2025-07-29 12:24
Euro resumes decline after Monday's retreat Wall St futures edge up before Fed, mega cap earnings Analysts warn tariffs are drag on EU and US economies Oil flat after Trump shortens Russia deadline LONDON, July 29 (Reuters) - Wall Street futures pointed to a buoyant open on Tuesday ahead of earnings reports from a number of companies and the Federal Reserve's policy meeting that starts later in the day. S&P 500 futures ticked up 0.3%, while Nasdaq futures added 0.5%, riding on hopes for upbeat results from mega caps this week that include Apple (AAPL.O) , opens new tab, Meta Platforms (META.O) , opens new tab, Microsoft (MSFT.O) , opens new tab and Amazon (AMZN.O) , opens new tab. Sign up here. The dollar index climbed 0.4% to 98.951 after the rush out of short dollar positions lifted it 1% overnight, while it eased a one-week high on the yen to stand at 148.69 . Yields on 10-year Treasuries inched up 3 basis points to 4.392%, having crept higher on Monday as markets braced for another steady decision on interest rates from the Federal Reserve. Futures imply a 97% chance the Fed would keep rates at 4.25%-4.5% at its meeting on Wednesday and reiterate concerns that tariffs will push inflation higher in the short term. Analysts also assume one, or maybe two, Fed officials will dissent in favour of a cut and supporting wagers for a move in September. The odds could change depending on a slew of U.S. data this week including gross domestic product for the second quarter, where growth is expected to rebound to an annualised 2.4%, after a 0.5% contraction in the first quarter. Figures on job openings are due later on Tuesday that will help refine forecasts for the crucial payrolls report on Friday. "The equity rally has narrowed, valuations are stretched and market internals are flashing caution, and consumer data -particularly around housing and retail - show signs of fatigue," said Bruno Schneller, managing director at Erlen Capital Management, Zurich. "This is the start of a 'show-me' phase - for both policymakers and corporates. Markets will demand confirmation: from earnings, from macro, and from the Fed," Erlen added. Canada's central bank also convenes on Wednesday and again is widely expected to hold rates at 2.75%. TARIFF ECHOES U.S. equity moves follow record closing highs for the S&P and the Nasdaq on Monday in volatile trading after the U.S. struck a trade agreement with the European Union, while the Dow remained just about 200 points short of an all-time high. The U.S.-EU trade deal, announced on Sunday, halved threatened 30% U.S. tariffs on EU imports to 15% and bolstered expectations that more such agreements will follow ahead of President Donald Trump's looming August 1 deadline. Trump also flagged a "world tariff" rate of 15%-20% on all trading partners that were not negotiating a deal, among the highest rates since the Great Depression of the 1930s. "While the worst-case scenario was averted, the implied EU tariff increase from 1% in January is a significant tax increase on EU exports," wrote economists from JPMorgan in a note. "This is a very big shock that unwinds a century of U.S. leadership in global free trade," they said. "While we no longer see a U.S. recession as our baseline from this shock, the risk is still elevated at 40%." The euro fell 0.4% to $1.1543 , after retreating 1.3% overnight in its largest drop since mid-May. European shares recovered after Monday's sell-off. Europe's broad STOXX 600 (.STOXX) , opens new tab was up 0.6%, helped by some positive reactions to quarterly earnings. French (.FCHI) , opens new tab and German (.GDAXI) , opens new tab stock indexes rose over 1%. Novo Nordisk, one of Europe's biggest companies by market cap, named Maziar Mike Doustdar as its new chief executive after the abrupt removal of its previous CEO in May. Shares in the company were down as much as 29.8% by 1149 GMT, wiping off over 80 billion euros in market cap at one point. An air of caution saw MSCI's broadest index of world shares (.MIWD00000PUS) , opens new tab tick down about 0.2% after China stocks ended higher on Tuesday as a new round of Sino-U.S. trade talks continued, while Japan's Nikkei lost 0.8% (.N225) , opens new tab. A further risk to world growth came from a sudden spike in oil prices after Trump threatened a new deadline of 10 or 12 days for Russia to make progress toward ending the war in Ukraine or face tougher sanctions on oil exports. In commodity markets, prices for copper and iron ore were under pressure while gold was roughly flat at $3,316 an ounce . Brent was about 20 cents higher at $70.22 a barrel, while U.S. crude up 17 cents to $66.90. https://www.reuters.com/world/china/global-markets-wrapup-4-pix-2025-07-29/
2025-07-29 12:23
Brent crude hits highest since July 18 US and China officials in Stockholm for trade talks Trump's shorter deadline for Russia on Ukraine war raises oil flow concerns Market looks to U.S. interest rate decision LONDON, July 29 (Reuters) - Oil prices edged up on Tuesday on optimism that a trade war between the United States and its major trading partners was abating and as President Donald Trump ramped up pressure on Russia over its war in Ukraine. Brent crude futures were up 22 cents, or 0.3%, at $70.26 a barrel at 1218 GMT, having touched their highest since July 18, while U.S. West Texas Intermediate crude was at $66.98, up 27 cents, or 0.4%. Sign up here. Both contracts settled more than 2% higher in the previous session. The trade agreement between the United States and the European Union, while imposing a 15% import tariff on most EU goods, sidestepped a full-blown trade war between the two major allies that would have rippled across nearly a third of global trade and dimmed the outlook for fuel demand. The agreement also calls for $750 billion of EU purchases of U.S. energy over the next three years, which analysts say the bloc has virtually no chance of meeting, while European companies are to invest $600 billion in the U.S. over the course of President Donald Trump's second term. Top economic officials from the U.S. and China are meeting in Stockholm for a second day to resolve longstanding economic disputes and step back from an escalating trade war between the world's two biggest economies. Trump also set a new deadline on Monday of "10 or 12 days" for Russia to make progress toward ending the war in Ukraine. Trump has threatened sanctions on both Russia and buyers of its exports unless progress is made. "Oil prices rallied after President Trump said he would shorten the deadline for Russia to come to a deal with Ukraine to end the war, raising supply concerns," ING analysts said in a note. Market participants are also waiting to hear the outcome of the U.S. Federal Open Market Committee meeting on July 29-30. The Fed is widely expected to hold rates but could signal a dovish tilt amid signs of cooling inflation, said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova. https://www.reuters.com/business/energy/oil-prices-rise-further-trade-war-relief-2025-07-29/
2025-07-29 12:04
July 29 (Reuters) - U.S. utility DTE Energy (DTE.N) , opens new tab missed Wall Street estimates for second-quarter profit on Tuesday, hurt by lower income from the gas and the energy trading segment. At the energy trading segment, which consists of energy marketing and trading operations, profit dropped 22.5% to $24 million as natural gas prices dropped 16.1% in the quarter ended June 30. Sign up here. Quarterly profit in its gas unit declined 50% to $6 million on higher operating, maintenance and rate base costs. However, the company's electric segment - its largest unit by net income - reported earnings of $318 million in the April-to-June quarter, compared to a profit of $279 million a year ago. The utility reaffirmed full-year 2025 adjusted profit in the range of $7.09 per share to $7.23 per share. Analysts expect the full-year profit to be $7.22 per share, according to data compiled by LSEG. DTE also said it has invested more than $1.8 billion in its utilities during the first half of 2025 and is on pace to invest $4.4 billion this year, to continue improving the safety and reliability of its electric and natural gas infrastructure. Electric grid projects need years of planning, permitting and construction and the rapid increase in data center demand has emphasized the need for faster buildout, thus the need for large investments. The Detroit, Michigan-based company reported an adjusted profit per share of $1.36 for the three months ended June 30, compared with analyst's estimate of $1.40 per share. https://www.reuters.com/business/energy/dte-energy-misses-second-quarter-profit-estimates-weak-gas-energy-trading-income-2025-07-29/
2025-07-29 12:00
July 29 (Reuters) - Duke Energy (DUK.N) , opens new tab said on Tuesday it would sell its Tennessee natural gas distribution business to Spire (SR.N) , opens new tab for $2.48 billion in cash, as the utility aims to streamline operations and unlock capital to invest in electric grid upgrades. About $800 million of the proceeds will be used to pay down debt at Piedmont Natural Gas, while the remaining $1.5 billion will support Duke's $83 billion five-year capital plan focused on grid modernization and energy transition, the company said in a statement. Sign up here. The sale agreement includes nearly 3,800 miles of distribution and transmission pipelines and a liquefied natural gas facility serving about 205,000 customers. Piedmont's primary operations will remain in the Greater Nashville area after the transaction closes, expected in the first quarter of 2026. The integration of the Tennessee business is expected to expand Spire's utility footprint. The natural gas company has operations in Missouri, Alabama and Mississippi. https://www.reuters.com/legal/litigation/utility-duke-energy-sell-tennessee-natural-gas-business-248-billion-2025-07-29/
2025-07-29 11:51
$85 billion deal will create US transcontinental freight giant Unions, regulators expected to scrutinize deal over jobs and service impact Deal approval could take 19 to 22 months July 29 (Reuters) - Union Pacific (UNP.N) , opens new tab said on Tuesday it would buy smaller rival Norfolk Southern (NSC.N) , opens new tab in an $85-billion deal to create the country's first coast-to-coast freight rail operator and reshape the movement of goods from grains to autos across the U.S. If approved, the deal would be the largest-ever buyout in the sector and combine Union Pacific's stronghold in the western two-thirds of the United States with Norfolk's 19,500-mile network that primarily spans 22 eastern states. Sign up here. The two railroads are expected to have a combined enterprise value of $250 billion and would unlock about $2.75 billion in annualized synergies, the companies said. The $320 per share price implies a premium of 18.6% for Norfolk from its close on July 17, when reports of the merger first emerged. The companies said on Thursday they were in advanced discussions for a possible merger. The deal will face lengthy regulatory scrutiny amid union concerns over potential rate increases, service disruptions and job losses. The 1996 merger of Union Pacific and Southern Pacific had temporarily led to severe congestion and delays across the Southwest. The deal reflects a shift in antitrust enforcement under U.S. President Donald Trump's administration. Executive orders aimed at removing barriers to consolidation have opened the door to mergers that were previously considered unlikely. Surface Transportation Board Chairman Patrick Fuchs, appointed in January, has advocated for faster preliminary reviews and a more flexible approach to merger conditions. Even under an expedited process, the review could take from 19 to 22 months, according to a person involved in the discussions. Major railroad unions have long opposed consolidation, arguing that such mergers threaten jobs and risk disrupting rail service. "We will weigh in with the STB (regulator) and with the Trump administration in every way possible," said Jeremy Ferguson, president of the SMART-TD union's transport division, after the two companies said they were in advanced talks last week. "This merger is not good for labor, the rail shipper/customer or the public at large," he said. The companies said they expect to file their application with the STB within six months. The SMART-TD union's transport division is North America's largest railroad operating union with more than 1,800 railroad yardmasters. The North American rail industry has been grappling with volatile freight volumes, rising labor and fuel costs and growing pressure from shippers over service reliability, factors that could further complicate the merger. Union Pacific's shares rose as much as 2% in premarket trading, while Norfolk fell 2.45%. CONSOLIDATION The proposed deal had also prompted competitors BNSF, owned by Berkshire Hathaway (BRKa.N) , opens new tab, and CSX (CSX.O) , opens new tab, to explore merger options, people familiar with the matter said. Agents at the STB are already conducting preparatory work, anticipating they could soon receive not just one, but two megamerger proposals, a person close to the discussions told Reuters on Thursday. If both mergers are approved, the number of Class I railroads in North America would shrink to four from six, consolidating major freight routes and boosting pricing power for the industry. The last major deal in the industry was the $31-billion merger of Canadian Pacific (CP.TO) , opens new tab and Kansas City Southern that created the first and only single-line rail network connecting Canada, the U.S. and Mexico. That deal, finalized in 2023, faced heavy regulatory resistance over fears it would curb competition, cut jobs and disrupt service, but was ultimately approved. Union Pacific is valued at nearly $136 billion, while Norfolk Southern has a market capitalization of about $65 billion, according to data from LSEG. https://www.reuters.com/legal/litigation/union-pacific-buy-norfolk-85-billion-mega-us-railroad-deal-2025-07-29/
2025-07-29 11:32
Baker offers $210/shr, about 22% premium, to buy Chart Chart had previously agreed a merger of equals with Flowserve Expects $325 million in annual cost synergies in third year July 29 (Reuters) - Oilfield services firm Baker Hughes (BKR.O) , opens new tab said on Tuesday it would buy Chart Industries (GTLS.N) , opens new tab in a $13.6 billion all-cash deal, including debt, topping a previously-agreed merger offer that Chart struck with rival Flowserve (FLS.N) , opens new tab last month. The deal will give Baker Hughes greater exposure to industrial technology servicing liquefied natural gas and data centers, at a time when American energy exports and digital infrastructure growth are garnering huge interest from companies and investors. Sign up here. It forms part of Baker Hughes' efforts to leverage its industrial and energy technology portfolio, which helped boost second-quarter earnings, and continues a rebalancing of its business away from its traditional oilfield services focus. "The deal could check some notable strategic boxes for Baker, including increased industry diversification, higher aftermarket services revenue, and margin accretion," said RBC Capital Markets analyst Keith Mackey. Baker will pay Chart shareholders $210 per share, representing a 22% premium to the previous close, according to a statement which said the deal is expected to close by mid-year 2026. This values Chart's equity at around $9.44 billion, per Reuters calculations. Chart jumped 15.8% to close at $198.80, while Baker fell 1.7%. "The acquisition expands our offerings in core customer sectors while broadening our exposure to high-growth markets and strategic industrial segments like metals and mining," Baker Hughes CFO Ahmed Moghal said on a conference call. The Baker unsolicited offer follows Chart's June 4 agreement to merge with flow control systems maker Flowserve. Having been made aware of the Baker proposal and it being deemed "superior" by Chart's board, Flowserve decided not to submit a revised offer, the Dallas-based company said in a separate statement. By going with Baker, Chart's management secured both a higher effective price versus the Flowserve tie-up - which valued the company at around $160 per share - and also brought forward gains which Chart shareholders would have only gotten following the integration of Flowserve, a source familiar with the matter said. Shares of Flowserve, which will receive a $266 million breakup fee, closed up 2.4%. Chart manufactures industrial equipment such as valves and measurement technology for gas and liquid molecule handling and operates 65 manufacturing locations with over 50 service centers globally. Baker Hughes said $325 million in annualized cost synergies were expected to be realized at the end of the third year, with half from lower selling, general and administrative expenses. Goldman Sachs (GS.N) , opens new tab, Centerview Partners, and Morgan Stanley (MS.N) , opens new tab were Baker's financial advisers, with Wells Fargo (WFC.N) , opens new tab advising Chart. https://www.reuters.com/legal/transactional/baker-hughes-bets-lng-data-center-demand-with-136-billion-chart-industries-deal-2025-07-29/
