2024-05-06 04:40

A look at the day ahead in European and global markets from Rae Wee European markets will be waking up to a fairly quiet session with London closed for a holiday and little on the economic calendar to stand in the way of the latest rate-cut rally. Investors will be hoping the rise in risk appetite following Federal Reserve Chair Jerome Powell's relatively dovish steer on the U.S. interest rate outlook continues this week, after Wall Street and the MSCI World index hit three-week highs on Friday. The MSCI Asia ex-Japan index on Monday climbed to its highest since February 2023 while mainland stocks in China got off to a solid start after returning from the extended Labour Day break, in a sign that fragile investor sentiment is finally turning. Even the long wait for a solid rebound in the Chinese economy seems to be bearing fruit, with a private gauge showing the country's services activity expanded, albeit at a slower pace. Growth in new orders accelerated and business sentiment rose solidly last month. Elsewhere, U.S. earnings have, on the whole, been strong and company guidance generally bullish, the Fed appears reluctant to raise rates again and signs of softer economic data are keeping hopes of rate cuts this year alive. Global and emerging market financial conditions eased significantly last week, and are now the loosest since March 22, Goldman Sachs' financial conditions indicators show. A slew of Fed speakers are on the docket this week, and investors betting on an eventual rate-easing cycle this year expect policymakers to sing from the same hymn sheet as Powell after Friday's benign U.S. jobs report. And while lower U.S. rates would ease the pressure on most other currencies, over in Japan, that would only have a miniscule impact given stark interest rate differentials are likely to remain. The yen was back on the back foot on Monday after last week's suspected intervention from Japanese authorities, which sent the currency swinging roughly eight yen in the span of a week. Market participants bet last week's moves are not the last we've seen of the Japanese authorities' preference for striking during hours of thin liquidity. That could make Monday's Europe session an opportune time for yet another round of yen buying. Key developments that could influence markets on Monday: - Germany HCOB services PMI (April) - France HCOB services PMI (April) - Euro zone producer prices (March) Sign up here. https://www.reuters.com/markets/europe/global-markets-view-europe-2024-05-06/

2024-05-05 21:57

PORTO ALEGRE/CANOAS/SAO PAULO, May 5 (Reuters) - The death toll from heavy rains that have caused flooding in Brazil's southern state of Rio Grande do Sul has risen to at least 78, local authorities said on Sunday, with more than 115,000 people displaced. President Luiz Inacio Lula da Silva arrived in Rio Grande do Sul on Sunday morning with most members of his cabinet to discuss rescue and reconstruction efforts with local authorities. "Bureaucracy will not stand in our way, stopping us from recovering the state's greatness," Lula said at a press conference. "It is a war scenario, and will need post-war measures," state governor Eduardo Leite added. Volunteers using boats, jet skis - and even swimming - have assisted in ongoing rescue efforts. In the state capital Porto Alegre, Fabiano Saldanha said he and three friends have used jet skis to save about 50 people from flood waters since Friday in islands that are part of the city. "The only thing we hear when we enter a street is 'help,' 'help,'" Saldanha said. The death toll could still substantially increase as 105 people were reported missing on Sunday, up from about 70 the prior day, according to the state civil defense authority. It also said it was investigating whether another four deaths were related to the storms. Flooding from storms in the past few days has affected more than two thirds of the nearly 500 cities in the state, which borders Uruguay and Argentina, leaving more than 115,000 people displaced, according to authorities. Floods have destroyed roads and bridges in several cities. The rains also triggered landslides and the partial collapse of a dam at a small hydroelectric power plant. More than 400,000 people were without power on Sunday evening, while nearly a third of the state's population was without water, authorities said. In Porto Alegre, the Guaiba lake breached its banks, hitting the highest water level on record, according to the national geological service. Porto Alegre's international airport has suspended all flights since Friday. At a makeshift rescue center in Porto Alegre, Kaeli Moraes described being rescued along with her husband and their three children when the water had nearly reached the second floor of their house. "There was flooding in September, then in November, and now this one. It is only getting worse," Moraes said. In the city of Canoas, near Porto Alegre, Julio Manichesque, 76, was rescued by volunteers after he had stayed since Friday on the roof of the house where he has lived for 52 years. "I have never seen that much water," Manichesque said. During his weekly address to crowds in St. Peter's Square in Vatican City, Pope Francis said on Sunday he was praying for the people of Rio Grande do Sul. Sign up here. https://www.reuters.com/world/americas/death-toll-rains-southern-brazil-climbs-66-over-100-still-missing-2024-05-05/

2024-05-05 21:47

May 6 (Reuters) - A look at the day ahead in Asian markets. Investor sentiment in Asia is set to open the week on a positive note on Monday, buoyed by last week's upward momentum in global stocks, calmer currency markets, and a general easing of financial conditions. The main regional calendar events include services PMI figures from China and first-quarter GDP data from Indonesia, while Chinese President Xi Jinping is in Paris for talks with President Emmanuel Macron and European Commission President Ursula von der Leyen. Investors will be hoping the rise in risk appetite following Federal Reserve Chair Jerome Powell's relatively dovish steer on the U.S. interest rate outlook on Wednesday continues into this week. Wall Street and the MSCI World index hit three-week highs on Friday - S&P 500 had its best day since Feb. 22 - while the MSCI Asia ex-Japan index climbed to its highest since February last year. Asian stocks' trough-to-peak rise in the last two weeks has been an eye-catching 8%. U.S. earnings have, on the whole, been strong and company guidance generally bullish, the Fed appears reluctant to raise rates again and signs of softer economic data are keeping hopes of rate cuts this year alive. Global and emerging market financial conditions eased significantly last week, and are now the loosest since March 22, Goldman Sachs's financial conditions indicators show. Liquidity will be lighter than usual on Monday as London markets are closed for a holiday. Could the Bank of Japan take advantage and show its hand in the FX market? The dollar plunged almost 5% against the yen last week on the back of two suspected bouts of intervention from Japan, one on Monday and one on Wednesday. U.S. futures market data show hedge funds cut back their historically high short yen positions in the week through last Tuesday. That was probably accelerated by the yen's surge, and it is not unreasonable to think that some froth from the wider bearish Asia/bullish dollar trade has come off too. Indonesia's GDP figures on Monday are expected to show the economy grew at an annual rate of 5.00% in the first quarter, a Reuters poll showed, slightly lower than Finance Minister Sri Mulyani Indrawati's forecast of 5.17%. But seasonal factors are expected to mean GDP shrank 0.89% from the previous three months. Indonesia's central bank last month delivered a surprise rate hike in a bid to support the rupiah which had fallen to a four-year low. Bank Indonesia's 7-day reverse repurchase rate is now 6.25%, the highest since it became the main policy rate in 2016. On the political and diplomatic front, China's Xi Jinping is in Europe - his first visit to the continent in five years - and trade is high on the agenda, with France's Macron set to urge Xi to reduce trade imbalances. Here are key developments that could provide more direction to markets on Monday: - China Caixin services PMI - Indonesia GDP (Q1) - Chinese President Xi Jinping visits Europe Sign up here. https://www.reuters.com/markets/asia/global-markets-view-asia-graphic-pix-2024-05-05/

2024-05-05 19:34

PARIS, May 5 (Reuters) - The board of French tech firm Atos (ATOS.PA) New Tab, opens new tab was due to meet on Sunday evening to consider takeover offers, including one submitted by Czech businessman Daniel Kretinsky, Les Echos and Le Figaro reported. Atos, which secures communications for the French army and is set to manage cybersecurity for this summer's Paris Olympic Games, had given itself until Friday evening to receive refinancing offers. The struggling firm also received takeover offers led by David Layani, chief executive of OnePoint, Atos' largest shareholder, and U.S. fund Bain Capital. These bids would come in addition to the one submitted by creditors who represent about half of Atos' debt, the newspapers reported on Sunday. Atos declined to comment. Atos said on Monday it needed 1.1 billion euros ($1.2 billion) in cash to fund its businesses over the 2024-25 period, compared with 600 million euros in a previous estimate, due to changing market conditions. Its financial difficulties had led the French state to offer to acquire some of its strategic assets. ($1 = 0.9295 euros) Sign up here. https://www.reuters.com/markets/deals/atos-board-reported-be-meeting-sunday-review-takeover-bids-2024-05-05/

2024-05-05 17:59

PARIS, May 5 (Reuters) - French bakers cooked the world's longest baguette on Sunday at 140.53 metres (461 ft), reclaiming a record for one of the nation's best-known emblems taken by Italy for five years. The baguette, about 235 times longer than the traditional one, was made in Suresnes in the suburbs of Paris during an event for the French confederation of bakers and pastry chefs. The previous longest baguette of 132.62 meters was baked in the Italian city of Como in June 2019. To better that, the French bakers began kneading and shaping the dough at 3 a.m. before putting it in a specially-built slow-moving oven on wheels. "Everything has been validated, we are all very happy to have beaten this record and that it was done in France," Anthony Arrigault, one of the bakers, said after the baguette was approved by the Guinness World Records judge. Part of the baguette, which had to be at least 5 cm thick throughout, was cut and shared with the public. The rest was to be given to homeless people. The traditional French baguette must be about 60 cm long, be made from wheat flour, water, salt and yeast only, and weigh about 250 grammes, according to the official regulation New Tab, opens new tab. Sign up here. https://www.reuters.com/lifestyle/french-bakers-make-worlds-longest-baguette-beating-italy-2024-05-05/

2024-05-05 14:05

HOUSTON, May 5 (Reuters) - As Big Oil returns this week to the industry's annual showcase for offshore energy projects and equipment in Houston, deepwater discoveries off Guyana, Namibia and the U.S. Gulf Coast will take the spotlight. Offshore exploration had dimmed after the U.S. shale boom ushered in new and cheaper-to-tap supplies of oil, and as past offshore cost overruns pushed deepwater projects onto the industry's backburner. Newer deepwater projects have the attributes oil and gas companies are looking for: longer-term production, lower breakeven costs, big resource potentials and lower carbon emissions, said Pablo Medina, head of new ventures at energy consultants Welligence. "Deepwater is back in vogue," Medina said. Capital spending on all-new deepwater drilling is poised to hit a 12-year high next year, predicts consultancy Rystad Energy. Investment in all-new and existing deepwater fields could hit $130.7 billion in 2027, a 30% jump over 2023, it said. "The return of offshore and deepwater operations is going to be a big topic at OTC, and Namibia is going to be talk of the show," said James West, senior managing director at financial firm Evercore, referring to the recent series of oil finds off the west African coast. FASTER PAYBACK PERIODS With crude oil prices above $70 a barrels, energy producers can expect a return on their multi-billion-dollar deepwater projects in six years, a relatively short period considering the wells' longer lives compared with shale, explained Matt Hale, vice president of supply chain research at Rystad, at the Rystad Energy Forum in Houston last month. Deepwater resources also offer lower carbon emissions intensity than shale and other tight oils, averaging 2kg of carbon dioxide per barrel less than shale, Hale said. That appeals to investors seeking safer bets as environmental regulations tighten. Enthusiasm for offshore has climbed with discoveries and technology breakthroughs. Namibia's Mopane is forecast to hold as much as 10 billion barrels of oil, Portuguese oil company Galp Energia (GALP.LS) New Tab, opens new tab said last month. Chevron and TotalEnergies have made a breakthrough in ultra-high pressure environments with their Anchor project in the Gulf of Mexico, the world's first to operate at once-unfathomable 20,000 pounds per square inch (psi) pressures. The Anchor platform is preparing to start production off the Louisiana coast, and at its peak will produce up to 75,000 barrels per day (bpd) of crude and operate for 30 years. The Stabroek block off the coast of Guyana has demonstrated the potential for low cost production that rivals the best deepwater fields elsewhere. Over the next six years, more than half of its recoverable resources are expected pump at a breakeven price of less than $30 per barrel, according to Rystad. That is comparable to the breakeven on about 80% of deepwater recoverable resources off Norway, Rystad estimates. Renewed interest in deepwater has boosted demand and results for offshore drilling contractors. Rates for some vessels have surpassed $500,000 a day and contract durations are lengthening as vessel supply dwindles. "We are reaching this crescendo over the next 18 months or so where the (deepwater rig) market will level out," said Leslie Cook, upstream supply chain analyst at consultants Wood Mackenzie. Sign up here. https://www.reuters.com/business/energy/big-oil-finds-more-love-deepwater-exploration-fields-2024-05-05/