month of November. This was higher than the poll-predicted 4.4%, and the highest level since September 2021. Investors await the release of the November U.S. consumer price index later that day. A survey projects a 3.1% increase year-on-year. The markets are already pricing in two more 25-basis point rate cuts for next year. Gold and other non-yielding investments benefit from a low-interest rate environment. Palladium rose 2.8% to $1,693.55, which is a record high for nearly three years. Platinum rose 1.3%, to $1,924.05, an all-time high.
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Indonesia will issue investment instruments to invest in natural resource exports
A finance ministry official announced?on Friday that Indonesia would issue investment instruments to earn from exporting natural resources. The goal is to ensure exporters follow the rules and keep the foreign currency earnings in the country. The 'new'regulation is intended to increase U.S. Dollar liquidity onshore and stabilize the rupiah rate. It will require that natural resource exporters retain all their foreign currency earnings starting January 1st in state banks for a minimum of a year, and restrict their use. Febrio Kacaribu is a senior official in the Finance Ministry. He told a news conference that new FX bonds will be issued domestically. Indonesia is the largest?exporter in the world of thermal coal, nickel, tin, palm oil and rubber. It also sells a lot of coffee, rubber and other commodities. Febrio said that the earnings were converted to rupiah, and then sent offshore. Palm oil and mining associations have complained about the planned rule, as it will limit the conversion of their foreign exchange earnings into rupiah to a maximum 50%. Exporters are allowed to keep their earnings in any Indonesian Bank. The exporters can also be exempted from the requirement to retain the earnings for a certain period of time if they convert the proceeds into rupiah. Hadi Sugeng told GAPKI's secretary general on Thursday that they need money to fund their operation. Hendra Sinadia is the executive director of Indonesian?Mining Association. He said that miners also hoped that the government would?keep current rules. Febrio, when asked about the complaints from the industry, said that exporters would need to get a bank loan if they needed more rupiah money than the 50% limit. Febrio said that non-state banks would also have a limited impact on liquidity because they can still serve exporters who are not in the natural resources sector. (Reporting and writing by Stefanno Sulaiman, Gayatri Suryo; editing by Alison Williams).
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West African oil is struggling to find buyers, as global surpluses build
West African crude oil faces competition from Middle East, Latin America China and India switch to alternative, cheaper oil grades Dangote refinery reduces Nigerian imports of oil Robert?Harvey & Seher Dareen LONDON 18 DECEMBER - West African crude sellers are struggling to find buyers for up-to-26 December-and-January-loading cargoes due?to stiff competitors from abundant and cheaper alternatives, traders and analysts have told. Analysts say that the amount of crude oil from Nigeria and Angola which is not being sold, is indicative of an overall surplus in the oil market. This led to a sell-off on the international futures markets, which pushed Brent crude down below $60 per barrel this week. Victoria Grabenwoger, an analyst at Kpler, said that the overhang of West African crude cargoes reflects a global crude supply surplus which emerged in Q1 of this year. Two traders reported that approximately 20 million barrels (or a little more) of Nigerian crude oil were still unsold as of Thursday. Meanwhile, Angola had five or six cargoes left in its December-January programme. The cargoes are causing a delay in the beginning of the February trading cycle, even though Angola has already released its loading schedule and term nominations. This is a very large amount of oil that has not been sold, and it is especially unusual for this month. The West African trade cycle usually runs two months in advance. The estimated overhang for both countries was as high as forty million barrels this week. The analyst for OilX, Francisco Gutierrez said that the current market softness is partly seasonal, and partly due to changing buying patterns as a result of freight costs and other supply options. He added that Angolan trade in January has fallen 20% behind its average long-term pace, because China, the world's largest commodities buyer, switched to alternative grades which are cheaper or closer to each other. Analysts say that supplies from the Middle East are displacing West African medium and heavy grades in Asia due to lower official selling prices and shorter journeys in January. India's oil imports have remained?resilient? despite the tightening of Western sanctions. They are replacing medium-heavy density West African oils, while lighter to medium-density West African grades struggle to compete with supplies from Argentina and Brazil. Grabenwoger of Kpler said that Nigeria is also left with more oil to sell because Africa's biggest oil refinery, Africa's 650,000 barrels per day Dangote plant has reduced its imports. This will be due to maintenance in January. Reporting by Robert Harvey in London and Seher Dareen, edited by Alex Lawler & Barbara Lewis
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Minister: New Czech government considering several CEZ purchase options
The Czech government has a number of options to buy out CEZ. This includes leaving some assets on the market. However, it has not set a date for what could be one of the biggest energy changes in the country, according to its industry minister. Andrej Babis is a billionaire, and his populist ANO party leads a coalition government which took office last week, after winning the October elections. He has called for CEZ to be fully controlled in order to increase energy security. Karel Havlicek is the ANO vice chairman and first deputy premier. He told?on?Wednesday that a possible option was to take 100% of CEZ’s generation assets, and leave?distribution assets and trading assets at the stock exchange. State could buy all of CEZ, one of?central Europe's biggest companies with a $33 billion market capitalisation. Then relist a part of its distribution and trading assets. Havlicek refused to provide any further information on "price sensitive" matters. Once approved, the process could take two years. In an interview, he stated that "this would de facto signify that the desired steps towards energy security have been taken." "We'd have the whole generation under control like they do in France, for example." 'MASSIVE TRANSACTION' The cost of buying out minority shareholders who own 30% of CEZ would be reduced if CEZ listed some of its distribution or trading activities. The government holds 70% of the company. At the current share price, buyout costs would be more than 200 billion crowns (about $9.6 billion). Havlicek stated that any transaction must provide fair conditions for minority shareholders. He said that he did not want to speculate on when we would reach this goal, but added that the government is also working to reduce energy prices for customers and build new capacity mechanisms. He said a CEZ buyout would be a "massive transaction", but that it would give more flexibility to the state. Critics claim the plan would be costly and burden CEZ with debt. Havlicek stated that CEZ generates an annual profit before interest, taxes, depreciation, and amortization of 130 to 140 billion crowns. Therefore, it can handle a buyout without compromising investments.
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Chennai Petroleum Corp., India's largest refinery company, will increase capacity at Manali refinery.
Chennai Petroleum Corp. (CPCL), an Indian company, plans to increase the capacity of its Manali refinery in south 'India to 280,000 'barrels a day' from 210,000 bpd and enter fuel retailing. This is part of a strategy to grow. The company is a sub-sidiary of India's largest?refiner - the state-run Indian Oil Corp. It sells all of its transportation fuels, including diesel and gasoline, to the parent company, which also has a strong local retail network. H Shankar, managing director of the Chennai-based firm, announced that the company would enter the retail fuel business with 300 stations by the middle of 2028. He said that "CPCL 2.0" will be a new version of the refinery, which was previously referred to as a "standalone refinery". He stated that the company hopes to have a feasibility report on the Manali refinery expansion completed by October 2026. This will allow them to decide the cost and configuration of the new units. Shankar said CPCL was also in the process of finalising?the configuration?of the 180,000 bpd refining plant and related petrochemicals unit at Nagapattinam, in the southern Tamil Nadu State. Reporting by Nidhi verma, New Delhi. Editing by Harikrishnan Nair
Trump Media and fusion power company TAE Technologies join forces in $6 billion deal
The social media company of U.S. president Donald Trump is entering the fusion-power industry through a merger worth more than $6 billion with TAE Technologie. They are betting on this experimental technology, as AI datacenters 'drive a surge in energy consumption.
After the merger is completed in mid-2026, the shareholders of each company will hold about 50% of the combined entity. Trump Media and Technology Group is the holding company of businesses such as Truth Social, TAE Power Solutions and TAE life Sciences.
Stocktwits, an online hub for retail investors and social media, saw the shares of Trump Media surge by more than 33% during premarket trading.
TAE Technologies is supported by Alphabet’s Google and Chevron. The company aims to develop and market?next generation neutral beam systems? for fusion applications and other related areas in a?cost-effective way.
Nuclear fusion is a new technology aimed at generating electricity using the same process that powers our sun. It promises a vision of unlimited energy, free from pollution, radioactive waste and greenhouse gases.
The insatiable need for electricity to power data centers, which?power artificial-intelligence technologies, has renewed interest in nuclear energy supply. This includes restarting reactors that have been completely shut down, increasing capacity, and contracting?power for future small modular reactors.
A growing demand for energy is driving the development of nuclear power plants. These are widely considered to be a cleaner form of energy.
After the deal is closed, the two companies will?site and start construction on the first utility-scale fusion plant in the world.
The companies announced that Devin Nunes will be co-CEO with TAE's CEO and Director Michl binderbauer.
(source: Reuters)