2025-10-07 10:48

LONDON, Oct 7 (Reuters) - What matters in U.S. and global markets today By Mike Dolan , opens new tab, Editor-At-Large, Finance and Markets Sign up here. World stock markets cooled a touch on Tuesday after another AI-spurred start to the week, with Washington's shutdown putting the spotlight Federal Reserve speakers rather than data and overseas attention on Japan's new prime minister and the absence of one in France. AI-fueled risk appetite helped gloss over the messy political pictures to send Wall Street and world stock to new record closes on Monday - with MSCI's all-country index now up almost 19% for the year. Chip stocks roared after AMD's blockbuster supply pact with OpenAI, allowing the ChatGPT creator to buy a stake of up to 10% in the chipmaker and sending AMD's stock up 24%. With dealmaking gathering pace in financial and commodities sectors too, the frenetic activity is encouraging speculation about another leg higher in the stock market. Regional bank Comerica gained 13.7% on Monday after Fifth Third said it will buy the company in an all-stock deal valued at $10.9 billion and the Trump administration also announced a stake in Canada's Trilogy Metals as part of a mining development push in Alaska - doubling Trilogy's U.S. listed shares overnight. In macro markets, the dollar firmed against the euro and yen as Japan's leadership change cuts bets on a Bank of Japan rate hike this month and the French political impasse weighed further on French stocks and the single currency. Wall Street's attention switches to appearances later in the day from new Fed board member and former White House adviser Stephen Miran and an auction of 3-year Treasuries - with stock futures and Treasury yields steady to firmer. In today's column, I discuss how G7 policymakers are keeping the macro policy lights on "go" - running the global economy and markets hot even with inflation rates above target. Today's Market Minute * Outgoing French Prime Minister Sebastien Lecornu is starting two days of last-ditch talks on Tuesday with members of various parties, a day after his shock resignation, in an effort to find a way out of the country's political crisis. * The state of Illinois and the city of Chicago sued President Donald Trump on Monday, seeking to block the deployment of federalized National Guard troops to Chicago, as hundreds of National Guard troops from Texas headed to the nation's third-largest city. * Tesla TSLA.O is expected to unveil on Tuesday a more affordable version of its best-selling Model Y SUV, as the electric vehicle maker seeks to reverse falling sales and waning market share amid rising global competition. * India will allow users to approve payments made through popular domestic payments network, the Unified Payments Interface, using facial recognition and fingerprints starting October 8, three sources directly familiar with the matter said on Tuesday. * The U.S. government shutdown is delaying key economic data releases, thickening the fog of uncertainty for policymakers and businesses, but they needn't worry. They still have access to one of the best economic indicators, writes ROI markets columnist Jamie McGeever: the stock market. Chart of the day If Fed eases further this month, it will further fuel what are already the loosest U.S. financial conditions and lowest Treasury market volatility (.MOVE) , opens new tab in almost four years - just as stocks and inflation-hedges such as gold soar and frenetic dealmaking and tech-related speculation builds a head of steam Today's events to watch * U.S. August consumer credit (3:00 PM), Canada Aug trade balance (8:30 AM EDT) * Federal Reserve Vice Chair for Supervision Michelle Bowman, Fed Board Governor Stephen Miran, Minneapolis Fed President Neel Kashkari and Atlanta Fed boss Raphael Bostic all speak; European Central Bank President Christine Lagarde speaks * Canada's Prime Minister Mark Carney makes a second visit to the White House * U.S. corporate earnings: McCormick * U.S. Treasury sells $58 billion of 3-year notes Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here. You can find ROI on the Reuters website , opens new tab, and you can follow us on LinkedIn , opens new tab and X. , opens new tab Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. https://www.reuters.com/business/finance/global-markets-view-usa-2025-10-07/

2025-10-07 10:34

Sterling falls vs dollar, gains vs euro, yen Attention on global political developments BoE speakers later in the week Oct 7 (Reuters) - The British pound dipped against the dollar on Tuesday but gained slightly against the euro and yen, which remained under pressure due to political uncertainty and fiscal concerns in France and Japan. Sterling was down 0.3% against the dollar at $1.3441, but remains within its recent range. Sign up here. "It's quiet for sterling at the moment," said Mohamad Al-Saraf, forex research associate at Danske Bank, who noted that attention in the currency market was largely elsewhere. "We are awaiting a new catalyst, so we could see some range trading in the near term," he added. POUND CATALYSTS Bank of England chief economist Huw Pill is scheduled to speak tomorrow, and fellow rate-setter Catherine Mann is speaking on Thursday. Both Pill and Mann voted with the majority to keep interest rates unchanged at the last BoE meeting in September. Money market traders are pricing in under three basis points of easing at the next meeting in November, implying about a 10% chance of a quarter point cut. The next reduction is not fully priced until April next year. Against both the euro and the yen , the pound was up about 0.1%, extending on the gains from the previous day, when political developments rocked both currencies. POLITICAL SHOCKS IN JAPAN AND FRANCE In Japan, Sanae Takaichi won the race to become the next Liberal Democratic Party leader, and in turn, is set to be named the new prime minister. Takaichi has pledged to jolt the Japanese economy with aggressive spending and has been critical of the Bank of Japan's interest rate hikes. Her victory over the weekend sent the yen tumbling on Monday, and the currency remains on the backfoot. The unexpected resignation of French Prime Minister Sebastien Lecornu on Monday also triggered weakness in the euro, which has continued on Tuesday. The currency, which has largely weathered France's political turmoil in the last 18 months, remains under pressure as the political uncertainty makes fiscal consolidation less likely. ING head of forex strategy Chris Turner said currency investors will be watching the spread between German and French 10-year bond yields , a measure of the risk premium investors demand to hold French debt. The spread reached its widest level since January on Monday at 88 basis points. "A move through 90 bps would raise some alarm bells and add to some independent weakness in the euro," Turner said in a note. https://www.reuters.com/world/uk/sterling-slips-against-dollar-gains-both-euro-yen-2025-10-07/

2025-10-07 10:04

MUMBAI, Oct 7 (Reuters) - The Indian central bank likely conducted dollar-rupee buy/sell swaps on Tuesday alongside intervention in the local over the counter spot market to support the rupee, four traders told Reuters. Under a buy/sell swap, the Reserve Bank of India undertakes delivery of dollars at the spot rate, which will be reversed at a future date. Sign up here. The rupee was last at 88.77 per U.S. dollar, little changed on the day, but hovering just shy of its all-time low of 88.80 hit last week. Dollar-rupee forward premiums pulled back on account of the central bank's buy/sell swaps, with the 1-year implied yield retreating 6 basis points to 2.23%, the lowest in a month. https://www.reuters.com/world/india/indian-central-bank-likely-conducted-dollarrupee-buy-sell-swaps-traders-say-2025-10-07/

2025-10-07 10:01

Vaca Muerta slowdown would affect Argentina's energy export goals Wells drills and fracking stages both declined in July Oil firms urge policy changes to boost investment and exports BUENOS AIRES, Oct 7 (Reuters) - Drilling and fracking activity in Argentina's Vaca Muerta, the world's fourth-largest unconventional oil reserve, is plateauing due to lower oil prices and rising costs, a slowdown that could complicate the political agenda of libertarian President Javier Milei. The huge Vaca Muerta formation in western Argentina accounts for 64% of the country's oil production even though only 8% of it is under development. Sign up here. It is vital to Argentina's economic future and Milei's government, which needs to increase the country's energy exports to bolster Argentina's dollar reserves and build confidence in the government's ability to maintain a stable currency. Slowing drilling and fracking in Vaca Muerta may add to challenges facing Milei, whose approval levels have dipped amid political scandals and clashes with the opposition-controlled Congress, and his plan to export $30 billion in oil and gas by 2030 - doubling Argentina's global exports from current levels. Major investments in Vaca Muerta resulted in record Argentine production levels of 827,000 barrels per day in August - a 15% increase from a year earlier - but analysts expect a slowdown in coming months. Benchmark global oil prices are trading around $65 per barrel, down from $90 a barrel in April 2024. The number of wells drilled in Neuquen basin, where Vaca Muerta is located, fell to 55 in July from 67 in June, the third consecutive monthly decline, according to the most recent data from Argentine consulting group AGKC. Fracking stages - which involve injecting water and chemicals at high pressure to break rocks - in Vaca Muerta fell 9% in July compared to the previous month, according to Luciano Fucello, country manager for NCS Multistage, an oilfield services company. In an early September presentation to oil and gas executives, Daniel González, Argentina's Secretary of Energy and Mining Coordination, said oil production costs in Vaca Muerta were 35% to 40% higher than in the Permian formation in the United States. "The market will adjust and we'll return to more reasonable prices, but in the meantime, the most efficient will survive," said González. Analysts blamed higher prices for labor, services and utilities and more expensive financing for the growing costs. FEWER DRILLED WELLS While the industry had expected fracking stages to reach 24,000 by 2025, NCS Multistage's Fucello said that projection would fall several thousand short. "At this dollar level, at this interest rate level, it's better to keep the barrel of oil down and not extract it," said Ariel Kogan, director of AGKC Consultores. Kogan said many market participants expect a change in exchange rate policies, which would make extracting crude more profitable, after Argentina's October midterm elections. Delgado Industrias in Buenos Aires province, which supplies steel inputs to the oil industry, told Reuters it has seen a 40% drop in sales from 2024 due to the slowdown in oil well drilling and shale fracking, as well as increased competition with Chinese exporters. Business leaders say profitability is declining due to rising labor and production costs combined with a relatively stronger peso, which means profits from dollar-denominated oil sales are lower. They have called for labor reform to reduce the cost of hiring and firing workers. Duralitte, an oil, gas and mining component manufacturing company, has stopped exporting from its three industrial plants in Argentina because it can manufacture cheaper products in Brazil and the U.S., founder Gustavo Rossi told Reuters. He called for lower taxes. Large oil companies operating in Argentina such as Chevron, Tecpetrol and TotalEnergies have urged Milei's government to adopt policies that guarantee exports will not be restricted. They also want the government to eliminate foreign currency controls that limit access to dollars, in order to attract greater foreign investment and reach the government's production target of 1.5 million bpd. Milei has sought to create incentives for large investments and loosen restrictions for companies to pay dividends. But some major international companies, such as Exxon Mobil, have decided to sell their assets in Vaca Muerta or are considering doing so. "It's important that we have stability and predictability for the future, and that we can continue to lift the exchange controls so that companies like ours can continue not only investing but also distributing dividends," Sergio Mengoni, CEO of TotalEnergies in Argentina, told reporters at a conference in September. (This story has been refiled to fix a spelling in the byline) https://www.reuters.com/business/energy/slowing-vaca-muerta-oil-activity-could-pose-challenge-argentinas-milei-2025-10-07/

2025-10-07 09:31

Oct 7 (Reuters) - U.S. President Donald Trump's administration is mulling options to sell off parts of the federal government's $1.6 trillion student loan portfolio to the private market, Politico reported on Tuesday, citing three people familiar with the matter. Reuters could not immediately verify the report. Sign up here. The White House, the Treasury and the Department of Education did not immediately respond to Reuters requests for comment. The discussions are said to have taken place among senior Department of Education and Treasury officials, and have focused on selling high-performing portions of the government's massive portfolio of student debt owed by about 45 million Americans, the report added. The discussions also involved industry executives, including potential buyers of the debt, the report said. https://www.reuters.com/world/us/us-weighs-selling-parts-16-trillion-federal-student-loan-portfolio-politico-2025-10-07/

2025-10-07 07:59

Engines, batteries units restart on Wednesday Main production lines restart later this week Offers qualifying suppliers upfront cash payment for parts Quarterly sales volumes drop LONDON, Oct 7 (Reuters) - Britain's biggest carmaker, Jaguar Land Rover (JLR), said on Tuesday some factories would restart manufacturing on Wednesday after an almost six-week shutdown following a cyberattack, one of the country's most disruptive hacks. To try to help smaller parts suppliers who have been pushed to the brink after weeks without business, JLR also announced it would be providing some companies with up-front cash for parts during the production restart phase. Sign up here. The luxury carmaker, owned by India's Tata Motors (TAMO.NS) , opens new tab, has three factories in Britain, which together produce about 1,000 cars per day, and economists had warned of the impact of a prolonged shutdown on the country's manufacturing output. HIGH PROFILE HACKS JLR was the latest high profile cyberattack target in Britain this year, and comes after one of the country's major retailers Marks & Spencer (MKS.L) , opens new tab lost about 300 million pounds (about $400 million) after a breach forced it to shut down its online shop for two months. The incidents highlight the vulnerability of global business to increasingly sophisticated and more frequent attacks. Last month, a ransomware attack on check-in services left passengers stranded across major European airports. JLR, which analysts estimated was losing around 50 million pounds per week from the shutdown, was provided with a 1.5 billion pound loan guarantee by the British government in late September to help it support its suppliers. Business minister Peter Kyle said in a statement on Tuesday that his focus was on helping JLR resolve the incident and supporting the long-term health of the auto supply chain, which supports over 180,000 manufacturing jobs. "This is very welcome news for workers and suppliers, but I know many are still under pressure, particularly further down the supply chain," he said. PHASED RESTART JLR said in a separate statement on Tuesday that for the three months to September 30, wholesale and retail volumes dropped 24.2% and 17.1%, respectively, reflecting the impact of the production stoppage, plus the planned wind down of legacy Jaguar models and the effect of U.S. tariffs. "It has been a challenging quarter for JLR," JLR CEO Adrian Mardell said in a statement. JLR said its engines and battery units would restart work on Wednesday, as well as parts of its vehicle production plant including its body and paint shops, meaning the return of some of its 33,000 staff to work. Production lines for the Range Rover and Range Rover Sport vehicles at its main factory in Solihull will start later this week, the company added. Qualifying suppliers of parts used in the company's just-in-time production lines will now be paid shortly after the point of order, JLR said, compared to a previous 60-day post-invoice arrangement, helping to allay fears that some smaller businesses could go bust. ($1 = 0.7445 pounds) https://www.reuters.com/business/jlr-restart-some-manufacturing-operations-wednesday-2025-10-07/