2025-02-04 20:25

Feb 4 (Reuters) - Canadian pension fund CPP Investments is weighing strategic options, including a sale or initial public offering, for Encino Acquisition Partners that could value the U.S. oil and natural gas producer at as much as $7 billion, including debt, people familiar with the matter said. The deliberations come as the energy industry is anticipating tailwinds from the administration of President Donald Trump, which has put forward an economic agenda tailored to boost fossil-fuel production, as it speeds up permits for energy projects and rolls back environmental protections. Moreover, the booming demand for artificial intelligence and data centers is expected to drive a jump in U.S. power demand, which in turn is likely to boost the need for natural gas to fuel power generation. Houston, Texas-based Encino, which is majority-owned by CPP, is in the early stages of evaluating options and is working on selecting investment banks to lead the review process, the sources said, requesting anonymity as the matter is confidential. A deal is expected to happen later this year, the sources said, cautioning that Encino's plans are subject to market conditions. Encino and CPP declined to comment. Encino operates in the Utica shale basin of Ohio and is one of the largest privately owned oil and gas exploration and production companies in the United States. It was formed in 2017 as a partnership to buy and develop U.S. oil and gas assets. Under the terms of the agreement, CPP Investments invested $1 billion in the venture, while oil and gas producer Encino Energy agreed to operate the acquired assets. A year later, Encino Acquisition Partners bought Chesapeake Energy's Ohio assets for $2 billion. CPP Investments said in April 2024 it would invest another $300 million in the business to help accelerate the development of the company's assets. In January, Infinity Natural Resources raised $265 million from its IPO and the company's shares jumped on their debut in New York. The positive market reaction to the natural gas producer's stock market launch helped accelerate Encino's decision to explore its options, one of the sources said. Sign up here. https://www.reuters.com/business/energy/encinos-owner-mulls-7-billion-sale-ipo-energy-producer-sources-say-2025-02-04/

2025-02-04 20:15

Feb 4 (Reuters) - U.S. diner chain Waffle House has added a 50-cent surcharge for every egg in a customer’s order, the company said in a statement posted in its restaurants on Monday. The fee is temporary, the company said in a statement Tuesday, and is a response to a “dramatic increase in egg prices” caused by bird flu outbreaks. "While we hope these price fluctuations will be short-lived we cannot predict how long this shortage will last,” the statement read. The privately-held chain is known for its low prices. A standard American breakfast with two eggs is sold for $7.75 in Norcross, Georgia, where the company is headquartered. That meal is now $1 more expensive. The price of U.S. wholesale eggs hit an all-time high in December, according to commodity data firm Expana, with a dozen eggs going for $5.57 in the Midwest and $8.85 in California. The main factor driving egg prices higher is damage to the laying flock from bird flu. The virus wiped out more than 20 million chickens in the U.S. last quarter, data from the U.S. Department of Agriculture shows, the highest toll since the beginning of the outbreak in 2022. The chain said it has 2,100 locations across the United States. Its website says it serves 272 million eggs every year. Sign up here. https://www.reuters.com/world/us/bird-flu-spurs-diner-chain-waffle-house-add-50-cent-fee-per-egg-2025-02-04/

2025-02-04 20:08

Global shares see relief rally Slew of corporate earnings on tap Treasury yields near lowest in over a month Yen strengthens on bets of more BOJ hikes SINGAPORE/NEW YORK, Feb 6 (Reuters) - Global shares rose on Thursday in a modest relief rally as fears of an escalating trade war between the U.S. and its major trading partners ebbed, while U.S. Treasury yields came under pressure as traders pondered the country's rate outlook. European stock futures pointed to solid gains ahead of a slew of earnings releases, extending a rally from the previous session in part due to a surge in healthcare stocks as sales of Novo Nordisk's (NOVOb.CO) , opens new tab blockbuster drug Wegovy more than doubled in the fourth quarter. EUROSTOXX 50 futures rose 0.5%, while FTSE futures jumped 0.8%. DAX futures climbed 0.56%. Wall Street was similarly poised for a positive open, with S&P 500 futures and Nasdaq futures gaining more than 0.2% each. Amazon's (AMZN.O) , opens new tab earnings are due later in the day, where the pressure is on for it to deliver on lofty expectations for cloud computing after lacklustre reports from Microsoft (MSFT.O) , opens new tab and Alphabet (GOOGL.O) , opens new tab jolted investor faith in Big Tech's huge investments in artificial intelligence. And though many uncertainties remain under U.S. President Donald Trump's new administration, markets were for the most part relieved that things were not worse, particularly with regard to the tit-for-tat tariff moves. That helped lift global share markets and kept the dollar in check, giving some respite to its peers that had been heavily battered at the start of the week. "Relief is probably a good way to characterise (the market mood)," said Khoon Goh, head of Asia research at ANZ. The People's Bank of China on Thursday again set a stronger-than-expected yuan midpoint fixing, though the yuan still weakened after China sought the World Trade Organization's intervention to rule on new tariffs imposed by Trump. China's commerce ministry also said on Thursday that Beijing is ready to work with other countries to jointly respond to the challenges of unilateralism and trade protectionism, and labelled U.S. tariffs "vile". The onshore yuan last stood at 7.2845 per dollar, while its offshore counterpart eased 0.05% to 7.2862. "Chinese authorities at this stage are not indicating or showing any intention of weakening the yuan as part of the response to the tariffs. I think that has definitely helped to calm the market down," said ANZ's Goh. China's CSI300 blue-chip index (.CSI300) , opens new tab jumped more than 1% as investors continued to bet on domestic AI firms following Chinese start-up DeepSeek's breakthrough. The Shanghai Composite Index (.SSEC) , opens new tab gained 1.16%. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) , opens new tab advanced 0.44%, while Japan's Nikkei (.N225) , opens new tab tacked on 0.6%. RATES OUTLOOK U.S. Treasury yields were hovering near their lowest in over a month on Thursday, as investors were uncertain about the outlook for rates in the world's largest economy. U.S. Treasury Secretary Scott Bessent said on Wednesday that while Trump wants lower interest rates, he will not ask the Federal Reserve to cut rates. Bessent said in an interview with Fox Business Network that he and Trump are focused on the 10-year Treasury. "Certainly, those comments were interesting, and perhaps a little surprising, though likely suggest that Bessent is having something of a moderating influence on Trump, given that he appears to have steered the President away from direct attacks on the Fed – at least for now," said Michael Brown, senior research strategist at Pepperstone. "At the moment (I) think this is more about rhetoric than any firm action, which is likely why market participants have by and large shrugged the comments off, and there hasn’t been a considerable reaction." Bessent made the comments before Fed Vice Chair Philip Jefferson, who said he is content to keep the central bank's policy rate in its current position until policymakers get a better sense of the net effects of the Trump administration's policies on tariffs, immigration, deregulation and taxes. The benchmark 10-year Treasury yield was steady at 4.4342%, while the two-year yield edged slightly higher to 4.2055%. Futures point to just about 45 basis points worth of easing from the Fed by the year-end. . In currencies, the dollar was on the back foot. "The central vibe running through trade has been the solid bid in U.S. Treasuries, with the U.S. dollar finding increased selling flows across the G10 FX complex," said Chris Weston, head of research at Pepperstone. Against the dollar, the euro hovered above the $1.03 level and last bought $1.0390, while sterling strayed not too far from a one-month high and was fetching $1.2480. The Bank of England announces its rate decision later on Thursday, where it looks set to deliver a rate cut. The yen , meanwhile, was little changed at 152.59 per dollar, after earlier rising on comments from Bank of Japan board member Naoki Tamura who said the central bank must raise short-term interest rates to at least 1% by the second half of fiscal 2025 to contain inflation risks. In commodities, oil prices rose, steadying from a sell-off the previous day after Saudi Arabia's state oil company sharply raised March oil prices. U.S. crude edged 0.42% higher to $71.33 a barrel, while Brent crude rose 0.31% to $74.84 per barrel. Gold eased from a record peak and was last at $2,860.11 an ounce. Sign up here. https://www.reuters.com/markets/global-markets-global-markets-2025-02-04/

2025-02-04 20:05

Hedge funds return best month since February 2024 Returns lifted by broader rally and picking less risky stocks Tariff moves caused turmoil LONDON/NEW YORK, Feb 4 (Reuters) - Hedge funds started 2025 buoyed by choppier markets driven by uncertainty over new U.S. President Donald Trump's policies and a tumble in tech-darling Nvidia (NVDA.O) , opens new tab as Chinese artificial intelligence startup DeepSeek emerged, sources told Reuters. Bridgewater Associates, one of the world’s biggest hedge funds, posted gains of 8.2% last month in its macro flagship fund Pure Alpha, beating the main stock indexes. A global tech rout at the start of last week was followed by volatility ahead of Trump's weekend announcement of sweeping tariffs on Canada, Mexico and China, kicking off a trade war that could hurt economic growth internationally. Trump delayed tariffs on Canada and Mexico on Monday by one month, fueling wild swings in currency, bond and share markets. Despite the turmoil, stock-picking hedge funds that take bets based on company fundamentals recorded an average 2.6% return, their best month since February 2024, given a broader market rally, a Goldman Sachs prime brokerage note sent to clients on Tuesday showed. Some technology-focused long/short equity hedge funds managed to navigate the tech rout. Cadian Capital was up 8.32% in January, boosted by long positions in tech names, mainly small and mid-sized companies. SoMa Equity Partners rose 4.73% last month, helped by long positions in Roblox (RBLX.N) , opens new tab, Wix (WIX.O) , opens new tab, Uber Technologies (UBER.N) , opens new tab and Elastic (3E1.F) , opens new tab, a source familiar with the matter said. Shannon River also went up 2.46%, according to preliminary data, two sources said. Light Street went up 4.14%, another person said. Systematic equity funds returned 2.71% on average, the Goldman note also showed. Stock markets in the United States and Europe ended January near record highs (.SPX) , opens new tab, (.STOXX) , opens new tab, as did MSCI's World Stock Index. Hedge funds that follow a variety of strategies also ended the month higher. Daniel Loeb's Third Point flagship TP offshore fund was up 3.3%, while Cinctive gained 2.7%. Citadel's equity fund posted a 2.7% return in January, while its flagship Wellington fund rose 1.4%, a source familiar with the matter said on Tuesday, declining to be identified because the information was private. Business Insider reported the Wellington result on Monday. All Citadel's five investment strategies posted positive performances last month, the source added. Founded by investor Ken Griffin, Citadel had $65 billion in assets under management as of Jan. 1. Billionaire investor Cliff Asness's AQR Capital Management's systematic stock fund - the Delphi Long-Short Equity strategy - returned a net 3.5% in January, said another source close to the matter. It benefited from trades in developed equity markets and by picking less risky stocks, the source added. The $2.5 billion stock strategy is part of the $123 billion hedge fund. Winton's multi-strategy quantitative fund, which trades many different asset classes systematically, finished January up 0.3%, another source said. Sign up here. https://www.reuters.com/markets/deepseek-trump-how-hedge-funds-navigated-turbulent-start-2025-2025-02-04/

2025-02-04 19:27

MEXICO CITY, Feb 4 (Reuters) - Mexico's finance ministry said on Tuesday it was implementing measures to guarantee the stability of financial markets, as the peso currency and local stock exchange have undergone extended volatility amid the threat of U.S. tariffs on Mexican exports. Among the measures, the so-called budget revenue stabilization fund was strengthened and capitalized with more than 100 billion pesos ($4.87 billion), while the government will continue to look for ways to improve the debt maturity profile and reduce short-term liquidity needs. On January 31, the government refinanced 185 billion pesos it debt, extending debt maturities by an average of 2.14 years, the finance ministry said in a statement. "The third measure involves the implementation of a hedging program with derivative financial instruments, which contributes to reduce risk amid adverse conditions in the financial markets," said the ministry. ($1 = 20.5204 Mexican pesos) Sign up here. https://www.reuters.com/world/americas/mexico-implements-measures-ensure-stability-financial-markets-2025-02-04/

2025-02-04 18:20

BRASILIA, Feb 4 (Reuters) - Brazilian lower house speaker Hugo Motta said on Tuesday that the chamber will put a greater priority on the country's fiscal stability. In an interview with TV outlet GloboNews, Motta, who was elected lower house chief last Saturday, said the government needs to acknowledge that Brazil's economic situation is critical, and that a strategy for raising revenues will not work without controlling expenses. "The numbers regarding our economy are really very worrying and we know the serious consequences this can have for the Brazilian population," Motta said. President Luiz Inacio Lula da Silva's administration sent a spending cut package to Congress late last year, a move that led to a sell-off of Brazil's real currency after market analysts deemed the measures as insufficient to control expending. The real has regained ground this year, notching on Monday its longest streak of gains in 20 years. Sign up here. https://www.reuters.com/world/americas/brazils-new-lower-house-speaker-targets-fiscal-stability-priority-2025-02-04/