2024-10-16 00:15

Oct 15 (Reuters) - Atlanta Federal Reserve President Raphael Bostic on Tuesday said he penciled in just one more interest rate reduction of 25 basis points this year when he updated his projections for last month's U.S. central bank meeting. "The median was for ... 50 basis points more, above and beyond the 50 basis points that was done in September. My dot was 25 basis points more," Bostic said at an event in Atlanta. Bostic said, however, that his projection is not fixed in stone, and he will adjust it as needed in response to incoming data on inflation and the job market. "I am keeping my options open," he said. The Fed last month cut rates by 50 basis points in the first of what is expected to be a series of reductions over the next year to remove some of the policy restraint it imposed to lower inflation. Sign up here. https://www.reuters.com/markets/rates-bonds/feds-bostic-says-his-dot-was-25-bp-more-cuts-2024-2024-10-16/

2024-10-15 23:54

Woodside posts record quarterly production Records 21% sequential rise in quarterly revenue Shares of the company rise 1.5% Oct 16 (Reuters) - Australia's top energy firm Woodside (WDS.AX) , opens new tab marginally raised its annual output expectations on Wednesday after a record production for the quarter, reflecting ramp-up at Sangomar facility in Senegal and higher seasonal domestic gas demand. The country's top independent oil and gas producer narrowed its full-year production estimate to a range of 189 to 195 million barrels of oil equivalent (mmboe) from its prior forecast of 185 to 195 mmboe for the year. Work on Woodside's major growth projects have been continuing at pace, the oil and gas producer said, with the Scarborough energy project now over 73% complete. Woodside also posted a 21% sequential rise in revenue to $3.68 billion for the three months ended Sept. 30, beating a Visible Alpha consensus estimate of $3.29 billion and higher than the $3.03 billion in revenue posted in the previous quarter. Shares in the firm rose as much as 1.5% to A$25.17, despite a drop of over 1% in the broader energy index (.AXEJ) , opens new tab. Woodside's average realized price for the September quarter rose to $65 per barrel of oil equivalent (boe), higher than $62 per boe in the June quarter. It produced 53.1 million barrels of oil equivalent (mmboe) during the quarter, compared with 44.4 mmboe in the previous quarter. "Stronger oil production and timing of cargoes saw total revenue beat ours and the Visible Alpha forecast by 6%," said analysts at Citi. "We think Woodside will be in a position to provide better guidance at February." Separately, the company also announced that it is delisting from the London Stock Exchange due to low trading volumes and to cut administration costs. Nov. 19 will be its last trading day. Earlier this month, Woodside completed the acquisition of U.S. liquefied natural gas developer Tellurian , including its U.S. Gulf Coast LNG export project — now named Woodside Louisiana LNG — for $1.2 billion. The firm said it was targeting final investment decision readiness from the first quarter of 2025. Sign up here. https://www.reuters.com/business/energy/woodside-energys-q3-revenue-beats-expectations-higher-average-lng-prices-2024-10-15/

2024-10-15 23:08

MEXICO CITY, Oct 15 (Reuters) - Mexican telecommunications giant America Movil (AMXB.MX) , opens new tab reported on Tuesday that it more than tripled its net profit in the third quarter from a year ago, due in part to a weaker peso boosting its foreign earnings and lower financing costs. Net profit increased 217% to 6.43 billion Mexican pesos ($326.37 million), the company said in a filing to Mexico's main stock exchange. Revenues for the company, controlled by the family of Mexican billionaire Carlos Slim, came in at 223.46 billion pesos ($11.35 billion) for the period, up nearly 10% year-on-year. Net profit came in below the estimate from analysts polled by LSEG, who had forecast dollar-denominated net earnings of $1.11 billion from revenues of $11.47 billion for July through September. The company said its higher earnings were nonetheless helped by the sale of some towers as well as the depreciation of the Mexican peso, boosting the peso-denominated value of earnings made abroad. By end-September, the Mexican peso had weakened more than 13% against the U.S. dollar compared to a year earlier. America Movil said the peso had weakened against most currencies in the regions where it operates, "with the notable exception of the Brazilian real." America Movil said its core earnings, or earnings before interest, taxes, depreciation and amortization (EBITDA), rose around 12% in the quarter to 89.42 billion pesos, an increase of 6% stripping out the impacts of foreign exchange. The company added 1.8 million subscribers, including 1.4 million post-paid customers, driven mainly by gains in Brazil, the region's largest economy. In the fixed-line segment, the company added 327,000 broadband accesses. Operating profit grew 14.2% in the quarter, while financing costs were down 4.8%, the company said. America Movil entered a joint venture with Ericsson in September to sell network software, together with 11 other telcos. Also in September, America Movil signed a non-binding deal with Spain's Telefonica (TEF.MC) , opens new tab to explore joint participation in the sale of assets of Chilean carrier WOM. ($1 = 19.6921 Mexican pesos at end-September) Sign up here. https://www.reuters.com/business/media-telecom/telecoms-giant-america-movil-triples-quarterly-net-profit-q3-2024-10-15/

2024-10-15 23:01

LONDON, Oct 15 (Reuters) - China's imports of refined lead surged in August with the country set to be a net importer of the battery metal for the first time since 2020. The sudden shift in trade patterns results from a squeeze on the Shanghai Futures Exchange (ShFE) lead contract in July. A shortage of deliverable metal in the mainland market led to a scramble for Western lead and simultaneously opened up an import arbitrage window with the London Metal Exchange (LME). China's resurgent import appetite has halted a long-running build in LME inventory. A redistribution of global lead stocks is clearly underway. The question is whether this is a flash event or the start of a more structural change in east-west trade flows. SHANGHAI SHORTS China imported just 540 metric tons of lead in the first half of 2024 but volumes leapt to 14,000 tons in July and an unprecedented 53,000 tons in August. It's possible that the record inflows in August included some Chinese metal that had been sitting in bonded warehouses and re-directed to the domestic market. That in itself would be a highly unusual phenomenon. The trigger for the change in Chinese trade flows was a July squeeze on the ShFE lead contract which was the climax of a long-running battle between Shanghai bulls and bears. Tightness in the front part of the forward curve was exacerbated by extremely low exchange stocks as on-warrant ShFE inventory fell below 10,000 tons in August. Moreover, short-sellers looking to deliver physical metal against their positions struggled to find the right lead after the ShFE tightened its bismuth impurity threshold in April. Multiple deliveries were rejected by exchange officials, forcing shorts to look overseas. Fortunately for them, there is no shortage of lead outside of China. LME stocks of registered and off-warrant lead rose every month between February 2023 and July 2024, when they peaked at a combined 350,000 tons. The uptrend reversed in August, when combined inventory fell by 57,000 tons as metal was diverted to China. SQUEEZE OVER? The time-spread tightness on the ShFE lead market has dissipated, the hefty front-month premium switching to a discount in the middle of September. That has made imports less attractive, which should lead to a tail-off in inbound volumes after pre-booked shipments show up in the next few months' customs figures. However, there has been no sustained rebuild in Shanghai exchange inventory. On-warrant stocks rose to 54,500 tons mid-September but have since slid back to 34,760 tons. Total ShFE deliverable stocks closed last week at 44,566 tons, still much lower than LME registered stocks of 194,300 tons. The continued east-west stocks imbalance leaves the Shanghai market vulnerable to renewed tightness, particularly if there is a resumption of bull-bear hostilities. BATTERY SCRAP SHORTAGE Although China's shift from net exporter to net importer has been triggered by a squeeze on the futures market, it is rooted in physical market dynamics. The world's largest producer of refined lead has seen output decline this year with both primary and secondary operators experiencing tight availability of feed. Imports of lead concentrates were down by 9.2% over the first eight months of 2024 and primary smelter output fell by 4.5% over the January-September period, according to local data provider Shanghai Metal Market (SMM). The secondary sector, which processes refined lead from battery scrap, has fared even worse with output down by 34.4% year-on-year in September, according to SMM. The problem is a lack of battery scrap due both to a mild 2023-2024 winter, meaning less battery failure, and changes to local government incentive schemes, according to analysts at Macquarie. Prices for battery scrap are higher than for primary metal in parts of the Chinese market, compressing margins for many smelters, SMM reports. China doesn't allow imports of scrap lead, meaning the supply stress has moved to the primary metal segment of the supply chain. GLOBAL SURPLUS Falling Chinese production is the main reason the International Lead and Zinc Study Group forecast global output of refined lead to fall by 0.2% this year at the organisation's biennial meeting in September. The group still expects a global supply surplus of 63,000 tons this year following on a 106,000-ton surplus in 2023. However, that's a marginal number in a 13-million ton market and a forecast that is highly dependent on whether Chinese lead production can recover over the balance of the year. Moreover, the global picture is currently masking a strong divergence between China and the rest of the world. The burst of imports over July and August hasn't fully resolved that gap. The opinions expressed here are those of the author, a columnist for Reuters Sign up here. https://www.reuters.com/markets/commodities/china-imports-record-amount-lead-after-shanghai-squeeze-andy-home-2024-10-15/

2024-10-15 22:56

RIO DE JANEIRO/SAO PAULO, Oct 15 (Reuters) - Brazilian miner Vale (VALE3.SA) , opens new tab reported on Tuesday a 5.5% increase in its third-quarter iron ore production compared to a year earlier, reaching the highest level in almost six years. The company, one of the world's top iron ore suppliers, reported output of 91 million metric tons in the three months ended Sept. 30, it said in a securities filing. The volume of iron ore produced reached the highest level in a three-month period since the final quarter of 2018, powered by improved performance at a trio of Brazilian mining projects - S11D, Itabira and Brucutu - according to the company. Last month, the firm raised its 2024 forecast for iron ore output to between 323 million and 330 million tons after a stronger-than-expected first half. Iron ore sales during the third quarter rose 1.6% from a year earlier to 81.8 million tons, mostly due to an increase in pellet shipments. RBC Capital Markets analysts said Vale's production figures were above expectations across the entire portfolio and the miner was on track to achieve its full-year guidance. Although sales volumes lagged production, the company said inventory build at the iron ore division is expected to reduce this quarter. RBC analysts said that should translate into an upgrade of market estimates for 2024 core earnings. The average realized price of Vale's iron ore fines was about $91 per ton in the quarter, down nearly 14% year-on-year, and 7.7% lower than the second quarter. Vale noted that due to price increases and portfolio adjustments, its realized prices declined almost $5 per ton less than market prices during the quarter. BASE METALS Vale's copper production increased some 5% from a year earlier to reach 85,900 tons in the third quarter, the miner said, adding that all of its copper projects showed an improvement. The company's nickel output was also up, by almost 12% year-on-year to total 47,100 tons, due to stronger performance at its Sudbury project as well as the ramp-up of Voisey's Bay underground mines, both in Canada. Vale shipped 75,200 tons of copper in the quarter, up about 2% year-on-year, while it sold 40,700 tons of nickel, nearly 4% more than the same period last year. Sign up here. https://www.reuters.com/markets/commodities/brazils-vale-posts-q3-iron-ore-output-up-55-2024-10-15/

2024-10-15 22:56

Nvidia falls from record high, chip sector under pressure UnitedHealth ends down 8% after Q3 results Walgreen Boots rallies sharply after results Indexes down: Dow 0.75%, S&P 500 0.76%, Nasdaq 1.01% Oct 15 (Reuters) - Wall Street's major stock indexes closed lower on Tuesday, with a 1% drop in the technology-heavy Nasdaq leading losses as chip stocks tumbled on demand concerns while the energy sector fell 3% as oil prices dropped. Earnings reports were a mixed bag with positive reactions to some financial services results contrasting with an 8% slump in shares of UnitedHealth (UNH.N) , opens new tab after the health insurer forecast 2025 profit below Wall Street estimates. The Nasdaq came under particular pressure from market heavyweight Nvidia (NVDA.O) , opens new tab, the leading chip maker for artificial intelligence. Nvidia shares fell 4.7% after scoring a record-high close on Monday and after a media report that the Biden administration is considering capping AI chip exports by U.S. companies. Chip stocks lost ground broadly after results of chip-equipment-maker ASML Holdings (ASML.AS) , opens new tab showed downbeat expectations for 2025 sales. ASML's U.S.-listed shares tumbled 16% and helped drag down the Philadelphia semiconductor index (.SOX) , opens new tab 5.3% for its biggest one-day drop since early September. "There seems to be a lot more stress concentrated in chips. This is putting downward pressure on technology as a sector," said Kevin Gordon, senior investment strategist at Charles Schwab. But while Gordon saw weaker-than-expected earnings as an excuse to sell off chip stocks, he was encouraged that there were roughly as many stocks advancing as declining on the Nasdaq. "It's not a broad-based washout," he said, noting that stocks that were selling off on the day had previously outperformed. "It's indicative of megacap stocks pulling down the indexes." The energy industry index (.SPNY) , opens new tab finished down 3% for its biggest one-day percentage decline since early October 2023 as crude prices fell on weaker demand expectations after a media report suggested Israel would not strike Iranian oil targets. The Dow Jones Industrial Average (.DJI) , opens new tab fell 324.80 points, or 0.75%, to 42,740.42, the S&P 500 (.SPX) , opens new tab lost 44.59 points, or 0.76%, to 5,815.26 and the Nasdaq Composite (.IXIC) , opens new tab lost 187.10 points, or 1.01%, to 18,315.59. Notably, both the Dow and the S&P 500 registered record closing highs in the previous session. Behind energy, the S&P 500's technology index (.SPLRCT) , opens new tab was the biggest decliner, losing 1.8%. But defensive sectors outperformed, with real estate (.SPLRCR) , opens new tab the biggest advancer, adding 1.2%, followed by consumer staples (.SPLRCS) , opens new tab up 0.6% and utilities (.SPLRCU) , opens new tab, which ended up 0.5%. In the financial sector, Bank of America (BAC.N) , opens new tab shares rose 0.5% following a third-quarter profit beat, while Charles Schwab (SCHW.N) , opens new tab shares climbed 6% after exceeding estimates. However, Citigroup (C.N) , opens new tab shares fell 5% after it reported mixed results with net income declining and net interest income weaker than expected while debt underwriting propped up its investment banking results. Bucking the trend of tech stock declines, Apple (AAPL.O) , opens new tab finished up 1.1% after earlier touching a record high. Also, Walgreens Boots Alliance (WBA.O) , opens new tab shares rallied 15.8% after narrowly beating Wall Street's lowered estimates for fourth-quarter adjusted profit and announcing plans to shut 1,200 stores to cut costs. Investors will watch in coming days for the next batch of earnings as well as key economic data, including monthly retail sales and industrial production figures. Earlier on Tuesday afternoon, San Francisco Fed President Mary Daly said that even after September's interest-rate cut, policymakers were still working to bring down inflation. Traders are pricing in a roughly 98% chance the Fed will cut interest rates by 25 basis points in November, according to CME's FedWatch. Declining issues outnumbered advancers by a 1.01-to-1 ratio on the NYSE where there were 514 new highs and 41 new lows. On the Nasdaq, 2,109 stocks rose and 2,214 fell as declining issues outnumbered advancers by a 1.05-to-1 ratio. The S&P 500 posted 112 new 52-week highs and no new lows while the Nasdaq Composite posted 173 new highs and 82 new lows. On U.S. exchanges 12.85 billion shares changed hands compared with the 12.18 billion average for the last 20 days. Sign up here. https://www.reuters.com/markets/us/futures-mixed-investors-await-earnings-chip-stocks-slip-2024-10-15/