2024-04-16 00:30

Fed's Powell: restrictive rates policy needs more time to work U.S. to launch new sanctions on Iran Israel war cabinet to meet following Iran's weekend attack API shows US crude stocks rose last week, products down HOUSTON, April 16 (Reuters) - Oil prices settled marginally lower on Tuesday after economic headwinds pressured investor sentiment, curbing gains from geopolitical tensions with eyes on Israel and its pending response to Iran's attack on Israeli territory over the weekend. Brent crude futures for June delivery settled 8 cents lower, or 0.1% at $90.02 a barrel. U.S. crude for May delivery fell 5 cents lower, or 0.1%, to end at $85.36. The run of disappointing data showing stronger-than-expected inflation means the Federal Reserve will likely need more time than previously thought to be confident that inflation is on the path to 2%, Fed Chair Jerome Powell said. "The recent data have clearly not given us greater confidence, and instead indicate that it's likely to take longer than expected to achieve that confidence," Powell said during an event held at The Wilson Center in Washington. "Rising interest rates are killing markets, as it appears the Fed is stuck in the mud, while the economy continues to inflate," said Tim Snyder, economist at Matador Economics. On the supply side, Brent reached $92.18 on Friday, its highest level since October on concerns that Iran would respond to Israel's April 1 strike on its embassy compound in Damascus. But prices retreated on Monday after the Iranian counter-attack on Israel over the weekend proved less damaging than anticipated. "So far, markets appear rather sanguine to the rising tensions, and cautiously optimistic that Israel’s response will be restrained, and that an all-out war will be sidestepped," said Matthew Ryan, head of market strategy at global financial services firm Ebury. U.S. Treasury Secretary Janet Yellen said the U.S. intends to hit Iran with new sanctions in coming days due to its unprecedented attack on Israel, and that these actions could seek to reduce Iran's capacity to export oil. Israel's war cabinet was set to meet for the third time in three days on Tuesday, an official said, to decide on a response to Iran's attack, amid international pressure to avoid further escalating the conflict in the Middle East. This third meeting, however, has now been postponed until Wednesday, as Western allies eyed swift new sanctions against Tehran to help dissuade Israel from a major escalation. "Any further developments regarding retaliation could raise the risk premium on oil, particularly given Iran’s position as OPEC’s third-largest producer," said Fiona Cincotta, senior financial market analyst at City Index. Iran produces more than 3 million barrels per day of crude oil as a major producer within the Organization of the Petroleum Exporting Countries. Iran will respond to any action against its interests, President Ebrahim Raisi was reported as saying by the Iranian Student News Agency a day after Israel warned it will respond to Tehran's drone and missile attack. Meanwhile, U.S. crude oil inventories rose by 4.1 million barrels last week while gasoline and distillates stockpiles fell by 2.5 million and 427,000 barrels respectively, according to market sources citing American Petroleum Institute figures. This compared with expectations that U.S. crude inventories rose about 1.4 million barrels, an extended Reuters poll showed. The Reuters Power Up newsletter provides everything you need to know about the global energy industry. Sign up here. https://www.reuters.com/business/energy/oil-prices-rise-israel-weighs-response-iran-attack-2024-04-16/

2024-04-16 00:06

April 15 (Reuters) - Canadian oil and gas producer Tamarack Valley Energy (TVE.TO) New Tab, opens new tab has temporarily shut in about 6,200 barrels of oil equivalent per day (boepd) of production after a fire at a third-party gas plant at Mitsue, Alberta, CEO Brian Schmidt said on Monday. The plant, which processes Tamarack's gas from various batteries in the Nipisi area, was shut down on Saturday. Schmidt declined to say which company owns the affected gas plant. Tamarack said in a statement it is considering several options to accelerate the resumption of its production as the plant operator evaluates how long it will take to restart the facility. "I suspect from the fire and equipment it's not going to be a short time," Schmidt told Reuters in a phone interview. Tamarack's options include re-routing its gas to other processing plants and seeking relief from an Alberta Energy Regulator directive that limits gas flaring, he added. The volumes temporarily shut-in amount to roughly 10% of Tamarack's total production, RBC Capital Markets analyst Luke Davis said in a research note. "We expect the stock to lag peers until further clarity is provided," Davis wrote. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/canadas-tamarack-valley-shutters-production-after-alberta-gas-plant-fire-2024-04-16/

2024-04-16 00:02

SANTIAGO, April 15 (Reuters) - Chile's state-run miner Codelco plans to select a partner for a future lithium project in one of the country's top salt flats, Maricunga, in the first quarter next year, Chairman Maximo Pacheco said on Monday. Codelco, Chile's top copper producer, is entering the lithium business under the mandate President Gabriel Boric's government announced last year to boost the state's role in Chile's lithium mining, the world's second-largest after Australia. The new project in Maricunga comes after Codelco boosted its presence in the salt flat to about 65% after completing its purchase of Australia's Lithium Power International in March. Pacheco said in an interview that Codelco hired Rothschild to scout for interested companies through the end of the year, and that the selected partner will get a 49% share of the project. Codelco is also pursuing a joint venture with Chile's SQM (SQMA.SN) New Tab, opens new tab in the Atacama salt flat, the best of its type for lithium in the world due to its high concentration of the ultralight metal, which is key to the green energy transition. Pacheco said the companies will "definitely" meet a May 31 deadline after the date was pushed back two months, and said the negotiation had been complicated by extensive due diligence and dialogue with communities concerned over the local water supply. Several local groups on Monday said they were pulling out of the talks, in which 18 communities participate, because they did not perceive a good faith effort by the companies to negotiate, and did not see eye-to-eye with the other indigenous groups. As part of a preliminary deal, SQM agreed to hand over its concessions in the Maricunga to Codelco, and Pacheco said SQM would not be in the running for the Marciunga project due to its focus in the Atacama. The winner, Pacheco said, would not necessarily need to offer a strategy for direct lithium extraction (DLE) - the technologies that provide an alternative to water-intensive evaporation ponds, and that are still largely unproven. "We realize that we have to transition from traditional evaporation technologies to other technologies with less environmental impact. And we know that we have to do it gradually," he said. "We can't start with full DLE on the first day." Speaking at the CRU World Copper Conference and CESCO Week, which comprise the largest annual gathering of industry executives and analysts, Pacheco said the company is also devoting $4 billion this year to boost copper production, which in 2023 hit a quarter-century low. At the Teniente complex, work to open the Andesita mine is 40% complete with production expected to begin at the end of October, while at Chuquicamata, Codelco expects its request for an environmental permit for upgrades, submitted in January, to take a year to be approved. "We're building and developing four mega-projects to be able to sustain and increase our production, that obviously has all the risks you can imagine," he said. Whether Codelco will need to seek more debt financing will depend on the strength of copper prices, he said. Although he declined to offer an estimate for pricing this year, Pacheco said market fundamentals look strong, particularly as the energy transition pushes demand for copper. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/commodities/chiles-codelco-aims-land-partner-maricunga-lithium-by-next-year-2024-04-16/

2024-04-15 23:13

TOKYO, April 15 (Reuters) - Microsoft (MSFT.O) New Tab, opens new tab backed artificial intelligence startup OpenAI made a pitch for business in Japan on Monday as it opened its first Asia office in Tokyo. "This is just the first step in what I hope will be a long-term partnership with the people of Japan, government leaders, businesses and research institutions," OpenAI CEO Sam Altman said in a video message. The startup, which has caused excitement among consumers since the launch of its ChatGPT generative AI chatbot in late 2022, is looking to grow new sources of revenue globally. Altman and Chief Operating Officer Brad Lightcap have hosted hundreds of Fortune 500 company executives in the United States and Britain this month to pitch for business, Reuters has reported. Last year Altman said he was considering a Japan location after meeting Prime Minister Fumio Kishida. The startup has also opened offices in London and Dublin. Japan hopes to take advantage of AI as it looks to compete with an increasingly assertive China, accelerate the shift to digital services and alleviate deepening labour shortages. "We have a backlog of demand," Lightcap told reporters in Tokyo, adding that "we expect a meaningful contribution from Japan over time," without providing details. OpenAI said it has a custom model optimised for the Japanese language and that Tadao Nagasaki, who was president of Amazon Web Services in Japan, is heading the Japan business. While the country is seen as a laggard in the technology, local companies including telcos SoftBank (9434.T) New Tab, opens new tab and NTT (9432.T) New Tab, opens new tab are investing in large language models. OpenAI's customers in Japan include automaker Toyota Motor (7203.T) New Tab, opens new tab, manufacturer Daikin Industries (6367.T) New Tab, opens new tab and local government. Microsoft said last week it would invest $2.9 billion over two years in cloud and AI infrastructure in Japan, part of a wave of investment globally by U.S. tech giants. The Technology Roundup newsletter brings the latest news and trends straight to your inbox. Sign up here. https://www.reuters.com/technology/openai-bids-japan-business-it-opens-tokyo-office-2024-04-15/

2024-04-15 22:40

Goldman Sachs rises after Q1 profit beat Salesforce falls on report of likely Informatica deal Tesla falls on layoffs report Indexes down: Dow 0.65%, S&P 500 1.2%, Nasdaq 1.79% NEW YORK, April 15 (Reuters) - U.S. stocks closed sharply lower on Monday, as an early lift from a strong retail sales report succumbed to a jump in Treasury yields and concerns about rising geopolitical tensions between Iran and Israel. With the S&P 500 coming off its biggest one-day percentage drop since Jan. 31 in the prior session, stocks opened higher in part after data showed retail sales increased by more than expected in March. Also providing early support were gains in some financial stocks after their quarterly results, as Goldman Sachs (GS.N) New Tab, opens new tab rose 2.92% after its first-quarter profit beat Wall Street estimates, fueled by a recovery in underwriting, deals and bond trading that lifted its earnings per share to the highest since late 2021. M&T Bank (MTB.N) New Tab, opens new tab jumped 4.74% after forecasting better-than-expected annual net interest income (NII), while brokerage Charles Schwab (SCHW.N) New Tab, opens new tab advanced 1.71% despite reporting a fall in quarterly profit. The stocks were the three best performers in the S&P 500 financial (.SPSY) New Tab, opens new tab sector. But gains faded over concerns the hostilities between Israel and Iran could continue to flare, and Treasury yields jumped, with the benchmark 10-year U.S. Treasury note hitting its highest level since November. "You saw a little bit of a bounce this morning because maybe people thought 'OK it sold off on Friday' in anticipation of something really bad happening in the Middle East," said Ken Polcari, managing partner at Kace Capital Advisors in Boca Raton, Florida. "All the geopolitical stuff is going to cause tension and anxiety in the market, the realization that rates are not going down anytime soon has got to be finally hitting home, that's what the bond market is telling you, that rates are going to go higher." The Dow Jones Industrial Average (.DJI) New Tab, opens new tab fell 248.13 points, or 0.65%, to 37,735.11, the S&P 500 (.SPX) New Tab, opens new tab lost 61.59 points, or 1.20%, to 5,061.82 and the Nasdaq Composite (.IXIC) New Tab, opens new tab lost 290.07 points, or 1.79%, to 15,885.02. The S&P 500 is now down 2.64% over the past two sessions, it's biggest two-day drop since early March 2023. The index also closed below its 50-day moving average, a technical support level, for the first time since Nov. 2. Israel faced growing pressure from allies to show restraint and avoid an escalation of conflict in the Middle East as it considered how to respond to Iran's weekend missile and drone attack, launched after a suspected Israeli attack on its embassy. Each of the 11 major S&P sectors were lower, with the rate-sensitive real estate (.SPLRCR) New Tab, opens new tab and utilities (.SPLRCU) New Tab, opens new tab sectors among the worst performers. Stocks have struggled recently, with the S&P 500 suffering two straight weeks of declines and its biggest weekly percentage drop since October last week as investors have pushed back expectations for the timing and size of any rate cuts from the Federal Reserve. Apple (AAPL.O) New Tab, opens new tab fell 2.19% as one of the biggest drags on the S&P 500 after data from research firm IDC showed the company's smartphone shipments dropped about 10% in the first quarter of 2024. Tesla (TSLA.O) New Tab, opens new tab slumped 5.6% after the EV maker said it will lay off more than 10% of its global workforce, according to an internal memo seen by Reuters. Salesforce (CRM.N) New Tab, opens new tab stumbled 7.28% after Reuters reported, citing a source, that the customer relations software maker was in advanced talks to acquire Informatica (INFA.N) New Tab, opens new tab. On the NYSE, declining issues outnumbered advancing ones by a 5.1-to-1 ratio and on the Nasdaq, decliners outnumbers advancers by a 3.5-to-1 ratio. There were 39 new highs and 138 new lows on the NYSE while on the Nasdaq, there were 37 new highs and 333 new lows. Volume on U.S. exchanges was 11.53 billion shares, compared with the 11.03 billion average for the full session over the last 20 trading days. Get a look at the day ahead in U.S. and global markets with the Morning Bid U.S. newsletter. Sign up here. https://www.reuters.com/markets/us/futures-bounce-back-last-sessions-battering-amid-middle-east-jitters-2024-04-15/

2024-04-15 21:46

April 16 (Reuters) - A look at the day ahead in Asian markets. Asian markets open on Tuesday against an extremely challenging backdrop of slumping global equity and bond prices New Tab, opens new tab, a rising dollar, and the yen's slide to lows that many analysts reckon will prompt direct intervention from Japanese authorities. U.S. and world stocks fell to two-month lows - the S&P 500 chalked up its biggest two-day decline in over a year - as the 10-year U.S. Treasury yield and dollar index made fresh 2024 highs. That's a tightening of financial conditions that will only weigh on Asian markets. Goldman Sachs' aggregate emerging market financial conditions index hit a five-month high on Friday, and almost certainly rose further on Monday. It is the backdrop against which China releases top-tier economic data including March industrial production, retail sales, fixed asset investment and house prices, which will all be wrapped up in first quarter GDP growth figures. Chinese stocks rallied on Monday after the securities regulator on Friday issued draft rules to improve the market and protect investors' interests, but that momentum is unlikely to last. Recent economic data have fallen short of expectations, most notably trade, which saw a sharp contraction in exports, and credit growth, which hit a record low on a broad basis. China's property crisis remains front of mind too, after state-backed developer China Vanke said it was facing short-term liquidity pressure and operational difficulties. The firm's Hong Kong-listed shares hit a record low on Monday. Tuesday's official figures are expected to show China's growth slowed to 4.6% year-on-year from 5.2% in the previous three months, maintaining pressure on policymakers to unveil more stimulus measures. That would be the slowest rate of expansion since the first quarter of 2023. China's growth will figure highly in discussions between U.S. Treasury Secretary Janet Yellen and Chinese officials on the sidelines of the International Monetary Fund and World Bank spring meetings in Washington this week. China's central bank on Monday fixed the yuan at its weakest level against the dollar since March 25. The onshore yuan hit a five-month low close to 7.24 per dollar, just inside its daily trading band limit. There are no such overt limits on Japan's yen, of course, and even if there were, the currency's relentless slide this year would probably have smashed them anyway. Once again, FX traders will be on high alert for yen-buying intervention from Japanese authorities after the yen slumped to a new 34-year low through 154.00 per dollar on Monday. It is the worst-performing G10 and main Asian currency this year. Tokyo hasn't acted yet, but if it does, the yen's reversal could be powerful - hedge funds are sitting on their largest net short yen position in 17 years. Here are key developments that could provide more direction to markets on Tuesday: - China GDP (Q1) - China industrial production, retail sales, investment, house prices (March) - Indonesia consumer confidence (March) Get a look at the day ahead in Asian and global markets with the Morning Bid Asia newsletter. Sign up here. https://www.reuters.com/markets/asia/global-markets-view-asia-graphic-pix-2024-04-15/