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Dalian Iron Ore Gains as Steel Prices Rise; On Track for Fourth Weekly Gain
Dalian iron ore contracts gained a little on Friday, their fifth consecutive session of gains, as higher steel prices supported this key ingredient in steelmaking, while expectations for increased shipments weighed. As of 0317 GMT, the?most traded September iron ore contract?on China's Dalian Commodity Exchange(DCE) was 0.25% higher. It was trading at 817 Yuan ($120.07). This contract has gained 3% so far this week. The benchmark June Iron Ore on the Singapore Exchange is 0.23% lower at $110.50 per ton. The contract is up 2.66% so far this week. Both contracts are set to register a fourth successive weekly increase. According to Mysteel consultancy, higher steel prices have a positive impact on steel mill margins and iron ore purchasing interest. Steel inventories, meanwhile, also declined week-on-week. Mysteel reports that hot metal production fell due to China's May Day holiday. However, blast furnaces are still running at near-peak rates and supporting the demand for steelmaking raw materials. According to official statistics, Brazilian iron ore exports increased by 34.57 millions tons in April compared to 30.07million tons. According to a document seen by?, the mining operations were resumed Thursday in two blocks of Guinea’s giant Simandou Iron Ore Project operated by a consortium headed by China’s?Baowu Resources, after workers ended their strike. A union official and a document seen by?both confirm that mining operations?resumed on Thursday at two blocks of Guinea's giant Simandou iron ore project operated by a consortium led China's?Baowu Resources after workers ended a strike. The other steelmaking ingredients were mixed. Coking coal was up by 0.31%, and?coke was down by 0.16%. The benchmarks for steel on the Shanghai Futures Exchange diverged. Hot-rolled coils and rebar grew by 0.14% each. Wire rod fell 0.41%, and stainless steel dropped 2.32%. According to a Shanghai Metals Market note, stainless steel inventories?in China have rebounded following weeks of continuous destocking. Production output has exceeded trading volumes and pushed prices down.
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Oil prices rise on Mideast tensions; AI propels Asian stocks to a sparkling weekly gain
Oil prices rose on Friday, and stocks were slightly lower. The U.S. and Iran were exchanging fire in the Middle East. However, many Asian markets were still heading towards stellar weekly gains as AI demand has swept chipmakers. Benchmark Brent crude futures rose 1.3% to $101.60 per barrel, while European stock futures declined 0.7%. On Thursday, the United States and Iran traded fire in the most severe test of their month-long truce. Iran claimed that the situation was back to normal while the U.S. stated it didn't want to escalate. The President Donald Trump stated that the ceasefire which has been in place for more than a month is still in force, maintaining hopes for a negotiation. Stock markets in Asia, which had been surging thanks to gains made by chipmakers and AI-related stocks, have only slightly dipped from their record highs. MSCI's broadest?index of Asian?shares excluding Japan fell by 0.8%. South Korea's KOSPI also dropped, but it was still on track for a gain of over 12% a week - the biggest since 2008 - thanks to the surge in SK Hynix and Samsung. The Nikkei 225 index in Japan is up 4.5% and Taiwan's benchmark has gained 6.9%. Marija Veitmane is the head of equity research at State Street Markets. She said that despite ongoing hostilities, oil prices are still high and markets are pricing for a limited time. Asia and the U.S. were the biggest buyers at the expense of Europe. SoftBank shares, of which it is the majority owner, fell by 0.4% through Friday morning. Arm Holdings warned that there was a problem securing supplies for its artificial intelligence chip. S&P futures increased by 0.2%. The currency markets were largely stable, with the dollar recovering after recent lows. The yen was in the spotlight as Japan may have intervened to prevent further declines. The dollar was worth 156.9 yen, while the euro was $1.1731. The Aussie was $0.7210, and the yen struggled to maintain gains above 155 despite surges of $70 billion on suspicion of intervention since last Thursday. China's Yuan, Asia’s best performing currency since the outbreak of the war, is poised to surpass 6.8 dollars and is near its highest since 2023. U.S. JOBS & UK ELECTIONS IN CENTER A survey of economists indicates that investors are waiting for the U.S. Non-Farm Payrolls Report on Friday. The jobs report is expected to show an increase in April of 62,000, after a rebound of 178,000?in March. Local elections are also planned in Britain. Investors are worried that the gilt market may be affected by the expected poor results for the Labour Party. Analysts at ING said that "Gilts have already been under scrutiny because of inflation?risks. Adding political uncertainty could push (global investors) to look elsewhere." The last time the sterling was stable around $1.36 According to a trade law from the 1970s, a U.S. court of trade has ruled that Trump's 10% temporary global duties are not justified. Analysts expect an appeal to be filed quickly and that the overall impact of U.S. levy will be minimal. Treasury yields tracked crude oil prices higher on Thursday, as traders were worried about inflation. However, they did not move significantly more on Friday. The benchmark 10-year yield was at 4.39%. The yields on Australian 10-year bonds jumped by six basis points, to 4.99%. Bitcoin was heading towards its sixth consecutive weekly gain at $79460. (Reporting and editing by Edmund Klamann, Kim Coghill and Tom Westbrook)
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Markets focus on US-Iran deals prospects as gold on track to gain weekly gains
Investors remained hopeful about a U.S. Iran peace deal despite renewed threats, and gold rose?on?Friday. As of 0218 GMT, spot gold was up 0.7%, at $4,719.85 an ounce. Bullion is up 2.3% this week. U.S. Gold Futures for June Delivery rose by 0.4% to $4,728.30. The United States fired on Iran in the most serious test of their month-long truce, but Iran claimed that the situation had returned to normal. The comments made by the Trump administration today that the ceasefire was holding and there is still optimism about a possible deal between the U.S. and Iran are helping to support the gold price for the moment, said Kyle Rodda a senior financial analyst at Capital.com. The rise in oil prices has pushed gold prices down by more than 10%. Increased crude oil prices are likely to increase interest rates, as they can fuel inflation. Gold is often seen as a hedge against inflation, but high interest rates can weigh down on this non-yielding investment. We are just waiting for the next headline to see if Iran and the U.S. have reached an agreement. Rodda stated that he thought there would be some choppy prices in the next 24-hours leading up to the end of the week. The markets are now awaiting the U.S. monthly employment report, due later today, to determine how the Federal Reserve plans to move forward with its monetary policy this year. Surveys of economists predict that nonfarm payrolls increased by '62,000 jobs in April after recovering?by 178,000 last month. Silver spot rose 1.6%, to $79.74 an ounce. Platinum gained 1.3%, to $2,048.08, while palladium rose 1.2%, to $1,498.62. (Reporting and editing by Subhranshu sahu, Rashmi aich, and Noel John from Bengaluru)
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Oil prices jump on renewed US-Iran hostilities
The price of oil rose by more than 1% after renewed fighting between the U.S.A. and Iran. This triggered a fragile ceasefire, and dashed hopes that the Strait of Hormuz would be reopened, an important transit route for oil and gas. Brent crude futures rose $1.41 or 1.41% to $101.47 per barrel at 0123 GMT. West Texas Intermediate (WTI), U.S. crude oil futures, rose $1.12 or 1.18% to $95.93 per barrel. Prices had already risen more than 3% at the opening of the market. This ended three days of declines following reports that earlier in the week,?the U.S. was close to reaching a deal with Iran to end the fighting. It would also allow the Strait of Hormuz reopen fully. However, it would put off the larger issues surrounding Iran's nuke programme. Both contracts are expected to drop 6% in the next week. The price spike on Friday was a result of Iran accusing the U.S. of violating the month-long ceasefire between the two countries. Meanwhile, the U.S. claimed its attacks were in retaliation for Iranian?fire that hit its navy ships transiting the strait on Thursday. Iran's military claimed that the U.S. targeted an Iranian oil-tanker, another ship, and civilian areas on the mainland and in the Strait. Donald Trump, the U.S. president, told reporters that the ceasefire remained in place despite the renewed fighting. Washington was waiting for a response from?Iran to its latest peace proposal. This did not address several contentious issues, including the U.S. request to reopen a strait that was a conduit for one-fifth the world's supply of oil and gas before the war, but has been mostly closed since the conflict began, which included strikes by Israel. Tony Sycamore, IG analyst, said that the situation on the supply front remains tight. He also stated that a 'peace agreement' remains elusive. Separately the U.S. Commodity Futures Trading Commission, which is investigating trades of oil prices totaling $7 billion, ahead of President Trump's key Iran War-related announcements, was reported on Thursday. The majority of trades were'short positions', or bets that prices would fall, made on the Intercontinental Exchange and Chicago Mercantile Exchange before Trump announced his intention to delay attacks on Iran or to announce a ceasefire.
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The war in Iran will accelerate China's switch to electric trucks over diesel
Analysts and automakers predict that the rise in diesel prices caused by the Iran War will accelerate the electrification process of China's heavy trucks fleet this year and help to reduce fuel consumption in the world's biggest oil importer. Over the past two years, electric?heavy trucks have grown from a niche to nearly a quarter of all new heavy truck purchases by 2025. This is thanks to government subsidies and cheap refuelling. The growth of last year was particularly pronounced in the fourth quarter, as buyers believed that the trade-in subsidies would soon end. According to CVWorld.cn, new-energy heavy trucks, which are mainly electric, started this year with a similar boom. Sales grew 45% on an annual basis to 44,000 units, accounting for over a quarter of segment sales. CVWorld.cn also said that it expects sales of heavy electric vehicles to increase 30% in April, due to a stronger seasonal demand as well as higher oil prices. Min Ji, a senior analyst at S&P Global Mobility said that the war in China has pushed up fuel prices, and this will lead to accelerated replacement of traditional trucks. The company plans to revise its forecasts for electric truck sales by the end of this month. Electric heavy trucks have a range of about 300 km (186 mi), and are mainly used for short trips between industrial sites, and transport hubs. However, long-distance corridors continue to expand and manufacturers such as Sany now market trucks with a range of up 600 km. The rapid introduction of liquefied natural gas and electric trucks has also reversed the decades-long growth of the use of gasoline and diesel in China. Several energy consultants now expect diesel consumption to decline faster than originally forecast. GL Consulting predicts that diesel consumption will fall by 4.3% in this year, compared to a forecast of 4.1% before the war. Rystad Energy forecasts a 5% drop in diesel demand this year. This is faster than the 4% decline they predicted before the war. It's equivalent to an additional decrease of around 40,000 barrels a day. MOVE OVERSEAS AND SAVE MONEY The economics of buying an EV truck are more compelling because the price of diesel in China has risen 27% since the Iran War began on February 28, the highest it's been in four years. In China, electric heavy trucks can cost up to 500,000 yuan (about $73,500), and diesel versions more than 300,000. But buyers are able to save nearly half of that price with a trade-in program that was extended from April to the end of the year. The EV trucks are a lot cheaper to run. GL Consulting estimates that lifetime costs for an electric truck – including purchase price, fuel and operation costs over a million kilometers – are half of a diesel-equivalent at current?fuel rates. These lower costs also drive an export boom into Europe, which is the second largest electric truck market in the world, but it still lags behind China. According to the International Energy Agency, China will sell 160,000 electric trucks in 2024. In Europe, however, they'll only be less than 25,000. In March, it was reported that up to 12 Chinese manufacturers, including the top-selling Sany brand, planned to sell their products in Europe at a price of up to one third less than what is currently being charged. Chen Dong, the Deputy General Manager of Sany, told reporters in April that Sany was already anticipating that the market for electric tractor trucks would increase by 50%, to 250,000 units. Chen stated that the odds of reaching this goal are on the rise, due to rising oil prices.
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Oil prices and futures are down on renewed US-Iran conflict
After the United States and Iran exchanged fire, U.S. stocks futures fell in early trading on Friday. This put in doubt a one-month-old Middle East ceasefire. U.S. crude futures, which were?lower than last week's closing price of $96.8 per barrel, rose?more?than?2%. S&P futures fell about 0.2%, and Nikkei Futures indicated a slightly lower opening for Japanese shares which had soared to new record highs Thursday. Iran's top joint Military Command said that the U.S. targeted an Iranian oil tanker as well as another ship that entered the Strait of Hormuz. The U.S. Military?said that it acted out of self-defence when Iran attacked Navy destroyers passing through the strait. The U.S. military said that Iran did not target any U.S. assets during the attack, and U.S. president Donald Trump told ABC News that the ceasefire agreement with Iran was still in place. The strikes took place while Washington awaited Iran's response to an American proposal that would stop the fighting, but leave most controversial issues, like Iran's nuke programme, unresolved. The rising tension in the foreign exchange market lifted the dollar from its recent lows, and it is now on track to finish the week largely steady. The yen has been unable to rise above 155 per dollar despite the fact that data suggests the authorities in Tokyo sold up to $67 billion to defend the currency in the last week. The last time the yen traded was at 156.88 to a dollar, and the euro was at $1.1726. U.S. Treasury secretary Scott Bessent will be visiting Tokyo next week. Markets are on high alert for any comments that he may make regarding the yen and Japan's monetary policies, considering his previous remarks in favor of faster Japanese rate hikes. A survey of economists indicates that investors are eagerly awaiting the U.S. non-farm payrolls data on Friday. The report is expected to show that jobs increased by 62,000 in April after recovering 178,000 in March. (Reporting and editing by Edmund Klamann; Tom Westbrook)
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US Trade Court rules Trump tariffs illegal but issues narrow block
The U.S. trade court ruled on Thursday against President Donald Trump’s latest 10% tariffs on global goods, stating that they were not justified by a 1970s law on trade. However, the court only halted 'the levy on Washington State and two small businesses. The U.S. Court of International Trade has ruled in favor of two businesses, Washington State and the state of Washington that had challenged the tariffs which went into effect on 24 February. The decision was 2-1 with one judge stating that it was premature for the small businesses to win. The White House didn't immediately respond to our request for comment. The Trade Court declined to issue an order that would block tariffs on all imports. They rejected a request from a group of states led by Democrats. The court determined that Washington was the only state that had imported goods and paid Section 122 tariffs. Washington provided evidence that it had paid tariffs via the University of Washington - a public research institute. The?duties for other importers will continue to be in effect during any government appeal. Basic Fun!, a toy manufacturer, and Burlap & Barrel, a spice importer both argued that the new tariffs were an attempt to sidestep a landmark U.S. Supreme Court decision which struck down the Republican president's 2025 tariffs imposed under International Emergency Economic Powers Act. The two small businesses, toy company Basic Fun! In his February order Trump invoked Section 122 of 1974's Trade Act, which allows duties to be imposed for up to 150 days in order for serious "balance of payment deficits" to be corrected or prevent a depreciation of dollars. The court ruled on Thursday that the law did not apply to the types of trade deficits Trump cited in February's order. This decision is a major win for American companies who rely on global manufacturing to provide safe and affordable products. Unlawful tariffs are making it difficult for companies like Basic Fun to grow and compete. We are encouraged that the court recognized that these tariffs were beyond the President's authority. This ruling provides clarity and stability to companies that are navigating global supply chain," he said. Trump's administration claimed that there was a "serious balance-of payments deficit" in the U.S., a deficit of $1.2 trillion annually on goods trade and a deficit of current account of 4% GDP. Some economists and lawyers argued that the U.S. was not at the brink of a balance-of payments crisis. This made the new duties susceptible to legal challenges.
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Consolidated Edison reports higher quarterly profits on robust power demand
Consolidated Edison announced a rise in its first-quarter profit on Thursday. This was due to a 'robust demand' for their electricity, steam and gas?services, amid freezing temperatures across the United States. The U.S. Energy Information Administration predicts that power consumption in the United States will hit new records this year. A winter storm and an Arctic 'Blast' spread a mix of heavy snow, freezing rain and sleet across the majority of eastern U.S. This boosted demand for natural gas and electricity, both of which are used to heat homes. Consolidated Edison has service areas in New York, New Jersey and Westchester County. Tim Cawley, CEO of the company, said that "Electrification in heating and transportation has accelerated at an unprecedented rate". He added that they were investing to meet this demand while balancing costs and affordability. The company plans to invest approximately $6.59 billion in capital projects by 2026, and $6.76 trillion by 2027. Consolidated Edison’s total operating revenue increased to $5.09bn during the first quarter. This is up from $4.79bn a year earlier. The increase was primarily due to higher revenues for?gases and steam. During the quarter, electric revenues increased 4.7% to $3.04 Billion. The New York utility's net income increased to $924 million in the three-month period ended March 31 from $791 millions a year ago. (Reporting from Vallari Srivastava, Bengaluru. Editing by Sahal Muhammad)
Southeast Asian leaders look for ways to mitigate the impact of Iran war
The leaders of Southeast Asian nations?holding a meeting on Friday will likely thrash out an coordinated response to the impact of the 'Middle East Crisis, in order to?ease the pressure of an energy shock which has shook?their oil-dependent economies.
Leaders of ASEAN are expected to meet on Cebu Island in the Philippines to push for an harmonised approach to ensure food and energy security in a particularly vulnerable region to the nearly 70-day long blockade of Strait of Hormuz.
Ferdinand Marcos Jr, Philippine president, said in his opening remarks, as ASEAN chair, that ASEAN stood together to show its ability to respond with resolve and unity, but it must "remain agile".
He said, "We must ensure energy security and resilience in the region."
"In a period of increased volatility, ASEAN needs to strengthen coordination, reinforce preparedness and pursue practical collective measures in order to ensure a stable supply of energy and improve interconnectivity."
COORDINATION CHALLENGE
ASEAN's economic ministers met on Thursday in Cebu and, according to the chair, "identified concrete, practical response measures" for ensuring energy and food security. However, these proposals were lacking specifics.
Diversifying suppliers and routes, and developing a protocol for crisis communication were among the suggestions. However, it was not clear what action, if any would be taken.
The Philippines, one of the first countries to declare an emergency energy situation, has been pushing for the approval of an ASEAN oil sharing framework agreement that is based on commercial interests.
Coordination remains a major challenge for ASEAN. Integration has been slow despite rapid economic growth in each member country. There are vast differences among the 11 ASEAN members, and there is no central authority that can ensure compliance with ASEAN initiatives and agreements.
On Friday, the ASEAN leaders are scheduled to hold a retreat and will likely call for a settlement that is negotiated between the United States and Iran. They may also ask for the reopening of Strait of Hormuz. This was a passageway for 130 vessels per day and for a fifth of world oil and gas prior to the conflict.
According to a draft of a statement that was seen on Thursday, leaders will urge ASEAN members complete the internal processes necessary to approve a fuel sharing pact to ensure its "earliest entry into force".
PEACE PROGRESS
Marcos called a meeting between the leaders of Thailand, Cambodia and Laos amid a fragile truce, which resulted in an agreement for a'restart of engagement after two deadly border conflicts last year.
The foreign ministers agreed to have a virtual discussion with their counterparts from Myanmar. Myanmar is keen to normalise its ties with the?ASEAN and allow its leaders to attend?its summits after a ban was imposed following a military coup in 2021 that led to widespread demonstrations which spiralled into civil war.
The crisis in Myanmar is dividing the bloc. Some members are seeking to engage with a nominally civil government headed by Min Aung Hlaing. He was a former chief of the junta and became president after a lopsided election won by a party that supports military rule.
(source: Reuters)