2025-01-22 11:03

A look at the day ahead in U.S. and global markets from Mike Dolan Retaining a persistent, if uncertain, threat of new tariffs, U.S. President Donald Trump quickly switched his attention to technology and artificial intelligence this week - exciting the red-hot sector that's about to report its latest earnings round. Trump on Tuesday announced a private sector investment of up to $500 billion to fund infrastructure for artificial intelligence, aiming to outpace rival nations in the business-critical technology. The newly sworn-in President said ChatGPT creator OpenAI, SoftBank (9984.T) , opens new tab and Oracle (ORCL.N) , opens new tab plan a joint venture called Stargate, which he said will build data centers and create more than 100,000 jobs in the United States. Softbank shares soared more than 10% in Tokyo trading, while Oracle surged 9% out of hours ahead of Wednesday's bell. With the fizz back in tech, streaming giant Netflix (NFLX.O) , opens new tab burst 14% higher in premarket trade on Wednesday after its latest earnings update revealed a record 18.9 million new subscribers over the holiday quarter and plans for price hikes. The renewed tech focus comes as the Nasdaq (.IXIC) , opens new tab has marginally underperformed the broader S&P500 (.SPX) , opens new tab so far this year, with even Apple (AAPL.O) , opens new tab under a cloud on Tuesday despite brisk Wall Street stock index gains. The Apple retreat allowed AI-chip darling Nvidia (NVDA.O) , opens new tab to retake top spot as America's most valuable company. With some big industrial names topping the corporate diary on Wednesday, and the first 10% of S&P500 firms pointing to overall annual profit growth of almost 11% through the last quarter, stock futures were up smartly before the open. The S&P500 closed above the 6,000 mark on Tuesday for the first time this year - less than 1% from record highs. Despite the AI tilt, Trump continued to rattle the tariff sabre overnight - without necessarily giving much additional clarity on where exactly or when they may be coming. Trump vowed to hit the "very, very bad" European Union with tariffs and said his administration was also discussing a 10% punitive duty on Chinese imports - blaming the trafficking of fentanyl from China to the U.S. via Mexico and Canada. Currency gyrations around the threats seemed to have calmed down, however, with traders adopting a 'wait and see' mode and assuming any moves will happen only after the countries in question respond to Trump's main concerns. The dollar index (.DXY) , opens new tab slipped to its lowest in two weeks, with the euro clocking its best levels of the year so far - even as European Central Bank officials speaking in Davos lined up behind more interest rate cuts this year. Even though exchange rate swings have seemed large this week, implied currency volatility gauges have actually subsided. Three-month dollar/yen 'vol' fell to its lowest since July on Wednesday with the Bank of Japan's latest interest rate hike now seen to be baked in. Equivalent euro vol measures are the lowest since November, and even sterling measures have returned to two-week lows. European shares brushed off Trump's trade threats too, with the STOXX600 (.STOXX) , opens new tab index hitting a record high on Wednesday. Addidas (ADSGn.DE) , opens new tab helped Germany's DAX (.GDAXI) , opens new tab to a new record too and the sportswear brand jumped 6% after its latest results. The near 6% gain in benchmark euro zone stock indexes (.STOXXE) , opens new tab this year is twice that of the S&P500 in dollar terms - with Bank of America's latest global fund manager claiming allocations to European stocks this month were their second largest allocation in a quarter of a century. Chinese stocks (.CSI300) , opens new tab, (.HSI) , opens new tab were less enthusiastic about being back in the tariff firing line, however, and fell back about 1% on Wednesday - the yuan slipping too. Despite the pre-inauguration phone call between Trump and Chinese President XI Jinping last week, Trump appears to be emboldened enough to publicly resume the trade war he started in his first term. Back in fixed income markets, the jittery start to the new year seems to have calmed considerably. A combination of lower oil prices - due in part to Trump's plans to increase domestic drilling - and the lack of immediate tariff hikes has helped to cosset Treasury yields back at levels seen at the turn of the year. After significant relief from U.S. inflation data last week, Canada underlined the optimism on consumer prices on Tuesday with an unexpectedly large drop in monthly prices that kept annual inflation below the Bank of Canada's 2% target last month. Elsewhere, recently agitated British gilts also outperformed this week as news of a big drop in UK hiring and robust auction demand for the bonds offset higher public borrowing numbers and pulled yields back to where they were at the start of the year. Key developments that should provide more direction to U.S. markets later on Tuesday: * Canada December producer price inflation * US corporate earnings: Halliburton, Procter & Gamble, Johnson & Johnson, Discover Financial, Kinder Morgan, Steel Dynamics, Abbott Laboratories, Travelers, Amphenol, Ge Vernova, TE Connectivity, Textron, Teledyne * World Economic Forum in Davos, including European Central Bank President Christine Lagarde, Bundesbank President Joachim Nagel, Bank of France chief Francois Villeroy de Galhau, Dutch central bank boss Klaas Knot and European Union commissioner Valdis Dombrovskis * German Chancellor Olaf Scholz meets French President Emmanuel Macron in Paris * US Treasury sells $13 billion of 20-year bonds Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2025-01-22/

2025-01-22 11:01

Iran informed IAEA of planned acceleration last month That speeding up is starting to kick in, Grossi says Western powers see move as a serious escalation Grossi calls for diplomacy, sees U.S. openness there DAVOS, Switzerland, Jan 22 (Reuters) - Iran is "pressing the gas pedal" on its enrichment of uranium to near weapons grade, U.N. nuclear watchdog chief Rafael Grossi said on Wednesday, adding that Iran's recently announced acceleration in enrichment was starting to take effect. Grossi said last month that Iran had informed the International Atomic Energy Agency that it would "dramatically" accelerate enrichment of uranium to up to 60% purity, closer to the roughly 90% of weapons grade. Western powers called the step a serious escalation and said there was no civil justification for enriching to that level and that no other country had done so without producing nuclear weapons. Iran has said its programme is entirely peaceful and it has the right to enrich uranium to any level it wants. "Before it was (producing) more or less seven kilograms (of uranium enriched to up to 60%) per month, now it's above 30 or more than that. So I think this is a clear indication of an acceleration. They are pressing the gas pedal," Grossi told reporters at the World Economic Forum in Davos. According to an International Atomic Energy Agency yardstick, about 42 kg of uranium enriched to that level is enough in principle, if enriched further, for one nuclear bomb. Grossi said Iran currently had about 200 kg of uranium enriched to up to 60%. Still, he said it would take time to install and bring online the extra centrifuges - machines that enrich uranium - but that the acceleration was starting to happen. "We are going to start seeing steady increases from now," he said. Grossi has called for diplomacy between Iran and the administration of new U.S. President Donald Trump, who in his first term, pulled the United States out of a nuclear deal between Iran and major powers that had imposed strict limits on Iran's atomic activities. That deal has since unravelled. "One can gather from the first statements from President Trump and some others in the new administration that there is a disposition, so to speak, to have a conversation and perhaps move into some form of an agreement," he said. Separately, U.N. Secretary-General Antonio Guterres said at Davos that Iran must make a first step towards improving relations with countries in the region and the United States by making it clear it does not aim to develop nuclear weapons. Sign up here. https://www.reuters.com/world/middle-east/iran-has-about-200-kg-uranium-enriched-near-bomb-grade-grossi-says-2025-01-22/

2025-01-22 10:50

LUSAKA, Jan 22 (Reuters) - Zambia's copper output rose 12% in 2024, buoyed by a recovery in production at key mines as the government counts on the sector to drive economic growth. Output reached roughly 820,670 metric tons, up from 732,580 tons the year before, Mines Minister Paul Kabuswe said on Wednesday. Barrick Gold's (ABX.TO) , opens new tab Lumwana mine ramped up output and Vedanta Resources' (VDAN.NS) , opens new tab Konkola Copper Mines (KCM) resumed activities. Output also picked up at Mopani Copper Mines, which was recently bought by United Arab Emirates firm, International Resources Holding. Kabuswe said production rose despite electricity shortages after a devastating drought that hit hydroelectric power generation. Zambia is Africa's second-largest copper producer after Democratic Republic of Congo, and the government is trying to lift annual copper output to 3 million tons within about a decade. Vedanta, backed by Indian billionaire Anil Agarwal, has said it plans to invest about $1.3 billion to revive production at KCM, which nearly collapsed after an ownership battle with Zambian authorities. Canadian miners Barrick and First Quantum Minerals (FM.TO) , opens new tab are also boosting output at their mines in Zambia while KoBold Metals, backed by U.S. investors, has said it plans a $2 billion copper mine in the southern African country. Sign up here. https://www.reuters.com/markets/commodities/zambias-2024-copper-production-rises-12-mines-minister-says-2025-01-22/

2025-01-22 10:10

KAMPALA, Jan 22 (Reuters) - The Ugandan shilling weakened against the U.S. dollar on Wednesday, on the back of foreign exchange demand by fuel importers and the manufacturing sector, traders said. At 0942 GMT commercial banks quoted the shilling at 3,675/3,685, compared to Tuesday's close of 3,668/3,678. Sign up here. https://www.reuters.com/markets/currencies/ugandan-shilling-weakens-fx-demand-by-fuel-importers-manufacturers-2025-01-22/

2025-01-22 10:07

MUMBAI, Jan 22 (Reuters) - The Indian rupee strengthened on Wednesday, tracking gains in most of its regional peers, while dollar-rupee forward premiums declined on the back of likely dollar-rupee buy/sell swaps conducted by the Reserve Bank of India. The rupee closed at 86.3225 against the U.S. dollar, up nearly 0.3% on the day. While the currency came under pressure earlier in the session and was supported by dollar-selling intervention by the Indian central bank, it ticked up in the latter half of the day on the back of dollar sales by foreign banks, traders said. At least three local private banks were also spotted offering dollars, aiding the rupee, a trader at a state-run bank said. The RBI also likely conducted dollar-rupee buy/sell swaps, which prompted a decline in forward premiums, traders said. The 1-year dollar-rupee implied yield dropped to 2.27%, its lowest level since July last year. The central bank has been conducting such swaps routinely to manage the impact of its spot market interventions on the cash in the banking system. Dollar-selling interventions remove INR liquidity from the system but the impact can be offset by selling dollars for a future date rather than in the spot through buy/sell swaps. Meanwhile, an uptick in most Asian currencies also aided the rupee. The dollar index was down 0.1% to 107.9 after whipsawing over the last two days as the trade tariff news flowed out of Washington. While tariffs found only a passing mention in U.S. President Donald Trump's inaugural speech on Monday, he said late on Tuesday that the administration was discussing imposing a 10% tariff on goods imported from China on Feb. 1. "Markets have continued to unwind USD longs as U.S. Treasuries had another strong session, and a delay in tariff announcements is fuelling some tentative optimism," ING Bank said in a note. Sign up here. https://www.reuters.com/markets/currencies/rupee-ends-higher-broad-based-dollar-sales-uptick-asian-peers-2025-01-22/

2025-01-22 09:58

NAIROBI, Jan 22 (Reuters) - Kenya's shilling was marginally stronger against the U.S. dollar on Wednesday, data from the London Stock Exchange Group showed. At 0912 GMT, the shilling traded at 129.00/129.50 per dollar, compared to 129.10/129.60 at the close of trading on Tuesday. Sign up here. https://www.reuters.com/markets/currencies/kenyan-shilling-marginally-stronger-against-dollar-lseg-data-shows-2025-01-22/