2024-10-29 11:14

Oct 29 (Reuters) - Phillips 66 (PSX.N) , opens new tab beat quarterly profit estimates on Tuesday as strength in its chemicals and midstream segments helped the refiner more than offset a slump in refining margins from lackluster fuel demand. The company, which owns nearly 72,000 miles of U.S. pipeline systems, has moved more fuel this year than before through its pipelines as it expands its natural gas liquids market share. Volumes of the super-chilled fuel that moved through its pipelines rose to 2.79 million barrels per day in the first nine months of 2024, compared to 2.70 million bpd in 2023. The company said its third-quarter adjusted profit rose 15.6% from a year earlier. Its chemicals segment reported an adjusted profit of $342 million, up from $104 million a year earlier. However, its refining segment was hit by a drop in realized margins driven by lower crack spreads. Margins fell to $8.31 per barrel in the quarter from $19.06 a barrel. U.S. refinery margins, measured by the 3-2-1 crack spread , dipped to $14.28 in mid-September, the lowest since early 2021. Globally, refiners have seen a drop in profitability on soft consumer and industrial demand, especially in China, because of slowing economic growth and rising penetration of electric vehicles. British energy giant BP (BP.L) , opens new tab earlier today reported a fall in third-quarter profit on weaker refining margins. Rival Valero (VLO.N) , opens new tab last week also reported a fall in third-quarter profit, but managed to beat earnings estimates. Phillips 66's third-quarter adjusted profit came in at $2.04 per share, well above analysts' average estimate of $1.66, according to data compiled by LSEG. It also managed to return $1.3 billion to shareholders through dividends and share repurchases in the quarter. Sign up here. https://www.reuters.com/business/energy/refiner-phillips-66-reports-lower-third-quarter-profit-weak-fuel-demand-2024-10-29/

2024-10-29 11:07

MUMBAI, Oct 29 (Reuters) - The total quantum of gold being held by India's central bank in its foreign exchange reserves rose by the end of September, while the proportion of the yellow metal held domestically also jumped sharply, according to a half-year forex reserves management report on Tuesday. As of end-September, the Reserve Bank of India (RBI) held 854.73 metric tonnes of gold, compared to 822.10 metric tonnes at the end of March. The proportion of gold held domestically rose to 510.46 metric tonnes as of Sept. 30, against 408.31 metric tonnes at the end of the previous quarter, the RBI said. "In value terms (USD), the share of gold in the total foreign exchange reserves increased from 8.15% as at end-March 2024 to about 9.32% as at end-September 2024," the report said. Sign up here. https://www.reuters.com/world/india/indian-cenbanks-domestically-held-gold-reserves-jump-by-end-sept-report-shows-2024-10-29/

2024-10-29 10:26

A look at the day ahead in U.S. and global markets from Mike Dolan Even as public borrowing estimates were shaved on Monday, U.S. Treasury yields continue to probe three-month highs as markets lean toward a win for Donald Trump in next week's election and a possible clean sweep in Congress for his Republican party. In an event-packed fortnight that sees the first of this week's five U.S. megacap earnings later on Tuesday alongside critical job openings data, Wall Street stock indexes (.SPX) , opens new tab, (.IXIC) , opens new tab remain buoyant near record highs. But it's Treasuries that are bearing the brunt of election anxiety, with many prediction models now suggesting a better than even chance that Trump will win the White House and Republicans take both House and Senate majorities on Nov. 5. The Treasury said on Monday it plans to borrow $546 billion in the fourth quarter, $19 billion lower than the July estimate, but bond markets remain agitated by Trump's extensive tax cut pledges with the government's budget deficit already running at a whopping 6.4% of national output. After edgy auctions of two- and five-year notes on Monday, benchmark 10-year Treasury yields have topped 4.3% for first time since July and Treasury volatility gauges (.MOVE) , opens new tab have hit their highest in over a year. While the move comes as Federal Reserve easing expectations for the coming year have been scaled back to as little as 130 basis points, election bets elsewhere also appeared to price a growing chance of a Trump return to the White House. Opinion polls show the race is too close to call, but shares in Trump Media & Technology (DJT.O) , opens new tab have more than trebled in the past month and Bitcoin hit its highest in almost five months on Tuesday too. With swingeing trade tariffs another marquee policy promise from Trump, China's yuan hit its weakest in more than two months. Mainland Chinese shares (.CSI300) , opens new tab closed lower again. Investor attention is on a Chinese leadership meeting on Nov. 4-8. Reuters sources said China is considering approving the issuance of over 10 trillion yuan ($1.4 trillion) in extra debt in the next few years to bolster the economy, but it could be higher in the event of Trump Presidency. Despite another set of jarring house price data in Hong Kong that underscored the country's ongoing property bust, the Hang Seng (.HSI) , opens new tab closed higher as HSBC HSBA.L beat third quarter profit expectations and its shares gained almost 3% to six-year highs - helped by a fresh $3 billion stock buyback. In Japan, the political stalemate after weekend elections there saw the yen languishing near three-month lows through 153 per dollar amid doubts about whether a new coalition would support further monetary tightening by the Bank of Japan. Yuichiro Tamaki, head of the opposition Democratic Party for the People and possible 'kingmaker' in a new government, said the BOJ should avoid overhauling its ultra-loose monetary policy for now and focus on whether real wages turn positive. The dollar (.DXY) , opens new tab was steady more broadly, with the euro marginally firmer ahead of key euro zone GDP and inflation numbers later in the week. European shares (.STOXXE) , opens new tab were higher, with Britain's FTSE100 (.FTSE) , opens new tab outperforming slightly on HSBC's results and ahead of the pivotal UK budget statement on Wednesday. The pound too held the line. Back on Wall Street, Alphabet's (GOOGL.O) , opens new tab earnings after the bell on Tuesday are the first of five 'Magnificent Seven' stocks reporting this week and will set the tone for digital and tech giants that dominate the S&P500 (.SPX) , opens new tab. Its stock was a tad higher in Frankfurt on Tuesday. U.S. stock futures were a touch higher ahead of today's open. The VIX (.VIX) , opens new tab stock volatility index hovered just below 20. Boeing's (BA.N) , opens new tab shares dipped 2.8% on Monday after the planemaker launched a stock offering that could raise up to $22 billion in a bid to shore up its finances amid an ongoing worker strike. Other stocks of note reporting today are Advanced Micro Devices, First Solar, Pfizer and MacDonalds. Crude oil prices nursed Monday's heavy losses on easing Middle East tensions and skulked below $68 per barrel. Key developments that should provide more direction to U.S. markets later on Tuesday: * US September job openings, international trade balance, retail/wholesale inventories, August house prices, Dallas Federal Reserve's October service sector survey; Brazil Sept current account * US corporate earnings: Alphabet, Advanced Micro Devices, McDonald's, Pfizer, PayPal, Corning, First Solar, Visa, MSCI, Sysco, DR Horton, Edison, Chubb, Caesars Entertainment, EQT, Stanley Black & Decker, Ecolab, American Tower, Masco, Incyte, FirstEnergy, Zebra Technologies, Royal Caribbean Cruises, IDEX, FMC, Mondelez, Stryker, DaVita, Essex Property etc * Bank of Canada Governor Tiff Macklem speaks * US Treasury sells $44 billion of 7-year notes and also sells 2-year floating rate notes; sells $48 billion of 12-month bills Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2024-10-29/

2024-10-29 09:45

LONDON, Oct 29 (Reuters) - British lenders approved 65,647 mortgages in September, the Bank of England said on Tuesday, the highest number since August 2022, shortly before the country was hit by the "mini-budget" bond market crisis under former Prime Minister Liz Truss. The figure was slightly higher than the median forecast of 65,000 in a Reuters poll of economists. Britain's housing market gathered momentum after the BoE cut interest rates in August for the first time since 2020. Earlier this month, the Royal Institution of Chartered Surveyors said house prices, sales and enquiries all rose in September. The BoE data also showed a dip in net borrowing by consumers during September which edged down to 1.23 billion pounds ($1.60 billion) from 1.35 billion pounds in August. That helped to lower the annual growth rate for all consumer credit to 7.5% in September, down from 7.7% in August and the slowest increase in more than a year. Some measures of consumer confidence have fallen in the run-up to this week's first budget of Britain's new government which is likely to include tax increases. Prime Minister Keir Starmer has warned of tough measures to repair the public finances although he has also said the brunt of the measures will fall on those "with the broadest shoulders." ($1 = 0.7702 pounds) Sign up here. https://www.reuters.com/world/uk/uk-mortgage-approvals-hit-highest-since-before-2022-mini-budget-2024-10-29/

2024-10-29 09:01

TOKYO, Oct 29 (Reuters) - The Japanese government stuck to its assessment that the economy is recovering moderately, although it reiterated the need to pay close attention to potential global economic risks and financial market volatility. "The economy is expected to continue recovering at a moderate pace with the improving employment and income situation," the Cabinet Office said in its monthly report for October, keeping the assessment unchanged for a third straight month. The report was released after Sunday's general election in which Japan's ruling bloc led by the Liberal Democratic Party lost its majority, complicating the outlook for interest rates and fiscal policy. The monthly report identified higher interest rates in the U.S. and Europe, and stagnation in Chinese real estate market as downside risks for the Japanese economy. The fallout from conflicts in the Middle East and Japan's inflation should also be watched, it said. The government largely kept its view on other sub-sectors of the economy unchanged, except for industrial production, which it downgraded to describe as "flat recently" from "shows movements of picking up." It was the first downward revision in industrial production in eight months, and the report said the sector was expected to recover even though the impact from the risks of an economic downturn overseas needed to be monitored. Private consumption, which accounts for more than half of economic output, continued to show signs of picking up, as demand for new vehicles and house appliances is improving, the government said. Business investment is also picking up, and firms' assessment on the current business conditions is improving. The report was presented on Tuesday at a meeting of relevant cabinet ministers and Bank of Japan (BOJ) Governor Kazuo Ueda. The BOJ's closely watched "tankan" survey showed earlier this month that Japanese business sentiment was steady in the three months to September, while companies remained cautious about the outlook with service-sector firms projecting business conditions to sour over the next three months. The BOJ will hold a two-day policy-setting meeting this week, ending on Thursday. A slim majority of economists in a Reuters poll expect the central bank to stick to its current monetary policy and forgo raising interest rates again this year. Sign up here. https://www.reuters.com/markets/asia/japan-continues-see-moderate-economic-recovery-cuts-factory-output-view-2024-10-29/

2024-10-29 08:23

Sterling holds steady ahead of budget Budget due Wednesday; fund managers sanguine for now Options market shows demand for near-term hedges LONDON, Oct 29 (Reuters) - The pound held steady on Tuesday, while sterling options rose to their highest since the start of the month, reflecting a modest degree of nervousness among traders a day before UK finance minister Rachel Reeves presents the new budget. Overnight implied options volatility, a measure of demand for protection against very near-term price swings, rose to its highest for sterling since Oct. 9, at 8.63% , while for euro/sterling options, it touched its highest since Sept. 19, at 5.33% The pound itself was last unchanged on the day at $1.297, on course for its first monthly loss since September 2023, down around 3%. Reeves will deliver the new Labour government's first budget in 14 years on Wednesday, two years after then-Prime Minister Liz Truss' tax-cutting plans sparked a crisis in the bond market. She plans around 40 billion pounds ($52 billion) worth of fiscal measures, according to government sources, mostly from tax increases plus cuts to some public services, to meet her pledge to cover day-to-day spending without borrowing. ING strategist Francesco Pesole said there was no political risk premium priced into the pound right now, while speculators are sitting on a fairly substantial bullish position in sterling futures, which could quickly get unwound if there is any disappointment stemming from the budget. "Sterling continues to look vulnerable ahead of tomorrow’s budget event and next week’s U.S. election, and risks remain skewed to a move to $1.2800-1.2850," he said. In the run-up to Truss' then-finance minister presenting the budget in 2022, overnight implied options volatility for sterling hit nearly 30%. Meanwhile, global asset managers are also relatively sanguine towards UK governments bonds - one of the biggest casualties of the Truss "mini budget" in September 2022. Modest, but steady economic growth, along with a continued decline in UK inflation have reaped only one rate cut so far from the Bank of England this year. Markets are priced for at least one more before the end of this year, but the BoE is expected to be one of the slower major central banks when it comes to lowering borrowing costs, meaning the pound has enjoyed a degree of support this year. Sterling is still the best-performing major currency against the dollar in 2024, with a near 2% gain, compared with runner-up, the Chinese yuan , which in the offshore market, is down 0.5% against the U.S. currency. With the U.S. presidential election just a week away, and the outcome too close to call, analysts have said many investors are unwilling to lay on large new trades. Sign up here. https://www.reuters.com/markets/currencies/sterling-steady-ahead-uk-budget-set-first-monthly-fall-since-sept-2023-2024-10-29/