2025-09-22 19:17

Sept 22 (Reuters) - Chipmaker Nvidia (NVDA.O) , opens new tab is set to invest up to $100 billion in ChatGPT-parent OpenAI, signing a letter of intent for a strategic partnership to deploy at least 10 gigawatts of compute, the companies said on Monday. Nvidia has used its financial clout to keep its hardware central to the buildout of artificial intelligence systems. Keeping OpenAI, which is also exploring its own chip designs, as a key customer could help the company reinforce its dominance as the industry considers rival suppliers. Sign up here. Here are some analyst reactions to the partnership: MATT BRITZMAN, SENIOR EQUITY ANALYST, HARGREAVES LANSDOWN "For Nvidia, the prize is huge — every gigawatt of AI data centre capacity is worth about $50 billion in revenue, meaning this project could be worth as much as $500 billion. By locking in OpenAI as a strategic partner and co-optimizing hardware and software roadmaps, Nvidia is ensuring its GPUs remain the backbone of next-gen AI infrastructure. The market is clearly big enough for multiple players, but this deal underscores that, when it comes to scale and ecosystem depth, Nvidia is still setting the pace — and raising the stakes for everyone else." JACOB BOURNE, TECHNOLOGY ANALYST, EMARKETER "Demand for Nvidia GPUs is effectively baked into the development of frontier AI models, and deals like this should also ease concerns about lost sales in China. It also throws cold water on the idea that rival chipmakers or in-house silicon from the Big Tech platforms are anywhere close to disrupting Nvidia's lead. For OpenAI, it signals greater independence as it continues diversifying away from its Microsoft partnership and races to develop its next-generation models." ANSHEL SAG, PRINCIPAL ANALYST, MOOR INSIGHTS & STRATEGY "I think this strengthens the partnership between the two companies that has existed since the beginning of OpenAI's existence. This also validates Nvidia's long-term growth numbers with so much volume and compute capacity, also enabling OpenAI to scale to even bigger customers." BEN BAJARIN, CEO OF TECHNOLOGY CONSULTING FIRM CREATIVE STRATEGIES "Really the point Nvidia was making was that it's just enabling OpenAI to meet surging demand and, at this point, we know there's surging demand for Nvidia GPUs, because that's primarily what OpenAI runs on." KIM FORREST, CHIEF INVESTMENT OFFICER, BOKEH CAPITAL "This sounds like Nvidia is investing in its largest customer. These arrangements can be beneficial for both parties. But there can be dangers as well. Being totally linked with each other can cause for short-sightedness and can make an entry point for other chip competitors to come into other AI companies and woo them. We are not sold on the model of LLM as being the technology that will create vast amounts of productivity that everyone expects." GIL LURIA, ANALYST AT D.A. DAVIDSON "While the announcement is positive for OpenAI's ability to ramp, we are concerned Nvidia has become the 'investor of last resort,' bailing out OpenAI's overextended commitments." DAVID WAGNER, PORTFOLIO MANAGER AT APTUS CAPITAL ADVISORS "Nvidia continues to double-down on AI as we always figured that CEO Jensen Huang would want to invest downward into AI factories - this announcement is much earlier than many would have expected." STACY RASGON, ANALYST AT BERNSTEIN "On the one hand, this helps OpenAI deliver on what are some very aspirational goals for compute infrastructure, and helps Nvidia ensure that stuff gets built. On the other hand the 'circular' concerns have been raised in the past, and this will fuel them further." https://www.reuters.com/business/view-analysts-react-nvidias-100-billion-investment-openai-2025-09-22/

2025-09-22 18:57

Sept 22 (Reuters) - Como will donate all proceeds from Wednesday's Coppa Italia match versus Sassuolo to support the local community after the city suffered flood damage following torrential rain in Northern Italy overnight, manager Cesc Fabregas said on Monday. The centre of Como was badly hit after Lake Como flooded following intense rainfall, with water flowing through the city's streets, partially submerging cars and causing damage to homes and businesses. Sign up here. "The club will donate all the proceeds from the Italian Cup match against Sassuolo ... to support the local community during this difficult time," Fabregas said in an Instagram post referring to the second-round tie between the two Serie A teams. "My thoughts are with everyone in Como today. Seeing our beautiful lake flood and the damage it has brought is heartbreaking," he added. "Como is more than just a city to me, it is home, it is family, it is community. "To all the people, families, and businesses affected, please know you are not alone," Fabregas said. The former Spain midfielder ended his playing career at Como in 2023, with the club competing in Serie B, and began his managerial career there, helping them gain promotion as assistant coach and taking over as manager last season. https://www.reuters.com/sports/soccer/como-donate-italian-cup-tie-proceeds-flood-damage-relief-says-fabregas-2025-09-22/

2025-09-22 18:50

Capital hike to alleviate Cosan's debt Cosan shares drop 21% after announcement Analysts see potential benefits despite shareholder dilution SAO PAULO, Sept 22 (Reuters) - Brazilian conglomerate Cosan's (CSAN3.SA) , opens new tab plan to raise up to 10 billion reais ($1.9 billion) through public offerings will go towards alleviating the company's debt, an executive said on Monday, adding none of the funds would go to helping Raizen, its embattled joint venture with oil major Shell (SHEL.L) , opens new tab. Although analysts welcomed the move, Cosan's shares plunged 21%, on track for their worst day ever. The losses wiped off around 3 billion reais from its market cap. Raizen's shares slipped 9%. Sign up here. "The capital will be used exclusively to de-leverage Cosan," CFO Rodrigo Araujo said during an investor call following the announcement of the capital hike. Cosan reported a net debt of 17.5 billion at the end of June, stable from the end of the first quarter. Raizen (RAIZ4.SA) , opens new tab produces sugar and ethanol and is one of the biggest energy companies in Brazil, Latin America's largest economy. Low sugarcane yields have however hit its bottom line, debt and stock performance. Shell declined to comment on Cosan's deal. In addition to Raizen, Cosan's portfolio includes logistics firm Rumo (RAIL3.SA) , opens new tab, lubricants company Moove, natural gas firm Compass and agricultural property manager Radar. Its capital increase plan includes a 4.5 billion-real investment from BTG Pactual Holding, which has billionaire Andre Esteves among its partners, and an additional 2 billion reais from Perfin Infra Fund. Cosan's founder, Rubens Ometto, is set to contribute with 750 million reais through his family office, and a follow-up offering of up to 2.75 billion reais is also planned. Cosan executives said the move was not the "only step" in Cosan's deleveraging process, as the company will continue pursuing asset sales. It can now, however, wait for more favorable market conditions. MIXED REACTION Citi analysts said the deal implies a 40-50% dilution to current shareholders but should be positive as Cosan would enter "a new phase, which should be marked by deleveraging in the holding company." Ometto's holding firm Aguassanta, BTG and Perfin will control Cosan through a 20-year shareholders' agreement. The new board will be comprised of five members nominated by Cosan and four jointly appointed by BTG and Perfin. The financial restructuring also sets the stage for leadership succession at Cosan, the company said. Ometto, or a successor appointed by him, is expected to remain chairman for the next six years. UBS analysts said they saw Cosan emerging much healthier after the process. ($1 = 5.3378 reais) https://www.reuters.com/business/energy/brazils-cosan-says-10-billion-capital-hike-relieve-debt-not-fund-raizen-2025-09-22/

2025-09-22 17:59

Hammack emphasizes caution due to persistent inflation above 2% target Fed's recent rate cut reflects internal divisions on future interest rate path Hammack sees job market near maximum employment despite signs of fragility Sept 22 (Reuters) - The Federal Reserve needs to be "very cautious" in removing restrictive monetary policy with inflation still above the central bank's 2% target and remaining persistent, Cleveland Fed President Beth Hammack said on Monday. "I think we are only a short distance to neutral, and it worries me that if we remove that restriction from the economy, things can start overheating again," Hammack said in remarks that showed the divisions inside the Fed over whether interest rates will keep falling. Sign up here. Hammack's comments at an event at the Cleveland Fed headquarters followed last week's decision by the Federal Open Market Committee - the Fed's interest-rate-setting panel - to lower the central bank's benchmark rate by a quarter-percentage point to a range of 4.00%-to-4.25%. Hammack, among the most hawkish Fed policymakers, is not a voter on policy this year and did not say whether she supported the reduction. But in her remarks she emphasized that inflation remains a significant concern for her, while she sees the job market as remaining closer to the Fed's "maximum employment" mandate, even if there are emerging signs of fragility. The latest unemployment rate at 4.3% "is right around a maximum employment number," Hammack said, and while it may edge up this year it is expected to fall again before long. "On the inflation side, we are missing by a more meaningful number, by a full percentage point. And we have been missing for four-and-a-half years, and I anticipate missing for the next couple of years." "I think we should be very cautious in removing monetary policy restriction because I think it's important that we stay restrictive to bring inflation back down to target," Hammack said. Along with their decision on interest rates, Fed officials last week updated their quarterly economic and policy projections. The median expectation among the 19 officials showed an expectation for rates to drop by another half a percentage point this year, but nearly half of them did not see that as appropriate. Six of them saw the current level as appropriate through this year, and two others saw only one more quarter-point reduction this year as appropriate. Another official felt the level of rates prior to last week's reduction was the appropriate level. Part of the judgment in rate decisions involves policymakers estimating how far current policy is from the so-called neutral rate of interest that neither stimulates nor restricts economic activity. "I have one of the higher estimates on the committee, and I think we're only very mildly restrictive after last week's move" Hammack said. "So I think we are a very short distance to neutral." https://www.reuters.com/business/feds-hammack-still-focused-inflation-calls-caution-easing-policy-2025-09-22/

2025-09-22 16:44

NEW YORK, Sept 22 (Reuters) - Top U.S. asset manager Vanguard is bullish on corporate bonds despite high valuations, and while it expects tariffs will continue to be a risk for the U.S. economic and inflation outlook, those headwinds could be offset by further Federal Reserve interest rate cuts. Investment-grade credit spreads - or the premium over U.S. Treasuries paid by high-rated companies to issue bonds in the U.S. market - declined to 74 basis points last week, their lowest since 1998, as investors pile into the asset class to grab higher yields than U.S. Treasuries, and as a Fed in rate-cutting mode is expected to encourage economic activity by lowering borrowing costs for U.S. firms. Sign up here. "Credit spreads are near historical lows, but healthy fundamentals, attractive all-in yields, robust investor demand, a proactive Fed, and low recession risk support current valuations," Sara Devereux, global head of fixed income at Vanguard, said in a note to clients on Monday, seen by Reuters. She added the firm has been adding credit risk across its portfolios. "Credit valuations are stretched but justified," she said. Vanguard, which manages $11 trillion, estimated that about a third of the impact of President Donald Trump's tariffs has already passed through the economy, with half expected by year end and the rest in 2026. "A slow pace of implementation has helped the economy digest the changes and companies mitigate the impact, but risks to growth and inflation persist," Devereux said. The Fed lowered interest rates by 25 basis points last week to a 4%-4.25% range, and traders are betting additional rate cuts this and next year will bring interest rates to about 3% by the end of 2026. Further rate adjustments, as well as Trump's policies that include tax cuts and deregulation, will likely offset the impact of tariffs on U.S. growth, said Devereux, adding she expects moderate growth over the next year. However, she warned, the Fed is unlikely to cut rates by as much as the market is expecting, unless the economy enters a recession. https://www.reuters.com/business/vanguard-bullish-us-credit-despite-tariff-risks-still-horizon-2025-09-22/

2025-09-22 16:16

FRANKFURT, Sept 22 (Reuters) - The euro cannot replace the dollar as the world's dominant currency, but needs to strengthen its global role, partly to protect the bloc in case of a sustained loss of confidence in the dollar, Germany's central bank chief said. The dollar has fallen this year in response to erratic U.S. policies, boosting calls across Europe to beef up the euro's global role to provide investors with an alternative safe haven. Sign up here. Analysts and central bankers have voiced concern that tariffs make trade policy unpredictable, that large tax cuts, promised by U.S. President Donald Trump, make U.S. debt unsustainable and his attacks on the U.S. Federal Reserve's independence have damaged the dollar's safe haven reputation. "The U.S. dollar is no longer fully perceived as a safe haven," Bundesbank President Joachim Nagel said. "While it seems neither realistic nor desirable for the euro to replace the U.S. dollar as the reserve currency in the foreseeable future, a greater international significance of the euro would certainly be possible and desirable," Nagel added. For the euro to gain international weight, the bloc needs a stability-oriented fiscal stance, predictable policies, military assertiveness, deep, liquid, and open capital markets, and a wide range of high-quality, safe investments, Nagel said. "The high savings of European households should be better channelled to increase innovation, productivity, and competitiveness," Nagel said. "Our savings are urgently needed to finance Europe's green and digital transition, as well as defence spending." Although reduced confidence in the dollar has increased the euro's value, Nagel said he was not concerned about its current valuation, especially since the gain was much smaller when based on trade-weighted numbers. The euro also needs to be able to ward off the stability threat from the growing role of stablecoins in the financial world, Nagel said. Stablecoins are designed to maintain their value, but without regulation, pose a risk to financial stability since a loss of confidence in them could lead to a fire sale of reserve assets, especially U.S. government bonds. https://www.reuters.com/business/finance/euro-needs-enhanced-global-role-cannot-overtake-dollar-bundesbank-says-2025-09-22/