2024-04-03 03:11

MUMBAI, April 3 (Reuters) - The Indian rupee is expected to open marginally higher on Wednesday after the U.S. dollar retreated from a more than four-month high. Traders, however, said that the upside was likely to be limited after the opening uptick. Non-deliverable forwards indicate rupee will open at around 82.35 to the dollar compared to 82.3850 previous close. The dollar index pulled back slightly from a more than four-month high of 105.10 hit on Monday, while the offshore Chinese yuan recovered to 7.2426. If there is a dip at open (on USD/INR pair) will "in most likelihood it will have very little carry on", a forex salesperson at a bank said. "From out client interactions, we see considerable interest to buy (USD/INR) right now, which I think probably reflects the nervousness from last week's moves." Last week, the USD/INR pair climbed to a record high of 83.45, surprising market participants. The central bank likely intervened to make sure that the rupee remained confined to its long-held range, traders said. Data released overnight showed U.S. job openings edged up in February and new orders for U.S.-manufactured goods increased more than expected. This follows data that showed an unexpected expansion in manufacturing activity. This pushed the 10-year U.S. Treasury yield to 4.40%, the highest in four months, before it pulled back. The data had little impact on the odds of what the Federal Reserve is likely to do at its May and June meetings. Investors have nearly priced in a May rate cut and odds of a June rate cut are near 60%. A slew of Fed officials are due to speak this week, which ANZ Bank said "can provide guidance on the path of monetary policy". On Tuesday, San Francisco Fed President Mary Daly said she believes three interest-rate cuts this year is a "reasonable" expectation. KEY INDICATORS: ** One-month non-deliverable rupee forward at 83.40; onshore one-month forward premium at 7 paisa ** Dollar index down at 104.74 ** Brent crude futures at $88.98 per barrel ** Ten-year U.S. note yield at 4.35% ** As per NSDL data, foreign investors bought a net $282.5 mln worth of Indian shares on April 1 ** NSDL data shows foreign investors bought a net $566.5 mln worth of Indian bonds on March 28 Keep up with the latest medical breakthroughs and healthcare trends with the Reuters Health Rounds newsletter. Sign up here. https://www.reuters.com/markets/currencies/rupee-may-see-relief-dollar-pullback-upside-largely-capped-2024-04-03/

2024-04-03 02:48

WASHINGTON/TOKYO, April 2 (Reuters) - The head of the U.S. Senate Banking Committee on Tuesday urged the White House to scrutinize the relationship between Nippon Steel and the Chinese steel industry, citing national security concerns amid bipartisan opposition in Congress to the Japanese company's $14.9 billion deal to acquire U.S. Steel Corp (X.N) , opens new tab. "As you examine this deal, I urge you to thoroughly investigate the allegations raised in this report and examine Nippon's ties to the Chinese government and the danger this merger poses to American national and economic security," Sherrod Brown said in a letter to Biden citing an April report , opens new tab by consultancy Horizon Advisory. Nippon Steel said in a statement that Horizon's report was "rife with inaccuracies and misrepresentations" and that its operations in China were "very limited", representing less than 5% of its global production capacity. The White House did not immediately comment. Horizon Advisory did not immediately respond to a request for comment. Horizon's report said Nippon had a long-run history of supporting the establishment of China's steel industry and that it operated, in whole or in part, nine facilities in China and had active joint ventures with a range of Chinese state-backed steel champions. "Nippon's connection to the Chinese steel ecosystem and industrial policy agenda has concerning implications regarding ties to China's military-civil fusion strategy and quest for global economic power," said Brown, a Democrat from Ohio who is running for another term in the Nov. 5 elections. Nippon Steel said the entities in which it invests in China have no control over its operations or business decisions outside of China, and that its Chinese partners do not have any access to information about Nippon Steel’s operations, including about its R&D and engineering, outside of China. The White House sees steel as critical to national security, and Biden said last month that U.S. Steel should remain domestically owned. His opponent in the Nov. 5 presidential election, former President Donald Trump, has promised to block the deal if he wins. 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/us-senator-urges-biden-review-alleged-nippon-steel-ties-china-2024-04-02/

2024-04-03 02:46

RIO DE JANEIRO, April 2 (Reuters) - Transpetro, the logistics arm of Brazil's state-run oil firm Petrobras (PETR4.SA) , opens new tab is analyzing projects to supply all its 48 terminals with renewable energy, the subsidiary's director of ducts and terminals Marcio Guimaraes said, ahead of the inauguration of a solar plant in Sao Paulo state on Tuesday. The plant, set to be operated by Transpetro, will supply enough energy to Brazil's national grid to account for all operations at Transpetro's terminal in Guarulhos International Airport, said Guimaraes. "We don't want just one to use as an example," Guimaraes told Reuters during a phone interview. "We do have solutions being analyzed, being studied, for each of our units." Petrobras has put a big bet on renewables as part of its plan to shift from an oil company to an energy firm, in line with President Luiz Inacio Lula da Silva's wish to kickstart Brazil's energy transition. Transpetro invested 12 million reais ($2.37 million) in the Guarulhos project, and this year is set to start another one in the firm's Coari Waterway Terminal, in Amazonas state, to be completed sometime next year. Coari ships oil from Petrobras' Urucu onshore oil and gas cluster in Amazonas. At Coari the firm is set to use solar and hydro power generation supported by the use of batteries, the executive said. Guimaraes did not give out a timeline for renewable solutions in other terminals. ($1 = 5.0574 reais) 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/brazils-petrobras-subsidiary-push-renewables-terminals-2024-04-03/

2024-04-03 01:00

LONDON, April 3 (Reuters) - Portfolio investors have continued to realise profits on formerly bullish diesel positions and begun to turn bearish as supplies adjust to the disruption of trade through the Red Sea and a mixed industrial outlook. Hedge funds and other money managers sold the equivalent of 26 million barrels in the six most important petroleum-related futures and options contracts over the seven days ending on March 26. Sales came after fund managers purchased 140 million barrels the week before, one of the largest increases in the last decade, according to position reports filed with exchanges and regulators. But nearly all the latest week’s sales were in middle distillates (-24 million barrels), both U.S. diesel (-8 million) and European gas oil (-17 million). There were only minor adjustments elsewhere in NYMEX and ICE WTI (-5 million barrels), Brent (+1 million) and U.S. gasoline (+3 million). As a result, the combined distillates position was reduced to 49 million barrels (43rd percentile for all weeks since 2013), down from a recent peak of 87 million (72nd percentile) on Feb. 13. Chartbook: Oil and gas positions , opens new tab The reduction in distillate positions has coincided with a significant softening of gas oil and diesel prices compared with crude oil. The premium for European gas oil over Brent crude had shrunk to roughly $168 per tonne on March 26, down from a recent peak of $274 on Feb. 9. The premium for U.S. ultra-low sulphur diesel over U.S. crude had fallen to $28 per barrel from $48 over the same period. Despite attacks on tankers in the Red Sea and Gulf of Aden that forced the re-routing of diesel trade there has been no discernible tightening of supplies. U.S. diesel inventories were about 14 million barrels (-10% or -0.86 standard deviations) below the prior ten-year seasonal average on March 22. But the deficit has not worsened significantly from 11 million barrels (-8% or -0.76 standard deviations) at the start of 2024. The market has adjusted to the longer routes for diesel deliveries and the impact of Ukraine’s drone attacks on Russia’s refineries. In the meantime, the outlook for a cyclical industrial recovery in the major economies to boost diesel consumption and prices has remained mixed. Global freight flows appear to be strengthening after a long but shallow downturn between the middle of 2022 and the middle of 2023. Manufacturing in the United States and China also shows signs of increasing, but Europe’s industrial businesses have struggled to emerge decisively from recession. Persistent inflation in the services sector has forced central banks to postpone anticipated interest rate cuts until the middle of the year or later. In consequence, the expected tightening of distillate inventories has been pushed back and caused many fund managers to be more cautious in the short term. U.S. NATURAL GAS Investors made few changes to gas positions for the third week running, after an earlier buying surge in late February and the start of March occasioned by the announcement of production and drilling cuts fizzled out. Hedge funds and other money managers had reduced their net short position to 431 billion cubic feet (bcf) (20th percentile for all weeks since 2010) on March 26 from 1,675 bcf (3rd percentile) on Feb. 20. In real terms, prices remain only a little above the multi-decade lows hit in mid-February. Announced drilling and output cuts should put a floor beneath them and the balance of risks is tilted to the upside in the medium term. But working gas stocks were still 656 bcf (+40% or +1.44 standard deviations) above the prior ten-year seasonal average on March 22 and it will take time erode the bloated inventories. Related columns: - Global freight acceleration will lift fuel prices (March 27, 2024) - Oil market saw frenzy of hedge fund buying (March 25, 2024) - Hedge fund optimism about diesel ebbs away (March 18, 2024) John Kemp is a Reuters market analyst. The views expressed are his own. Follow his commentary on X https://twitter.com/JKempEnergy , opens new tab 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/distillate-futures-see-big-outflow-speculative-money-2024-04-02/

2024-04-03 00:55

MEXICO CITY, April 2 (Reuters) - Mexico's agriculture ministry on Tuesday said it is taking preventative measures to increase surveillance and reinforce inspections of U.S. livestock imports after bird flu was found in dairy cattle there. Avian influenza, commonly known as bird flu, has so far been detected in dairy herds in five U.S. states, according to the U.S. Department of Agriculture (USDA). The Mexico-United States Commission for Prevention of Foot-and-Mouth Disease and other Animal Exotic Diseases (CPA) will visit livestock stables to take samples for lab analysis, a statement by Mexico's agriculture ministry said. Officials from Mexico's agriculture sanitation authority Senasica will also increase surveillance of cattle entering the country for any sign of respiratory distress, the agriculture ministry said. Mexico is a major market for U.S. beef and dairy products. Texas and the U.S. Centers for Disease Control and Prevention (CDC) on Monday reported the second case of avian influenza in a person who had contact with dairy cows presumed to be infected with the virus, following a 2022 case in Colorado. Avian flu has reached new corners of the globe in recent years, spread by wild birds. Since 2022, 82 million U.S. chickens, turkeys and other birds have been culled. The virus is fatal to poultry but has been less severe in mammals. The Reuters Daily Briefing newsletter provides all the news you need to start your day. Sign up here. https://www.reuters.com/world/americas/mexico-taking-preventative-measures-after-bird-flu-found-us-dairy-cattle-2024-04-03/

2024-04-03 00:52

Brent, WTI futures rise as supply risks move into focus OPEC+ ministerial meeting makes no recommendation on policy U.S. EIA reports surprise jump in crude stocks NEW YORK, April 3 (Reuters) - Oil prices settled at their highest levels since October on Wednesday on investor concerns about supply disruptions due to conflict in the Middle East, although a jump in U.S. crude oil inventories capped the gains. Brent futures rose 43 cents, or 0.5%, to settle at $89.35 a barrel, and U.S. West Texas Intermediate futures gained 28 cents, or 0.3%, to $85.43 a barrel. Both contracts were up more than a dollar earlier in the session due to growing concerns about the potential for a supply deficit during the peak summer driving season. A meeting of top ministers from the Organization of Petroleum Exporting Countries and its allies including Russia, kept oil supply policy unchanged on Wednesday and pressed some countries to boost compliance with output cuts. The group said some members would compensate for oversupplies in the first quarter. It also said Russia would switch to output rather than export curbs. "If those compensation cuts get implemented, and Russia switches their export cuts to crude cuts, OPEC+ production should trend lower in the second quarter - a period when demand seasonally picks up," UBS analyst Giovanni Staunovo said. Also on Wednesday, Federal Reserve Chair Jerome Powell was cautious about future interest rate cuts due to recent data showing higher-than-expected job growth and inflation. The comments were positive for oil because they indicated solid U.S. economic growth, said Rob Haworth, senior investment strategist for U.S. Bank's asset management group. In the Middle East, Iran has vowed revenge against Israel for an attack on Monday that killed high-ranking Iranian military personnel. Iran is the third-largest producer in OPEC. Brent and WTI futures have hit five-month intraday highs for three consecutive sessions, also lifted as Ukraine's attacks on Russian refineries cut fuel supply there. Oil market participants are figuring out how to price in these developments and for how long, said Angie Gildea, the U.S. national sector lead for energy, natural resources and chemicals at KPMG. Bank of America Global Research raised its 2024 Brent and WTI forecasts to $86 and $81 a barrel, respectively, it said in a note. Oil's gains were capped after the U.S. Energy Information Administration reported U.S. crude stocks increased by 3.2 million barrels in the week to March 29. Analysts polled by Reuters had expected a decrease of more than 1.5 million barrels, in line with data reported by the American Petroleum Institute on Tuesday. "The EIA report went in the other direction on crude oil from what the API reported yesterday, so that has helped pause the rally a little bit," said Bob Yawger, director of energy futures at Mizuho. 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/oil-gains-market-buffeted-by-supply-worries-2024-04-03/