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Investors muted by Fed leadership change and mixed earnings
Investors were cautious in early trading on Thursday as they digested mixed earnings from corporates and continued to be wary of the leadership of the U.S. Federal Reserve. The expectation of a more accommodating Fed policy has increased in response to weaker macroeconomic data from the United States and Donald Trump's nomination of dovish candidates for the Fed board. According to CME FedWatch, traders now price in a 95.2% probability of a rate cut for September, up from 63% by the end of July. The U.S. monetary policy changes have a major impact on Gulf markets where the majority of currencies are pegged with the dollar. Dubai's benchmark index fell 0.4% due to declines in financial and real estate shares. Emaar Properties dropped 1% while Emaar Development fell 2.3%. Emaar Properties, Dubai’s largest property developer posted a 39.7% increase in net profit for the second quarter attributable shareholders compared to last year, but a 9% drop from the previous period. The benchmark Abu Dhabi index fell 0.1% due to a loss of 0.4% in International Holding, and a drop of 2.6% in Agthia Group which posted a loss in the second quarter. Burjeel Holding, on the other hand, surged by 4.8% after reporting a net profit that was more than doubled. Saudi Arabia's benchmark index fell 0.2% with the majority of constituents reporting losses. Petro Rabigh dropped 1.6% after the petrochemical firm reported a net loss of 1,37 billion riyals for its second quarter. Savola Group fell 1% after the food giant reported a 22% drop in net quarterly profit year-on-year. The benchmark index in Qatar rose by 0.1%. Qatar Aluminum Manufacturing rose by 2.6% after reporting a 44 percent increase in net profit for the first half of the year. (Reporting and editing by Md. Manzer Hussain)
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Canadian Natural Resources exceeds profit expectations on higher production
Canadian Natural Resources, which has benefited from increased oil and gas production, surpassed Wall Street's expectations for the second quarter profit on Thursday. The Trans Mountain Pipeline Expansion (TMX) has been a boon to oil producers across the country. The TMX has tripled oil flow to Canada's Pacific Coast, from landlocked Alberta. It also raised the price of Canadian crude. Canadian Natural, based in Calgary, Alberta, said that its total production rose to 1,42 million barrels equivalent per day (boepd), from 1.29 millions boepd, a year ago. According to LSEG, the country's biggest oil and gas company posted an adjusted profit per share of 71 Canadian dollars for the three-month period ended June 30. This was higher than analysts' estimates of 65 Canadian dollars. Reporting by Sumit S. Saha, Bengaluru. Editing by Shilpi M. Majumdar.
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NoFI, South Korea's feed wheat buyer, purchases 65,000 t from United States
The leading South Korean animal feed manufacturer Nonghyup Feed Inc. (NOFI) bought about 65,000 metric tonnes of animal feed wheat, which was expected to come from the United States. This purchase took place in an international auction on Thursday. The wheat was purchased in a single consignment. Around 40,000 tons were bought at an estimated price of $262.94 per ton, cost and freight included. The rest of the wheat was at a premium rate of 184 U.S.cents per bushel over the Chicago December Wheat contract. A $1.50 surcharge per ton is added for port unloading. Columbia Grain International is believed to be the seller. Wheat was expected to arrive in South Korea by November 15. The tender requested that the wheat be shipped between October 5-24. This is a slight change from what was originally requested. The reports reflect the opinions of traders, and it is still possible to estimate prices and volume later. The Chicago Wheat Futures have hit a five-year low this week, as global supplies of recent wheat harvests from the United States and Black Sea Region have flooded the markets. A German trader commented: "U.S. Wheat is currently the cheapest wheat in the world, so it's not surprising that the U.S. is making sales at tenders such as this." The Feed Leaders Committee of South Korea (FLC), on Wednesday, purchased approximately 60,000 tons from feed wheat suppliers around the world. (Reporting and editing by Michael Hogan)
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Farmers union: Ukraine will ship 300,000 tonnes of barley to China before August 20.
UAC, the Ukrainian agricultural union, said that Ukraine exported between 250,000 and 300,000 metric tons (metric tons) of barley to China during July. The largest Ukrainian farmers' union UAC said that the last barley exports to China were due on August 15th. UAC reported that the volume of barley exported for July-August totaled 770,000 tons. Last month, Ukrainian analyst Barva Invest reported that Chinese companies had contracted to purchase up to 700 000 tons of the Ukrainian barley crop in 2025. Ukraine is one of the largest barley producers and exporters in the world. Beijing has certified it to supply barley for Chinese markets. UGA, the Ukrainian grain traders' union, reported that China was the largest importer of Ukrainian barley during the 2023/24 crop season with a volume of 702,000 tonnes. UAC warns that traders could face further problems with barley exports as the heavy rains in late July slowed down harvesting, grain quality and crop yield. The UAC also says this year's crop won't be a record. Early August saw farmers harvesting 3.6 million tonnes of barley, while the total crop could be 4.5-5 million tons. The union stated that "this volume will not suffice for us, and because most of the barley consumed in Ukraine is imported into the country, there could be a deficit as early as December." (Reporting and Editing by Louise Heavens, Pavel Polityuk)
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Maersk boosts profit outlook as container demand defies trade fears
Shipping group A.P. Moller-Maersk raised its profit forecast for the full year on Thursday as global demand showed resilience in spite of concerns about trade wars. Maersk, considered a barometer for world trade, has said that it expects container volumes in the global market to increase between 2% and 4 %, as opposed to a range from a 1% growth up or down. Estimated in May Maersk's second-quarter earnings report stated that a contraction in U.S. exports was "more than offset" by a strong increase in imports to other regions including Europe. Vincent Clerc, CEO, said that despite market volatility and historic uncertainty in global trade the demand for our products remained strong. We responded with speed and flexibility. Maersk expects to earn between $8 billion and 9.5 billion dollars in underlying earnings this year, up from its previous guidance between $6 billion and 9 billion. Maersk's EBITDA grew 7% on an annual basis in the second quarter, to $2.3 billion. Analysts had expected $1.98 billion. Analysts in a poll conducted by the company had predicted $12.61 billion. Sales between April and Juni increased 3% on an annual basis to $13.1 billion. Reporting by Jacob GronholtPedersen; editing by Terje Solsvik
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High electricity costs are a harsh reality for Britain's AI dreams: Bousso
NESO report: Data centre energy consumption to triple by 2035 The cost challenge of nuclear and offshore wind investment is highlighted The UK has the highest wholesale electricity prices of all developed economies Ron Bousso LONDON, 7th August - Britain's ambitions to boost its economy and tap into the AI revolution face the harsh reality of the fact that the abundance, clean, and reliable electricity supply required to achieve this is unlikely to be realized any time soon. The Prime Minister Keir starmer has laid out a number of major industrial policies to revive Britain's stagnant economy. This includes pouring money into the artificial-intelligence industry which, according to the government, would increase productivity and generate over $50 billion in gains each year. The data centres that run AI are highly energy-intensive and often require a separate source of power to operate. According to grid operator NESO the UK's electricity demand is expected to increase from 319 terawatt-hours in 2024 up to 450 TWh by 2035. Data centres are expected to triple their power consumption during this period. The government's plans to modernise and expand the country's aging power system through low-carbon sources of energy could paradoxically complicate this effort by increasing Britain's already high energy costs. EXPENSIVE PLANS UK power prices are the highest in any developed country. Wholesale electricity prices increased by 40% from a year ago to $115 per megawatt-hour on average, according to International Energy Agency. This was mainly due to an increase in gas-fired generation during cold weather conditions and a reduction of wind output. This compares to average prices of $100/MWh in Germany and France, as well as $48/MWh in the United States. The British government wants to lower energy prices through a combination of measures, including reducing the grid's dependence on natural gas, increasing renewable power generation and battery storage, improving transmission infrastructure, and connecting grids with neighboring countries. These upfront investments, however, will initially increase the cost of electricity for consumers. Off-Course Offshore wind represents the flagship of Britain’s renewable energy policy. The government aims for offshore wind capacity to increase to 43-50 gigawatts (GW) by the end decade from the current 15 GW. Despite rising construction and finance costs, the government increased the maximum guaranteed price for offshore wind projects or the strike price in the auction this year by 11% compared to the previous round. This was a follow-up to a 66% increase in the last auction. The actual strike price of the contract for difference auction, which starts in this month, could be lower than government ceiling. Cost increases forced Danish developer Orsted to halt the development of its 2.4 GW Hornsea 4 off-shore wind project in May. Nuclear energy is a low-carbon alternative that the UK is also exploring. The UK government announced on 22 July that it had secured investment to develop the Sizewell nuclear plant, Britain's 2nd new nuclear plant within a decade. It is expected to become operational by 2030. Nuclear energy is a reliable source of low-carbon, steady energy. The current sizewell development costs of 51 billion pounds (38 billion pounds) are nearly twice the original estimate from earlier in the decade. This is due to inflation and increased material costs. Cost overruns in nuclear projects are not uncommon. The focus on offshore wind and nukes could increase the cost of electricity, reducing British industry's competitiveness and decreasing support for energy transition. CHOICE OR NO CHOICE Does the government offer any other viable options? Andrew Birch is the CEO of OpenSolar. He believes that Britain needs to liberalise their power market. This would require removing subsidies, such as CfDs, and letting the market determine which energy sources can best meet consumer demands. Although the idea is a good one, given that energy is so important to Britain, both in terms of its economy and security (especially with the AI race and the energy transition), the government will not be willing to relinquish control. A second option would be to transform the UK's old, centralised electricity system into an operation based on many small batteries and generators. This would also increase the grid's efficiency. It would cost billions in advance costs. All infrastructure and investment could be assessed by general taxation, rather than through energy bills. This would reduce sticker shock for consumers each month. This option is unlikely be to gain much political support because voters dislike higher taxes as much as they hate high energy prices. This leaves the possibility of increased private-public partnerships or government-financed investments. To avoid a sustained backlash, the latter would have to be clearly communicated to markets. If properly planned, UK investments in renewables, nuclear power, batteries, and transmission could pay off. However, given the many challenges, it is unlikely that the benefits will be felt for another decade. This spells trouble for Britain’s ambitious AI plans. You like this column? Open Interest (ROI) is your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis. The markets are changing faster than ever. ROI can help you keep up. 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New York Times Business News - August 7, 2018
These are the most popular stories from the New York Times' business pages. These stories have not been verified and we cannot vouch for the accuracy of these reports. The new tariffs imposed by U.S. president Donald Trump on more than ninety countries went into effect at midnight Thursday. This accelerated a global economic war which is already affecting the U.S. United Airlines has resumed its operations after a nationwide system failure that grounded all flights on Wednesday. The Federal Aviation Administration warned of possible delays while the airline recovers. Trump increased the tariffs on Indian exports by 25%, bringing them to 50%. This was a punishment for India continuing to buy Russian oil. Trump and Apple CEO Tim Cook announced a $100 billion investment in Apple's U.S. Advanced Manufacturing and Supply Chain, with the goal of increasing domestic sourcing and avoiding threatened iPhone tariffs.
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Maguire: US energy exporters are likely to be disappointed by any US-Indian trade deal.
Many people see the new 25% tariffs on Indian goods imposed by U.S. president Donald Trump as a negotiation tactic to force India into buying more U.S. goods and energy in the future. India's energy importers have less flexibility than it may seem, despite the fact that India's economy is growing fast and ranks fifth in the world. India is limited in its ability to buy large quantities of U.S. coal, oil, LNG and refined products due to tight corporate margins, cost sensitive consumer markets, long-term import agreements and a slowing economy. India is located at the base Asia, so it's much closer to other energy exporters. However, it is not as close to the United States. This would result in higher shipping costs for India if it switched to U.S. origin products. The upcoming trade talks will no doubt be used to entice some Indian companies into making major U.S. investments and purchases, which could boost the mood in Washington D.C. The Indian market is unlikely to provide the massive and binding commitments of purchase that U.S. oil, gas, and coal exporters are looking for. TOUGH SPOT India's import requirements are not the only thing that it has to be concerned about. According to data from the International Monetary Fund, India's biggest export market is the United States. It accounted for almost 20% of Indian exports over the past few years. India's exports in 2024 to the United States will be just over $80 Billion, and its imports of the U.S. will total just under $45 Billion. It will be difficult for India to replace the lost U.S. customers with other buyers, as the U.S. market is twice the size of the United Arab Emirates, India's second largest export market. This means that the trade negotiators are committed to repairing trade ties as quickly as they can, and they will look at all possible ways of reducing trade imbalances. CRUDE CUT-PRICE India's rapid increase in its purchases of Russian crude since mid-2022 was a major concern for the U.S., Europe and other countries. It also became a focus during recent trade negotiations. Kpler data shows that the average monthly crude oil flow from Russia to India has jumped from 3.2 million barrels per month between 2018-2021 to 50 millions barrels per month since mid-2022. The more than 15-fold increase in Russian oil purchased by India has provided Moscow with vital import earnings as it deals with the fallout of its war in Ukraine and has seriously undermined efforts to reduce funding to Moscow. India's refusal of joining Western-led sanctions was a source of anger for the international community. However, India's willingness to increase imports from Russia ensured that refiners in India and their fuel consumers would be protected from any global oil price rise. In fact, it was the reverse as Indian importers managed to get steep discounts from Russian oil suppliers who were desperate for sales. These cheap barrels imported from Russia allowed refiners like Reliance, a major Indian company, to increase their supplies and drive the economic growth of India since 2020. Indian officials have said that they are only acting for their own benefit when it comes to the new tariffs, as the country has not acted in the best interests of its 1.4 billion people. Any aggressive shift away from cheaper Russian crude to more expensive U.S. oil would have a drastic impact on the Indian economy and would likely lead to an increase in fuel prices, which would be harmful for Indian consumers and refiners. Data from LSEG show that since 2022 the official price of the main grade Russian oil imported by India has averaged $70 a barrel, which is about $10 less than the main U.S. Crude for export during the same period. The real discount is probably greater than the U.S. price, as Indian importers are likely to have secured their Russian oil at lower prices. This means that Indian refiners will not be able to switch to U.S. Crude anytime soon, even under pressure. LONG SHOTS OF COAL & LNG U.S. negotiators have cited liquefied gas as a way to reduce trade gaps. A single LNG cargo costs several million dollars. Indian importers of energy products have less room to change the current U.S. suppliers. Indian gas importers have already signed long-term contracts with suppliers like Qatar and United Arab Emirates and are subject to stiff penalties if they break the contract. Even if Indian buyers were willing to cancel those deals and buy from the U.S., they could face an increase in shipping costs which would make the overall cost of cargo uneconomical. It takes around 30 days for an LNG tanker to travel from the U.S.A. to India, six times as long as the trip from Qatar. The U.S. coal industry will face similar challenges in removing Indonesia from India's coal pipeline. The shipping time from Indonesia to India is approximately 11 days. This compares to the 27-day trip on the East Coast of the United States. India's trade negotiators will have to look for other ways to reach a deal with the U.S. due to the gap between journey times and shipping prices. These are the opinions of a columnist who writes for. You like this article? Check it out Open Interest The new global financial commentary source (ROI) is your go-to for all the latest news and analysis. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on You can find us on LinkedIn.
Wall Street Journal, August 7,
These are the most popular stories from the Wall Street Journal. These stories have not been verified and we cannot vouch their accuracy.
- Activist investor Starboard Value has a more than 9% stake in Rogers Corp and plans to seek another round of changes at the engineering-materials maker to boost shares.
Disney's ESPN, TKO Group and World Wrestling Entertainment reached an agreement worth more than $1.6 Billion that gives the sports-media firm exclusive rights to WWE's highest-profile events.
Apple and other electronics companies worried about trade issues will be happy to hear that U.S. president Donald Trump has announced that he will impose tariffs of approximately 100% on all chips entering the U.S.
United Airlines began taking off flights again late on Wednesday evening, just a few short hours after the carrier halted departures due to a technology problem that affected all of its systems.
The Federal Trade Commission (FTC) has blocked Edwards Lifesciences from acquiring medical device company JenaValve Technology.
Microsoft recruits top talent from Google DeepMind to create a startup culture, and offer lucrative incentives.
(source: Reuters)