2025-01-01 06:10

War ends Russia's dominance of gas supply to Europe Norway, US, Qatar replace Russian gas Loss of Russian gas undermined EU's competitiveness Slovakia, Austria have alternative supplies Heating, hot water cut off in breakaway Moldovan region MOSCOW/KYIV, Jan 1 (Reuters) - Russian gas exports via Soviet-era pipelines running through Ukraine came to a halt on New Year's Day, marking the end of decades of Moscow's dominance over Europe's energy markets. The gas had kept flowing despite nearly three years of war, but Russia's gas firm Gazprom said it had stopped at 0500 GMT after Ukraine refused to renew a transit agreement. The widely expected stoppage will not impact prices for consumers in the European Union - unlike in 2022, when falling supplies from Russia sent prices to record highs, worsened a cost-of-living crisis and hit the bloc's competitiveness. The last remaining EU buyers of Russian gas via Ukraine, such as Slovakia and Austria, have arranged alternative supply, while Hungary will keep receiving Russian gas via the TurkStream pipeline under the Black Sea. But Transdniestria, a breakaway pro-Russian region of Ukraine's neighbour Moldova also reliant on the transit flows, cut off heating and hot water supplies to households early on Wednesday. Local energy company Tirasteploenergo urged residents to dress warmly, hang blankets or thick curtains over windows and balcony doors, and use electric heaters. Ukrainian President Volodymyr Zelenskiy, writing on the Telegram messaging app, said the end of gas transit through his country to Europe was "one of Moscow's biggest defeats" and urged the U.S. to supply more gas to Europe. "The more there is on the market from Europe's real partners, the faster we will overcome the last negative consequences of European energy dependence on Russia," he wrote. Europe's "joint task" now, he wrote, was to support ex-Soviet Moldova "in this period of energy transformation". The European Commission said the EU had prepared for the cut-off. "The European gas infrastructure is flexible enough to provide gas of non-Russian origin," a spokesperson for the Commission said. "It has been reinforced with significant new LNG (liquefied natural gas) import capacities since 2022." Russia and the former Soviet Union spent half a century building up a major share of the European gas market, which at its peak stood at around 35%. But the EU has slashed its dependence on Russian energy since the start of the war in Ukraine by buying more piped gas from Norway and LNG from Qatar and the United States. Ukraine, which refused to extend the transit deal, said Europe had already made the decision to abandon Russian gas. "We stopped the transit of Russian gas. This is a historic event. Russia is losing its markets, it will suffer financial losses," Ukraine's Energy Minister German Galushchenko said in a statement. ALTERNATIVE SUPPLIES Ukraine will lose up to $1 billion a year in transit fees from Russia. To help offset the impact, it will quadruple gas transmission tariffs for domestic consumers from Wednesday, which could cost the country's industry more than 1.6 billion hryvnias ($38.2 million) a year. Gazprom will lose close to $5 billion in gas sales. The company halted supply to Austria's OMV (OMVV.VI) , opens new tab in mid-November over a contractual dispute but in recent weeks Russian gas has been reaching Austria via Slovakia at a rate of around 200 gigawatt hours (GWh) per day. For Jan. 1, only about 7 GWh per day is expected to flow from Slovakia to Austria, Austrian energy regulator E-Control said. Slovakia's main gas buyer SPP said it would supply its customers mainly via pipelines from Germany and also Hungary, but would face additional transit costs. Combined pipeline routes from Russia delivered a record high 201 billion cubic metres (bcm) of gas to Europe in 2018. The Nord Stream route across the Baltic Sea to Germany was blown up in 2022 and the Yamal-Europe pipeline via Belarus has also shut. Russia shipped about 15 bcm of gas via Ukraine in 2023, down from 65 bcm when the last five-year contract began in 2020. ($1 = 41.9000 hryvnias) Sign up here. https://www.reuters.com/business/energy/russia-halts-gas-exports-europe-via-ukraine-2025-01-01/

2025-01-01 04:27

MUMBAI, Jan 1 (Reuters) - The Indian rupee weakened slightly in early trading on Wednesday, pressured by dollar bids on behalf of importers amid lacklustre trading to kick off 2025, while dollar-rupee far forward premiums retreated from an over one-and-a-half-year high. The rupee was at 85.6725 against the U.S. dollar as of 09:50 a.m. IST, down from its close of 85.6150 in the previous session. The local currency has faced persistent downward pressure over the last few weeks on the back of multiple headwinds ranging from persistent strength in the U.S. dollar to concerns about India's slowing economic growth. The rupee declined for the seventh consecutive year in 2024, with bankers and analysts expecting the depreciation pressure to linger in early 2025. The dollar index rose nearly 0.4% on Tuesday to 108.4, close to an over two-year high, while U.S. bond yields rose in holiday-thinned trading. The 10-year U.S. Treasury yield nudged higher by 3 basis points to 4.57%. Amid the lingering downward bias on the local currency, importers should "buy all dips (on USD/INR)," said Ani Bhansali, head of treasury at Finrex Treasury Advisors. Bhansali expects the rupee to trade between 85.40 and 85.70 on the day. Meanwhile, dollar-rupee forward premiums retreated, with the 1-year implied yield down 4 bps at 2.50% after touching their highest level since April 2023 in the previous session. An "unusual surge" in very near-dated dollar-rupee swap rates had boosted forward premiums, which is cooling off now, a trader at a state-run bank said. Trading activity is also "relatively muted given the start of the new year, the trader added. Most regional markets were closed for the New Year holiday, while price action on India's equity benchmark indexes were also muted. Sign up here. https://www.reuters.com/markets/currencies/rupee-dips-importer-dollar-bids-far-forward-premiums-retreat-2025-01-01/

2025-01-01 02:43

MUMBAI, Jan 1 (Reuters) - The Indian rupee is likely to open flat-to-slightly-lower on Wednesday, with traders expecting the currency to weaken gradually in the near-term as a hawkish Federal Reserve and expectations surrounding Donald Trump's second term as U.S. President keep the dollar on the front foot. The 1-month non-deliverable forward indicated that the rupee will open at 85.62-85.63 against the U.S. dollar, compared with its previous close of 85.6150. The local unit dipped to its sixth consecutive record closing low on Tuesday, pressured by a decline in its regional peers. The rupee declined for the seventh consecutive year in 2024, largely on the back of multiple headwinds in the final quarter of the calendar year. Regional currencies were mostly weaker, with several markets closed for the New Year holiday, while the dollar index hovered close to its highest level in over two years. The prospect that the Fed will hold interest rates higher-for-longer alongside expectations of policies to be introduced by U.S. President-elect Donald Trump have boosted the dollar and U.S. bond yields. Meanwhile, the rupee has faced additional pressure on the back of local headwinds including India's slowing growth and a widening trade deficit. "Rupee is likely to remain on a steady depreciation trajectory," said Abhishek Goenka, chief executive at FX advisory firm IFA Global. "We may see a conscious, deliberate, controlled correction of (rupee's) overvaluation to support growth," Goenka said. The rupee's 40-currency trade-weighted real effective exchange rate, a measure of its competitiveness, stood at 108.14 in November, indicating the currency was overvalued by around 8%. The rupee's relative overvaluation is a potential drag on India's exports. Traders will also watch out for any potential changes in the Reserve Bank of India's forex intervention strategies over 2025 under the its new governor. KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.89; onshore one-month forward premium at 27 paisa ** Dollar index at 108.4 ** Brent crude futures up 1.1% at $74.8 per barrel ** Ten-year U.S. note yield at 4.57% ** As per NSDL data, foreign investors sold a net $187.1 mln worth of Indian shares on Dec. 30 ** NSDL data shows foreign investors sold a net $125.3 mln worth of Indian bonds on Dec. 30 Sign up here. https://www.reuters.com/markets/currencies/rupee-tipped-weaken-gradually-amid-broad-dollar-strength-2025-kicks-off-2025-01-01/

2025-01-01 01:06

U.S. stock indexes post annual, quarterly gains S&P 500 posts biggest two-year gain since 1997-98 Indexes off: Dow 0.07%, S&P 500 0.43%, Nasdaq 0.90% NEW YORK, Dec 31 (Reuters) - Wall Street lost ground on Tuesday as investors closed the book on a remarkable year for equities, during which the U.S. stock market was powered to record highs by the twin engines of the artificial-intelligence boom and the U.S. Federal Reserve's first interest rate cuts in three-and-a-half years. The three major U.S. stock indexes closed in negative territory, ending a languid, low-volume session that contrasted with the tumultuous year that preceded it. 2024 included intensifying geopolitical strife, a U.S. presidential election and shifting speculation regarding the path of Fed policy in the coming year. "There’s no Santa Claus rally this week, but investors received the gift of gains in 2024," said Greg Bassuk, chief executive officer at AXS Investments in New York. "2024 was a massive year for equity gains driven by a trifecta of the AI explosion, a slew of Fed interest rate cuts and a robust U.S. economy." "It sets the stage for continued strength heading into 2025," Bassuk added. For 2024, the Nasdaq surged 28.6%, while the bellwether S&P 500 notched a 23.3% gain, marking the index's best two-year run since 1997-1998. The blue-chip Dow posted a 12.9% advance for the year. Among the 11 major sectors of the S&P 500, communication services (.SPLRCL) , opens new tab, technology (.SPLRCT) , opens new tab and consumer discretionary (.SPLRCD) , opens new tab were 2024's big percentage gainers, jumping between 29.1% and 38.9% on the year. Healthcare (.SPXHC) , opens new tab, real estate (.SPLRCR) , opens new tab and energy (.SPNY) , opens new tab were the only sectors that registered single-digit gains, while the materials (.SPLRCM) , opens new tab sector was the sole 2024 decliner, dropping nearly 1.8%. For the fourth quarter, the Nasdaq jumped 6.2%, while the S&P 500 advanced 2.1%. The Dow eked out a 0.5% gain for the October-December period. The Dow Jones Industrial Average (.DJI) , opens new tab on Tuesday fell 29.51 points, or 0.07%, to 42,544.22, the S&P 500 (.SPX) , opens new tab lost 25.31 points, or 0.43%, to 5,881.63 and the Nasdaq Composite (.IXIC) , opens new tab lost 175.99 points, or 0.90%, to 19,310.79. Looking ahead to 2025, financial markets are now pricing in about 50 basis points of additional interest rate cuts from the Fed, with investors eying stretched valuations and uncertainties surrounding tax and tariff policies from the administration of President-elect Donald Trump. "Investors should be cautious regarding the impact of the incoming Trump administration and how that affects certain sectors," Bassuk said, adding that "the instability driven by geopolitics, specifically the Russia/Ukraine war and continued strife in the Middle East could trigger consternation" in companies and sectors with ties to the affected regions. Bassuk believes the AI boom still has room to grow. "Valuations have become lofty amid the stock run up, but because we believe that the growth in AI is set to continue and move beyond hardware to software in a massive way across most sectors," he added. Advancing issues outnumbered decliners by a 1.3-to-1 ratio on the NYSE. There were 52 new highs and 125 new lows on the NYSE. On the Nasdaq, 2,013 stocks rose and 2,336 fell as declining issues outnumbered advancers by a 1.16-to-1 ratio. The S&P 500 posted 2 new 52-week highs and one new low while the Nasdaq Composite recorded 43 new highs and 71 new lows. Volume on U.S. exchanges was 14.59 billion shares, compared with the 14.81 billion average for the full session over the last 20 trading days. Sign up here. https://www.reuters.com/markets/us/ai-boom-fed-rate-cuts-lift-us-stocks-new-highs-2024-2024-12-31/

2024-12-31 23:41

Dec 31 (Reuters) - Grid operator PJM Interconnection responded on Tuesday to a complaint from Pennsylvania Governor Josh Shapiro over power market rules, citing concerns about potential power shortages due to the fast-paced expansion of data centers. Shapiro had filed a complaint with the Federal Energy Regulatory Commission on Monday, arguing that the largest U.S. power grid operator needs to change its market rules to avoid a potential surge in electricity costs. "We have been warning for over two years of the prospect that parts of our country could run short of power during high demand periods," PJM said in a statement. "This possibility has been growing, primarily as a result of state and federal policy decisions that are pushing generators to retire prematurely, and also due to unprecedented and rapidly growing data center construction," the grid operator added. The company has sought permission from federal regulators to lower the market price cap and has proposed faster integration of new generation projects to mitigate issues such as power deficiencies during periods of high demand. PJM, which serves nearly 65 million people across the U.S., has faced increased public scrutiny since July when it said that its annual capacity auction would lead to record-high payments to power plants within its system. Sign up here. https://www.reuters.com/business/energy/pjm-responds-pennsylvania-governors-complaint-over-power-market-rules-2024-12-31/

2024-12-31 23:03

MEXICO CITY, Dec 31 (Reuters) - Mexico's peso weakened nearly 23% this year to close the final day of trading at 20.82 pesos per U.S. dollar on Tuesday, the currency's deepest drop against the greenback since the 2008 global financial crisis. The peso's volatile year kicked off with months of steady gains until the days following June's general election, which swept the leftist coalition led by the ruling Morena party to a resounding victory in the presidential race as well as large congressional majorities. Ahead of the election, the Mexican currency traded in April at about 16.26 pesos per dollar to reach a nine-year high. The election win for Morena paved the way for passage of constitutional reforms in September, including a major overhaul of the judiciary that critics argue will undermine the independence of the courts in Latin America's second-biggest economy. The election of U.S. President-elect Donald Trump in November exacerbated the peso's rocky ride, amid his fresh tariff threats against Mexico, which sends around 80% of its exports to its northern neighbor. Mexico's main stock index also shed value during the year, dipping nearly 14% to close on Tuesday at 49,513 points, its steepest fall since 2018. Sign up here. https://www.reuters.com/markets/currencies/mexican-peso-posts-biggest-annual-drop-versus-us-dollar-16-years-2024-12-31/