2025-01-24 20:58
Canadian dollar gains 0.2% against the greenback For the week, the currency climbs 0.9% Flash estimate shows factory sales up 0.6% in December Canadian bond yields ease across the curve TORONTO, Jan 24 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Friday, adding to its weekly gain, as few new details on proposed U.S. tariffs led to broad-based declines for the American currency. The loonie was trading 0.2% higher at 1.4350 per U.S. dollar, or 69.69 U.S. cents, after moving in a range of 1.4316 to 1.4383. For the week, the currency gained 0.9%, as it recovered from a near five-year low at 1.4515, it hit on Tuesday. "The Canadian dollar is benefitting from broad USD weakness as investors remain skeptical of the degree and severity of tariff implementation in the absence of any new announcements," said Jayati Bharadwaj, a global FX strategist at TD Securities. U.S. President Donald Trump has threatened to impose sweeping tariffs on trading partners, including a 25% tax on goods imported from Canada. The premier of Ontario, Canada's most populous province, said he would call an early election, citing the need for a strong mandate to fight against tariffs. The price of oil , one of Canada's major exports, settled slightly higher at $74.66 a barrel but was down for the week after Trump announced sweeping plans to boost domestic production while demanding that OPEC move to lower crude prices. Canadian factory sales most likely rose 0.6% in December from November, largely driven by increases in the petroleum and coal products as well as food subsectors, a preliminary estimate showed. Canadian bond yields moved lower across the curve, with the 10-year down 3.4 basis points at 3.430%. Sign up here. https://www.reuters.com/markets/currencies/canadian-dollar-adds-weekly-gain-tariff-skepticism-2025-01-24/
2025-01-24 19:57
NEW YORK, Jan 24 (Reuters) - NextEra Energy (NEE.N) , opens new tab has spoken with regional grid operators and filed notice with federal regulators about a possible restart of its Duane Arnold nuclear power plant in Iowa, the company's CEO, John Ketchum, told Reuters on Friday. After decades in decline, U.S. nuclear power has become a highly-desired electricity source for Big Tech , opens new tab's AI data centers. Nuclear's ability to supply vast quantities of around-the-clock energy that is virtually carbon-free has boosted shares of nuclear power plant companies over the last year. "We are very excited about the way Duane Arnold is moving forward," Ketchum said. No fully-shut U.S. nuclear reactor has been brought back to life, but Duane Arnold would be among three plants in the country in the process of attempted restarts. One of the sites - Constellation Energy's (CEG.O) , opens new tab Three Mile Island plant, which is being renamed Crane Clean Energy Center, in Pennsylvania - secured a power purchase agreement to deliver power from the plant for Microsoft (MSFT.O) , opens new tab data centers. The roughly 600-megawatt Duane Arnold Energy Center, which shut in 2020 after operating for 45 years, would likely also feed power to data centers, Ketchum said, though no contracts have been signed. The facility has undergone an initial engineering assessment, which found the plant's reactor is in strong shape and the broader plant could be restored to operations by as early as late 2028. Duane Arnold cooling towers, which were destroyed in a powerful wind storm, will need to be rebuilt, Ketchum said, adding he expects construction to be straightforward and not require nuclear expertise. There is also work to be done on transmission, and equipment for the site has not been ordered, he said. Two near-term milestones on potentially restarting Duane Arnold include a detailed analysis and inventory of the site's condition and securing a customer to buy power from the site, he said. Sign up here. https://www.reuters.com/business/energy/nextera-advances-toward-iowa-nuclear-plant-restart-2025-01-24/
2025-01-24 19:53
HOUSTON, Jan 24 (Reuters) - The Texas construction contractor that last year quit the Golden Pass liquefied natural gas plant project, a joint venture between QatarEnergy and Exxon Mobil (XOM.N) , opens new tab, could exit Chapter 11 bankruptcy before April, the company said on Friday. Zachry Holdings said the U.S. Bankruptcy Court for the Southern District of Texas on Friday approved its reorganization plan, paving the way for it complete the process no later than the end of March. The court set a hearing for Feb. 26 to confirm the plan. San Antonio-based Zachry quit the export terminal project in Sabine Pass, Texas and filed for bankruptcy in May, saying costs exceeded the budget of its fixed-price construction contract. It was unsuccessful in trying to renegotiate. Several U.S. LNG projects are expected to move forward under the Trump administration, and once Zachry completes the bankruptcy reorganization, it could represent another option for developers seeking an experienced LNG contractor. Chiyoda International Corp replaced Zachry as the lead construction contractor at Golden Pass, and Zachry in July 2024 reached a settlement to resolve disputes related to the project. Construction costs at Golden Pass were budgeted at $10 billion and Zachry's share was budgeted at $5.8 billion. Zachry said the project was costing $30 million to $40 million weekly while Golden Pass paid it $70 million monthly. "We are pleased to have filed the revised plan... and all parties have committed to working in good faith to finalize creditor treatment under the plan," Zachry said in a statement. The exit caused further delays in the construction of the 18 million metric tonnes per annum LNG facility, which is now expected to produce first LNG in 2025, according to Exxon. Zachry said it continues to operate at all of its active projects and jobs sites. Sign up here. https://www.reuters.com/business/energy/former-golden-pass-lng-contractor-emerge-bankruptcy-by-april-2025-01-24/
2025-01-24 19:32
Ukraine and Israel conflicts underpin global demand Jets, drones, helicopters, tanks and air defenses popular Foreign military sales up 45.7% Direct commercial sales up 27.5% Jan 24 (Reuters) - U.S. military equipment sales to foreign governments in 2024 surged 29% to a record $318.7 billion, the State Department said on Friday, as countries sought to replenish stocks sent to Ukraine and prepare for major conflicts. The figures from the Biden administration's final year underpin expectations of stronger sales for U.S. weapons makers like Lockheed Martin (LMT.N) , opens new tab, General Dynamics (GD.N) , opens new tab and Northrop Grumman (NOC.N) , opens new tab, whose shares are forecast to climb amid rising global instability. During his presidential campaign, Republican Donald Trump said allies should spend more on their own defenses. Trump wants other members of NATO to spend 5% of their gross domestic product on defense – a huge increase from the current 2% goal and a level that no NATO country, including the United States, currently reaches. Defense contractors are straining to meet the surge of demand that has mushroomed as a result of Russia's invasion of Ukraine. Global ministries of defense have been lining up to submit orders to boost their inventories, while the U.S. is seeking to replenish stockpiles of weaponry and munitions sent to Kyiv. Arms sales and transfers are viewed as "important U.S. foreign policy tools with potential long-term implications for regional and global security," the State Department said in a statement. Sales approved in 2024 included $23 billion worth of F-16 jets and upgrades to Turkey, $18.8 billion worth of F-15 fighter jets to Israel, and $2.5 billion worth of M1A2 Abrams tanks to Romania. Orders approved in 2024 often go into the order backlog for U.S. weapons makers, which are expecting that orders for hundreds of thousands of artillery rounds, hundreds of Patriot missile interceptors, and a surge in orders for armored vehicles will underpin their results in coming quarters. There are two major ways foreign governments purchase arms from U.S. companies: direct commercial sales negotiated with a company, or foreign military sales in which a government typically contacts a Defense Department official at the U.S. embassy in its capital. Both require U.S. government approval. Direct military sales by U.S. companies rose to $200.8 billion in fiscal 2024 from $157.5 billion in fiscal 2023, while sales arranged through the U.S. government rose to $117.9 billion in 2024 from $80.9 billion the prior year. Sign up here. https://www.reuters.com/business/aerospace-defense/ukraine-related-demand-sends-us-arms-exports-record-2024-2025-01-24/
2025-01-24 19:28
LONDON, Jan 27 (Reuters) - It's a big week ahead as the U.S. Federal Reserve, European Central Bank and Bank of Canada hold their first meetings of 2025. Into the mix go earnings from heavyweights including Apple and Tesla, and likely market spikes from comments by new U.S. President Donald Trump - especially any on tariffs. Here's your guide to the week ahead in global markets from Lewis Krauskopf in New York, Kevin Buckland in Tokyo and Amanda Cooper, Lucy Raitano and Yoruk Bahceli in London. 1/ FED AHEAD The Fed holds its first meeting of the year, just over a week after Trump's return to the White House. The central bank is widely expected to pause its easing cycle on Wednesday, after cuts totalling 100 basis points (bps) last year. Investors want to know how many more reductions are likely this year. Remember, the Fed rattled markets in December when it lowered projected rate cuts for 2025 as it braced for firmer inflation than it had previously estimated. Since then, data showing slower underlying inflation brought relief, especially after a blowout jobs report. Earnings reports will also take centre stage, with megacap companies Apple, Tesla and Microsoft headlining a busy earnings week, while the advanced reading of Q4 U.S. economic growth is out Thursday. 2/ CUT? WHY NOT The ECB is set to cut rates again by another 25 bps on Thursday as Trump tariff threats cast a shadow over the euro zone's sluggish economy. Trump did not impose day-one tariffs and said the U.S. is not ready for universal ones, but Canada, Mexico and China are in the firing line, as is the European Union. Traders are watching for further clues from ECB chief Christine Lagarde that could move the needle for the three further cuts they expect this year after Thursday's move. Some policymakers have also signalled agreement that rates will fall towards 2%, within the estimated range of the "neutral" rate that neither boosts nor restricts the economy. The question is whether tariffs will change that. That depends on how they impact inflation. 3/ TICK TOCK TO TARIFFS The United States' biggest trade partners face a nervous wait until the turn of the month, when Trump has threatened new tariffs on Canada, China and Mexico. What maybe surprising is the 10% levy faced by Beijing is dwarfed by the 25% duties promised for Trump's neighbours, and well below the 60% blanket tariff on Chinese imports previously mooted. Perhaps the rekindled Trump-Xi Jinping bromance has something to do with it. Or maybe Trump is just starting slow. Either way, the self-proclaimed dealmaker looks as if he wants to bring Beijing to the negotiating table, with TikTok as the centrepiece. So the lead up to Feb. 1 could be busy with backroom conversations, though China breaks for the Lunar New Year on Wednesday. Beijing made sure it acted before that, fortifying its stock market against tariff shocks with plans to channel tens of billions of dollars of investment from state-owned insurers into equities. 4/ ROLLER-COASTER RIDE For all the hand-wringing leading up to the inauguration, Trump's first week in office was mostly benign for markets. Volatility across stocks, bonds and currencies has retreated, and demand for hedging risk around the Mexican peso , the Canadian dollar and the Chinese yuan has shrunk from the extremes hit on inauguration day. Analysts expect there will be more detail on what tariffs Trump will apply and where on April 1. Before then, there is plenty of time for more of Trump's off-the-cuff comments, such as remarks to journalists on Jan. 21 that he was considering duties on China from Feb. 1. On Sunday, the U.S. and Colombia pulled back from the brink of a trade war after Colombia agreed to accept military aircraft carrying deported migrants. Investors should brace for more roller-coaster price action. 5/ EUROPE INC Europe's earnings season is overshadowed by uncertainty over Trump's policies, although Q4 numbers are expected to be marginally positive. According to LSEG I/B/E/S estimates, Q4 earnings, on average, rose 1.9% from the same period in 2023, driven by growth in utilities and financials. Energy names are expected to drag. Geopolitics and weak euro zone business activity should be offset by a robust U.S. economy and falling euro, a tailwind to exporters, supporting earnings. After all, 40% of the STOXX 600 index revenue comes from outside Europe. Luxury bellweather LVMH reports Tuesday, Dutch computer chip equipment maker ASML Wednesday, and Deutsche Bank Thursday. Danish weight-loss drug manufacturer Novo Nordisk reports the week after. European stocks attracted their second largest allocation in a quarter of a century in January, a BofA investor survey shows, a sign that sentiment is shifting even as Trump angst reigns. Sign up here. https://www.reuters.com/business/take-five/global-markets-themes-graphic-pix-2025-01-24/
2025-01-24 18:36
Jan 24 (Reuters) - U.S. energy firms this week cut the number of oil and natural gas rigs operating for a third week in a row to the lowest since December 2021, energy services firm Baker Hughes (BKR.O) , opens new tab said in its closely followed report on Friday. The oil and gas rig count, an early indicator of future output, fell by four to 576 in the week to Jan. 24. , , Baker Hughes said this week's decline puts the total rig count down 45, or 7% below this time last year. Baker Hughes said oil rigs fell by six to 472 this week, their lowest since December 2021, while gas rigs rose by one to 99. In the Permian Basin in West Texas and eastern New Mexico, the nation's biggest oil-producing shale basin, the rig count fell by six in the week to 298, the lowest since February 2022. That six-rig decline in the Permian was the biggest weekly drop since August 2023. The oil and gas rig count declined by about 5% in 2024 and 20% in 2023 as lower U.S. oil and gas prices over the past couple of years prompted energy firms to focus more on paying down debt and boosting shareholder returns rather than raising output. Even though analysts forecast U.S. spot crude prices could decline for a third year in a row in 2025, the U.S. Energy Information Administration (EIA) projected crude output would rise from a record 13.2 million barrels per day (bpd) in 2024 to around 13.6 million bpd in 2025. On the gas side, the EIA projected a 43% increase in spot gas prices in 2025 would prompt producers to boost drilling activity this year after a 14% price drop in 2024 caused several energy firms to cut output for the first time since the COVID-19 pandemic reduced demand for the fuel in 2020. The EIA projected gas output would rise to 104.5 billion cubic feet per day (bcfd) in 2025, up from 103.1 bcfd in 2024 and a record 103.6 bcfd in 2023. Sign up here. https://www.reuters.com/business/energy/us-oil-gas-rig-count-falls-lowest-since-dec-2021-baker-hughes-says-2025-01-24/
