2024-10-23 05:42

MUMBAI, Oct 23 (Reuters) - The Indian rupee held its ground on Wednesday, supported by mild dollar sales by state-run banks that also blunted the impact of rising U.S. bond yields, which dragged the local currency's regional peers lower. The rupee was at 84.0725 against the U.S. dollar as of 11:00 a.m. IST, compared with its close at 84.0775 in the previous session. Asian currencies were down between 0.1% and 0.4% on the day, after the 10-year U.S. Treasury yield rose to a three-month high of 4.23% in Asia trading, boosted by heightened odds of a victory for Donald Trump in the upcoming U.S. elections. The rise in U.S. bond yields also boosted the dollar, which was last at 104.15, close to its highest level since early August. "The risks remain skewed towards a stronger dollar and weaker risk-sensitive currencies as Trump hedges grow into the vote," ING Bank said in a note. The rupee had weakened to its record low of 84.0825 on Tuesday, pressured by outflows from local stocks. Intervention by the Reserve Bank of India (RBI), via state-run banks, helped limit losses. Goldman Sachs on Tuesday lowered Indian equities to "neutral" from "overweight", citing the country's slowing economic growth, which would weigh on corporate earnings amid record foreign outflows from local equities. Foreign investors have net sold over $8.5 billion of local stocks in October so far. The rupee's losses, however, have been limited by routine interventions by the RBI. On Wednesday, state-run banks "were mildly on offer (on USD/INR), which should limit upside," a trader at a state-run bank said. Investors now await remarks from a Federal Reserve policymaker later in the day, alongside the release of the Fed's 'Beige Book', a summary of current U.S. economic conditions, for cues on the future path of policy rates. Sign up here. https://www.reuters.com/markets/currencies/rupee-flat-wedged-between-higher-us-yields-state-run-banks-dollar-offers-2024-10-23/

2024-10-23 05:34

SINGAPORE, Oct 23 (Reuters) - Singapore LNG Corporation (SLNG) has agreed to charter from a unit of Japan's Mitsui O.S.K. Lines (MOL) (9104.T) , opens new tab a newly built floating storage and regasification unit (FSRU) as the island nation's second import terminal for liquefied natural gas (LNG). SLNG, which operates Singapore's sole LNG terminal, said on Wednesday that the new terminal, or FSRU, was expected to start operations by the end of the decade. It will be built by South Korean shipbuilder Hanwha Ocean and have a storage capacity of 200,000 cubic meters and a regasification capacity of 5 million tons per annum (mtpa), SLNG said. MOL said in a separate statement that it would own, manage and operate the FSRU after delivery, which is scheduled for 2027. Singapore's current terminal on Jurong Island has an annualised average gas supply capacity of 9 mtpa, with a peak capacity of around 11 mtpa. The second terminal will be berthed at Jurong Port and infrastructure will be developed to connect the FSRU to onshore pipelines and Singapore's gas pipeline network, SLNG said. SLNG had said in October last year that it would develop and operate Singapore's second LNG import terminal to better enable the country's natural gas demand to be met entirely by LNG. Sign up here. https://www.reuters.com/business/energy/singapore-lng-signs-deal-with-japans-mitsui-osk-lines-second-lng-terminal-2024-10-23/

2024-10-23 05:28

Oct 23 (Reuters) - Swiss chemicals firm Ems Chemie (EMSN.S) , opens new tab said on Wednesday its nine-month sales fell due to weak demand in its main markets Europe and China, and a strong Swiss franc, which appreciated as a safe haven currency. The company maintained its full-year guidance although it expects the weak market environment to persist in the fourth quarter. WHY IT'S IMPORTANT Ems Chemie generates about half of its sales in the automotive market and is a supplier of the world's largest EV maker, China's BYD. The company makes lightweight polymer car parts, which are especially useful in electric vehicles, which typically weigh more due to heavy batteries. CONTEXT European automakers are hit with a sway of problems ranging from high production costs and tepid demand at home to challenges presented by vehicle electrification and competition from China, where consumers cut on spending due to a weaker economy. Ems Chemie makes most of its sales in Germany and China KEY QUOTES "In China, the recently announced economic stimulus package will probably only have a positive effect and boost confidence in the medium term," the company said in a statement. "In Europe, no signs of structural political improvements or confidence are noticeable". "In the USA general disillusion may follow the presidential elections". BY THE NUMBERS Sales fell by 6.3% to 1.59 billion Swiss francs ($1.83 billion) in January-September, a tad below LSEG's consensus of 1.60 billion Swiss francs. ($1 = 0.8669 Swiss francs) Sign up here. https://www.reuters.com/markets/commodities/swiss-ems-chemie-9m-sales-down-weak-demand-europe-china-2024-10-23/

2024-10-23 05:23

Natural gas trucks may displace 380,000 bpd of diesel globally in 2025 Chinese LNG-fuelled truck sales doubled in H1 2024 vs. 2023 LNG truck cost over diesel can be recouped in China in 190 days Costs over diesel in India can be recouped in 1-1/2 years BEIJING/NEW DELHI, Oct 23 (Reuters) - Trucking fleets in China are embracing cleaner-burning liquefied natural gas (LNG) for fuel, a trend neighbouring India wants to emulate, accelerating a decline in diesel demand and rattling suppliers to the world's biggest oil importer. The rise of LNG trucks in China comes on top of world-leading electric vehicle (EV) adoption there and a prolonged economic slowdown, dampening demand in what for decades has been the main driver in oil consumption growth, with crude imports down 2.8% so far this year, weakening global prices. In September, the Organization of Petroleum Exporting Countries (OPEC) warned that LNG truck penetration will weigh on China's future fuel demand. Sales of LNG-fuelled trucks in China surged in the first half of 2024 after a plunge in local LNG prices to 108,862 vehicles, more than double the same period in 2023, according to information provider CVWorld, with government subsidies and tighter emissions standards in recent years paving the way. With only 645 LNG-powered trucks operating in India according to transport ministry data, its rollout is at an earlier stage, but the government said in September it aims to convert about one-third of its heavy truck fleet of over 7 million vehicles in five to seven years, a target experts call ambitious. That could also weaken crude demand growth in India, which analysts expect to become the top consumption driver as Chinese demand stabilises. "India will not have the same penetration rates as China but improved infrastructure has reduced inefficiencies already, and Indian diesel demand growth may have peaked as a result," said Amrita Sen, founder of research consultancy Energy Aspects. "Given China and India have been the key diesel demand growth centres, the weakness in both augurs poorly for diesel cracks," she said, referring to the profit margin from refining diesel. The Chinese and Indian governments are providing policy support for LNG trucks to reduce pollution, but companies are attracted by cost savings. LNG trucks become economical in China and India when LNG is at least 20% cheaper than diesel, industry experts said. A new LNG truck is 40% more expensive than the diesel variety in India, according to global consultants ICF. In China, LNG trucks are around 18% more expensive, said Horizon Insights, a Chinese research provider. But with the fuel savings, companies can make back the higher up-front costs. Horizon Insights said in June that the extra cost of buying an LNG truck over a diesel vehicle could be recouped in 190 days based on prices at the time. In India, the higher costs can be recouped in 1-1/2 years based on mileage of 80,000 km (49,700 miles) per year, said Gurpreet Singh, a managing director at ICF. STATION EXPANSION NEEDED Mumbai-based GreenLine Mobility Solutions Ltd runs around 500 LNG-powered trucks and has ordered over 2,000 more, said Kaizad Palia, its chief operating officer, adding that the only downside is a lack of fuelling stations outside of western India. "Where there is no network as of now, we are unable to pitch in. We will expand our operations with the expansion of fuel stations in the country," he said. In China, LNG trucks have been especially popular in the north, near its gas fields, accounting for over half of new truck sales there last year, according to Energy Aspects. They have been less cost effective in the south, where LNG prices can be double levels in the north, said energy consultants FGE. Globally, Wood Mackenzie expects natural gas vehicles used in road freight to displace around 360,000 barrels per day (bpd) of diesel usage in 2024 and 380,000 bpd in 2025. Maintaining LNG truck momentum depends heavily on fuel prices. The IEA has said an "unprecedented surge" in LNG projects coming online from next year will pressure prices lower. But rising local LNG prices and lower diesel prices in August ended a 20-month streak of year-on-year increases in LNG truck sales in China, according to Energy Aspects, highlighting the price-sensitivity of demand for the vehicles. Over the longer term, LNG-powered trucks may be displaced by electric trucks, especially in top EV market China, as battery technology improves and when battery swapping infrastructure is built. However, India is supporting policies for more LNG trucking, aiming to have 66 LNG stations in a year, compared with 20 now, said a government official aware of the plan, asking to remain unidentified as they are not authorized to speak to the media. Government think tank NITI Aayog in January recommended lower taxes and the abolition of tolls for LNG trucks and backed incentives for truck manufacturers. New Delhi may also provide incentives on truck purchases and set up a fund to subsidise LNG for the transport sector so it is up to 20% cheaper than diesel, the government official said. Blue Energy Motors, in the western Indian city of Pune, launched an LNG truck in 2022 through a tie-up with Italy's Iveco Group (IVG.MI) , opens new tab and has sold 600 of them, CEO Anirudh Bhuwalka said. It hopes to sell 1,000 LNG trucks this fiscal year and 3,000 next year, and recently won a 130-truck tender from Container Corp of India. Sign up here. https://www.reuters.com/business/energy/lng-fuelled-trucking-accelerates-asia-denting-diesel-demand-2024-10-23/

2024-10-23 04:45

A look at the day ahead in European and global markets from Ankur Banerjee The rising odds of a Trump presidency in a still-too-tight-to-call U.S. election and shifting expectations of the Federal Reserve being less aggressive in its easing has left investors nervous, leading to safe assets dollar and gold soaring. The European markets on Wednesday will wake up to gold setting yet another record, Treasury yields at a three-month top and the greenback at its highest since Aug. 2, pushing yen to near 152 per dollar. Whisper it quietly but while intervention chatter is not fully back yet, verbal jawboning from Japanese officials could start ramping up soon. The yen's rapid weakening from around 140 per dollar in just over a month has come as Treasury yields steadily climbed back above 4% after a slew of strong U.S. economic data led traders to temper their wagers of swift and deep Fed interest rate cuts. Markets are currently pricing in 41 basis points of cuts for the year, meaning traders are having to guess whether the Fed will deliver consecutive 25 bps cuts in November and December. The Fed started its easing cycle with a cut of 50 bps in September. With less than two weeks to go for the U.S. presidential election, investors are also increasingly positioning ahead of the Nov. 5 polling day. While markets are reacting to rising odds of Republican candidate Donald Trump beating Vice President Kamala Harris, the Democratic candidate, according to betting websites, opinion polls show the race to the White House remains too tight to call. In a new Reuters/Ipsos poll, Harris held a marginal 46% to 43% lead over Trump. Expect markets to be volatile in the run up, investors said. For now, markets are choosing to believe a Trump presidency is on the way, boosting the dollar and Treasury yields as Trump's policies including tariffs and restrictions on undocumented immigration are likely to fan inflation, keeping interest rates higher for longer. Meanwhile, it was a tale of contrasting fortune for newly minted stocks from two of the biggest initial public offerings in the region this year. Tokyo Metro's (9023.T) , opens new tab shares soared 44% in their market debut on Wednesday after Japan's largest IPO in six years bagged the firm $2.3 billion. Hyundai Motor India (HYUN.NS) , opens new tab shares, on the other hand, slid 7% on their market debut on Tuesday after retail investors gave a lukewarm reception to India's biggest-ever IPO. And we end with some corporate earnings, where French cosmetics giant L'Oreal's (OREP.PA) , opens new tab third-quarter sales missed expectations after low consumer confidence in China sapped demand for beauty products. Also keep an eye on fast food and consumer stocks across Europe and U.S. after one person died and dozens fell ill from E. coli infections in the U.S. linked to hamburgers from McDonald's (MCD.N) , opens new tab. Key developments that could influence markets on Wednesday: Earnings: Akzo Nobel, Volvo Car, Swedbank, Heineken, Reckitt Benckiser, Lloyds Banking Sign up here. https://www.reuters.com/markets/europe/global-markets-view-europe-2024-10-23/

2024-10-23 03:04

MUMBAI, Oct 23 (Reuters) - The Indian rupee is likely to hold near lifetime low on Wednesday after U.S. Treasury yields climbed to a three-month high with eyes on the presidential election, helping the dollar extend its rally. The 1-month non-deliverable forward indicated that the rupee will open at 84.0750-84.0850 to the U.S. dollar compared with 84.0775 in the previous session and the all-time low of 84.0825 hit on Tuesday. The run-up in the dollar and U.S. yields, and the selloff in Indian equities amid foreign outflows have recently been weighing on the rupee. The Reserve Bank of India has helped the currency weather the challenges, and the rupee's drop has been measured. "RBI remains the key factor here, and one can expect that even if the rupee depreciates from here, the quantum will be moderate and the broader theme of stability will be maintained by the RBI," said Srinivas Puni, managing director at forex advisory firm QuantArt Market Solutions. The dollar index topped 104 on Tuesday to reach the highest in two-and-a-half months, boosted by the rally in U.S. rates. The 10-year U.S. Treasury yield hit a three-month high. The resilient U.S. economy, the possibility of stickier inflation and the prospects of Donald Trump winning the U.S. elections have prompted investors to demand higher yields. The 10-year U.S. yield is now up 60 basis points from the low hit mid of last month. Alongside the rise in U.S. rates, investors have moderated their expectations on Federal Reserve rate cuts. The U.S. central bank repeating a 50 bps rate cut at their next meeting is completely off the table. It is highly likely that the Fed will decide on a smaller 25 bps rate cut with a small possibility of no cut at all. KEY INDICATORS: ** One-month non-deliverable rupee forward at 84.20; onshore one-month forward premium at 11 paise ** Dollar index up at 104.12 ** Brent crude futures down 0.2% at $75.9 per barrel ** Ten-year U.S. note yield at 4.23% ** As per NSDL data, foreign investors bought a net $1,273.8mln worth of Indian shares on Oct. 21 ** NSDL data shows foreign investors sold a net $34.1mln worth of Indian bonds on Oct. 21 Sign up here. https://www.reuters.com/markets/currencies/rupee-hold-near-all-time-low-higher-us-yields-upbeat-dollar-2024-10-23/