2024-10-18 20:20

TSX ends up 0.5% at 24,822.54 For the week, the index adds 1.4% Materials sector rises 3.2% IAMGOLD jumps 16.6% Oct 18 (Reuters) - Canada's main stock notched on Friday its third straight day of record closing highs, overcoming uncertainty around the Middle East conflict and the upcoming U.S. election, as metal mining shares jumped on higher gold and copper prices. The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) , opens new tab ended up 132.06 points, or 0.5%, at 24,822.54. For the week, the index added 1.4%. That's its sixth straight weekly gain, which is the longest such stretch since April. "It's a stealth rally," said Brandon Michael, senior investment analyst at ABC Funds. "Everyone is so focused on the noise — the looming U.S. election, geopolitics - and they’re very skeptical." Some analysts have worried that stretched valuations for some high-flying technology stocks and potential volatility around the Nov. 5 U.S. presidential election could lead to a market pullback. U.S. benchmark the S&P 500 has advanced nearly 23% since the start of the year and the TSX is up 18.4% as central banks globally, including the Bank of Canada, began easing campaigns. The BoC is widely expected to reduce its key policy rate by 50 basis points on Wednesday, which would be the first super-sized reduction in 15 years outside of the pandemic era. "The earnings are beating expectations, the economy is charging ahead, and there remains a massive amount of cash on the sidelines ready to be deployed," Michael said. The materials sector rose 3.2% as new measures to boost liquidity in the Chinese stock market helped drive up copper prices, while gold extended its record-setting run. IAMGOLD Corp (IMG.TO) , opens new tab was a standout, with its shares jumping 16.6% to reach a seven-year high. Consumer discretionary (.GSPTTCD) , opens new tab added 0.5%, supported by a 2.9% rise in the shares of auto parts supplier Magna International Inc (MG.TO) , opens new tab. Energy limited the market's advance. The sector fell 0.4% as the price of oil settled 2.1% lower. Sign up here. https://www.reuters.com/markets/tsx-futures-edge-up-higher-metal-prices-2024-10-18/

2024-10-18 19:44

Bostic to be patient on rate cuts A recession is not underway and is not likely, Bostic says Fed has two more policy-setting meetings this year Oct 18 (Reuters) - Atlanta Federal Reserve Bank President Raphael Bostic on Friday made the case for patient reductions in the central bank's policy rate to somewhere between 3% and 3.5% by the end of next year, a pace that would get inflation down to its 2% target by then and keep the U.S. economy out of recession. "I'm not in a rush to get to neutral," Bostic told the Mississippi Council on Economic Education Forum on American Enterprise in Jackson, Mississippi. "We must get inflation back to our 2% target; I don't want us to get to a place where inflation stalls out because we haven't been restrictive for long enough, so I'm going to be patient." At the same time, he said, he envisions further cuts to the Fed's target for short-term borrowing costs, now in the 4.75%-5.00% range. "If the economy continues to evolve as it does — if inflation continues to fall, labor markets remain robust, and we still see positive production — we will be able to continue on the path back to neutral," he said. A neutral Fed policy rate — where borrowing costs neither stimulate nor restrict economic growth — is probably in the 3% to 3.5% range, he said. Inflation, currently at 2.2% by the Fed's preferred measure, will likely get to the Fed's 2% target toward the end of 2025, and "that should be sort of the timetable for when we should get to neutral," he said. Financial markets are currently pricing in two quarter-point interest rate cuts before the end of the year and further reductions next year, likely bringing the policy rate to a 3.25%-3.5% range by September 2025. The Fed reduced its policy rate by a bigger-than-expected half-of-a-percentage point last month to keep borrowing costs from cooling the labor market too sharply. Since then, readings on the job market have come in stronger than expected, with monthly job growth accelerating and the unemployment rate ticking down to 4.1%. Bostic has said he expects only a single quarter-point cut over the last two Fed meetings of the year. "A recession has never been in my outlook," Bostic said. "I've always felt that there was enough momentum in this economy to absorb the restrictiveness of our policy and drive inflation back down to its 2% target. I'm grateful that that's been playing out so well. But the job is not done." Sign up here. https://www.reuters.com/markets/rates-bonds/feds-bostic-says-he-is-no-rush-get-rates-down-neutral-2024-10-18/

2024-10-18 19:43

Agreement set to be officially signed on Oct 25, four sources say Deal to be for 170 bln reais in total compensation, with 100 bln over 20 years Samarco to be primary obligor; Vale and BHP to cover 50% each of any unmet obligations RIO DE JANEIRO, Oct 18 (Reuters) - Miners Vale (VALE3.SA) , opens new tab, BHP (BHP.AX) , opens new tab and Samarco are discussing a near $30 billion compensation deal with Brazilian authorities related to the 2015 Mariana dam collapse, they said on Friday, with an agreement set to be signed on Oct. 25, sources said. The collapse of the dam at an iron ore mine owned by Samarco, a joint venture between Vale and BHP, near the city of Mariana nine years ago unleashed a wave of toxic tailings in a disaster that killed 19 people, left hundreds homeless, flooded forests and polluted the length of the Doce River. The three mining firms have for years been negotiating a compensation agreement with the country's public attorney and with state and federal authorities, hoping a deal would end several court actions on the matter. In separate statements and securities filings, Vale, BHP and Samarco said the version of the agreement currently being discussed would include a total compensation of 170 billion reais ($29.9 billion), with 100 billion reais of that to be paid through 20 years directly to public authorities. The total amount also includes 32 billion reais to be spent by the firms in remediation and compensation measures, and a further 38 billion reais that they have already disbursed, according to the companies. The agreement is set to be officially signed on Oct. 25, four sources told Reuters on Friday. Local newspaper O Globo had earlier in the day reported the date. Vale, Samarco and BHP did not say when they expect to sign the agreements. Brazil's solicitor general office, which is part of the negotiations, did not immediately respond to a request for comment on the date. Vale and BHP said Samarco would be the primary obligor for the payments, with both owners each paying 50% of any obligations Samarco cannot fund. Samarco, which is under bankruptcy proceedings, said a previous plan approved by its creditors ruled that it could only pay up to $1 billion in compensation measures until 2031. Any disbursements exceeding it will be covered by Vale and BHP, it added. Based on that, Vale on Friday forecast that its third-quarter earnings will reflect 5.3 billion reais in new liabilities related to the dam's collapse. BHP said the agreement in discussion "is broadly aligned with the existing $6.5 billion provision." In September, Brazil Energy and Mining Minister Alexandre Silveira said the talks at the time were for a roughly 167 billion reais agreement, three billion reais below the terms released by the firms on Friday. Brazil rejected a previous 127 billion reais proposal earlier this year. ($1 = 5.6897 reais) Sign up here. https://www.reuters.com/world/americas/brazil-ink-deal-with-miners-over-mariana-dam-collapse-oct-25-sources-say-2024-10-18/

2024-10-18 18:28

Oct 18 (Reuters) - British finance minister Rachel Reeves is expected to announce the end of a temporary five pence cut in fuel duty from next year in her budget this month, the Financial Times reported on Friday, citing people briefed on the chancellor's views. Reeves has also been urged by the Treasury department to end a 13-year freeze on fuel duty, FT reported , opens new tab. A Treasury spokesperson said: "We do not comment on speculation around tax changes outside of fiscal events." Duty paid on motor fuels has been frozen since 2011, except for a temporary cut in the 2022/23 tax year, as governments feared a backlash from drivers especially in rural areas. In the last budget published in March under the previous Conservative government, the latest cancellation of the scheduled fuel duty rise cost around 3 billion pounds ($3.9 billion) in 2024/25. ($1 = 0.7668 pounds) Sign up here. https://www.reuters.com/world/uk/uks-reeves-may-cut-5-pence-fuel-duty-discount-next-year-ft-reports-2024-10-18/

2024-10-18 18:24

FAA review to probe risk assessment, resource allocation, regulatory adherence Transportation Department's Inspector General criticized FAA's Boeing oversight FAA audit found 97 noncompliance incidents in Boeing's processes WASHINGTON, Oct 18 (Reuters) - The Federal Aviation Administration said on Friday it will open a new safety review into Boeing (BA.N) , opens new tab as the agency continues aggressive oversight of the U.S. planemaker after an in-flight emergency , opens new tab in January. The new review will probe issues like risk-assessment quality, resource allocation, and adherence to regulatory requirements, and is expected to take three months, the FAA said. An FAA spokesperson said the agency plans regular reviews of Boeing. Last week, the Transportation Department's Office of Inspector General criticized the FAA's oversight of Boeing, saying the agency does not have an effective system to oversee the planemaker's individual manufacturing facilities. A Boeing spokesperson said the planemaker continues "to cooperate fully and transparently with the FAA. We support all actions that strengthen safety in aviation." The FAA said Friday it was reviewing Boeing’s operational safety processes "to ensure they meet FAA requirements and result in timely, accurate safety-related information for FAA use" and said it was "part of our aggressive oversight to ensure Boeing has the right tools to sustain lasting changes to its safety culture." An FAA audit of Boeing completed in February found 97 incidents of noncompliance, spanning "issues in Boeing’s manufacturing process control, parts handling and storage, and product control," according to a U.S. Senate report, adding that the FAA found 23 examples where employees "failed to follow processes or lacked proficiency." FAA Administrator Mike Whitaker, who has regularly vowed to hold Boeing accountable for safety lapses, said last month safety culture improvements at Boeing may take three to five years to put in place. The FAA's oversight of Boeing came under new scrutiny after a door plug missing key bolts blew off a new Alaska Airlines (ALK.N) , opens new tab 737 MAX 9 jet at 16,000 feet (4,880 meters) in January, prompting the Justice Department to open a criminal investigation and the FAA to open a separate probe. A series of reports in recent years have raised concerns about the FAA's oversight of Boeing. Last month, a U.S. Senate panel investigating Boeing's culture faulted oversight by the agency. Whitaker said last month he would revamp the FAA's own safety management program. He said in June the agency was "too hands-off" in oversight of Boeing before January. The FAA chief took the unprecedented step in January of barring Boeing from expanding 737 MAX production until he is satisfied they have made significant quality improvements. Sign up here. https://www.reuters.com/business/aerospace-defense/faa-says-new-boeing-safety-review-will-take-about-three-months-2024-10-18/

2024-10-18 17:15

Loonie trades in a range of 1.3786 to 1.3810 Heads for a 0.3% weekly decline Price of U.S. oil decreases 1.6% Bond yields ease across the curve TORONTO, Oct 18 (Reuters) - The Canadian dollar steadied against its U.S. counterpart on Friday but was on track for its third straight weekly decline, as oil prices fell and investors bet on an unusually large interest rate cut from the Bank of Canada. The loonie was trading nearly unchanged at 1.38 to the U.S. dollar, or 72.46 U.S. cents, after moving in a range of 1.3786 to 1.3810. For the week, the currency was down 0.3%. "The fact that USD-CAD ends the week flirting with a break above 1.38 should not be a surprise," said Nick Rees, senior FX market analyst at Monex Europe Ltd. "While appearing hot on the surface, the recent September's jobs data was much weaker in the details, while a counterpart CPI print seen this week was unambiguously soft." Growth in Canada's consumer price index slowed more than expected to 1.6% in September, which is below the Bank of Canada's 2% target. "Set against a backdrop of anemic growth, the data makes a strong case for the BoC to deliver a 50 bp (basis point) rate cut next week. We think they will too, suggesting that risks are skewed toward further loonie downside," Rees said. Investors see a roughly 90% chance the BoC will cut its benchmark interest rate by half a percentage point at a policy decision on Wednesday, swaps market data showed. The policy rate is currently at 4.25%. It would be the fourth rate cut since June and the first reduction greater than 25 basis points in 15 years outside of the pandemic era. The price of oil , one of Canada's major exports, fell 1.4% to $69.70 a barrel as China's economic growth slowed and threats to supply abated in the Middle East. Canadian bond yields eased across the curve, with the 10-year down 3 basis points at 3.13%. Sign up here. https://www.reuters.com/markets/currencies/canadian-dollar-falls-third-week-jumbo-rate-cut-bets-2024-10-18/