2024-10-22 10:27

SINGAPORE, Oct 22 (Reuters) - Thailand is yet to finalise terms of an extension to a multilateral deal with Singapore to import hydropower from Laos through Malaysia and Thailand, a senior Thai government official told Reuters on Tuesday. Singapore's Energy Markets Authority (EMA) said last month it would double the capacity of electricity traded as a part of the second phase of the Lao PDR-Thailand-Malaysia-Singapore Power Integration Project (LTMS) through additional supply from Malaysia. "Singapore have agreement with Malaysia, but for Thailand ... we're still in discussion within our country with the agencies," Sompop Pattanariyankool, Thailand's deputy permanent energy secretary said on the sidelines of the Singapore International Energy Week conference. Pattanariyankool did not give specifics, and said the "whole thing is in the process of discussion." Singapore's EMA did not immediately respond to a request seeking comment. Grid interconnection is widely seen as a key solution to cut southeast Asia's growing reliance on fossil fuels for power generation, and EMA called the first-of-its-kind multilateral deal in the region "historic" when it was signed in 2022. Reuters reported in July that Singapore had yet to sign a renewal deal with Thailand and Malaysia due to disagreement over the quantity of power to be purchased, as both countries were asking Singapore to guarantee the purchase of a fixed amount of electricity to cover transmission costs. Since then, Malaysia has agreed to directly supply power to Singapore through the LTMS corridor. The chief executive of Malaysia's national utility confirmed on Tuesday that it had started exporting power to Singapore. "(As a) part of the LTMS, we have the MS version of it, which is Malaysia, Singapore, and this is where the nations do business-to-business collaboration," Jalaluddin Bin Megat Hassan, president and chief executive officer of Tenaga Nasional, said on the sidelines of the same event. "Happy to share that it started last month." However, it was not clear how much power will be exported from Laos via Thailand as a part of the second phase of the LTMS project as Thailand has yet to agree with the terms. Singapore utilised nearly 40% of its contracted capacity during the first nine months after the first phase of the LTMS became operational in July 2022, according to data from energy think-tank Ember. But as global natural gas prices plunged from record highs, power imports from Laos fell to nearly zero in the fifteen months that followed, Ember data showed. Sign up here. https://www.reuters.com/markets/deals/thailand-yet-finalise-terms-multilateral-clean-power-deal-with-singapore-2024-10-22/

2024-10-22 10:26

Oct 22 (Reuters) - Indian chemicals and polymers maker SRF (SRFL.NS) , opens new tab posted a steeper-than-expected drop in its second-quarter profit on Tuesday, hurt by sustained weak demand in its mainstay chemicals business and higher costs. SRF reported a consolidated net profit after tax of 2.01 billion rupees ($23.9 million) for the quarter ended Sept. 30, down 33% from last year, in its seventh straight quarterly profit drop. Analysts were expecting a profit of 2.93 billion rupees, according to data compiled by LSEG. The company's chemical business unit, which consists of specialty chemicals, fluorochemicals, and agrochemicals among others, contributes nearly 40% to its revenue and fell 5% in the quarter. Total revenue grew 7.8% to 34.24 billion rupees, while total expenses jumped 13.7%, led by an increase in the cost of raw materials. For further earnings highlights, click KEY CONTEXT The chemicals industry has been grappling with high inventory and destocking for the past few quarters, putting continuous pressure on their margins, according to analysts. Jefferies analysts in a pre-earnings note called Q2 a "challenging quarter" for Indian chemical firms, saying crop protection demand remained weak in the quarter due to continuous destocking in Asia, the EMEA region, and parts of Latin America. Refrigerant gas prices remained weak as export prices of hydrofluorocarbon (HFCs) from India were down 35% year-over-year in July, the brokerage added, citing trade data. SRF's fluorochemicals business, which is part of the chemical business unit, includes refrigerants, and industrial chemicals. PEER COMPARISON * The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell ** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT JULY-SEPTEMBER STOCK PERFORMANCE -- All data from LSEG IBES -- $1 = 84.0480 Indian rupees Sign up here. https://www.reuters.com/markets/commodities/indian-chemicals-maker-srf-misses-q2-profit-view-weak-demand-higher-costs-2024-10-22/

2024-10-22 10:13

MUMBAI, Oct 22 (Reuters) - The Indian rupee slipped to an all-time low on Tuesday, pressured by weakness in its regional peers and likely outflows from local equities, although the Reserve Bank of India's intervention helped curb sharp declines, traders said. The rupee closed marginally weaker at 84.0775 against the U.S. dollar, its weakest closing level on record, after touching its all-time low of 84.0825 earlier in the session. Asian currencies fell between 0.1% and 0.4%, while the dollar index was at 103.9, hovering close to its highest level in two months. Expectations of a less dovish U.S. rate cut cycle and the rising odds of a second presidential term for Donald Trump have boosted the dollar and U.S. bond yields in recent sessions. The 10-year U.S. Treasury yield rose to a near-three-month-high on Tuesday and was at 4.20%, while the dollar index has risen more than 3% this month. "We suspect we are seeing more signs of some deleveraging ahead of the closely contested U.S. election in two weeks -- a dynamic that we see supporting the dollar across the board," ING Bank said in a note. Besides that, dollar demand from foreign banks, likely related to outflows from the domestic equity market, also weighed on the rupee, traders said. Foreign investors have sold nearly $10 billion, on a net basis, of local stocks so far in October, on course for a record monthly outflow. The benchmark BSE Sensex (.BSESN) , opens new tab and Nifty 50 (.NSEI) , opens new tab indexes were down more than 1% each on the day. Despite these pressures, the rupee has outperformed its regional peers this month as the central bank's routine interventions have helped the currency stave off sharp declines. On Tuesday too, state-run banks were spotted offering dollars, most likely on behalf of the RBI, traders said. Sign up here. https://www.reuters.com/markets/currencies/rupee-slips-all-time-low-weak-asia-fx-likely-equity-outflows-2024-10-22/

2024-10-22 10:08

A look at the day ahead in U.S. and global markets from Mike Dolan U.S. Treasuries are starting to balk at post-election fiscal prospects and the resulting spike in benchmark borrowing rates has knocked stock markets off their perch and lifted the dollar to its best level since early August. Ten-year Treasury yields zoomed higher again on Tuesday, topping 4.2% for the first time in three months. On one level, there's been some further dialling back of Federal Reserve easing expectations - with an implied 'terminal rate' for the whole Fed easing cycle backing up close to 3.5% next year and less than 150 basis points from the current policy rate. The robust performance of the economy is mainly responsible for that, as is the steady stream of Fed officials speaking of only 'modest' rate cuts ahead. Trepidation about market-based long-term inflation expectations , troughing as high as 2.3%-2.5% is also starting to shift the horizon somewhat. But investors are mostly focussed now on next month's election and the absence of any plan from either party to rein in budget deficits already well north of 6% of GDP. What's more, betting markets now lean toward the candidate - Donald Trump - most likely to aggravate that fiscal position and bookmaker bets on a Republican clean sweep of Congress are rising too. Reflecting some of those concerns, the New York Fed's estimate of the 10-year Treasury 'term premium' - a key measure of the compensation investors demand to hold long-term government debt securities - has risen to its highest level of the year, at more than 14 bps. It's been negative for most of the year. BlackRock boss Larry Fink repeated his warnings about the deficit situation at an event on Monday, saying rising government debt was a 'big problem' and both parties were guilty for the widening deficits. The back-up in Treasury yields this week has lifted the dollar index (.DXY) , opens new tab to its best levels since August 2, with currency markets also parsing the implications of Trump's sweeping trade tariff plans. Goldman Sachs said on Tuesday the euro could fall as much as 10% - implying a drop below $1.0 from current levels - in a scenario in which Trump imposes widespread tariffs and cuts domestic taxes if he returns to the White House. A 10% global tariff and 20% levy on Chinese imports, combined with the stimulus of domestic tax cuts, could cause the dollar to rally sharply and the euro to drop 8% to 10%, Goldman's Michael Cahill told clients. Although the euro regained some footing, the dollar continued to push higher above 150 yen as Japan's weekend election is eyed by markets. The Canadian dollar was also on the back foot ahead of a possible jumbo 50bp rate cut from the Bank of Canada on Wednesday. With election and debt worries, geopolitical angst and longer-term inflation questions as a spur, gold continued to probe higher - though remained just shy of intraday records set at $2740 on Monday. The bond market rumbling has been enough to knock Wall Street stocks (.SPX) , opens new tab back from new records, although the tech-heavy Nasdaq outperformed and made some gains ahead of megacap corporate earnings later this month. Futures were mostly in the red ahead of Tuesday's open, however. Much of the macro world will be focussed on the International Monetary Fund's annual meeting in Washington, with the IMF's latest World Economic Outlook due for release later and multiple top central bank officials speaking around the event. Overseas, Japan's Nikkei (.N225) , opens new tab ended down more than 1% despite the weaker yen, and Chinese stocks (.CSI300) , opens new tab, (.HSI) , opens new tab were mostly flat. Europe (.STOXXE) , opens new tab was lower too. In corporate developments, there was good news in the tech sector from SAP SAPG.DE, whose shares rose 5% after the German software company raised full-year targets on strong cloud business. And HSBC Holdings (HSBA.L) , opens new tab said on Tuesday it would combine some of its commercial and investment banking operations in a major overhaul under new CEO Georges Elhedery. A new leadership structure, which includes the appointment of Pam Kaur as the lender's first female chief financial officer, will carve up its operations into four business lines - Britain, Hong Kong, corporate and institutional banking, and wealth banking. Key developments that should provide more direction to U.S. markets later on Tuesday: * US corporate earnings: Texas Instruments, General Motors, General Electric, Verizon, Baker Hughes, Enphase Energy, Packaging Corp of America, Invesco, CoStar, Seagate Technology, Paccar, Fiserv, 3M, Moody's, Quest Diagnostics, Pentair, Pultegroup, Sherwin Williams, Danaher, Freeport-McMoRan, Interpublic, Norfolk Southern, RTX, Genuine Parts, AO Smith * International Monetary Funds releases World Economic Outlook at IMF-World Bank Annual Meetings in Washington; European Central Bank President Christine Lagarde, ECB chief economist Philip Lane and Bank of Portugal governor Mario Centeno all speak; Bank of England Governor Andrew Bailey, deputy governor Sarah Breedon and BoE policymaker Megan Greene all speak * Richmond Federal Reserve's October business surveys; Canada September producer prices * Philadelphia Federal Reserve President Patrick Harker speaks Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2024-10-22/

2024-10-22 09:11

LONDON, Oct 22 (Reuters) - Goldman Sachs said on Tuesday the euro could fall as much as 10% - implying a drop below $1 from current levels - in a scenario in which Donald Trump imposes widespread tariffs and cuts domestic taxes if he wins the Nov. 5 U.S. presidential election. Republican former President Trump is currently neck and neck with Democratic Vice President Kamala Harris, but Trump's radical economic policies would likely have the bigger impact on Europe, a key trading partner of both the United States and China. Goldman said a scenario in which Republicans win the presidency and Congress could lead to higher tariffs and domestic tax cuts that would act as stimulus for the economy. A 10% U.S. tariff on all imports and a 20% levy on Chinese products, combined with tax cuts, could cause the dollar to rally sharply and the euro to drop 8% to 10%, Goldman Sachs analyst Michael Cahill said in a note on Tuesday. The euro last traded at $1.083 . It last traded below parity in November 2022. Both measures would likely push up inflation, implying significantly higher interest rates in the U.S. than Europe that would boost the dollar's appeal. "We expect the strongest dollar response to come from a Republican sweep, which would open the door to larger tariff increases in combination with domestic tax cuts," Cahill wrote A narrower trade war, in which Trump only imposes further tariffs on China, could see the euro fall by around 3%, Cahill said. "A Democratic sweep or divided Democratic government would likely result in some initial dollar downside, as markets reprice the prospect of more dramatic changes in tariffs." The euro has dropped 2.7% so far in October, as the U.S. economy has pulled away from Europe, and as some investors have positioned for higher tariffs after a potential Trump victory. Sign up here. https://www.reuters.com/markets/currencies/goldman-sachs-says-euro-could-drop-10-under-trump-tariffs-tax-cuts-2024-10-22/

2024-10-22 08:53

BANGKOK, Oct 22 - Thailand's economic growth may not reach 3% this year but should come in above that level next year as the government will accelerate investment, the finance minister said on Tuesday. Southeast Asia's second-largest economy is strong, with the public debt to GDP ratio expected to remain under its mandated ceiling of 70%, Pichai Chunhavajira told reporters. "The Thai economy is in a growth phase," he said. "Thailand is about to invest more, so it is not at risk of having its credit ratings downgraded," he added. The economy grew 1.9% last year, lagging peers. Last week's central bank rate cut would also help boost investment and slow the baht's appreciation, Pichai said. The baht has appreciated by 2% against the dollar so far this year, making it the region's second-best performing currency after Malaysia's ringgit . The baht reached its highest level against the dollar in 31 months in September. Sign up here. https://www.reuters.com/markets/asia/thai-finmin-says-growth-may-not-reach-3-2024-will-2025-2024-10-22/