2024-11-06 08:05

Nov 6 (Reuters) - Metals recycler and battery materials producer Umicore (UMI.BR) , opens new tab said on Wednesday it would pause construction of its battery materials plant located in Loyalist, Canada. "Umicore is navigating a challenging environment where we feel the impact of the complex transitioning of the automotive industry towards electric mobility. Serving our North American customers out of Korea is now clearly the most effective use of our assets," CEO Bart Sap said in a statement. The maker of catalytic converters and battery materials for carmakers launched a review of its business in July, and said it had postponed a "large scale" investment in an unspecified battery recycling plant in Europe, as well as for the on in Canada. The Belgian group said ‍it had not drawn on incentives provided by the Canadian government, and added that if the construction resumes, it would access them under same conditions, including employment commitments. Sign up here. https://www.reuters.com/markets/commodities/umicore-pause-construction-battery-materials-plant-canada-2024-11-06/

2024-11-06 07:59

Peso recovers after touching weakest level in over two years Mexico's currency has slipped more than 18% this year vs dollar Analysts foresee potential rough 2025 for peso LONDON/MEXICO CITY/NEW YORK, Nov 6 (Reuters) - Mexico's peso was narrowly weaker on Wednesday after largely recovering from a slump earlier in the day to its lowest level in more than two years, as analysts said the slide in response to Donald Trump's U.S. election victory was overdone. While the U.S. election extended a streak of volatility and weakness for emerging markets, Mexico was seen as particularly vulnerable given its exposure to the U.S. economy, its biggest export market. The peso weakened 0.4% at 1436 ET, trading at 20.2048 per dollar, after dropping in early trading as low as 20.8100 per dollar for the first time since August 2022, a fall some analysts said may have been overdone. "I think some of it was priced in the currency already, though there’s big domestic factors impacting (the peso) as well," said Shamaila Khan, head of fixed income for emerging markets and Asia Pacific at UBS Asset Management. "Volatility could be both ways, because when you have super majority, there are a lot of good things the government can do as well," Khan added, referring to the political strength of the country's ruling Morena coalition. Emerging market currencies have shown mixed behavior against a soaring dollar , with the Brazilian real gaining over 1% and Chile's peso chalking up the biggest losses in Latin America. The Mexican peso has shed over 18% of its value so far this year against the U.S. dollar, posting sharp setbacks after Mexico's election in the summer roiled domestic assets. Rodolfo Ramos, head of Mexico research at Brazilian bank Bradesco, said a Trump administration was not an unknown and this was now "an attractive entry point" for investors. "Mexico has already worked with him successfully," he said in a note to clients. "We see uncertainty on tariffs in the short term, but we remain positive on nearshoring over the medium and long run." After Trump's 2016 presidential victory, the peso plummeted around 8.5% against the dollar to a then-historic low. While markets evaluate the effects of trade barriers Trump has threatened, Mexican President Claudia Sheinbaum tried to play down concerns about a drastic rupture. FUTURE CONCERNS Still, Chris Turner, global head of markets at ING, said he would not rule out a move to 22.00 pesos to the dollar over the coming weeks. He added that 2025 could be a "rough year for the peso" ahead of the USMCA trade pact review in 2026. Citi's Luis Costa said in a note to clients that the Wall Street bank had put on a short position of the Mexican peso vs the South African rand, expecting the Latin American currency to weaken in that pairing. Immigration from Mexico to the U.S. as well as remittances are expected to be other flash points under a Trump presidency. Investors should also watch out for possible central bank interventions in emerging markets, said Costa. Banxico said it could intervene in the case of highly dysfunctional markets. Mexico's currency is one of top five worst performing emerging market currencies in 2024, much of that weakening since Sheinbaum's landslide victory in June. Sheinbaum is set to present her first budget on Nov. 15. Citi economists expect a 5% deficit for 2025. Sign up here. https://www.reuters.com/markets/currencies/mexicos-peso-slumps-two-year-low-markets-tilt-towards-trump-win-2024-11-06/

2024-11-06 07:58

SINGAPORE, Nov 6 (Reuters) - Efforts by the United States and others to persuade more countries to contribute to a new global climate financing initiative risks undermining the Paris agreement, Singapore's Environment Minister Grace Fu told Reuters on Wednesday. Nearly 200 nations will gather in Baku, Azerbaijan for COP29 climate talks on Monday to thrash out the details of a deal known as the New Collective Quantified Goal, designed to deliver billions of dollars of climate finance to the regions that need it the most. But the United States, Europe and others will only commit to the fund if the list of countries contributing to it is widened to include the likes of China, South Korea and Singapore, and the resulting deadlock could block progress during the talks. Fu said there were "tough negotiations" going on about the definition and structure of the fund, but widening the donor base risks "unravelling" the Paris Agreement. "The Paris Agreement has clear provisions … that talk about the responsibility of developed parties in supporting developing countries in mitigation and adaptation," she said. She said Singapore, which has already set up funds designed to speed up decarbonisation in Southeast Asia, would be willing to participate in the NCQG on a voluntary basis, but not as a "donor". The issue could be further complicated by the United States' presidential election, with Donald Trump expected to withdraw from the Paris agreement for a second time if he is re-elected, narrowing the existing donor base. Fu said it was too early to talk about the impact of the U.S. election on COP29, adding that Singapore hopes Washington will continue to be "involved, engaged and providing the necessary leadership". Also on the agenda in Baku will be Article 6 of the Paris Agreement, with countries still negotiating the small print on a global carbon credit market that will allow them to meet their climate goals by financing green projects beyond their borders. There were hopes that Azerbaijan would be able to announce the completion of a key part of Article 6 in the first few days of COP29, which could build momentum for success elsewhere, but Fu said it was too early to say whether that would happen. "The presidency has expressed their intention or their desire to see an early conclusion, and we, as co-facilitator are doing all we can to help bring that process forward," she said. "Obviously, there's still a lot of work that needs to be done." Sign up here. https://www.reuters.com/sustainability/sustainable-finance-reporting/deadlock-over-climate-finance-is-undermining-paris-agreement-singapore-minister-2024-11-06/

2024-11-06 07:38

LONDON, Nov 6 (Reuters) - Lloyd's of London insurer Beazley (BEZG.L) , opens new tab said on Wednesday that its initial view of its net exposure to U.S. hurricanes Helene and Milton was between $125 and $175 million. Insurers are bracing for large claims from the hurricanes, which caused huge damage in Florida in recent weeks, with analysts predicting up to $55 billion in insured losses. "Despite an active hurricane season and a global cyber event, we expect to deliver an undiscounted combined ratio of around 80% for the full year," chief executive Adrian Cox said. Combined ratio is a measure of underwriting profitability, in which a level below 100% indicates a profit. The insurer upgraded its combined ratio forecast earlier this year after first-half pretax profit nearly doubled. Beazley, a major cyber insurer, said earlier this year it had no plans to alter its guidance in the wake of the CrowdStrike IT outage , opens new tab. It said on Wednesday that the market was seeing an uptick in severity on ransomware claims but that this was not affecting its outlook. Insurance written premiums rose by 7% to $4.6 billion in the nine months to end-September and Beazley was on track to deliver its full-year guidance, it said in a trading statement. Beazley said premium rates on renewed business were flat, compared with a 5% rise a year ago. Insurance premiums have been rising in the past few years in response to inflation and to losses from the COVID-19 pandemic, wars and natural catastrophes. However, global commercial insurance rates fell 1% in the third quarter, the first quarterly decline in seven years, according to broker Marsh. Sign up here. https://www.reuters.com/business/finance/insurer-beazley-sees-125-175-mln-hit-hurricanes-helene-milton-2024-11-06/

2024-11-06 07:20

Republican Donald Trump wins U.S. election "Trump trades" boost dollar, rand tumbles Market volatility likely, analysts say JOHANNESBURG, Nov 6 (Reuters) - The South African rand slumped against a buoyant dollar on Wednesday as "Trump trades" surged, after Donald Trump won the U.S. election. Republican Trump recaptured the White House on Wednesday by securing more than the 270 Electoral College votes needed to win the presidency, Edison Research projected, four years after leaving office. At 1157 GMT, the rand traded at 17.77 against the U.S. dollar , down about 2.2% on its previous close. The dollar hit a four-month peak and was set for its biggest one-day rise since March 2020. It was last up about 1.8% against a basket of currencies. "The initial feeling is that Trump will give (South African) President Ramaphosa a lot to think about, which might not be good for the rand," said Danny Greeff, co-head of Africa at ETM Analytics. Trump's win has fuelled what's known as "Trump trades" with markets anticipating a continuation of his policies, which could mean higher growth in the short term but also potentially inflationary pressures. Complicating the rand's situation was South Africa's mid-term budget statement last week, said Zain Vawda, market analyst at MarketPulse by OANDA. The government forecast wider budget deficits and higher debt over the next three years and ratings agency Fitch on Monday said it had doubts over the government's ability to meet some of its targets. "This leaves the rand vulnerable to further losses against the greenback heading into the festive season," Vawda said. South Africa's benchmark 2030 government bond also fell, with the yield up 6 basis points to 9.375%. On the Johannesburg Stock Exchange the Top-40 (.JTOPI) , opens new tab index was last down about 1.4%. Sign up here. https://www.reuters.com/markets/currencies/south-african-rand-tumbles-markets-tilt-towards-trump-win-2024-11-06/

2024-11-06 07:15

Potential new tariffs on Chinese goods seen hurting metals Copper, gold, zinc retreat Oil prices flatten after falling more than $2 per barrel LONDON/CHICAGO, Nov 6 (Reuters) - Metals bore the brunt of global commodity price losses after a U.S. election win by Donald Trump on Wednesday, while oil, gas and agricultural commodity prices recouped some losses. Trump recaptured the White House by securing more than the 270 Electoral College votes needed to win the presidency, following a campaign of dark rhetoric that deepened the polarization in the country. Oil prices , flattened after falling by more than $2 per barrel earlier on a stronger dollar, with some analysts and investors saying the earlier decline was an over-reaction to the election results. Although Trump has long backed U.S. oil and gas production and could introduce heavy tariffs on imports which dampen economic growth and demand for fossil fuels, U.S. oil and gas production already hit record highs under former U.S. President Joe Biden, said Jacob Mandel at consultancy Aurora Energy Research. Benchmark European gas prices flattened out after rising slightly earlier. Agricultural commodities rebounded from earlier lows, with corn and wheat turning higher and soybeans paring losses on the back of sharply higher soyoil futures. A stronger dollar makes U.S. grain more expensive overseas and tariffs proposed by Trump could disrupt U.S. agricultural trade, particularly soybeans to leading importer China, which could retaliate with reduced purchases. But the peak U.S. soy export season is currently winding down so any impact from Chinese retaliation may not be felt until next summer. Also, Trump's promised tariff hikes on all imports could curb imports of used cooking oil by biofuels producers, boosting demand for domestically produced soyoil. Precious metals were still down, with gold prices at a three-week low on Wednesday, while copper lost nearly 4% and is set to post its biggest intraday loss in five months. For other metals, zinc became the worst performer of the base metals complex. The galvanising metal prices declined as China's steel industries could face headwinds as Trump pledged to boost local U.S. manufacturing. The copper market is pricing in the long-term direction of Trump's policies, a trader said. Trump said he would "rescind all unspent funds" under the Inflation Reduction Act (IRA), the Biden-Harris administration's signature climate law to decouple the global supply chain from China, which includes hundreds of billions of dollars in subsidies for electric vehicles, solar and wind energy, and increasing production of strategic minerals. "Gold will be torn between the risk of rising inflation, potentially slowing the pace of U.S. rate cuts, as tariffs are rolled out and continued demand for safe haven assets," Ole Hansen, head of commodity strategy at Saxo Bank, said. Commodity prices started to fall overnight as traders started to price in the likelihood of a Trump win. "This scenario is expected to bring about the promised tariffs on imported goods, particularly targeting China, potentially triggering a new wave of trade tensions and economic disruptions," Hansen added. Sign up here. https://www.reuters.com/markets/commodities/commodities-under-pressure-likely-trump-win-us-presidential-race-2024-11-06/