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FedEx drops on margin concerns, as investors consider freight impact
FedEx shares fell 6% on Wednesday before the bell, as lower margins in the core delivery segment sparked investor concerns about the company's transition following the spinoff?of?its highly profitable trucking division. FedEx spun off its FedEx Freight trucking division earlier this month in an effort to focus more on its delivery business. Investors are scrutinizing the slimmed down company to boost profits and reduce cost. FedEx Federal Express' operating margin fell from 8.4% to 7.7% as employee salaries, benefits and outsourced transportation costs increased. The U.S. Logistics firms, including UPS and FedEx, have seen their volume drop due to the changing U.S. Trade Policies. Meanwhile, the Iran War has increased fuel prices. Volumes have also been affected by the loss of duty-free treatment "de minimis", which was previously available for low-value ecommerce shipments that were tied to China-linked discounters, such as Shein and Temu. J.P. Morgan analysts said that FedEx may experience an overhang while the market sorts through all the moving parts of the Freight spinoff, and then shifts to a year-end reporting period. FedEx executives stated on a call after earnings that fuel surcharges offset the rising costs. FedEx, an indicator of global trade, has forecasted?annual earnings between $16.90 and $18.10 for each share as its fiscal year aligns with the calendar from its previous year-end in May. Analysts still haven't developed models to compare the new forecast with just its delivery operations. Morgan Stanley analysts stated that it would be difficult to judge numbers for the next few quarters due to the noise, but they will focus on fundamental debates. FedEx is trading at 14.68 times its projected 12-month earnings, slightly more than UPS at 14.05
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Andy Home: The ROI-Congo pivots to the west under the cover of cobalt control
The ambitions of the Democratic Republic of Congo in cobalt are?becoming more and more clear. Export restrictions have been used by the world's biggest producer of strategic metals, which are used in everything from stealth bombers to mobile phones, to reduce excesses and raise prices. Kinshasa is trying to shift its focus away from Chinese operators and towards the United States, as it gains more control of its cobalt industry. This rebalancing is accompanied by a renewed effort to integrate the artisanal and smaller-scale mining sector (ASM), a minefield of ethical issues for Western cobalt purchasers, into official sectors. MOVING MARKETS Congo has restricted cobalt exports from February of last year. A full ban was replaced by a quota-based system in October. Shipments only started picking up again early this year due to teething problems with the new administrativesystem. China's import numbers are still very low. According to the World Bureau of Metal Statistics which collects customs data, the largest buyer of Congolese Cobalt imported only 5,000 metric tonnes between January and April. This is down from nearly 200,000 tons during the same period in 2025. The stock surplus built up by previous years' Congolese production has cushioned the supply shock. Cobalt metal prices have been flat so far this year. However, at $26 per lb they are more than twice as high as before Congo stopped exports in early last year. Supply chain tensions are increasing. The price of cobalt hydrxide, the form in which the metal is shipped by Congo has continued to rise, and it now trades at the same level or even higher than the?metal prices this year. According to Ying Lu of Project Blue consultancy, this price inversion is reshaping supply chains as refineries use more metal to make sulphate - the type cobalt that battery manufacturers use. This may not just be a temporary glitch. Project Blue says that this shift in pricing suggests the market is charging a premium for cobalt units originating from the DRC. Securing Access As U.S. investments increase in Kinshasa, China's refiners will find it more difficult to secure access to Congo cobalt. The Congo's mineral wealth, especially cobalt, was the foundation of the U.S.-brokered agreement with Congo and Rwanda last June to end years' hostilities. Recent announcements indicate that the deal is beginning to work. Virtus Minerals - which describes itself as an U.S. critical minerals platform - bought the privately held Chemaf cobalt and copper mines in may and hopes to resume full operations following years of uncertainty. The Congo's Entreprise Generale du Cobalt has signed a Memorandum of Understanding with Trafigura, a trading house in the United States and EVelution for the supply of the latter's new proposed cobalt refinery. The Lobito Atlantic Railway is another U.S.-backed project that links the Congolese Copper Belt with the Angolan Port of Lobito. Western operators now have a viable alternative to the Chinese-backed TAZARA rail, which carries goods to the Tanzanian port at Dar es Salaam. ARTISANAL ARTISANAL ARTISANAL ARTISANAL ARTISANAL ARTISANAL ARTISANALL 'GOLDSTANDARD' EGC must ensure that ASM it provides to its Western partners are ethically pure. Illegal mining in Congo and the cobalt markets has been a problem for many years. Kinshasa tried to integrate its shadow mining industry before, but with limited success. A new venture between the EGC and Mercuria, a trading house, aims to "establish" a "Gold Standard", for responsible ASM mining at the Kasulo site. If Congo is to reduce its dependency on China by opening up new markets in the United States, it must assure Western consumers that they are not purchasing "blood cobalt". More Power This year, events have conspired in a way that will increase Congo's influence on the cobalt markets. Sherritt International’s Canadian refining operation is under serious scrutiny after the latest round of U.S. Sanctions forced the company's joint venture operations in Cuba to be discontinued. Ambatovy's nickel-cobalt operations are being sold to a new owner after a cyclone knocked them out in February. The nickel refineries in Indonesia, another non-Congo cobalt source, are under pressure due to reduced mining quotas, and problems with sourcing the sulphuric acids they need. The Congo, which is already responsible for 70% of the global mining supply. This power is being used to redefine the cobalt markets and the strategic position of the country in the global race for critical minerals. Andy Home is a columnist at. This column is great! Open Interest (ROI) is your new essential source of 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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German expert panel recommends social media ban for children under 13
A government-appointed panel of experts has recommended that Germany consider banning under-13s from having their own social media accounts, imposing child safety measures on 'platforms, and introducing parental duties to prevent "digital negligence". According to a document released on Wednesday, the commission has submitted 56 "recommendations" to the Family Ministry for a strategy for protecting children and young people online. This includes the option of banning social media for those under 13 years old. The government has welcomed the recommendations, which will be discussed in the political arena. In a press release, German Minister of Family Affairs, Senior Citizens, Women and Youth Karin Prien said: "I believe the proposal to impose a legal age limit on the use of social media is the best way forward in terms of the independent use." The panel proposed tiers of protection for those aged 13-16, 16-18, and 17-19 years old, in order to protect young people against online risks, without completely excluding them. The commission proposes that instead of a uniform age limit, restrictions should be based on the risk assessment of each platform and based upon specific service- or function-specific requirements. Many countries, including Australia, France and Canada, as well as Spain, Slovenia, Greece, Canada, and the United Kingdom, have banned social media to protect their youth. The ruling conservatives and Social Democrats in?Germany have already?spoken out for access restrictions. They see fake news and AI-generated images as threats to children and young people. Politicians are also concerned that radical forces target young people at a very young age.
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Binance vows that it will remain in Europe despite a license setback
Binance, the crypto?platform, plans to remain in 'the?European Union, and will seek permission to operate there again, according to a senior executive. This is after its application for a new license regime failed. It threatened access for millions users. Gillian Lynch said that Binance would not leave Europe after the company's bid to obtain a license in Greece for services such as crypto trading within the EU failed. She said, "We might just have to take a different route in order to be?authorized." "If Greece is not an option, I am looking at alternatives." Binance is now on a collision course with European regulators. The company only has a week to obtain a license before its current operating permit in Europe expires. This would force it to shut down EU operations. Binance, according to two people familiar with the process, has met with regulators in Ireland and Greece. However they have encountered resistance. Officials expressed concern about the company’s past sanctions for money laundering, its complicated international structure and their perception of a high-risk culture. The regulators in all three countries refused to comment or didn't respond. The letters sent to regulators show how one of the largest crypto companies in the world has struggled to get an EU license despite regulatory opposition. Lynch stated that Binance didn't know why they had been?refused approval? and believed previously that the Greek regulator planned to grant a license. She stated that Binance had contacted at least four regulators, but had only submitted one application to Greece. Lynch, when asked about Binance’s past issues, said that Binance had invested in internal controls and compliance, had employed approximately 1,500 compliance personnel, and did not have any outstanding issues relating to its application. Reporting by John O'Donnell and Elizabeth Howcroft. Francesco Canepa, Lefteris papadimas. (Editing by Tommy Reggiori Wilkes. ElisaMartinuzzi, Mark Potter and Mark Potter.
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UN agency reports that ships have begun sailing through Hormuz as part of the UN evacuation scheme
A spokesperson announced on Wednesday that ships have started sailing through the 'Strait of Hormuz' under a new scheme by the U.N.'s shipping agency in order to evacuate vessels trapped there by the conflict. International Maritime Organization announced on Tuesday that the initiative, which took months to complete, would allow hundreds of ships and 11,000 seafarers stranded at the Gulf of Mexico to pass through Hormuz. A spokesperson for the IMO said that "ships have already started to pass under this plan", refusing to give any details about the vessels that have crossed. LSEG ship-tracking data showed that at least two dry bulk?ships and one cargo'ship' have sailed past Hormuz in the last 12 hours under this scheme. According to LSEG's and MarineTraffic's ship tracking data based upon analysis of ship movement, at least 35 commercial ships, primarily?dry bulk?, cargo?, and container?vessels?, were preparing for passage through the strait. According to the analysis of?vessels-waiting, these vessels include smaller commercial ships, including five smaller oil tanks, coastal ships, and tugs. The IMO stated that the U.S., Iran and the Sultanate of Oman had reached a ceasefire agreement, allowing the scheme to be implemented. In a Wednesday note, the IMO emphasized that vessels should wait for instructions. "Crowding in the waiting area may?result?in the need to pause further notifications due to?safety." The U.S. Military launched a mission in recent weeks to assist ships get out of the Strait. (Reporting and editing by Andrew Heavens, Philippa Fletcher and Jonathan Saul)
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UN agency reports that ships are already sailing through Hormuz as part of the UN evacuation scheme
A spokesperson for the U.N. shipping agency said that ships have already passed through 'the Strait of Hormuz' under a newly-launched evacuation scheme. A spokesperson for the International Maritime Organization (IMO), a U.N. agency, said that "ships have already started to pass under the plan." He declined to give any 'details' on the ships that had passed. LSEG's ship tracking data revealed on Wednesday that two dry -bulk ships, and one cargo -ship, have sailed through Hormuz in the past 12 hours. According to LSEG & MarineTraffic'ship tracking data' based on an analysis of ship movement, at least 35 commercial ships, primarily dry?bulk, cargo, and container vessels, were preparing for a passage through the strait. The IMO announced on Tuesday that the scheme, which took months to complete, would allow hundreds of ships, with a total of?11,000 seafarers, to sailed through Hormuz. (Reporting and editing by Andrew Heavens; Jonathan Saul)
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Additional oil tankers leaving Hormuz will add to global supply
Shipping data shows that three stranded oil tankers, each carrying 5 million barrels of crude oil, left the Strait of Hormuz Wednesday. Two of them were headed to Asia. The interim agreement between Iran and the U.S. has released more supply?stuck?in the Gulf, which is bringing down?global?prices. Data from LSEG & Kpler revealed that the VL Breeze (flagged South Korean) is a Very Large Carrier, carrying 2,000,000 barrels of Qatari Condensate & Abu Dhabi Crude. It has passed through the strait on its way to Daesan. The supertanker was chartered by South Korean refiner Hyundai Oilbank. The data revealed that the VLCC Plata Carrier chartered by Indian Oil Corp is headed?outside the strait, carrying 2 million barrels Saudi crude. It is accompanied by the Suezmax tanker Prudent Warrior which is headed?for Sohar in Oman with 1,000,000 barrels Iraqi Basrah oil. Both vessels are flying the 'Liberian flag. Hyundai Oilbank and IOC were not available for comment. Kpler analysts and Vortexa analysts estimated that last week, close to 90 millions barrels of crude oil were trapped inside the Gulf. The South Korean maritime ministry announced on Wednesday that four vessels operated by South Korean shippers had left the strait, and were sailing towards their destinations. One vessel was bound for South Korea while the other three were headed to third countries. The ministry reported that 18 of the 26 vessels stranded in the Gulf since the beginning of the Middle East conflict are still there. It wasn't immediately clear if the ships were sailing on the temporary maritime routes established by?Oman & the International Maritime Organization in order to help ships safely leave the region. Oman has said that it will keep the Strait of Hormuz free of tolls and open to all shipping. It has also designated two temporary routes to the north and south of existing shipping lanes to help vessels leave the area safely. Shipping data revealed that two empty LNG tankers, the Milaha Qatar and the Shandong Redwood, were the last to be seen heading west of the strait in order to load cargoes at Qatar. Nine LNG tankers have been seen transiting the strait in order to load cargoes at Qatar, which is the highest number of empty LNG vessels since the start of the war. The Financial Times reported that Qatar's Prime Minister Sheikh Mohammed Bin Abdulrahman Al-Thani stated the Gulf state will resume normal?LNG output within a few short weeks. (Reporting from Florence Tan and Emily Chow, in Singapore; Nidhi in New Delhi; Jonathan Saul, in London; Additional reporting by Jack Kim, Heejin Kim, and Milla Nissi Prussak in Seoul)
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FedEx's margin hit is a concern for investors as they gauge the freight spin-off company's fortunes
FedEx shares fell 7% on Wednesday before the bell, due to investor concerns about the 'transition' of the company following the spin-off of its highly profitable trucking unit. FedEx spun off its trucking division, FedEx Freight earlier this month, in an effort to focus on the delivery business. Investors are scrutinizing the slimmed down company to boost profits and reduce cost. FedEx Federal Express' operating margin fell from 8.4% to 7.7% as employee salaries, benefits and outsourced transportation costs increased. Fuel prices have risen due to the Iran 'war' and changes in U.S. Trade Policies. Volumes have also been affected by the loss of duty-free treatment "de?"minimis" for low-value e?commerce shipments linked to China-linked discounters such as Shein or Temu. In a recent note, J.P. Morgan analysts noted that FedEx may experience an overhang as the market sorts through the various moving parts of the Freight'spin-off' and moves to a year-end reporting period. FedEx, an indicator of 'global trade', has forecast earnings per share between $16.90 and $18.10, after re-aligning its fiscal year with the calendar from May. Analysts still haven't 'built models to enable comparisons with a new forecast that only includes its delivery operations. Analysts at Morgan Stanley said that it would be difficult to judge the numbers in a few quarters due to the noise. However, they will focus on fundamental issues. FedEx is trading at 14.68 times its projected 12-month earnings, a little higher than UPS's 14.05. (Reporting and editing by Shreya biswas in Bengaluru, Siddarth S. in Bengaluru)
Binance vows that it will remain in Europe despite a license setback
Binance, the crypto platform, plans to remain in the European Union, and will make another push to get permission to operate, said a senior executive, after their application under a 'new licence regime' failed. This threatened access to millions of users.
Binance will not leave Europe, said?Gillian?Lynch after the company's failed bid to obtain a license in Greece for services like crypto trading within the EU.
She said, "We might just need to take a different route in order to be approved." "If Greece is not an option, I am looking at alternatives."
Binance is now on a collision course with European regulators. The company only has a week to obtain a license before the current permit to operate in Europe expires. This would force it to shut down its EU operations.
Binance, according to two people familiar with the process, has met with regulators in Ireland and Greece. However, they have encountered resistance.
Officials were concerned by the company's history of money laundering penalties, its international structure and their perception of a risk-taking culture.
The regulators in all three countries either declined to comment or didn't respond.
The letters sent to regulators show how one of the largest crypto companies in the world has struggled with regulatory resistance and obtaining an EU license.
Lynch stated that Binance didn't know why they were denied approval, and previously thought the Greek regulator intended to grant a license.
She said Binance contacted four to five regulators, but had only submitted one application - to Greece.
Lynch, when asked about Binance's previous problems, said that Binance had invested heavily in compliance and internal control, had employed approximately 1,500 compliance personnel, and did not have any outstanding issues with its application.
Regulatory Concerns
Binance's inability to obtain an EU license?before June 30 raises doubts about its future?in the EU. The EU's new crypto regulations will be tested to see if authorities can enforce what amounts to a complete ban.
The European Securities and Markets Authority (ESMA) said on Tuesday that crypto firms without a license must "take immediate measures to wind up their EU activities in a timely manner".
MiCA (the EU's groundbreaking crypto regime) came into effect last year. Firms have until the end of June to get an authorisation to serve customers in all 27 member states.
Binance claims to have more than 300 millions customers worldwide, but has declined to disclose how many of those are in the EU. Sensor Tower estimates that the app was downloaded over 4 million times last year in the EU, with France, Germany, and Spain accounting for most of those downloads.
Sources who spoke on condition of anonymity said that regulators assessing Binance’s bid were concerned with the backgrounds of senior executives, and the exchange’s track record in money laundering controls. They viewed these as being inadequate.
One source cited the influence of Binance founder Changpeng Zhao who stated in a podcast from February that he was the ultimate beneficial owner. Another source cited Binance's global complex structure.
Lynch said Zhao is "100% removed" (from the company).
Binance had previously struggled to gain regulatory approval in other countries. It has been told to leave Japan and the UK after it operated there without a license. Its primary licence is in the United Arab Emirates.
Zhao, also known as CZ, pleaded guilty in 2023 to violating U.S. money laundering laws. This was part of a $4.3 Billion settlement after a long investigation.
Donald Trump, the U.S. president, pardoned him last year after he served almost four months.
Binance, according to U.S. authorities, has violated anti-money laundering laws and sanctions laws by failing to report over 100,000 suspicious transactions that were linked to groups designated as terrorist organizations in Washington.
REGULATORS COLLABORATE
Under MiCA crypto firms can submit an application through a single national regulator, and then use this as a passport to sell services across the bloc.
One source said that regulators in Latvia, Ireland, and Greece worked closely together to ensure a "consistent" approach to Binance’s application.
Several regulators are concerned that inconsistent enforcement may undermine efforts to supervise a multi-billion dollar industry. They warn this could destabilise the markets, facilitate illegal finance and harm investors.
Eleanor Hughes, Binance's general counsel, said that Binance believed it met MiCA requirements. While national regulators issue licences, ESMA can discuss applications. Reporting by John O'Donnell and Elizabeth Howcroft. Francesco Canepa, Lefteris papadimas. (Editing by Tommy Reggiori Wilkes. ElisaMartinuzzi, Mark Potter and Mark Potter.
(source: Reuters)