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Dollar wobbles as stocks rise on hopes of earnings offset by Trump's Korea tariffs
Investors hoped that a barrage?U.S. Mega-cap earnings were a big factor, but uncertainty due to President Donald Trump's tariff moves against South Korea capped broader gains. Trump increased tariffs to 25% on autos, lumber, and pharmaceutical imports to the U.S. from Asia's 4th-largest economy. The Nasdaq Futures rose 0.2%, as investors prepared for the earnings of the Magnificent Seven, including Microsoft, Apple, and Tesla, on Wednesday. Even South Korea's KOSPI reversed earlier losses and was last to gain 0.8%. Silver surged 6.4% to $110.60 per ounce and is not far off the record set just on Monday. Christopher Louney is a commodity strategist with RBC Capital Markets. He said that the frenetic uncertainty and a weaker US dollar were two of the main factors behind this latest leg up for gold. According to the duration, similar major rallies in the past have occurred around mid-December or early September. The current duration of the rally is not an anomaly, he added, and gold could reach as high as $7100/oz by year's end based on 2025 performance. In Asia, MSCI’s broadest Asia-Pacific share index outside Japan rose by?0.4%. Japan's Nikkei fell 0.1% due to the sharp yen rebound that has clouded its export sector. Hong Kong's Hang Seng index gained 0.4%, but Chinese blue-chips were flat. Overnight, Wall Street rose a fourth time in a row, and both the S&P500 and Nasdaq reached their highest levels in over a week. The earnings reports of U.S. technology giants will be a major test to see if the AI-driven rally can continue. On Wednesday, the Federal Reserve will announce its latest policy decisions. No change in interest rates are expected. The criminal investigation by the Trump Administration into Jerome Powell's term as chair, which ends in May, will overshadow this meeting. Betting markets online now give a 50% chance to Rick Rieder of BlackRock, a bond chief who advocates lower rates, like Trump. US DOLLAR MALAISE Investors are rethinking their optimistic expectations for a period where the dollar will be stable. The latest decline to four-month lows was driven by sharp gains of the Japanese yen on Friday, when talk about rate checks from the New York Fed fueled the risk that a joint U.S. and Japanese intervention would be needed to stop the yen’s slide. The dollar was stable?at154.30 yen, after losing a staggering 2.6% in the previous two sessions. It is also well below the 160-yen level that the Japanese authorities consider to be a red line. The greenback's value against six major currencies was unchanged at 97.09 - close to a 4-1/2-month low of 96.8. The benchmark yield on the 10-year Treasury note increased by 1 basis point, to 4.225%. This is after it fell for four consecutive sessions, from its recent high of 4.313%. In the background, Republicans and Democrats are at odds over funding Trump's Department of Homeland Security following the fatal shooting of an American citizen by federal immigration agents in Minnesota. Tuesday's oil prices were largely flat. Brent crude futures fell by 0.1% to $60.58 a barrel, while U.S. West Texas Intermediate Crude dropped 0.2% to $65.48.
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Even as US winter storm reduces crude production, oil prices continue to fall
The price of oil fell on Tuesday, despite a major winter storm that hit the crude production in the U.S. Gulf Coast and affected refineries. Brent crude futures fell 28 cents or 0.4% to $65.31 per barrel at 0145 GMT. U.S. West Texas Intermediate Crude was $60.39 per barrel, down by 24 cents or 0.4%. Analysts and traders estimate that oil producers in the U.S. lost up to two million barrels of oil per day, or about 15% of the nation's production, over the weekend. This was due to a winter storm which swept through the country and put strain on the energy grids and infrastructure. Daniel Hynes, ANZ analyst, said that the freezing weather was causing problems at several refineries on the U.S. Gulf Coast. This raised concerns over fuel supply disruptions. Two U.S. officials said on Monday that a U.S. carrier aircraft and its supporting warships had arrived in the Middle East. This increased President Donald Trump's ability to defend U.S. troops or possibly?take militairy action against Iran. "Supply risk hasn't completely disappeared" Hynes stated that tensions in the Middle East continue to persist after President Trump dispatched military assets to the area. At a meeting held on February 1, eight members of OPEC+ (the Organization of the Petroleum Exporting Countries, and its allies) are expected to 'keep the group's pause' on increasing oil 'output for March,' according to three OPEC+ delegates. Prices have risen due to a decrease in Kazakhstan's production. Saudi Arabia, Russia and the UAE are among eight OPEC+ countries that will meet in Kuwait. (Reporting by Anushree Mukherjee in Bengaluru; Editing by Sonali Paul)
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McGeever: ROI-America Inc.'s productivity boom could be global.
The U.S. economic system is experiencing a productivity boom, and it may even be spreading globally. Artificial intelligence will accelerate the trend of technological leaps that have been a hallmark of U.S. efficiency, flexibility and dynamism. However, there are some early signs that AI's benefits may be spreading. The Purchasing Managers' Index (PMI), released on Friday, showed that British businesses have started the year off on a good footing. Demand at home and abroad has been robust since April 2024. The pace of job loss has also increased since December. Since late 2024, the sub-indices of employment in Britain's PMI have been below that threshold which separates expansion from contraction. The UK appears to be increasing the amount of goods produced per hour of work - the textbook definition for productivity growth. The latest German PMI data also revealed a similar picture, albeit a little grainier. The output in January was at its highest level in three months. Employment fell at the fastest rate since November 2009 - excluding pandemic declines. It's true that PMI data doesn't always match up with official statistics on growth and employment, but one shouldn't put too much weight in any single month's results. The burgeoning trend shouldn't be ignored. JP Morgan economist Allan Monks points out that the UK's ratio of output per employee - a crude measure of productivity - has been at its highest level since August 2013 - even if you exclude pandemic distortions. Bruna Skarica, a Morgan Stanley analyst, agrees, writing that "a degree of skepticism is probably warranted around the PMIs, but the dynamics of resilient growth and?sluggish labor demand merits greater attention." LONG-TERM PATIENTISM What is driving this? It's probably the AI and technology frenzy. Businesses are betting that AI can make them more innovative, productive and cost effective. However, it remains to be determined whether AI will enable the rest to the world to close the productivity gap between the United States and the rest. This seems to be a better option in China. China, the world's second largest economy, is already experiencing?significant productivity increases in certain sectors such as autos, steel and high-value manufactured goods. Goldman Sachs economists believe that China's computing capacity is starting to surpass the U.S. and will essentially double over the next five year period. It's another story in Europe. The continent is often viewed as a weak point in the global value-chain, with low productivity and growth potential. Economists attribute this to a lack of innovation in technology, excessive regulation, high public debt, and low private investments. Goldman Sachs economists estimate AI will only add 0.05 points per year to European growth over the next few decades, but this figure will rise to "more significant" 0.2 points per year by 2030. The U.S. will still enjoy only a half of the AI-induced productivity growth that they are expected to experience. PRODUCTIVITY A 'GET OUT OF JAIL FREE' CARD? Federal Reserve Chair Jerome Powell signaled in December that productivity growth can help the central banks reduce inflation, while maintaining a dovish policy to support the economy and labor market. Productivity gains that are faster and more widespread will reduce inflation. If productivity increases accelerate and spread globally, central banks may not have to change interest rates dramatically in order to meet their inflation targets. The flip side is that it could be more difficult to maintain full employment if AI advancements allow economies to thrive with fewer workers. Powell could have more to share on this topic when the Fed meets next week. All of this, of course, should be taken as a pinch of salt. Even at the best times, productivity figures can be a bit shaky and difficult to measure. As the Office for National Statistics' labor market data in Britain was revealed to be flawed last year, so are productivity assumptions. Investors are betting that AI-related global spending will reach trillions of dollars in the next few years. This may be revealed by the earnings of U.S. megacaps such as Meta, Microsoft, and Apple?this week. There are still many unknowns, but there is some evidence that the AI spending could lead to a global economic boom. You like this column? Check out Open Interest, your new essential source for global financial commentary. Follow ROI on LinkedIn and X. Listen to the Morning Bid podcast daily on Apple, Spotify or the app. Subscribe to the Morning Bid podcast and hear journalists discussing the latest news in finance and markets seven days a weeks.
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US Medicare payments to insurers will increase slightly in 2027, but share prices fall
The U.S. government announced on Monday that it would be increasing payments to private insurance companies for Medicare Advantage plans managed by them next year. This will result in an average rate increase of 0.09 percent. Shares of the?companies? fell more than 10 percent. In after-hours trading shares of UnitedHealth, CVS Health, and Humana fell between 8%-13%, while those of Elevance Health Centene, and Molina Healthcare dropped by nearly 5%. The update is based on underlying costs trends, quality ratings for 2026, and changes in the risk adjustment model where insurers get paid more if their patients are sicker. CMS Administrator Mehmet Oz stated that these proposed payment policies will ensure Medicare Advantage is better for those it serves. The agency also wants to modernize the risk adjustment system and protect taxpayers from unnecessary expenditure. The government anticipates that a?0.09% increase will result in an additional payment of more than $700 millions in 2027. Kevin Gade is the chief operating officer of Bahl and Gaynor which owns shares in UnitedHealth. He added that the margins of 2027 and earnings per share for insurers would be affected. Gade said that he expected to hear more about the impact of proposed rates during UnitedHealth's conference with analysts and investors on Tuesday, after the company announces its fourth-quarter results. The Wall Street Journal was the first to report this news. Morningstar analyst Julie Utterback stated that the industry will be looking to see if the agency changes its assumptions before finalizing a rule. She said that the final rate announcement will be released in a few weeks. The proposed update does not reflect the 2.45% increase the government expects to see in payments for the coding of next year. Medicare will announce the final rates on April 6, 2019. Health plans welcome reforms that strengthen Medicare Advantage. Flat funding for the program at a time of high medical costs, and high use of services, will affect seniors' coverage, said Chris Bond, a spokesperson for America's Health Insurance Plans, a trade association. Bond said that if the proposal is finalized it could lead to benefit cuts and increased costs for 35 million seniors and people who have disabilities renewing their Medicare Advantage plans in October 2026. Medicare Advantage Plans cover more than half of those enrolled in Medicare, the government program for people 65 years and older who are also disabled.
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Brazilian government claims that floods in the Vale mining area have damaged Brazilian rivers
The Minas Gerais government announced on Monday that overflowing water from a Brazilian mining area owned by Vale had caused environmental damage when it reached the Maranhao River. The flooding on Sunday in two separate but nearby areas, both owned by Vale and hit by heavy rain, led to a flood at the site of steelmaker CSN. According to the government of Minas Gerais and the companies, there were no injuries in the incidents near Ouro Preto or Congonhas. Vale will be required to 'implement emergency measures' to clean up the affected area, monitor the river and submit an environmental recovery plan, according to the government of the state. Vale?did not immediately respond to a question about the statement but previously had?said that local communities were not affected. The flooding took place 'on the anniversary of Vale’s Brumadinho Dam burst on January 25, 2019, which unleashed a mud avalanche and ravaged local rivers and communities, killing 270 people. Vale has said there is no link between the accident and tailings dams in the area. Reporting by Fabio Téixeira, Editing by Jamie Freed
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Guyana's economic growth is projected to be 19.3% by 2025, despite a slowdown in the oil sector.
Kemol King GEORGETOWN Jan. 26 - Guyana's economy expanded 19.3% in 2025, despite a lower growth in oil production and exports than in previous years. Finance Minister Ashni Singh announced this on Monday, when presenting the annual budget. Singh stated that the oil sector will grow by 21% in 2025, compared to 57.7% the year before. The non-oil industry is expected to grow by 14.3%. This growth was primarily driven by agriculture, mining and construction, as well as the services sector. Singh stated that "our overall real economic growth continues be supported by strong growth in the oil and gas sector, as well sustained growth across non-oil sectors." The crude oil production in 2025 will total 261.1 million barrels. This is up from the 225.4 million barrels produced in 2024. A consortium led by ExxonMobil began operations in August on its fourth project in the country. The Exxon-led consortium controls all of Guyana's crude oil production. Singh stated that Guyana will export 260 cargos in 2025. Of these, 32 cargos are being shipped by the government, using its share of the oil produced by Exxon. One cargo of crude oil is approximately one million barrels. Oil will continue to be a major driver of growth for the economy in 2026. Production from Guyana's 5th offshore project is due to begin later this year. Exxon increased Guyana's capacity for oil production to over 900,000 barrels a day (bpd), and a new development set to take place this year will aim to further increase production up to 1,15 million bpd. The government is expected to continue to prioritize infrastructure in its budget, using oil revenue to build 40,000 homes within five years and expand road networks throughout the country. Guyana, Latin America's latest oil producer, has in recent years become the fifth largest crude exporter of the region after Brazil, Mexico and Venezuela. (Reporting and editing by Brendan O'Boyle, Daina Beth Solon)
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Urals crude differentials reduce on wider discount at Indian ports
Urals crude differentials were reduced on Monday as discounts for the 'grade' to dated Brent reached their highest levels since 2022 in India. Urals oil cargoes that will be delivered in Indian ports in February are trading at a discount of $10 per barrel compared to dated Brent. This is a rise of $3-$5 per barrelle compared to estimates for cargoes loaded in the autumn months last season and near?the largest discount ever recorded. Three OPEC+ delegates said that OPEC+ will likely keep its pause in?oil production increases for March during a meeting on 'Sunday. Prices are rising because of a decrease in Kazakhstan's crude oil production. Kazakhstan's Energy Ministry said Monday that the vast Tengiz Oilfield in the country is preparing to resume oil production soon, and the production at the Korolevskoye Oilfield has already resumed. PLATTS WINDOW * There were no bids or offers made for Urals, Azeri BTC, and CPC?Blend on Monday, traders reported. Interfax reported that the Russian energy ministry had submitted a request to the government, asking for the lifting of the gasoline export ban. The source was familiar with the issue. (Reporting and Editing by Paul Simao).
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Gold reaches record high of $5,100 due to geopolitical concerns
On Monday, gold prices soared above $5,100 as investors sought refuge amid political turmoil around the world. Silver and platinum also reached record highs. By?12:30 p.m.?ET (1831 GMT), spot gold had risen 2% to $5,077.22 per ounce after reaching a record of $5,110.50. U.S. Gold Futures for February Delivery settled 2.1% higher at $5,000.50. Gold prices are supported by the elevated level of geopolitical uncertainty and economic instability. Central banks continue to be strong buyers, as they diversify their foreign exchange reserves and decrease reliance on the U.S. Dollar," said Ryan McIntyre. McIntyre said that investor inflows have also resumed into exchange-traded physical backed funds, with the holdings up approximately 20% over the past year. TRUMP'S 100% TARIFF THREATEN ON CANADA Donald Trump, the U.S. president, said on Saturday that he would impose 100% tariffs on Canada if they follow through with a trade agreement with China. Adrian Ash, BullionVault's head of research, said that "Trump and Trump" will be the main drivers for precious metals this year. This move is driven by a wave of first-time investors. Private investors in Asia and Europe are leading the charge, as they rush to "build their own personal holdings of silver?and gold." Investors also focused on the possibility of a coordinated currency-intervention by U.S. authorities and Japanese authorities. The criminal investigation by the Trump administration into Fed chairman Jerome Powell is also overshadowing this week's Federal Reserve Meeting, where the central bank will be expected to keep rates unchanged. Powell has been under pressure from Trump to lower interest rates. This would be in support of non-yielding, or non-returning, gold which has gained nearly 18% this year after 64% gain in 2025. Gold reached major milestones last year. It was the first time that gold exceeded $3,000/oz or $4,000/oz. GOLD MAY REACH $6000/oz BY YEAR'S END, SAY SOME ANALYSTS Analysts believe there is room for "further upward momentum". Societe Generale predicts gold will reach $6,000/oz before the end of the year, but cautions that this estimate may be conservative and there is still room for further gains. Morgan Stanley, on the other hand, said that the rally may continue and highlighted a bull case target of $5700. Silver spot reached a record high of $117.69 per ounce, and was last up 10.2% to $113.46. Prices broke through the $100 mark as momentum-driven and retail investor buying pushed the physical market for precious and industrial metals to a tighter state. "Momentum has been strong. Chinese silver prices are at a significant premium over London prices. This indicates that further gains could be made in the near future. But such high prices will reduce industrial demand, said UBS analyst Giovanni Staunovo. Spot palladium rose 5.9% to 2,127.68 dollars, its highest level since 2022.
Sharks continue winning streak against Canucks
San Jose Sharks are looking to keep up their winning ways when they begin a five-game trip in Vancouver on Tuesday against the Canucks.
San Jose hasn't played since beating the New York Rangers by 3-1 last Friday.
Macklin Celebrini and Pavol Regenda both scored for the Sharks who have gone 9-4-0 over their last?13 games.
Will Smith and Collin Graf each added two assists, while Alex Nedeljkovic saved 28 shots for his fifth consecutive win.
Ryan Warsofsky, Sharks' coach, said: "I liked the maturity of our play in the third period." "We showed better winning habits during the third period. The second half of the period was not as good. "We weren't good at all in terms of our details, both with and without the puck. So I'm glad that we locked it down there."
San Jose took an early 2-0 advantage after Celebrini and Regenda each scored power-play goals in the first period, 1:59 apart.
Celebrini stated that he was frustrated by the way his?power play had been working. We want our power play to make a difference for our team and help us win games. But we haven't done that in the last two games.
Celebrini scored his second goal in the first frame to give the Sharks an early 3-0 lead. This was Celebrini's seventh career "multi-goal" period. Celebrini, who is 19 years and 224 days old, became the second youngest active player in history to score 50 career goals. Sidney Crosby was first.
The Vancouver native was fourth in the league for points (74) as well as assists (48), while leading the Sharks in goals with 26.
Canucks and Sharks will be playing eight home games. Vancouver only has one win in the first five matches of this stretch. They are coming off a Sunday 3-2 loss against the Pittsburgh Penguins.
Kevin Lankinen, the Canucks' goalkeeper, made 22 saves. The Canucks have lost their last two games and are now 1-11-2.
Canucks head coach Adam Foote had no update on Brock Boeser. The forward received a blow to the face from Penguins' Bryan Rust during the last seconds of Sunday's game.
The league announced Monday that Rust would be subject to an investigation into the illegal head check.
Foote stated post-game that "it was a headshot -- it was shoulder in his head." "Even if he was desperate to return (to the play), because there was a scrum near the net, I think it's something you have to control your body. I thought it was an incredibly vicious blow to the head.
The game on Tuesday will be the third in a series of four matches between the two teams this season. San Jose won both of the previous games, 3-2 at home (Nov. 28,) and 6-3 on the road (Dec. 27,).
Field Level Media
(source: Reuters)