2025-07-25 05:33
Brent, WTI up 0.3% after 1% gain in previous session EU says trade deal with US within reach US prepares to allow limited oil operations in Venezuela, sources say Investors brace for data week next SINGAPORE, July 25 (Reuters) - Oil prices rose on Friday as trade talk optimism supported the outlook for both the global economy and oil demand, outweighing news of the potential for more oil supply from Venezuela. Brent crude futures touched a one-week high and were up 20 cents, or 0.29%, at $69.38 a barrel by 0519 GMT. U.S. West Texas Intermediate crude futures climbed 20 cents, or 0.30%, to $66.23. Sign up here. Oil, along with stock markets, gained support from the prospect of more trade deals between the United States and trading partners ahead of an August 1 deadline for new tariffs on goods from an array of countries. After the United States and Japan unveiled a trade deal on Wednesday, two European diplomats said the European Union was moving toward a deal involving a baseline U.S. tariff of 15% on EU imports, plus possible exemptions. "Trade talk optimism appears to be offsetting expectations for stronger Venezuelan supply," ING analysts wrote in a client note on Friday. The United States is preparing to allow partners of Venezuela's state-run PDVSA (PDVSA.UL), starting with U.S. oil major Chevron (CVX.N) , opens new tab, to operate with limitations in the sanctioned nation, sources said on Thursday. Venezuelan oil exports could consequently increase by a little more than 200,000 barrels per day, which would be welcome news for U.S. refiners, as it would ease tightness in the heavier crude market, ING analysts wrote. So far this week, Brent has gained 0.4% and WTI has fallen 1.4%. Both contracts advanced about 1% on Thursday, driven by reports of cuts to Russian gasoline exports. This week there were brief disruptions in Kazakh Black Sea oil exports and Azeri BTC crude loading from the Turkish port of Ceyhan. Also supporting the market were U.S. crude inventory draws. U.S. Energy Information Administration data on Wednesday showed crude inventories fell last week by 3.2 million barrels to 419 million barrels, far more than the 1.6 million barrel draw estimated by analysts in a Reuters poll. "I am encouraged by the way crude oil held and bounced away from band this week, which keeps hopes intact of a rebound back towards $70," said IG analyst Tony Sycamore, adding that next week will bring data for traders to chew over. Economic data next week from the world's biggest economies and oil consumers include factory activity in China and U.S. inflation, jobs and inventories. https://www.reuters.com/business/energy/oil-gains-trade-talk-optimism-offsets-potential-higher-venezuelan-supply-2025-07-25/
2025-07-25 05:32
NEW DELHI, July 25 (Reuters) - At least four children were killed and 17 injured in India's western state of Rajasthan after the roof of a school building collapsed on Friday, local media reported, with dozens still feared trapped under the rubble. A local police officer, who declined to be named, told Reuters the school building was old and the roof might have fallen in as a result of heavy rainfall in the region. Sign up here. "There were 25-30 children in the room when the roof fell after the morning prayers," Rajasthan education minister, Madan Dilawar, told AajTak news channel. Visuals from news channels showed locals gathered around the site of the collapse. Distressed family members could be heard crying as authorities used a crane to remove the debris. Local media reported that 32 students had been pulled out safely, but rescue operations were ongoing. "Instructions have been given to the concerned authorities to ensure proper treatment for the injured children," Rajasthan Chief Minister Bhajanlal Sharma said on X. Some of the injured children were critical, local police officer Amit Kumar told the PTI news agency, according to the Economic Times newspaper. https://www.reuters.com/world/india/school-roof-collapse-indias-rajasthan-kills-4-children-media-reports-2025-07-25/
2025-07-25 05:03
Sentiment boosted by US-Japan deal this week Markets pauses ahead of Fed, BOJ policy meetings next week Eyes on US-EU trade deal negotiations Markets shrug off Trump's Fed visit SINGAPORE, July 25 (Reuters) - The dollar inched off two-week lows on Friday, but kept on track for its biggest weekly drop in a month, as investors contended with U.S. tariff negotiations before an August 1 deadline, while looking ahead to central bank meetings next week. Both the U.S. Federal Reserve and the Bank of Japan are expected to hold rates at next week's policy meetings, but traders are focusing on the subsequent comments to gauge the timing of the next move. Sign up here. "Next week’s BOJ policy meeting will be closely watched for hints on the timing of the next rate hike," said Carol Kong, currency strategist at Commonwealth Bank of Australia. The prospect of rate hikes by the BOJ had improved, she added, after a trade deal struck with the United States this week lowered tariffs to 15% on auto imports from Japan. But a near-term rate hike is hardly a done deal with the timing dependent on whether the economy can withstand the impact of U.S. tariffs, four sources familiar with the BOJ's thinking told Reuters. The yen stood at 147.20 to the dollar, on course for a weekly gain of nearly 1%, although the currency was weaker on the day as investors weighed monetary policy outlook and the fate of embattled Japanese Prime Minister Shigeru Ishiba. A majority of economists in a Reuters poll this week said they expect Japan's central bank to raise interest rates by 25 basis points this year. The dollar index , which measures the U.S. currency against six other units, was at 97.448, set for a drop of 1% this week, its weakest performance in a month. On Thursday, the European Central Bank left its policy rate at 2%, as expected, in a break from a year of policy easing, to await clarity over future U.S. trade ties after the European Commission said a negotiated solution was in reach ahead of the August 1 deadline. The euro was little changed at $1.174, but not far from $1.183, the near four-year high it touched at the start of the month. The euro is up 13.5% this year as tariff policies take the shine off the dollar. Progress on trade deals has also raised market hopes for talks with China, after U.S. Treasury Secretary Scott Bessent said officials of both countries would meet in Stockholm next week to discuss an extension of the deal negotiation deadline. The Australian dollar has been boosted by the rise in risk appetite after the trade deals and was last at $0.6593, hovering near an eight-month high touched on Thursday. TRUMP'S FED VISIT Donald Trump locked horns on Thursday with Fed Chair Jerome Powell during a rare presidential visit to the central bank, criticising the cost of renovating two historical buildings at its headquarters and pressing the case for lower interest rates. Markets mostly shrugged off the visit, however, having become accustomed to Trump's repeated tirades against Powell and the Fed. "Trump's Fed visit was spectacle over substance," said Prashant Newnaha, senior Asia-Pacific rates strategist at TD Securities. "The market's focus is firmly on next week's Fed meeting. We expect Powell to repeat a patient, data-dependent policy outlook with flexibility but (he) is unlikely to commit to cuts." At their two-day rate-setting meet, the central bank's 19 policymakers are widely expected to leave their benchmark interest rate in the range of 4.25% to 4.50%. Traders are pricing in 43 basis points of rate cuts by the end of 2025. ANZ strategists expect the Fed to cut rates by 25 basis points in September and again in December. "Were it not for tariff uncertainty, we judge that rate cuts would already have resumed," they said in a note. "The labour market is weakening, service price disinflation is well established, demand growth has slowed and there is no discernible evidence that higher tariffs are spilling into a broader inflation problem." In cryptocurrencies, bitcoin fell 2.6% to $115,644, while Ether was down 3.3% at $3,616. https://www.reuters.com/world/middle-east/dollar-steadies-focus-shifts-fed-boj-meetings-2025-07-25/
2025-07-25 04:56
MUMBAI, July 25 (Reuters) - The Indian rupee declined to its weakest level in a month in early trading on Friday, pressured by a fall in local equities as well as investors cutting their very near-tenor bullish bets on the currency, traders said. The rupee fell to 86.5775, its lowest level since June 23, before paring losses to last quote at 86.51, down 0.1% on the day as of 10:10 a.m. IST. Sign up here. India's benchmark equity indexes, the BSE Sensex (.BSESN) , opens new tab and Nifty 50 (.NSEI) , opens new tab fell about 0.5% each, dragged by losses in Bajaj Finance due to asset quality concerns. Regional equities and currencies were mostly lower as well with the offshore Chinese yuan, a closely tracked peer of the rupee, down 0.2%. Interbank was holding onto modest long positions on the rupee overnight, which were cut in early trading, pushing the currency lower, a trader at a private bank said. In the near-term, expectations are that the rupee could go "another leg lower," to 86.80 before reversing course. Investors and traders are also hunkering down for a week likely to be dominated by news flow surrounding the August 1 U.S. tariff deadline, policy decisions by the Federal Reserve and the Bank of Japan, alongside key U.S. data prints. For the dollar, "what seemed like a new uptrend to start the month has nearly all but unwound. Lot of event risk next week, before the market switches into August-mode," BofA Global Research said in a note. The dollar index is on course to end the week down by about 1% after rising over the last two weeks and was last quoted at 97.6. Meanwhile, analysts polled by Reuters expect the Reserve Bank of India to keep policy rates unchanged in August but note that the central bank is likely to lower it again by year-end. Almost half of the polled analysts forecast that interest rates would be lower than previous forecasts at the year-end as falling inflation has prompted calls for at least one more rate cut this year. https://www.reuters.com/world/india/weak-local-stocks-positional-adjustments-push-rupee-one-month-low-2025-07-25/
2025-07-25 04:45
A look at the day ahead in European and global markets from Gregor Stuart Hunter Aaaaaand... breathe. After an enormous week of trade deals, a more hawkish ECB and a buyer's strike in the Japanese bond market, investors are taking a pause from a recent risk-on rally ahead of U.S. President Donald Trump's August 1 tariff deadline. Sign up here. Traders can be excused some profit-taking. On the docket next week are interest rate decisions from the U.S. Federal Reserve, the Bank of Japan and the Bank of Canada, plus U.S. non-farm payrolls data and earnings from Amazon (AMZN.O) , opens new tab, Apple (AAPL.O) , opens new tab, Meta (META.O) , opens new tab and Microsoft (MSFT.O) , opens new tab. Earnings season so far has laid bare the fact that businesses focused on artificial intelligence are raking it in. Those catering to actual people, less so. One more reason to relax: Following a rare - and tense - visit to the Fed on Thursday, Trump expressed displeasure with the cost of renovating the bank's headquarters but said he is not going to fire Chairman Jerome Powell. For now, anyway. "To do so is a big move and I just don't think it's necessary," Trump told reporters after the visit. Yields on Treasury bonds and the U.S. dollar index were little changed afterwards, again shrugging off Trump's attacks on Powell and the threat to the Fed's independence that such attacks imply. That said, Wall Street looked like it might extend record highs to the end of the week, with S&P 500 and Nasdaq futures both up around 0.2%. The past week saw trade agreements with Japan, Indonesia and the Philippines, while deal talks continued with the EU and South Korea. Trump has since said Australia has agreed to open its market to American beef in a post on Truth Social, and will next meet British Prime Minister Keir Starmer in Aberdeen, Scotland, to thrash out the details of a trade framework agreed in June. Still in the hot seat is BOJ Governor Kazuo Ueda after the core consumer price index for Tokyo rose 2.9% on year in July. The central bank is in a tough spot when it comes to managing inflation. Its hands are tied as pressure builds on the prime minister to step down after the weekend's election drubbing but with no clear candidate to replace him. The dollar strengthened 0.2% against the yen after the inflation data to 147.23. Still, the Japanese currency remains on course for a weekly gain of 1.1%. Key developments that could influence markets on Friday: Trying to keep up with the latest tariff news? Our new daily news digest offers a rundown of the top market-moving headlines impacting global trade. Sign up for Tariff Watch here. https://www.reuters.com/business/retail-consumer/global-markets-view-europe-2025-07-25/
2025-07-25 04:41
LONDON, July 25 (Reuters) - Europe's smaller companies are emerging as a popular vehicle for investors to help insulate portfolios against both tariffs and a stronger euro, as cheaper credit and the prospect of more government spending bolster confidence in the economic outlook. The domestic-leaning bias of smaller companies makes them less vulnerable to levies on cross-border goods and they are also less exposed to currency swings when the euro strengthens, making euro-zone exports more expensive abroad. Sign up here. The STOXX Europe small- (.SCXP) , opens new tab and mid-cap (.MCXP) , opens new tab indexes have risen 9% and 11% this year, respectively, beating the STOXX Europe large-cap index (.LCXP) , opens new tab, which has risen just 7%. U.S. President Donald Trump has bagged a handful of trade agreements with global partners since unveiling sweeping global levies in April, the most significant of which was a deal with Japan this week. But there is still no deal with the European Union and an August 1 deadline is just days away. Speculation swirled on Wednesday of a 15% rate for the EU, but was quickly dismissed by the White House. "One of the benefits of small-caps is that they are a bit more insulated from a geographical standpoint," said Ingmar Schaefer, a portfolio manager at Van Lanschot Kempen. "Whatever happens with U.S. tariffs, a local company will not be impacted by as much as a global player in the same field." An analysis by Goldman Sachs found that companies in the STOXX large-cap index generate about 35% of their revenue in Europe, compared to 60% of revenue generated by companies in the small- and mid-cap indexes. That has helped to offset a stronger currency. The euro has risen over 12% in 2025 to around $1.17, defying predictions prior to the April 2 "Liberation Day" tariff announcements that it could even reach parity with the dollar. But that was upended by investors turning their back on U.S. assets. Some analysts now expect the euro to hit $1.20, a possible headwind for larger companies due to greater international exposure, but a relative tailwind for smaller companies. "The way people have played Europe in the past is to be apologists for Europe, targeting businesses that have high revenue exposure to the U.S. or the Asian consumer through the luxury sector," said Harry Eastwood, investment director at Artemis Investment Management. "Liberation Day slightly disrupted the global order of trade and small- and mid-caps have become much more interesting, purely from the fact that they're somewhat insulated from that," Eastwood said, adding that his fund was at the upper limit of its small- and mid-caps weighting. DISCOUNT SHRINKS Historically, smaller companies have tended to trade at a premium to large ones, as they generally exhibit higher growth rates. But the situation reversed in 2023 and 2024, as inflation in Europe soared and the European Central Bank raised borrowing costs, leading smaller companies to now trade at a discount to bigger ones. Small-caps traded at a record discount of 11% to larger companies in March this year but that has since shrunk. The STOXX Europe small-cap index currently trades at 13.4 times forward earnings, below the large-cap index's 14.3 times, a discount of 6.5%. "We've been in a situation where most investors have had less confidence in the earnings of small companies compared to large companies which is why they traded at a discount," said David Walton, fund manager at Marlborough. "But in the last month, we've seen a slight increase in confidence in the earnings outlook for small companies which is supporting the rally." European small- and mid-sized companies have registered net inflows for the last 10 weeks straight, the longest such stretch since 2021, according to Lipper fund flows data. Germany, the euro area's biggest economy, has unveiled a massive spending push, while the ECB has begun to lower interest rates. Both could spur the euro zone economy, giving it a much-needed boost after years of subdued growth. Germany's SDAX (.SDAXI) , opens new tab small-cap index, has jumped almost 20% since the federal election in February, while the blue-chip DAX (.GDAXI) , opens new tab has risen 8.4% in the same period. The ECB paused its rate-cutting cycle this week, but the deposit rate is 200 basis points lower than it was in the middle of last year. "When we look at the next 12 months we think there can definitely be a re-rating of small caps vis-à-vis large caps," said Van Lanschot Kempen's Schaefer. https://www.reuters.com/business/finance/investors-bet-europes-smaller-companies-dodge-tariff-fallout-strong-euro-2025-07-25/
