2024-11-26 03:30

SHANGHAI, Nov 26 (Reuters) - The yuan fell against the U.S. dollar to its weakest in nearly four months after U.S. President-elect Donald Trump said he would impose a 25% tariff on all products from Mexico and Canada, and an additional 10% tariff on goods from China. Offshore yuan dropped roughly 0.3% on the news to 7.2730 per dollar, its lowest since July 30, while onshore yuan also fell after the market opening. "The directional impact is clear for the yuan – weaker – but Chinese authorities will be nervous about devaluing too much and encouraging outflows," said Ben Bennett, head of investment strategy for Asia at LGIM. Prior to the market opening, the People's Bank of China (PBOC) set the midpoint rate , around which the yuan is allowed to trade in a 2% band, at 7.1910 per dollar, which was 450 pips firmer than the Reuters' estimate. The effectiveness of the fixing as a tool to manage yuan depreciation expectations is limited, said analysts at Nomura in a note. "We believe that, if onshore spot USD/CNY rises above the 7.30 level, market activity will shift where USD demand strengthens versus sellers," the Nomura analysts said, adding that this will present a challenge to authorities if they don't allow the yuan fixing to get weaker. Nomura suggested to go long dollar against the offshore yuan. The spot yuan opened at 7.2524 per dollar and was last trading 105 pips lower than the previous late session close at 7.2553 as of 0239 GMT. Actual tariff announcements and negotiations will drive the yuan in coming quarters, said Liang Ding, an analyst at research firm Macro Hive. "Given the 'promise made, promise kept' rhetoric of the Trump campaign, markets may begin to price in additional risk premia related to the second trade war as Trump’s inauguration approaches," Ding said. During Trump's first term as president, the yuan weakened about 5% against the dollar after the initial round of U.S. tariffs on Chinese goods in 2018, and fell another 1.5% a year later when trade tensions escalated. As part of his pitch to boost American manufacturing during the recent election campaign, Trump said he would impose tariffs of 60% or more on goods from China. The proposed tariffs, as well as other policies such as tax cuts, are seen as inflationary and likely to keep U.S. interest rates relatively high, hurting currencies of U.S. trading partners. The dollar's six-currency index was 0.075% lower at 107.27. LEVELS AT 02:39 GMT Sign up here. https://www.reuters.com/markets/currencies/chinas-yuan-slides-4-month-low-trumps-tariff-promise-2024-11-26/

2024-11-26 02:48

MUMBAI, Nov 26 (Reuters) - The Indian rupee will be under pressure on Tuesday after U.S. President-elect Donald Trump pledged to impose tariffs on all imports from Canada and Mexico and levy an additional 10% tariff on Chinese products, boosting the U.S. dollar. The 1-month non-deliverable forward indicated that the rupee will open at 84.32-84.33 to the U.S. dollar compared with 84.2875 in the previous session. The dollar index rose 0.4% to 107.3 following Trump's comments. "As one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% tariff on all products coming into the United States," Trump said in a post on the social media platform Truth Social. On China, Trump accused the country of not taking strong enough steps to curtail the flow of illicit drugs crossing the border into the U.S. from Mexico. "Until such time as they stop, we will be charging China an additional 10% Tariff, above any additional Tariffs, on all of their many products coming into the United States of America," Trump said. The offshore Chinese yuan declined to a four-month low following Trump's comments while the Mexican peso and the Canadian dollar weakened by 1.5% and 1%, respectively, against the dollar. Weakness in the yuan will "expectedly spillover (to the rupee) but expectations that the Reserve Bank of India will be active near 84.50 levels should keep the decline limited," a trader at a state-run bank said. The rupee had declined to its all-time low of 84.5075 last week. While Trump's decision to nominate investor Scott Bessent as Treasury Secretary had calmed market nerves and cooled the dollar on Monday, Trump's "protectionist tendency and volatile temperament imply that uncertainty for markets will remain," DBS Bank said in a note. KEY INDICATORS: ** One-month non-deliverable rupee forward at 84.44; onshore one-month forward premium at 12 paisa ** Dollar index at 107.21 ** Brent crude futures up 0.3% at $73.2 per barrel ** Ten-year U.S. note yield at 4.28% ** As per NSDL data, foreign investors bought a net $127mln worth of Indian shares on Nov. 22 ** NSDL data shows foreign investors sold a net $46.3mln worth of Indian bonds on Nov. 22 Sign up here. https://www.reuters.com/markets/currencies/rupee-face-headwinds-trumps-tariff-promise-boosts-dollar-2024-11-26/

2024-11-26 00:28

Mexican peso, Canadian dollar slide on threat of 25% tariffs Bitcoin loses ground, gold up slightly Oil prices settle down after Israel-Lebanon ceasefire deal NEW YORK/LONDON, Nov 26 (Reuters) - The U.S dollar rose against some currencies on Tuesday after U.S. President-elect Donald Trump pledged to impose new tariffs on imports from Canada, Mexico and China, while MSCI's global equity index was higher after the release of the Federal Reserve's latest meeting minutes. The minutes from the meeting earlier this month showed officials divided over how much farther they may need to cut interest rates, but in agreement about avoiding concrete guidance about how policy would evolve in the weeks ahead. "With the stock market, no surprises is good news. The market likes certainty above anything else," said Burns McKinney, portfolio manager at NFJ Investment Group in Dallas. "Overall, Fed policymakers are still supportive of a careful approach. ... They didn't say anything hawkish." The Dow Jones Industrial Average (.DJI) , opens new tab rose 123.74 points, or 0.28%, to 44,860.31; the S&P 500 (.SPX) , opens new tab rose 34.26 points, or 0.57%, to 6,021.63; and the Nasdaq Composite (.IXIC) , opens new tab rose 119.46 points, or 0.63%, to 19,174.30. After Wall Street had closed, MSCI's gauge of stock markets across the globe (.MIWD00000PUS) , opens new tab turned higher and was up 1.52 points, or 0.18%, at 859.27. Europe's STOXX 600 (.STOXX) , opens new tab index earlier closed down 0.57%. While it was below its session high, the dollar was still up against the Mexican peso and Canadian dollar in afternoon trading. Trump, citing concerns over illegal immigration and illicit drug trading, had said earlier that he would put a 25% tariff on products from Mexico and Canada, and an additional 10% tariff on goods from China. He had previously threatened to slap tariffs in excess of 60% on Chinese imports. But investors toned down their initial reactions to the tariff threat and appeared to view it as a "negotiation tool," according to McKinney. However, U.S. Treasury yields rose on Tuesday, as Monday's sharp bond rally lost momentum with the tariff announcement undoing some of the investor optimism from Trump's selection late last week of Scott Bessent as Treasury secretary. "Concern about the tariffs and concern about the U.S. deficit are what's weighing on the market for the ability of the Fed to really cut," said Matt Eagan, portfolio manager and head of the Full Discretion Team at Loomis, Sayles & Co. The yield on benchmark U.S. 10-year notes rose 3 basis points to 4.293%, from 4.263% late on Monday while the 30-year bond yield rose 1.8 basis points to 4.4647%. The 2-year note yield, which typically moves in step with interest rate expectations, was flat at 4.252%, from 4.252% late on Monday. In currencies, the Mexican peso < MXN=> weakened 1.6% versus the dollar at 20.66 while the Canadian dollar weakened 0.56% to 1.41 per U.S. dollar. Oil prices settled lower, slightly extending Monday's losses in choppy trade after news of an agreement for a ceasefire between Israel and Lebanon, reducing oil's risk premium. U.S. crude settled down 0.25% at $68.77 a barrel and Brent ended at $72.81 per barrel, down 0.27% on the day. Bitcoin was down 2.80% at $91,064.35, adding to Monday's losses after last week hitting a record high at $99,830. The token had benefited from speculation of an easier regulatory environment for cryptocurrencies under Trump. In precious metals, gold prices were caught in a tug-of-war, dipping to a week low as safe-haven demand softened with news of the ceasefire, while concern over Ukraine and Trump's tariff plans added some support. Spot gold rose 0.29% to $2,632.81 an ounce. U.S. gold futures rose 0.34% to $2,625.60 an ounce. Sign up here. https://www.reuters.com/markets/global-markets-wrapup-1-2024-11-26/

2024-11-26 00:13

SAO PAULO, Nov 25 (Reuters) - Brazilian meatpackers have stopped supplying the Carrefour group (CARR.PA) , opens new tab in Brazil, its local unit said on Monday, after the retailer's global CEO vowed to keep South American meat off its shelves in France, sparking backlash from meat producers. "Unfortunately, the decision to suspend meat supply impacts our customers, especially those who trust us to supply their homes with quality and responsible products," Carrefour Brasil (CRFB3.SA) , opens new tab said in a statement. Carrefour CEO Alexandre Bompard said last week that the trade deal being discussed between the European Union and the Mercosur regional trade bloc presented the "risk of meat production spilling over into the French market (and) failing to meet its requirements and standards." His remarks in a social media post addressed to leaders of France's farm lobbies were blasted by Brazilian agribusiness industry groups, which issued a joint statement calling them "a protectionist stance." On Friday, local media began reporting that Brazilian meatpackers such as JBS (JBSS3.SA) , opens new tab and Marfrig (MRFG3.SA) , opens new tab had stopped supplying meat to Carrefour Brasil, although none of the named firms or Brazilian meat industry groups confirmed the move. Marfrig declined to comment, and JBS did not immediately comment on the matter. Carrefour representatives had previously clarified to Reuters that the retailer does not currently source meat in France from Mercosur countries. However, in Brazil, beef industry group Abiec has said Carrefour operates 1,200 stores that sell mostly domestic beef. Abiec declined to comment on Monday when asked about the supply halt. In its statement, Carrefour Brasil said it is seeking solutions to reverse the suspension as soon as possible, adding there is no meat shortage in its stores at the moment. The Brazilian unit was responsible for some 20% of the French group's total sales in the third quarter, according to company data. Brazil's Agriculture Minister Carlos Favaro said on Monday he was happy with the local suppliers' decision, after calling last week's Carrefour pledge an "orchestrated action" by French companies to sabotage the trade pact between the EU and Mercosur, which officials aim to finalize this year. Goldman Sachs analysts estimated that every day of meat sales lost, including beef, chicken and pork, could represent as much as an 1.8% decline to Carrefour Brasil's fourth-quarter net income estimates. Carrefour Brasil did not say which type of meat specifically was being impacted by the suspension. Sign up here. https://www.reuters.com/markets/commodities/brazil-meatpackers-halt-supply-carrefour-local-unit-ceo-faces-backlash-2024-11-26/

2024-11-25 21:47

Nov 26 (Reuters) - A look at the day ahead in Asian markets. Donald Trump's pick to be U.S. Treasury Secretary proved to be a balm for the bond market, while the dollar followed yields lower in a move poised to influence trading in Asia on Tuesday. The choice of prominent investor Scott Bessent made late on Friday, rippled through markets on Monday, after days of speculation over who Trump would choose to be essentially the highest-ranking U.S. economic official. Treasury yields, which move opposite to prices, fell sharply, with the benchmark 10-year yield touching its lowest level in more than two weeks. Treasury yields had been rising at a torrid pace, partially due to concerns that Trump's presidency would dramatically widen the federal deficit. But Bessent was seen as someone who might moderate any negative impact of Trump's fiscal policies. Some strategists said his nomination was a relief as he understands markets and his appointment could reduce the severity of potential tariffs, which are favored by Trump. The dollar index , which has surged since early October, pulled back sharply on the day. A weaker dollar could offer some relief to emerging market countries that have borrowed heavily in the U.S. currency, amid concerns about a rising dollar under Trump. The removal of uncertainty over the Treasury secretary position combined with lower bond yields boosted equities. MSCI's gauge of stocks across the globe (.MIWD00000PUS) , opens new tab was up about 0.4%, while the U.S benchmark S&P 500 (.SPX) , opens new tab closed up 0.3%. The spotlight was on U.S. small-cap stocks, with the Russell 2000 (.RUT) , opens new tab hitting a record intraday high for the first time in three years. Some investors say small caps could be in the sweet spot, as Trump's push for lower taxes and reduced regulations favors smaller companies, while the Fed's lowering of interest rates also stands to help smaller companies that tend to rely more on debt financing. Not everything was rosy in equities, as Chinese shares fell amid concerns about a trade war hurt risk appetite. The Shanghai Composite Index (.SSEC) , opens new tab touched its lowest in about a month. Elsewhere, signs of a ceasefire deal between Israel and militant group Hezbollah in Lebanon prompted a pullback in oil prices and gold, with the Treasury secretary news also dulling the precious metal's allure. With the Thanksgiving holiday in the U.S. coming on Thursday, trading was expected to thin out, even as central bank decisions in New Zealand and South Korea and inflation data in the U.S. were set to provide some excitement later in the week. Here are key developments that could provide more direction to markets on Tuesday: - Singapore manufacturing output (Oct) - Hong Kong export/import data (Oct) - Fed meeting minutes Sign up here. https://www.reuters.com/markets/asia/global-markets-view-asia-2024-11-25/

2024-11-25 21:38

PARAMARIBO, Nov 25 (Reuters) - Chinese mining company Chinalco could invest some $426 million in bauxite mining in Suriname, the chair of a Surinamese presidential mining commission said on Monday, with the South American country expected to get a 13% share in the project. If approved by parliament, Chinalco could begin construction by the middle of next year and would produce 6 million tonnes of bauxite - the key ore for aluminum - per year, said government advisor Daniel Lachman. Sign up here. https://www.reuters.com/markets/commodities/chinas-chinalco-could-invest-426-million-suriname-bauxite-project-2024-11-25/