Latest News
-
Markets await Fed minutes as gold extends its gains amid easing fears of rate hikes
On Tuesday, gold rose for a 'third straight session' as investors looked forward to the minutes of the Federal Reserve meeting. They were hoping for new clues about the direction the Federal Reserve will take with its monetary policy. Spot gold rose 0.2% to $4,424.28 an ounce at 0130 GMT. U.S. gold futures for December delivery also edged up 0.2% to $4480.90. The U.S. Dollar remained near multi-month lows against most major currencies. Dollar-priced precious metals become cheaper for holders of other currencies when the U.S. dollar weakens. Gold's gains are continuing "after last weeks soft U.S. data, which raised hopes that the?"Fed" will hold rates this year," IG Market Analyst Tony?Sycamore stated. Bullion is likely to perform well in an environment of low interest rates, as it reduces your opportunity costs for holding non-yielding investments. According to a survey, most economists believe that the U.S. Central Bank will maintain its key interest rate next month and until year's end. After unexpected job losses, lower than expected consumer price inflation, and weaker retail sales in August, the market pricing for a quarter-point increase in September has shifted to a near-65% chance that it will be held. The focus of Wednesday's market will be on the minutes from the Fed’s latest policy meeting. Sycamore stated that "additionally, gold seems to be regaining a safe-haven position as the hawkish rhetoric of Iran has helped gold 'brush off higher returns. A senior Iranian official said that Iran would shift to a more "fully offensive" military posture as efforts to negotiate an end to the U.S. war have stalled. Washington has also ruled out the extension of a temporary ceasefire. Silver spot rose by 0.9%, to $66.40 an ounce. The platinum price rose 0.2% to $1,772.75, and palladium fell 0.3% to $1,330.05. Reporting by Ashitha shivaprasad from Bengaluru, editing by Subhranshu sahu
-
Russian ESPO blend crude oil returns to premium vs Brent due to China's demand, traders claim
Four traders reported that the price of Russia's ESPO blend crude oil for October delivery to China can be up to $1 per barrel higher than ICE Brent. This is due to the strong Chinese demand as well as uncertainty about Middle East and Iranian oil supplies. The traders reported that Asian buyers were looking for alternatives to Middle Eastern crude oil due to concerns about the disruption of shipments across the Strait of Hormuz. Oil prices rose Monday, despite the lack of progress in diplomatic efforts to resolve the Middle East conflict. One of the traders stated that they were unsure how long the Mideast Crisis would last, and how much oil from Iran will be shipped out. Therefore, the Russian supply was the most reliable. The traders reported that ESPO blend cargoes delivered in October have been actively traded. Nearly all volumes were sold at a premium of around $1 per barrel to ICE Brent, based on the price paid by buyers for the cargoes to be delivered into Chinese ports. This compares?with cargoes for September delivery, which traded last month from a $1 per barrel discount to parity against ICE Brent. Last time ESPO Blend traded at a higher price than Brent was June. Two traders said that the strong?demand for Russian oil from Chinese refiners had pushed India out of the market. Two traders said that Indian refiners could not secure October ESPO allocations due to Chinese buyers snatching up all the available cargoes. According to traders, both China's independent oil refiners and major state-owned oil firms have been active buyers of ESPO blend cargoes. Reporting by Siyi Liu in SINGAPORE and Aizhu in MOSCOW. Additional reporting by Nidhh Verma in NEW DELHI. Mark Potter edited the article.
-
NexGen Energy, a Canadian miner NexGen RPT, holds talks with BHP to seek $1 billion for its uranium project
Leigh Curyer, the CEO of NexGen Energy, said that it was "talking" and sharing information with BHP about its Rook I project in Saskatchewan. NexGen Energy, a Canadian uranium mining company, has started construction on what will be the largest uranium mine in the world. The company is looking to raise $1 billion of capital over the next nine-month period. The miner will consider financing options such as prepayment agreements with utilities, debt finance, and direct equity in the project. Curyer, when asked if NexGen was in contact with BHP regarding a possible equity partnership in Athabasca Basin, said that NexGen had an open dialogue. He also noted BHP's purchase of a large piece of land close to the Rook Project. "We always talk to them." Curyer said that they have a "very open" dialogue when it comes to technical information. He said BHP wanted to give their portfolio more weight in countries with stable political systems. Let's see what the future holds. Two sources with knowledge of the matter said that BHP's Business Development team dominated NexGen in the last year under the previous CEO Mike Henry. According to an investor, who refused to be identified due to BHP policy, Brandon Craig will also take a "really close look" at the uranium market. However he acknowledged that the "scale of the project was difficult". BHP declined comment. The demand for AI has risen dramatically, resulting in a huge expansion of data centres that are power hungry. This in turn increases the need for more generation capacity including nuclear plants. BHP produces around 5% of the global uranium as a by-product from its Olympic Dam Copper operations in South Australia. BHP had previously said that it would not expand further. At least two other miners, such as Denison or Paladin, are also advancing uranium mining in the Athabasca area. BHP is gaining a foothold in this region. BHP is currently building the largest potash mine in the world. According to Canada's Natural Resources Ministry, the Athabasca Basin has the largest and highest-grade uranium deposits in the world. The majority of uranium is exported by companies like Orano Mining and Cameco. NexGen's Rook Mine is expected to be in production by 2030. The market capitalisation of BHP has increased by C$9.68billion in the last year. Some investors have suggested that it now looks too expensive. Rook I is located in the heart of Athabasca,?and surrounds the Patterson Lake. It aims to become one?of?the world's biggest uranium producers. Kevin O'Leary, a Canadian actor and investor who hosted the ground-breaking on Thursday called the project "a great energy story." Canaccord, a broker, said that it expected the demand for uranium in 2035 to triple from its current level of 2025. (Divyarajagopal is in Athabasca Saskatchewan and Melanie Burton is in Australia. Caroline Stauffer, Chizu Nomiyama and Caroline Stauffer edited the article.
-
Oil prices rise, bond yields increase as US-Iran ceasefire expires
Oil prices rose and bond yields increased, reducing the gains in stocks as Asian trading began on Tuesday. A truce between Iran and the United States expired and Tehran announced it would shift to a more "fully offensive" military posture. MSCI's broadest?Asia-Pacific?shares index outside Japan rose 0.8%. The South Korean KOSPI rose more than 3%, as Seoul's market returned from a holiday. The Nikkei fell by 0.3% while S&P500 e-minis futures were flat. The yield of the 10-year Treasury bond in the United States was up by 0.8 basis points at?4.728%. The 30-year counterpart was up 0.6 basis points at 5.3146%. This is the highest it has been in over a decade. Analysts at ING wrote that "typically, moves over 4.65% in the 10-year bond rate for the U.S. are followed by soothing words from the Trump administration. These usually focus on an imminent end to the Iran war." This time we are not hearing the same," they said. "In fact the latest indications point to no imminent resolution, as 'the shaky sixty-day truce? came to an end." The yield on the 10-year Japanese Government Bond rose by 2.5 basis points, to 2.945%. This is a record high for the past three decades. The S&P 500 fell 0.5% overnight on Wall Street while the Nasdaq Composite fell 0.3% as weak U.S. data, such as an unexpected decline in retail sales, led markets to reduce their bets that the Federal Reserve would soon increase interest rates. Westpac analysts said in a research report that "markets adopted a risk-off attitude as President Trump reaffirmed his disinterest in extending the ceasefire with Iran. With renewed 'tensions' in the Middle East, oil prices are rising and this is complicating sentiment." The U.S. Dollar Index, which measures the strength of the greenback against a basket six currencies, was trading?around a low of 99.527% for two months. The stalemate over Iran has refocused traders on global supply concerns. Oil prices rose by more than $2 Monday. Brent crude futures rose 0.2% to $91.06 per barrel as trading resumed in Asia. Gold rose 0.1% to $4,420.07 and extended recent gains for a third day in a row. Bitcoin was up by 0.1% to $64,398.48 while ether rose 0.3% to $1911.40. (Reporting and editing by Sonali Paul; Gregor Stuart Hunter)
-
As US-Iran tensions fade, oil prices rise as supply risks increase
The price of oil rose on Tuesday, as the prospect of a deal to end the Middle East conflict seemed further out of reach. Iran said it would adopt a more aggressive stance while the U.S. refused to extend a ceasefire. This increased concerns about the energy supply. A senior Iranian official said on Monday that Iran would adopt a "fully offensive' military posture as efforts to negotiate an end to the U.S. war have stalled. Washington has also ruled out the extension of a temporary ceasefire. The progress made towards peace talks, and the resumption of oil-tanker traffic in the Strait of Hormuz have slowed down. This threatens to prolong the conflict which the U.S. & Israel started on February 28, when they attacked Iran. Brent crude futures rose 27 cents or 0.3% to $91.14 at 0003 GMT after reaching their highest level since July 30 on Monday. U.S. West Texas Intermediate Crude Futures rose 42 cents, to $85.04 per barrel, after rising more than 1% earlier in the session, to $85.37. This was their highest level since July 31. Oil prices have risen to begin the week, as U.S. - Iran relations are becoming more shaky. Tim Waterer, chief market analyst for KCM, said that a deal to reopen Strait of Hormuz does not seem to be imminent. Shipping numbers are also still at a low level. Ship-tracking data by Kpler revealed that, following attacks on oil tankers, there were only five commodities vessels registered to transit the Hormuz Strait on Saturday, and none for Sunday. This compares with 31 the previous weekend. Yemen's Houthis launched missiles at what they called a Saudi military vessel and four 'escort vessels' in the Red Sea, according to Yahya saree, the military spokesperson for the group. The dual 'chokehold' on the Strait of Hormuz, and Bab el-Mandeb is still of great importance. These aren't secondary concerns. Waterer, of KCM, said that they are at the heart of the "current narrative on supply risk". Iran and Oman have been separately negotiating a management agreement for the?strait. They claim to be close to an agreement. Trump, however, responded to these negotiations by threatening to bomb?Gulf State, a long-standing U.S. partner in security. Media reports claimed that Trump had begun back-channel talks with the Islamic Revolutionary Guard Corps. A preliminary poll on Monday showed that crude oil stocks in the United States were likely to have declined last week along with product inventories. Reporting by Ishaan arora in Bengaluru, Editing by Chris Reese & Muralikumar Anantharaman
-
BHP earns more than expected profit from higher copper prices
BHP Group announced a higher-than-expected full-year underlying profit Tuesday, fueled by higher 'copper prices. The rapid buildout of energy-hungry AI-based data centres and the global shift to cleaner power have caused copper prices to reach record highs. This has intensified the race between mining companies to secure high-grade copper assets. BHP's biggest earnings generator is red metal. This includes byproducts like gold and uranium. Brandon Craig, BHP CEO, said that copper is driving the company's growth. The demand for our mines is increasing. The copper demand is expected to grow from 34 Mtpa today (million tonnes per year) to 50?Mtpa in 2050. BHP, world's largest copper producer, announced a?full-year attributable profit for the year of $13.20 billion, exceeding the Visible Alpha consensus of $12.66. This compares to the $10.16 billion reported a year earlier. The miner announced that it had paid a final dividend to shareholders of 99 cents each, which brought the total distribution for the year up to $1.72 per share. This was the highest amount in the past four years. Reporting by Sameer Lahiri and Shivangi Manekar in Bengaluru, editing by Shinjini Ganuli
-
Stocks and dollar drop after weak data, yields rise
U.S. stock prices ended lower on Monday, and the dollar hit a two month low against the Euro, as weak U.S. data, such as an unexpected decline in retail sales, led markets to reduce their bets about a Federal Reserve rate hike. Thirty-year Treasury Yields, on the other hand, have risen to their highest level since 2007. This is due to concerns about the U.S. Fiscal Pathway combined with heavy AI related corporate debt issuance. Investors waited anxiously for the quarterly reports of large retailers, including Home Depot, which is due to be released on Tuesday, as well as retail giant Walmart, which will be released on Thursday, in order to get information on the state of the U.S. consumers. Phil Blancato is the chief market strategist of Osaic Wealth. He said that recent concerns about softer data had caused the market to be a little tepid. Blancato said that August is a time when volume tends to be low, as many traders are on vacation. Blancato stated that there is a combination of the summer doldrums and waiting for consumer data. The Dow Jones Industrial Average dropped 0.51%. The S&P 500 fell 0.52%. And the Nasdaq Composite declined 0.31%. The MSCI index of global stocks fell by 0.35% while the pan-European STOXX 600 Index declined by 0.22%. Stocks were also affected by uncertainty over the economic impact the Iran War, which began in early February. Investors were telling themselves that wars will always end. David Morrison is a senior market analyst at Trade Nation. He said that no one had priced in the possibility of this war continuing as we near the end of the summer. The oil prices rose by over $2 on Monday, mainly due to investor concerns about global supply. This was fueled by the pessimism of investors regarding diplomatic efforts to end the war. Brent crude rose 2.59% to $90.81 a barrel. U.S. crude gained 2.74% on the day. Dollar fell as traders delayed their expectations of the Fed's next moves. Last week's benign consumer and producer price data, which showed a slight increase in inflation, gave traders hope that the worst price pressures had passed, even though the uncertainty surrounding the war continues. Unexpectedly, retail sales dropped last month. This has led to concern that the U.S. may not be as resilient than previously believed. The dollar index (which measures the greenback's value against a basket of currencies, including the yen, the euro and others) was down by 0.06% to 99.6. The euro rose 0.09% from $1.1579 to $1.1614. This is the highest since June 17. The markets are now pricing in 35% of the chance that a Fed decision will be made next month. This is down from 55% about a week ago, and 69% of the odds for a Fed action by December. Treasury yields gained, however, after the U.S. Government had to pay its highest rates ever for the sale of 30-year bond at an auction last week. The yield on the benchmark 10-year U.S. notes increased by 2.79 basis points, to 4.724%. The yield on 30-year bonds rose 4.43 basis points, to 5.3103%. This is the highest level since 2007. Three soft economic releases should have driven long-end yields down. The 30y bond auctions were held at the highest yields since 2001. And now, yields have risen even more. Anshul Pradoshan, Barclays Capital's analyst, wrote in a Monday note that the reason for this was a worsening fiscal forecast, AI-driven supply of corporate duration, and an increasingly price-sensitive customer base. Spot gold increased 1.02%, to $4420.41 per ounce.
-
Gold prices rise on a weaker dollar and eased Fed rate hike fears
Gold prices increased on Monday, supported by a weaker Dollar and diminishing expectations of an U.S. Federal Reserve interest rate hike. Investors continued to monitor the geopolitical tensions within the Middle East. By 1:34 pm EDT (1734 GMT), spot gold had risen 0.9%, to $4417.24 an ounce. U.S. Gold Futures?for December Delivery settled 0.8% higher at $4,473.70. Bart Melek is global head of commodity strategies at TD Securities. He said that gold prices are based on a stagflationary climate, with softer jobs and the expectation that the Fed would tolerate current inflation levels. The?US Dollar has fallen to an important psychological level of 100." Gold is now cheaper for those who hold other currencies than the dollar. The markets have reduced their bets that the Federal Reserve will raise rates after a weaker than expected U.S. payrolls data and lower consumer inflation figures last week. Investors await the minutes of the Fed's meeting in July, which are due on Wednesday, to get a sense of the central bank's outlook. CME's FedWatch Tool shows that traders see a 33% chance of a rate hike in September, down from 51.2%?a month ago. Lower interest rates tend to benefit gold, as they reduce the opportunity costs of holding bullion. A senior Iranian official said that Tehran will 'intensify tensions across the Strait of Hormuz, and in other parts of the region, if diplomatic efforts between the United States fail, signaling an 'offensive approach. Silver spot rose 2.1% per ounce to $66.01. Platinum rose 1.3%, to $1770.3 an ounce, while palladium increased 1.1%, to $1326.92. (Reporting and editing by Vijay Kishore, Tasim Zahid, and Sumit Saha from Bengaluru)
US inflation slows down in June but is likely to reverse amid Middle East conflict
The U.S. Inflation rate slowed down in June but it is only temporary as renewed hostilities are raising oil prices. The Bureau of Economic Analysis of the Commerce Department reported that the Personal Consumption Expenditures price index increased by 3.7% over the past 12 months, after advancing an unrevised 4.1% during May. This was the largest gain since April 2023. PCE inflation increased in line with expectations. The PCE Price Index fell 0.1% month-over-month, its lowest reading since April 2020. It had risen 0.5% in May.
These data were also included in the government’s second-quarter?estimate gross domestic product. This was published by the government on Thursday. The decline in PCE inflation was due to a "retreat" in oil prices, which coincided with a fragile ceasefire between the U.S. and Iran. Since then, the truce has broken down. Brent oil is hovering at just over $90 per barrel while U.S. average gasoline prices have returned to above $4 a gallon. PCE Price Index excluding volatile energy and food components rose 3.3% year-over-year in June, after rising 3.4% in May. It increased 0.1% in June, excluding food and energy. In May it had risen 0.3%. For its 2% inflation target, the Federal Reserve uses PCE measures. On Wednesday, the U.S. Central Bank left its overnight benchmark interest rate at 3.50% to 3.75%. Three members of the Fed's policy-setting committee dissented in favor of a quarter-percentage-point hike.
Fed Chairman Kevin Warsh said to reporters that the central bank will not "waver" from its commitment to bring inflation back to target. He stressed "there is nothing soft about inflation, and there is nothing soft about implicit inflation,?not under this committee's supervision."
Economists predict that the Fed will raise borrowing rates?as early as September. The impact of high inflation was softened this year by generous tax refunds, but now that cushion is diminishing, setting consumer spending up for a slowdown in the second half. Consumer spending, which makes up more than two thirds of economic activity, grew 0.3% in June, after a 0.9% increase in May. Consumer spending in June increased by 0.4% when adjusted for inflation. This is the same as in May. Personal income rose 0.2% in June after soaring by 0.7% in May. After inflation, the income available to households grew by 0.3% in May. Savings rate dropped to 2.7% from 2.8%, its lowest level since 2022. Lucia Mutikani, Chizu Nomiyama, and Paul Simao edited the report.
(source: Reuters)