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Solar stocks fall after Senate proposal to phase-out tax credits by 2028
U.S. Solar stocks fell in premarket trade on Tuesday, after a Senate committee proposed that solar and wind energy credits be phased out completely by 2028. This was part of the changes suggested for President Donald Trump's tax-cutting and spending bill. Enphase Energy, a manufacturer of solar inverters, was one of the largest decliners in the S&P 500 at the start of trading. Its shares fell 17.2% to $35. SolarEdge Technologies and Sunrun, both solar panel suppliers, each fell more than 20%. First Solar fell 10.5%. The draft bill, circulated last month by the U.S. Senate Committee, contains several changes to Trump’s budget, also known as "One Big, Beautiful Bill Act", which the House narrowly approved. The committee chair's language envisages the gradual phase-out of subsidies for solar and wind that were enshrined in the Biden era 2022 Inflation Reduction Act by 2026, by reducing it to 60% of its original value and terminating it by 2028. Tax credits will not be phased out under current law until 2032. Citi strategists stated that they "remain in a sell mode on residential solar." The bill had a phase-out beginning in 2029, and credits would be eliminated in 2032. This is a small improvement over the previous abrupt termination of credits when projects were not in service before 12/31/2028. Solar companies already face pressure due to a weak residential demand in the U.S., which is partly caused by high interest rates as well as metering reforms implemented in California's top market. These reforms have decreased the credits that customers receive for feeding excess electricity into the grid. Sunrun shares have fallen 27% over the last year while Enphase Energy has dropped 63%. Invesco's Solar ETF dropped by 22.8% in the last year. The Senate panel's proposed amendments to Trump's Budget extend tax credits for geothermal, hydro and nuclear power until 2036. Nano Nuclear Energy, Oklo, and other nuclear-related companies saw their shares rise by 2.2% and 2.1% respectively. The different versions of the bill in the two narrowly Republican-controlled chambers of Congress could complicate party leaders' goal of passing the bill, which is the centerpiece of Trump's domestic agenda, before a self-imposed July 4 deadline. (Reporting and editing by Devika Syamnath in Bengaluru)
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Wall Street futures fall as Mideast conflict continues
U.S. index futures fell on Tuesday, as the conflict in the Middle East entered into its fifth day. This dampened global investor confidence before the Federal Reserve’s upcoming policy meetings. The air war between Israel and Iran, which began Friday with Israel attacking Iran's nuclear facility, has raised fears that it could cause bottlenecks in oil exports to the oil-rich Middle East. Oil prices remain high due to uncertainty, and this has led to a rise in the premarket price of U.S. energy shares. Chevron shares and Exxon stock both rose by nearly 1%. The rise in oil prices coincides with the Fed's decision to maintain interest rates on Wednesday. According to CME Group’s Fedwatch tool, money market movements show that traders are pricing about 48 basis point rate cuts by 2025. There is a 59% likelihood of a rate cut of 25 bps in September. At 5:33 am. At 5:33 a.m. ET, Dow E Minis were 269 points down, or 0.63 percent, and S&P E Minis were 37.25 points down, or 0.62 percent. Nasdaq E-minis fell 138.5 points or 0.63%. The U.S. Senate Republicans released late Monday proposed changes to the President Donald Trump’s sweeping tax cut bill, which had passed through the House of Representatives earlier this year. Goldman Sachs strategists wrote in a report that the Senate's tax bill looks similar to the House version, but will likely cost more in the long-term. Solar stocks dropped after Senate changes to Trump’s tax-cut legislation revealed that solar, wind, and energy tax credit credits would be phased out by 2028. Enphase Energy shares, which make solar inverters fell 17%. Solar panel manufacturers Sunrun and SolarEdge Technologies both dropped by more than 21,6%. First Solar lost nearly 11%. The shares of nuclear power companies have risen after the Senate extended credit for nuclear energy until 2036. Oklo and Nano Nuclear Energy both rose by 1.9%. A rise in U.S. Treasuries, as investors seek out traditional safe-havens amid increased geopolitical unrest, has pushed down yields across the curve. The yields on the benchmark 10 year fell by about 3 basis points, to 4.42%. Reports claim that Eli Lilly, among other companies, is in advanced discussions to purchase gene-editing startup Verve Therapeutics. The deal could be worth up to $1.3billion. The drugmaker's shares fell by 1.2% while Verve rose 82.9%. The key data for today includes retail sales by month and import prices, scheduled to be released at 8:30 am. ET. (Reporting and editing by Maju Sam in Bengaluru, Kanchana Chakravarty from Bengaluru)
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Germany does not plan strategic gas reserves, Economy Ministry says
A spokesperson for the Economy Ministry said that Germany does not plan to create a national reserve of gas, as recent legislation requiring different filling levels in the winter months will encourage private companies to provide supply security. In order to avoid a supply disruption, European Union nations have increased their storage capacity in anticipation of the energy crisis that will follow Russia's invasion and occupation of Ukraine. Germany is the largest gas consumer in mainland Europe. Last month, German pipeline lobby group FNB suggested a new strategy for gas storage that included a permanent reserve. The spokesperson responded in writing to a question by saying that the Economy Ministry had not yet considered this strategy (storage). He added that the supply was generally secure. Bloomberg reported Tuesday, citing anonymous sources, that Germany is considering whether or not to build a strategic gas store. The new German coalition government has aligned its domestic regulations with the anticipated changes in European Union regulations. These include a requirement that gas storage facilities be filled to 80% by November 1, to ensure sufficient supply for winter. This is more flexible than the EU’s previous 90% filling capacity requirement. German utilities that operate gas storage facilities include Uniper SEFE, VNG Gasspeicher, and RWE. A spokesperson for the German Economy Ministry said that the ministry is aware of the fact that any additional government actions could increase the cost to consumers. GIE data showed that German gas stocks were last at 45.8% compared to the EU's 53.8 %. This was a significant drop from the 76.8% figure of a year earlier. Vera Eckert reported, Susan Fenton edited.
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Germany is down on wind turbines, but France has a nuclear deal with Germany
The wholesale electricity market in Europe showed mixed results on its two major markets on Tuesday morning. French prices rose on tighter supply locally, while German prices fell on the expectation of increased wind power output. The LSEG analysis pointed out that the increased production of brown coal and natural gas will also boost Germany's electricity supply. By 0930 GMT the French baseload day-ahead contracts had risen by 12.8%, to 53 euros (61.25 dollars) per megawatthour. The German equivalent contract was down by 14.5%, at 77.5 Euro/MWh. On Wednesday, wind power generation is expected to increase by 4.3 gigawatts in Germany to 11.3 GW. The French nuclear capacity has decreased by two percentage points to 69%. The power demand in Germany and France was flat on Wednesday. The average temperature is expected to rise by 3-4 degrees Celsius next week compared to Tuesday's levels. This comes at a moment when the energy markets closely monitor weather conditions, as they determine timing and intensity for air conditioning. The German baseload for the year ahead increased by 0.3%, to 92.3 Euros/MWh. In contrast, the French equivalent fell 2.3% at 66.7 Euros/MWh. The benchmark contract on the European carbon markets fell 0.7%, to 74.83 Euros per metric ton. In its monthly report for the month of June, Swiss utility Axpo stated that developments in U.S. China and U.S. Europe tariff negotiations would remain a source of major uncertainty on all commodity markets in the months to come. The EEX bourse in Germany celebrated its 25th anniversary on Monday. During this time, the exchange has grown from a small platform for electricity to a global leader for energy, environment products, freight, and agriculture.
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Trump claims that the EU is not offering a fair trade deal and Japan is also 'tough.'
U.S. president Donald Trump said that Treasury Secretary Scott Bessent stayed in Canada for the G7 summit, and suggested Japan is being "tough' in trade negotiations and the European Union has not yet offered him what he considered to be a fair deal. Trump left early from the G7 to deal with the developments in the Middle East. The president told reporters that the EU has been very tough with the United States over the years. Trump said, "We are talking but I do not feel they have offered a fair offer yet." "They will either make a fair deal, or pay what we tell them to pay." Trump said that there is a possibility of a deal between Washington, DC and Japan. "They are tough. The Japanese are tough. But you must understand that we will send you a letter stating 'this is the price you will pay' if you do not want to do business. "But there is a chance," said he. Trump said that pharmaceutical tariffs would be coming soon. We'll be doing pharmaceuticals in a very short time. "That's going bring all the businesses back to America," he said. It's going bring the majority of them, or at least a portion back in. Trump said that Canada would also pay for a part of the "Golden Dome", his missile shield project. (Reporting and editing by Jeff Mason, Kanishka Singh, Alex Richardson).
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Gold prices steady as markets focus on Middle East conflict and Fed decision
Gold prices were unchanged on Tuesday, as investors assessed the conflict between Israel & Iran and looked forward to this week's U.S. Federal Reserve policy meeting. As of 0851 GMT, spot gold was unchanged at $3,383.01 per ounce. U.S. Gold Futures dropped 0.5% to $3401.30. Israel and Iran traded attacks for the fifth day in a row on Tuesday. Donald Trump, the president of the United States, has called for an evacuation of Iran’s capital Tehran. He also cut short his trip from Canada to Canada's G7 summit. Separately, a report stated that he asked his National Security Council in the Situation Room to be ready. Han Tan, Exinity Group's chief market analyst, said that the markets are waiting to see if hostilities between Israel & Iran will escalate or remain contained. Gold still retains a bias to surge upwards when signs of an escalating Middle East conflict are present, given its status as a preferred safe haven in recent years. Sources claim that Iran has asked Oman and Qatar to encourage Trump to press Israel to agree to a ceasefire. In return, Iran is offering flexibility on nuclear talks. Bullion with zero-yield is seen as a hedge to geopolitical or economic unrest and thrives in low-interest environments. Wednesday is the day for the U.S. Central Bank's rate announcement and Jerome Powell, its chair. The market is currently pricing in two rate cuts before the end of this year. Citi has lowered both its short-term targets and long-term ones for gold. It said that the prices of gold could fall below $3,000 an ounce in late 2025 or even early 2026 due to a declining investment outlook and a better global growth outlook. Palladium dropped 0.4%, to $1,025.44, while platinum remained unchanged at $1246.59. (Reporting by Anushree Mukherjee in Bengaluru; Editing by Joe Bavier)
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EDPR, a renewable energy company, sticks to its US plans despite tax credits cuts
EDP? EDP? The Republican-controlled U.S. House of Representatives approved a budget reconciliation bill last month, which weakens clean-energy tax credits included in the 2022 Inflation Reduction Act. The Senate can still amend the bill. However, it is currently written in a way that would terminate 60 days after the bill's enactment several credits for projects which have not yet started construction. This makes most of the projects unfeasible. The CEO of the Portuguese company, Miguel Stilwell d'Andrade, told reporters at a late-night conference on Monday that he believes the firm will keep its forecasts for 2025 and 2026 in terms of the results and the installation of new capacities. EDPR has been preparing a business plan that will be revealed on 6 November and go beyond the year 2027. The renewables bet is here to remain in the U.S. He said that in 2024 we would install 2 GW, and this year 1 GW. We will also install up to 750 Megawatts by 2026. He added that the exact amount of investment in 2027 would depend on the final version approved of the reconciliation bill. He said, "Let's wait and see what the Senate produces." Senator John Curtis is one of only a few Senate Republicans to have stated that they would like to keep some tax credits. He said last week, however, that the bill needed to be changed to protect investors from major disruptions and to safeguard jobs. In December 2024, EDPR had installed capacity of 19,3 GW, with 51% in the United States.
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IEA: World oil demand will continue to grow this decade despite China's peak in 2027
The International Energy Agency announced on Tuesday that global oil demand would continue to grow until the end of the decade, despite a peak in China's top importer in 2027. Cheaper gasoline and a slower adoption of electric vehicles in the United States will support oil consumption. The IEA which advises industrialised nations did not alter its prediction that oil demand would peak in this decade. This is a stark contrast to the view of the producer group, the Organization of the Petroleum Exporting Countries, who say consumption will continue to grow and have not predicted a peak. A table from the IEA annual report in Paris shows that oil demand will reach a peak of 105.6 million barrels a day (bpd), by 2029, and then begin to decline in 2030. Global production capacity will rise by over 5 million barrels per day (bpd) to 114.7 millions bpd in 2030, according to the IEA's annual report. Conflict between Israel and Iran highlighted the risks to Middle East oil supplies, which helped send oil prices up by 5% on Friday to over $74 per barrel. The IEA stated that the latest forecasts indicate ample supplies until 2030 if no major disruptions occur. Fatih Bilo, IEA's Executive Director, said in a press release that the oil market will be adequately supplied in the coming years. Birol stated that recent events have brought to light the geopolitical threats to oil supply. China's oil consumption has slowed down after decades of being the world leader in global demand. It is also facing economic challenges and a major shift to electric vehicles. According to the IEA, oil consumption in the world's second largest economy will peak in 2027 due to a boom in EV sales, high-speed rail, and trucks that run on natural gas. The IEA predicted in February that China's demand may already have peaked for fuels used for air and road transport. The IEA has said that China's total oil demand in 2030 will only be marginally higher than it was in 2024. This is compared to the growth of 1 million bpd predicted in last year's IEA report. The IEA reported that lower gasoline prices in the United States and slower EV adoption have increased the 2030 oil forecast by 1.1 millions bpd compared to the previous prediction. Donald Trump, the U.S. president who returned to office in 2017, has been demanding lower oil prices from OPEC and taking aim at EVs by signing resolutions that were approved by legislators. (Editing by Tomasz Janovowski)
Profit taking by palm oil rivals Chicago soyoil
The Malaysian palm futures market extended its losses on Tuesday. This followed three consecutive sessions of gains. It was dragged lower by a drop in soyoil prices in Chicago and profit-taking actions.
By midday, the benchmark palm oil contract on Bursa Derivatives Exchange for September delivery had fallen 19 ringgit or 0.46% to 4,075 Ringgit ($961.54) per metric ton.
A Kuala Lumpur based trader stated that "the futures are in profit-taking mode following recent rally tracking Dalian and CBOT Soyoil sentiment".
Chicago Board of Trade Soyoil was down by 0.83%. Dalian's soyoil contract with the highest volume was up by 0.63%. Palm oil contracts rose 1.29%.
As palm oil competes to gain a share in the global vegetable oil market, it tracks the price fluctuations of competing edible oils.
U.S. Biofuel Blending Proposals are likely to increase Demand. Soybean futures reached a month-high before losing gains.
The oil prices rose on Tuesday amid fears that the conflict between Israel and Iran could intensify. This would increase the likelihood of unrest in the Middle East - a major producing region - as well as a disruption to the oil supply.
Palm oil is a better option as a biodiesel feedstock because crude oil futures are stronger.
Intertek Testing Services, a cargo surveyor, reported that exports of palm oil products from Malaysia for the period June 1-15 were up 26.3% over May 1-15. AmSpec Agri Malaysia, an independent inspection company said that shipments increased 17.8%.
Palm oil could test the support level of 4,042 Ringgit per metric tonne. A break below this mark would open up the possibility for a drop to 3,998 Ringgit.
(source: Reuters)