2024-10-22 03:39

MUMBAI, Oct 22 (Reuters) - The Indian rupee is likely to open nearly unchanged on Tuesday and trade in a narrow range amid expectations that the country's central bank intervention will offset the impact of a jump in the U.S. Treasury yields. The 1-month non-deliverable forward indicated that the rupee will open at 84.07-84.08 to the dollar, compared with 84.0725 on Monday and a record low of 84.0775 hit last week. The rupee's dip past the key level of 84 earlier this month has been of little consequence in terms of the currency's volatility. The rupee's realized volatility remains the lowest among Asian currencies. The biggest intraday swing on the currency since it declined past 84 has been just 10 paisa. Intraday price swings in the last two sessions have been limited to just 3 paisa. The Reserve Bank of India has been regularly selling dollars via public sector banks to make sure that the rupee's decline past 84 does not cause flutters. It is this central bank intervention that has helped rupee ride out equity outflows, the rally in the dollar and the rise in U.S. Treasury yields. "I have little doubt that we would, at the minimum, be at 84.50 if the RBI had left it to market forces," a currency trader at a bank said. "Today again, the RBI will just hold it (dollar/rupee) here and we will have a nothing day." US YIELDS, DOLLAR CLIMB The 10-year U.S. Treasury yield rose to a 12-week high on Monday, pushing the dollar index to the highest in more than two months. The recent fairly robust U.S. data, prospect of Donald Trump winning the U.S. November election and the less dovish Federal Reserve outlook have spurred a 40 basis points rise in the 10-year yield. KEY INDICATORS: ** One-month non-deliverable rupee forward at 84.18; onshore one-month forward premium at 10.75 paise ** Dollar index down at 103.94 ** Brent crude futures down 0.4% at $74 per barrel ** Ten-year U.S. note yield at 4.2% ** As per NSDL data, foreign investors sold a net $611.9mln worth of Indian shares on Oct. 18 ** NSDL data shows foreign investors sold a net $39.8mln worth of Indian bonds on Oct. 18 Sign up here. https://www.reuters.com/markets/currencies/india-central-bank-help-rupee-contend-with-soaring-us-yields-2024-10-22/

2024-10-22 00:07

Schmid: "My preference would be to avoid outsized moves" Logan: "Gradually lowering the policy rate ... can help manage the risks" Kashkari: The appropriate path of interest rates will "depend on the data" Daly: "I don't want to see the labor market slow further." Oct 21 (Reuters) - Four Federal Reserve policymakers on Monday expressed support for further interest-rate cuts, but appeared to differ on how fast or far they believe any cuts should go. Three of them, citing the strength of the economy and an uncertain outlook, expressed a preference for going slow, using words like "modest" and "gradual" to describe their views on the right pace for rate cuts. The fourth, San Francisco Fed President Mary Daly, said she feels Fed policy is "very tight" and does not believe that a strong economy, as long as inflation continues to fall, should keep the central bank from continuing to reduce rates. The remarks provide a small taste of what's expected to be a broad but closed-door debate of the appropriate path for policy at the Fed's upcoming policy meeting, on Nov. 6-7. After Friday, U.S. central bankers will observe a communications blackout -- abstaining from any public comments on their monetary policy views -- until the Fed announces its policy decision at the close of the two-day meeting on Nov. 7. "While I support dialing back the restrictiveness of policy, my preference would be to avoid outsized moves, especially given uncertainty over the eventual destination of policy and my desire to avoid contributing to financial market volatility," Kansas City Fed President Jeffrey Schmid told the Certified Financial Analysts Society of Kansas City, in Missouri. He said he believes rate cuts should be gradual and deliberate. Dallas Fed President Lorie Logan, speaking earlier in the day to the Securities Industry and Financial Markets Association in New York, made similar remarks. “If the economy evolves as I currently expect, a strategy of gradually lowering the policy rate toward a more normal or neutral level can help manage the risks and achieve our goals,” she said. The Fed last month cut the policy rate by a bigger-than-expected half of a percentage point, to a range of 4.75% to 5%, given cooling in both inflation and labor markets. It was the first rate cut in four years. Fed policymakers' economic projections published at the time showed that most thought further, and likely smaller, interest-rate reductions would be appropriate. Since then, strong retail sales and bigger-than-expected job growth in September have boosted speculation that the Fed could cut rates even more slowly, perhaps even pausing at next month's rate-setting meeting or the one in December. Daly, in a webcast interview with the Wall Street Journal, gave no indication she would support a pause. "I haven't seen any information that would suggest we wouldn't continue to reduce the interest rate consistent with achieving that durable expansion," she said, when asked about the November decision. "This is a very tight interest rate for an economy that already is on the path to 2% inflation, and I don't want to see the labor market slow further." The Fed, she added, should be "open-minded" to the possibility that stronger productivity growth may be allowing the economy to grow faster without pushing up on inflation, allowing the central bank to continue to reduce rates. Of the four Fed officials who spoke on Monday, Daly is the only current voter on the policy-setting Federal Open Market Committee, though all policymakers attend meetings and voice opinions. Minneapolis Fed President Neel Kashkari on Monday appeared to endorse a go-slow approach to rate cuts, repeating his call for "modest" interest rate cuts over the next "several quarters." He said the economy's strength shows the eventual resting point for the policy rate -- what is known as the neutral rate, where borrowing costs neither slow nor stimulate growth -- may be higher than it was in the past, a point that Schmid also made. "We want to keep the labor market strong and we want to get inflation back down to our 2% target," Kashkari said, and the appropriate path of interest rates will "depend on the data." But Kashkari said that a sharp deterioration of labor markets could move him to advocate for faster cuts. "If we saw a weakening, like real evidence that the labor market is weakening quickly, then that would tell me, as one policymaker, 'Hey, maybe we ought to bring down our interest rate more quickly than I currently expect,'" Kashkari said in a town hall at the Chippewa Falls Area Chamber of Commerce. Sign up here. https://www.reuters.com/markets/us/feds-kashkari-any-surprise-job-market-weakness-could-trigger-rethink-rate-cut-2024-10-21/

2024-10-21 23:49

Hedge fund unit has Barclays, Citibank debt commitment letter Says Citgo assets 'deteriorating', urges acceptance of its bid HOUSTON, Oct 21 (Reuters) - Hedge fund Elliott Investment Management on Monday pressed a court not to hold up its bid for Citgo Petroleum, saying the Venezuela-owned oil refiner's assets "are deteriorating in value" and creditors will not get a better offer from others. The comments came in a court filing after creditors last week described an up to $7.3 billion conditional bid placed before the court by Elliott's wholly-owned Amber Energy as inadequate and likely to be rejected. Elliott's wholly-owned Amber Energy repeated its threat to walk away if the court "does not address threshold issues," referring to its desire to hold back more than $2 billion of its offer as a set-aside were Venezuela bondholders to prevail in a separate lawsuit. And it wants the court to bar other lawsuits from seeking control over the same assets. Citgo (PDVSAC.UL) operates three U.S. refineries, 38 terminals, six pipelines and supplies fuel to 4,200 independent retailers. The Houston-based oil refiner is the centerpiece in a U.S. District Court in Delaware's auction seeking to satisfy $21 billion in claims against Venezuela for defaults and expropriations. In addition to Eliott's backing, Amber wrote it has obtained a debt commitment letter from Barclays (BARC.L) , opens new tab and Citigroup (C.N) , opens new tab's Citibank demonstrating its ability to finance the purchase. It also has retained an eight person refining management team ready to take over Citgo operations. The court filing did not address other issues raised by creditors, including an undisclosed breakup fee should the deal not conclude, and opposition to other bidders accessing Citgo financial data until after the court decides on its breakup fee. A spokesperson declined to respond to those issues. Amber wrote its proposal is "the best and only realistic pathway for the largest number of creditors" to receive payment despite creditors calling its terms as unlikely to provide them with auction proceeds "for years - if ever." Sign up here. https://www.reuters.com/markets/commodities/elliott-defends-citgo-offer-face-creditors-objections-2024-10-21/

2024-10-21 23:20

Oct 21 (Reuters) - San Francisco Federal Reserve Bank President Mary Daly on Monday said she has not seen anything to suggest the U.S. central bank would stop cutting interest rates, which are "absolutely" still high enough that they are restraining the economy. Daly, in a webcast interview with the Wall Street Journal, added that the goal is a "soft landing" where inflation cools to 2%, the labor market stays healthy, and wages catch up with higher prices. She said the Fed needs to continue to lower the policy rate as inflation comes down, or risk allowing policy to become overly tight and hurt the labor market. The policy rate, after the Fed's 50-basis-point rate cut last month, is now in the 4.75%-5% range; Daly on Monday said she estimates that a policy rate of around 3% would be a level that is neither tight nor loose but what economists call "neutral." Sign up here. https://www.reuters.com/markets/rates-bonds/fed-needs-continue-cut-rates-daly-says-2024-10-21/

2024-10-21 23:19

Boeing jumps after offering new wage deal Humana, Cigna fall after report companies resumed merger talks 114 S&P 500 companies to report results this week Nvidia closed at record high Indexes: Dow fell 0.8%, S&P down 0.18% and Nasdaq up 0.27% Oct 21 (Reuters) - The Dow Jones Industrial Average and S&P 500 closed lower on Monday, retreating from Friday's record high closes and six straight weekly gains as Treasury yields rose and investors wary of high valuations awaited earnings from major companies. "It's not at all unusual for the market to want to take a little bit of a breather after six weeks of continually record highs," said Carol Schleif, chief investment officer at BMO Family Office. The Dow Jones Industrial Average (.DJI) , opens new tab fell 344.31 points, or 0.80%, to 42,931.60, the S&P 500 (.SPX) , opens new tab lost 10.69 points, or 0.18%, to 5,853.98. The Nasdaq Composite (.IXIC) , opens new tab gained 50.45 points, or 0.27%, to 18,540.01, boosted by the chip heavyweight Nvidia (NVDA.O) , opens new tab, which rose 4.14% to close at a record high of $143.71. The yield on the benchmark 10-year Treasury jumped as high as 4.17%, a 12-week high. "The rise in the 10-year yield is causing confusion that maybe the economy is growing too rapidly and that employment remains too resilient," said Sam Stovall, chief investment strategist at CFRA Research. "As a result, the Fed might end up being slower to lower interest rates." On Friday, the Dow and the S&P 500 both closed at record highs as all three major indexes posted a sixth consecutive week of gains, their longest winning streak this year. Many rate-sensitive megacap technology stocks slipped. Tesla (TSLA.O) , opens new tab was down 0.84%. After a fairly upbeat start to earnings season, the focus was on the 114 S&P 500 companies scheduled to report this week. These include Tesla, Coca-Cola (KO.N) , opens new tab and Texas Instruments (TXN.O) , opens new tab. Ahead of a busy week for earnings, some investors likely took some profits, according to analysts. David Laut, chief investment officer at Abound Financial, said the market was looking at how stretched valuations are. Of companies that have reported so far, 83.1% beat earnings estimates, according to data compiled by LSEG on Friday. Monday's declines were broad, with almost all 11 major S&P 500 sectors in the red. The rate-sensitive Real Estate (.SPLRCR) , opens new tab sector dropped 2.08% as yields rose, while the technology sector was lifted by the jump in Nvidia. The economically sensitive small-cap Russell 2000 (.RUT) , opens new tab dropped 1.61%. Investors also looked ahead to the U.S. presidential election, with pollsshowing chances improving for former President Donald Trump, the Republican candidate. "As the election date approaches, even small changes in tight polls could drive seemingly erratic swings in market sentiment," Danske Bank analysts said. Boeing (BA.N) , opens new tab jumped 3.1% after news that workers could vote on a new deal to end a costly five-week strike. Spirit Airlines (SAVE.N) , opens new tab skyrocketed 53.06% after the company reached an agreement to extend a debt refinancing deadline by two months. Humana (HUM.N) , opens new tab slipped 2.46% after a report said Cigna (CI.N) , opens new tab had resumed merger talks with the health insurer. Cigna's shares also fell 4.69%. Home sales, flash PMI and durable goods reports are on the data docket through the week, as is the Fed's Beige Book. Declining issues outnumbered advancers by a 3.51-to-1 ratio on the NYSE. There were 262 new highs and 47 new lows on the NYSE. The S&P 500 posted 42 new 52-week highs and two new lows while the Nasdaq Composite recorded 89 new highs and 51 new lows. Volume on U.S. exchanges was 11.35 billion shares, compared with the 11.59 billion average for the full session over the last 20 trading days. Sign up here. https://www.reuters.com/markets/us/sp-500-futures-steady-earnings-heavy-week-looms-boeing-rises-2024-10-21/

2024-10-21 23:09

LONDON, Oct 22 (Reuters) - Global employers reported a fall in white-collar vacancies in September, a survey showed on Tuesday citing factors including the upcoming election in the United States, uncertainty around tax rises in Britain and rising geopolitical tensions. Recruitment consultancy Robert Walters' new monthly Global Jobs Index showed global vacancies dropped by 5% last month from August. Companies in Singapore, the United States, Britain, Australia, and Germany reported the biggest falls in vacancies, with firms citing low business confidence as a key factor. In some European countries which typically experience a seasonal jump in vacancies in September, firms reported a more muted increase than in previous years. "September's decline in professional job roles globally is a departure from the usual surge of hiring activity we expect at this time of year, and is a direct reflection of the geopolitical tensions, economic outlooks, and industry-specific issues on the global jobs market," said Toby Fowlston, chief executive of global talent solutions business at Robert Walters. The survey was based responses from 500 firms across professional sectors including health, real estate and construction, and energy and utilities. Fowlston said US firms were putting the brakes on hiring ahead of the Nov. 4 elections and potential policy shifts. Official data showed the US labour market added 254,000 jobs in September, the most since March. "The UK is experiencing increased uncertainty as businesses hold back on hiring in anticipation of the government's budget announcement," Fowlston added. Britain's new Labour government will deliver its inaugural budget on Oct. 30 and finance minister Rachel Reeves has warned that some taxes will go up to plug what she called a 22 billion-pound ($28.64 billion) fiscal hole. Government sources have said Reeves is looking for tax rises and spending cuts to the tune of 40 billion pounds. The survey showed that on a quarterly basis, vacancies were 19% higher in the July-September period compared to the three months before. ($1 = 0.7682 pounds) Sign up here. https://www.reuters.com/markets/us-election-geopolitics-uk-budget-fears-dent-global-vacancies-survey-shows-2024-10-21/