2025-02-27 06:16

LITTLETON, Colorado, Feb 27 (Reuters) - India has the second-largest clean power capacity development pipeline globally after China, with nearly 56,000 megawatts of new renewables, hydro and nuclear capacity under construction. Clean energy sources account for two-thirds of the all the new power capacity under development in India, according to Global Energy Monitor (GEM) data, and will result in a 35% jump in total clean power supply potential once complete. However, the country is also building 30,000 MW of new coal-fired capacity, which will preserve coal's status as India's primary power source even after the construction boom. The enduring heavy dependence on coal within India's power system underscores the challenge facing fast-growing economies that need to increase energy supplies to households and businesses as cheaply and quickly as possible. The expanded coal capacity will also further lift India's coal power emissions, which hit a new high in 2024 of over 1.2 billion metric tons of carbon dioxide (CO2), according to Ember. GROWTH SPURT The main driver of India's heavy coal reliance is the country's rapid energy demand growth, which has accelerated in line with its overall economy. Since 2021, India's primary energy consumption has grown by an average of 7% a year, according to the Energy Institute. That growth rate exceeded China's 5% pace and was more than twice the global average over the same period - resulting in regular bouts of strained power grids. To fend off further power shortages, India's utilities and government have made massive investments in expanding total power supply capacity, with emphasis on growing clean energy production. Indian power firms are currently constructing nearly 29,000 MW of solar, 6,300 MW of wind, 15,000 MW of hydro and nearly 6,000 MW of nuclear power capacity, GEM data shows. In addition, the country has a further 35,000 MW of solar, 6,000 MW of wind, 45,000 MW of hydro and 26,000 MW of nuclear in so-called pre-construction, which is where project permits are being lined up ahead of groundbreaking. All told, that is nearly 167,000 MW of clean power capacity in advanced planning stages in India, which exceeds the 166,000 MW of clean capacity at the same developmental stage in the United States, according to GEM. What's more, once all current and pre-construction clean energy projects are completed, India's total clean power capacity could rise by more than 100% from current levels, to nearly 330,000 MW. RISING TIDE LIFTS COAL TOO While clean power capacity is set to grow sharply, India's larger fossil fuel power base is also set to expand. In addition to the 30,000 MW of coal capacity under construction, Indian power firms have nearly 55,000 MW of coal capacity in pre-construction. That cumulative development load stands to increase India's total coal-fired capacity to nearly 355,000 MW, which means that coal power will continue to account for over half of India's total power capacity even after planned projects are complete. The larger overall coal footprint will in turn trigger even greater volumes of coal consumption by Indian power firms, which rely on locally-mined coal for around 75% of coal supplies. The remaining coal volume requirements are fulfilled by imports, mainly from Indonesia. Demand for both domestic supplies and imports looks set to swell sharply once current coal power projects are complete. More than 20,000 MW of new coal power capacity is located within inland areas that are serviced mainly by local miners, while over 6,000 MW of new coal capacity is located on India's south and southeast coasts, which can be fed via imports. That means that even though India's power firms can expect a large jump in clean power supplies over the coming years, coal will remain their main source of power generation for the foreseeable future. The opinions expressed here are those of the author, a market analyst for Reuters. Sign up here. https://www.reuters.com/markets/commodities/king-coal-stay-top-india-despite-big-clean-power-pipeline-maguire-2025-02-27/

2025-02-27 06:15

Feb 27 (Reuters) - Shares of UltraTech Cement (ULTC.NS) , opens new tab, India's top cement maker by capacity, fell about 6% to hit an eight-month low on Thursday as its plan to foray into the cables and wires business led to concerns over capital allocation and debt reduction. The cement maker, a part of the Aditya Birla Group, was the top percentage loser on India's benchmark Nifty 50 (.NSEI) , opens new tab index, which was little changed. Its shares were last down 6.16% at 10,288.30 rupees. The company announced on Tuesday it would spend 18 billion rupees ($206 million) to start the wires and cables business. Competition in India's cement industry is intensifying, with leaders UltraTech and Adani Group companies striking a series of deals to acquire smaller firms and expand their market share. "The key question is around diversification – is this spend justified at a time when its core business faces a larger, aggressive competitor," analysts at J.P.Morgan said. Billionaire Gautam Adani's conglomerate entered the cement industry in 2022 and has snapped up several rivals. Analysts, on average, have rated UltraTech stock a "buy", same as the Adani Group's Ambuja Cements (ABUJ.NS) , opens new tab and ACC (ACC.NS) , opens new tab, as per data compiled by LSEG. Motilal Oswal analysts said they see near-term worries for the UltraTech stock as traders view the company as a 'pure-play cement firm', adding its capital allocation may be questioned. Costs related to branding and setting up the distribution channel for the wires business would add to spending, which is estimated at 95 billion rupees for the year ending March, Macquarie said. UltraTech's standalone net debt rose to 152.83 billion rupees in December 2024 from 5.71 billion rupees in March 2024. Still, the foray could cause some disruption in the wires industry, where shares of dominant players Polycab (POLC.NS) , opens new tab, Havells (HVEL.NS) , opens new tab and KEI Industries (KEIN.NS) , opens new tab fell 15%, 5% and 7%, respectively. ($1 = 87.3830 Indian rupees) Sign up here. https://www.reuters.com/markets/commodities/indias-ultratech-cement-falls-analysts-not-impressed-by-cables-wires-foray-2025-02-27/

2025-02-27 06:12

MOSCOW, Feb 27 (Reuters) - The Russian government has decided to extend petrol export permits for producers until the end of August 2025, Russian news agency Interfax reported on Thursday. The government made the decision to maintain a stable situation in the domestic fuel market and support the oil refining economy, Interfax reported. Sign up here. https://www.reuters.com/business/energy/russia-extends-gasoline-export-permits-until-end-aug-2025-ifax-reports-2025-02-27/

2025-02-27 06:12

Weakening US consumer, business indicators signal caution S&P 500 underperforms global rivals this year, dollar down from Jan peak Tech sector struggles weigh on US stock performance NEW YORK, Feb 27 (Reuters) - Going into the year investors were betting that President Donald Trump's policies would spur U.S. stocks and the dollar to outperform their global peers. That assumption is increasingly getting tested. The Trump administration's revamp of the government and massive moves on trade and other policies have instead injected uncertainty, with consumers and businesses worrying about the economy, threatening the narrative of U.S. exceptionalism. The policy uncertainty is "leading to a dynamic ... where you start to see investors and business leaders and consumers alike kind of reining things in a little bit," said Garrett Melson, portfolio strategist at Natixis Investment Managers. "That's against the backdrop that, aside from all the policy and the Trump administration noise, was already on a cooling trajectory" for the U.S. economy, he added. In addition, the country's megacap tech and growth companies that drove much of the market's gains in recent years have faltered on valuation concerns and fed by worries over the DeepSeek low-cost Chinese artificial intelligence model. One ETF tracking the so-called "Magnificent Seven" group has fallen more than 10% from its high in mid-December. Nvidia (NVDA.O) , opens new tab, a critical member of the "Magnificent Seven" group, forecast first-quarter revenue above estimates on Wednesday, while the semiconductor company's margin outlook was slightly lower than expected, in a report that was primed to set the tone for markets on Thursday. Heading into 2025, U.S. equities and the dollar were widely expected to outstrip their foreign counterparts. So far this year, however, the U.S. benchmark S&P 500 (.SPX) , opens new tab has risen just over 1% against a roughly 7% climb for an MSCI index of stocks in over 40 other countries, while the greenback has slid about 3% from its January peak against a basket of its main rivals. Some of the diverging performance stems from developments outside the U.S., including surprising economic data in Europe and the emergence of an AI model in China that has shaken the technology sector, which has an outsized presence in U.S. stock indexes. However, worries about the domestic growth outlook have heightened after recent weak indicators from consumers and businesses, amid a barrage of announcements regarding trade and federal workforce cuts from the Trump administration, compounding concerns about the impact of still-firm inflation on the Federal Reserve's interest rate path. The latest economic reports could help drive a long-awaited catch-up for international assets, which have grown increasingly cheap compared with their U.S. rivals. For example, on a price-to-earnings basis, the S&P 500's premium over the MSCI index of stocks outside the U.S. reached its highest in more than two decades in late 2024, according to LSEG Datastream. Among the worrisome signs in the U.S. economy over the past week are a release on Tuesday showing consumer confidence falling at its sharpest pace in 3-1/2 years in February, and a separate reading that showed consumer sentiment dropping to a 15-month low. A survey on Friday showed business activity sank to a 17-month low, with activity nearly stalling in February. “The expectation has been for the U.S. (economy) to continue to do very well,” said Paul Nolte, senior wealth adviser and market strategist at Murphy & Sylvest Wealth Management, who at the start of the year tilted a global equities portfolio more toward stocks outside of the U.S. "So if there is some fault with that, then maybe some of the valuation excess that the U.S. has needs to come down closer to where the rest of the world is.” Recent weakness in U.S. economic data has spurred investors to ascribe incrementally higher probability to a "growth scare" scenario, Charlie McElligott, managing director of cross-asset strategy at Nomura, said in a note on Monday. Investors seem to be "getting their arms around" the implications of the initial Trump administration policies and starting to account for a far more serious growth drag than initial post-election narratives had suggested, he said. Other indicators also may reflect a cloudier corporate outlook. The National Federation of Independent Business's survey for January found the percentage of its small business members planning capital expenditures within the next six months dropping to the lowest level since before the November election. The value and total number of announced U.S. deals fell by about a third over roughly the first two months of 2025 compared with the same period a year earlier, according to Dealogic, even as the administration has been expected to provide a friendlier regulatory environment for mergers and acquisitions. "Another month or two of poor U.S. economic data would deliver a blow to the U.S. exceptionalism narrative" and be a downside risk for the dollar, strategists at BBH said in a note on Tuesday. European stocks generally have surged to start the year, with the continent-wide STOXX 600 index (.STOXX) , opens new tab rising 10% so far in 2025. Recent corporate profit growth in Europe is exceeding expectations by a greater extent than it is in the U.S., said Michael Rosen, chief investment officer at Angeles Investments. His firm has been "aggressively overweight" U.S. equities for most of the last 15 years, but in the near term, has moved more heavily to European shares, Rosen said. "There's just more evidence that the very strong economic performance that we've seen in the U.S. is beginning to diminish a bit," Rosen said. Indeed, the U.S. exceptionalism trade was "too crowded" following the election, said Keith Lerner, co-chief investment officer with Truist Advisory Services, paving the way for at least some reversal to start the year. Despite the shakier start for U.S. assets, many investors may not abandon the trade. While the U.S. economy was showing signs of weakness, many investors said risks of a near-term recession remained low while the economic benefits from Trump's policies could come later in the year. If the U.S. economy does struggle, at some point the weakness would likely spread elsewhere, investors said. "If the U.S. catches a cold, the rest of the world is going to get the flu," Nolte said. The Magnificent Seven companies have business models that many investors say can weather economic weakness better than other industries, which could support the U.S. market in a global slowdown. The Magnificent Seven "stocks are not cheap... but their leadership is not in question," said Phil Blancato, chief market strategist at Osaic. Sign up here. https://www.reuters.com/markets/us/why-us-exceptionalism-trade-is-faltering-2025-02-27/

2025-02-27 05:57

LAUNCESTON, Australia, Feb 27 (Reuters) - Asia's crude oil imports are off to a weak start in 2025, as top importer China continues to buy less and new sanctions put the brakes on cargoes from the continent's top supplier Russia. Asia's imports for the first two months of the year are on track to be 26.17 million barrels per day (bpd), down 780,000 bpd from the 26.96 million bpd for the same period last year, according to data compiled by LSEG Oil Research. The drop of about 3% in crude imports by Asia in the first two months of this year from the same period in 2024 brings into question the forecasts from the Organization of Petroleum Exporting Countries (OPEC) and other analysts for solid demand growth this year. The weakness in Asia's crude imports in the January-February period was driven by China, with the world's top oil importer seeing arrivals of 10.42 million bpd, down 840,000 bpd from the 11.26 million bpd for the first two months of 2024. The first two months of 2025 has seen the weakness in China's crude imports accelerate from the pace of decline recorded in 2024. China's oil imports were 11.04 million bpd in 2024, according to official customs data, leaving them down 210,000 bpd, or 2.1%, from the previous year. The world's second-largest economy has struggled to build economic growth momentum since emerging from its strict COVID-19 lockdowns, with property construction a key weak sector. But the rapid switch to electric and hybrid cars has also trimmed gasoline demand growth, and the same is occurring for diesel demand given the increasing adoption of trucks powered by liquefied natural gas. OPEC forecast in its February monthly report that China's crude oil demand will rise by 310,000 bpd in 2025 from the previous year, but the weak start to imports in the first two months of the year makes this look optimistic. INDIA STRENGTH In contrast to China, Asia's second-biggest oil importer India got off to strong start in 2025, with arrivals of 4.98 million bpd in the first two months, up 280,000 bpd from the 4.70 million bpd for the same period last year. However, it's worth noting that January's imports were 5.08 million bpd, and these slipped to 4.87 million bpd in February, which reflects that India may have been struggling to secure as much discounted Russian oil as it had been over 2024. The outgoing administration of former U.S. President Joe Biden introduced new sanctions on Russia's oil exports in January, largely targeting the so-called shadow fleet of tankers that deliver crude to India and China, the only two major buyers left to Moscow. Asia's imports of seaborne Russian crude are on track to fall to the lowest in February since May 2022, according to data compiled by commodity analysts Kpler. A total of 67.2 million barrels of Russian crude, equivalent to 2.40 million bpd, is expected to arrive in Asia in February, down from 2.75 million bpd in January and just better than half of the peak imports of 3.97 million bpd from May 2023. Asia's imports of Russian oil will have dropped for a fourth consecutive month in February, indicating that Western sanctions put in place after Moscow's February 2022 invasion of Ukraine are working to some extent. There is the possibility that Asia's imports of Russian crude will recover in coming months, firstly as traders find ways around the sanctions as they have done in the past, or if sanctions are relaxed by new U.S. President Donald Trump as part of efforts to end the conflict in Ukraine. But the broader question of whether Asia's crude oil imports will be strong enough to meet the forecasts for rising demand this year remains highly uncertain, given the evidence of weakness in the first two months. The views expressed here are those of the author, a columnist for Reuters. Sign up here. https://www.reuters.com/markets/europe/asias-falling-crude-oil-imports-challenge-2025-demand-forecasts-russell-2025-02-27/

2025-02-27 05:41

A look at the day ahead in European and global markets from Kevin Buckland It could be taken as testament to the market's laser focus on the health of the U.S. economy - and the threat from Donald Trump's trade wars - that even the financial report card from AI poster child and market bellwether Nvidia came and went with barely a ripple. Part of the reason, of course, is Nvidia's disclosures were overall neither hot nor cold: forecasts were strong but not sensational; gross margins declined, but with the promise of rising by mid-year. The most important takeaway was demand for the high-power, high-priced computing that Nvidia is known for is alive and well, despite what had initially appeared as a threat to the Western business model from China's ostensibly lower-cost AI competitor, DeepSeek. In Asia, Nvidia's influence was barely felt anywhere in the region, with tech shares - and the stock indexes they are part of - lacking uniform direction. Instead, the main focus was elsewhere. Bond yields and the dollar had more of a story to tell, lifting off recent lows as traders assessed the latest, contradictory, rumblings on tariffs from Washington, and what it all might mean for the economy and the path for Fed policy. Trump appeared to give Canada and Mexico another one-month stay of execution over 25% tariffs, shifting the deadline to April 2 - only for a White House official to try and roll that back to the earlier date of March 4. What was clear though is that Europe is in POTUS's crosshairs, as Trump floated a "reciprocal" levy of 25% "on cars, and all of the things" that will soon be revealed. Trump's trade war, while certainly more damaging to its targets, will also inflict pain on the United States. And the U.S. economy is not looking nearly as robust as it did just weeks earlier, following a run of soft data, compounded by Treasury Secretary Scott Bessent's comments this week that things are "brittle beneath" the surface. Traders have moved from pricing just one quarter-point Fed cut this year to two, with the first by July and the second as early as October, according to LSEG data. Investors will look to GDP data due on Thursday for further signs of a slowdown, while the Fed's preferred inflation gauge, the PCE deflator, is due on Friday. Europe has quite a lot of data to digest on Thursday, including jobs figures from Germany, producer prices from France, and consumer inflation in Spain. Outside the bloc, Switzerland reports GDP. The ECB will kick off the next round of central bank meetings in a week from now, with markets currently priced for a quarter-point cut then, and another two by September. However, discussions within the central bank centre on how much further rates really need to fall considering inflation is still a bit too high and the economy is struggling. Key developments that could influence markets on Thursday: -US GDP (Q4), durable goods orders (Jan) -France producer prices (Jan), Spain CPI (Feb), Germany jobs data (Feb) -Switzerland GDP (Q4) Sign up here. https://www.reuters.com/markets/europe/global-markets-view-europe-2025-02-27/