2024-03-29 17:52

WASHINGTON, March 29 (Reuters) - A group representing major automakers on Friday urged the White House to oppose any effort by steelmaker Cleveland-Cliffs (CLF.N) , opens new tab to buy rival U.S. Steel (X.N) , opens new tab, warning that a deal could result in anti-competitive pricing for vehicles. "A consolidation of the two companies would also place 65 to 90% of steel used in vehicles under the control of a single company," Alliance for Automotive Innovation CEO John Bozzella said in a letter, which was first reported by Reuters. President Joe Biden said earlier this month that U.S. Steel, which has agreed to be bought by Japan's Nippon Steel (5401.T) , opens new tab for $14.9 billion, must remain a domestically-owned U.S. firm. Cleveland-Cliffs has said it would consider another bid for U.S. Steel if the deal with Nippon Steel falls apart. "If the administration has concerns about the Nippon Steel deal, it must seriously consider alternative outcomes," said the letter from the group, which represents General Motors (GM.N) , opens new tab, Toyota Motor Corp (7203.T) , opens new tab, Volkswagen (VOWG_p.DE) , opens new tab, Hyundai (005380.KS) , opens new tab and others. "One option that should not be on the table is an arrangement that creates a market concentration of domestic steel production in a single company." The White House, Cleveland-Cliffs and U.S. Steel did not immediately comment on the letter. A combination of U.S. Steel and Cleveland-Cliffs would control "100% of the domestic electrical steel (e-steel) needed for electric vehicle (EV) motors and EV production," the automaker group said in its letter. It warned that a deal could "drive up the cost of both steel and e-steel, and ultimately increase the cost of finished vehicles (including EVs) for American consumers." The group wrote Congress, the Federal Trade Commission and U.S. Justice Department in October to raise its concerns about a tie-up, citing concerns about steel used to produce vehicle structural frames, automotive surface panels like doors, hoods and fenders, and EV motors. 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/automakers-urge-white-house-oppose-us-steel-sale-cleveland-cliffs-2024-03-29/

2024-03-29 16:02

PCE price index increases 0.3% in February Core PCE prices index gains 0.3%; up 2.8% year-on-year Consumer spending jumps 0.8%; personal income up 0.3% WASHINGTON, March 29 (Reuters) - U.S. prices moderated in February, with the cost of services outside housing and energy slowing significantly, keeping a June interest rate cut from the Federal Reserve on the table. The report from the Commerce Department on Friday also showed consumer spending rising by the most in just over a year last month, underscoring the economy's resilience. The United States continues to outperform its global peers despite higher borrowing costs, thanks to persistent labor market strength. "Core services inflation is slowing and will likely continue throughout the year," said Jeffrey Roach, chief economist at LPL Financial in Charlotte, North Carolina. "By the time the Fed meets in June, the data should be convincing enough for them to commence its rate normalization process." The personal consumption expenditures (PCE) price index rose 0.3% last month, the Commerce Department's Bureau of Economic Analysis said. Data for January was revised higher to show the PCE price index climbing 0.4% instead of 0.3% as previously reported. Economists polled by Reuters had forecast the PCE price index gaining 0.4% on the month. Goods prices rose 0.5% last month, boosted by a 3.4% jump in the cost of gasoline and other energy products. There were also strong increases in the prices of recreational goods, vehicles, clothing and footwear. But prices for furnishings and household equipment, and other long-lasting manufactured goods were subdued. In the 12 months through February, PCE inflation advanced 2.5% after increasing 2.4% in January. Though price pressures are subsiding, the pace has slowed from the first half of last year, and inflation remains above the U.S. central bank's 2% target. Fed Chair Jerome Powell said on Friday February's inflation data was "more along the lines of what we want to see." Fed officials last week left the central bank's policy rate unchanged in the current 5.25%-5.50% range, having raised it by 525 basis points since March 2022. Policymakers anticipate three rate cuts this year. Financial markets expect the first rate reduction in June. Most U.S. financial markets were closed for the Good Friday holiday, with the exception of the foreign exchange market. The dollar slipped against a basket of currencies on the data. SOME STICKINESS REMAINS Excluding the volatile food and energy components, the PCE price index increased 0.3% last month. That followed an upwardly revised 0.5% gain in January. The so-called core PCE price index was previously reported to have advanced 0.4% in January. Core inflation increased 2.8% year-on-year in February, the smallest gain since March 2021, after rising 2.9% in January. The Fed tracks the PCE price measures for monetary policy. Monthly inflation readings of 0.2% over time are necessary to bring inflation back to target. While some of the firmer readings in the consumer and producer price reports were not replicated in the PCE price data because of different weights, some elements of stickiness remain. Core inflation has increased at a 3.5% annualized rate in the past three months. Services prices increased 0.3%, slowing after a 0.6% jump in January. The cost of housing and utilities rose 0.5%. There were also solid increases in the prices of recreation services as well as financial services and insurance. But the cost of dining out, hotel and motel rooms was unchanged, while transportation services barely rose and healthcare increased marginally. PCE services inflation excluding energy and housing gained 0.2% last month after surging 0.7% in January. The so-called super core increased 3.3% year-on-year after rising 3.5% in January. Policymakers are monitoring the super core data to gauge their progress in fighting inflation. It has risen at a 4.5% rate in the past three months, which some economists said supported delaying rate cuts. But others viewed the elevated reading as the result of January's spike in prices, which they said did not mark a shift in the trend. "The six drivers of the surge in core inflation in 2021-to-22 - expanding margins, rapid wage gains, exploding rents, supply chain chaos, and pass-through from higher global food and energy prices - have all normalized or are in the process of normalizing, with no real signs of any reversal," said Ian Shepherdson, chief economist at Pantheon Macroeconomics. "That means the fundamental pressure on inflation is to the downside, but odd things can happen in individual months without changing the bigger picture." Consumer spending, which accounts for more than two-thirds of U.S. economic activity, jumped 0.8% last month. That was the largest gain since January 2023 and followed a 0.2% rise in January. When adjusted for inflation, consumer spending rebounded 0.4% after dropping 0.2% in January. The increase in the so-called real consumer spending suggested that consumption likely retained most of its momentum in the first quarter. That prompted the Atlanta Fed to raise its gross domestic product growth estimate this quarter to a 2.3% annualized rate from a 2.1% pace. Growth prospects were also bolstered by data from the Census Bureau showing both wholesale and retail inventories rising at a brisk clip in February, offsetting a 1.5% widening in the goods trade deficit. But much of the spending was funded from savings as income rose 0.3% after accelerating 1.0% in January on the back of a Costco Wholesale Corporation special dividend. Income at the disposal of households after accounting for inflation and taxes fell 0.1%. The saving rate dropped to 3.6%, the lowest level since December 2022, from 4.1% in January. "As long as employment growth remains strong, it can underpin solid spending, however, consumers overall are not prepared for a weakening in the labor market should it unfold," said Kathy Bostjancic, chief economist at Nationwide. 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/us-inflation-increases-moderately-february-consumer-spending-surges-2024-03-29/

2024-03-29 12:41

BENGALURU, March 29 (Reuters) - India's foreign exchange reserves (INFXR=ECI) , opens new tab rose for a fifth straight week to hit a record high of $642.63 billion as of March 22, data from the central bank showed on Friday. The reserves jumped by $139 million in the reporting week. Changes in foreign currency assets, expressed in dollar terms, include the effect of appreciation or depreciation of other currencies held in its reserves. Foreign exchange reserves include India's Reserve Tranche position in the International Monetary Fund. The Reserve Bank of India (RBI) intervenes in the foreign exchange market to curb excess volatility in the rupee. The domestic currency settled at 83.40 against the dollar on Thursday. India's financial markets were closed on Friday for a holiday. FOREIGN EXCHANGE RESERVES (in million U.S. dollars) --------------------------------------------------------- March 22 March 15 2024 2024 --------------------------------------------------------- Foreign currency assets 568,264 568,386 Gold 51,487 51,140 SDRs 18,219 18,276 Reserve Tranche Position 4,662 4,689 ---------------------------------------------------------- Total 642,631 642,492 ---------------------------------------------------------- Source text: (https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx , opens new tab) ((India Headline News Team; +91 80 6749 1310)) 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/business/finance/indias-forex-reserves-jump-record-high-2024-03-29/

2024-03-29 11:59

Russia faced with drone attacks on oil refineries Undamaged oil refineries have boosted output - Novak Issue of fuel deliveries by rail is being solved Arctic LNG 2 in talks on shipments, lack of tankers is key issue MOSCOW, March 29 (Reuters) - There is no need for Russia to ban exports of diesel to tackle rising prices and possible shortages of the fuel after drone attacks reduced refining capacity, Deputy Prime Minister Alexander Novak said on Friday. Speaking to reporters, Novak also said, without elaborating, that the Novatek-led (NVTK.MM) , opens new tab Arctic LNG 2 project, which started tentative production in December, remains in talks about liquefied natural gas (LNG) deliveries as Western sanctions hinder the availability of tankers for the project. Russia has faced a steep reduction in oil refining capacity, crippled by technical outages and drone attacks. It banned exports of gasoline for half a year starting from March 1. Refining capacity shut down by drone attacks has reached 14% of Russia's total oil refining capacity, according to Reuters calculations. The country's total daily offline primary oil refining capacity has jumped by around a third in March from February to 4.079 million metric tons. Novak said that other oil refineries managed to boost their output, while the government is working on the issue of fuel deliveries from plants amid railway bottlenecks. "The situation in the oil products market is stable today," Novak said. "Our companies have already increased the load at the available capacities. It allowed for more supply, including... gasoline and diesel fuel." Speaking about a technical outage at the Norsi refinery, Russia's fourth-largest by output, Novak said that a malfunctioning turbine may resume operations in a month or two. Industry sources have said one of two catalytic crackers remains out of action at the plant. ARCTIC LNG 2 In comments about Arctic LNG 2, key in Russia's plans to gain a fifth of the global liquefied natural gas market share by 2030-2035, Novak said that Novatek has been in talks about cargo delivery. The company has said commercial LNG supplies from the project were due to start in the first quarter of 2024. However, Washington in November imposed sanctions against the project that followed separate measures related to the project in September, over Russia's conflict with Ukraine. The project also has the challenge of securing gas carriers. Fearing a backlash from the sanctions, foreign shareholders suspended participation in the project, renouncing their responsibilities for financing and for offtake contracts for the plant. Responding to a question on when the first LNG cargo will be delivered from the project, Novak said that "the company is dealing with the issues, corresponding talks are under way". "Their main problem is with the tankers," he added. 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/russias-novak-says-theres-no-need-diesel-export-ban-2024-03-29/

2024-03-29 11:24

BEIJING, March 29 (Reuters) - Swiss agrichemicals and seeds group Syngenta on Friday withdrew its bid for a multi-billion dollar listing on the Shanghai Stock Exchange during a recent period of weakness in the Chinese equity market. The initial public offering (IPO), which would have valued the Chinese-owned firm at as much as $60 billion, has been postponed repeatedly since being proposed in 2021 due to unfavourable market conditions. "After careful consideration of industry environment and the company's own development strategy, Syngenta Group has decided to withdraw its application for IPO on the main board of the Shanghai Stock Exchange," the company said on Friday. The flotation had, like other recent deals, come unstuck due to a lull on the Chinese market, according to a person familiar with the matter, who spoke on condition of anonymity. Syngenta spokesman Saswato Das declined to give further details on why the company had stepped back from the IPO. Syngenta said it will look to restart the listing process either in China or on a different exchange, when conditions are right, as well as explore alternative sources of funding. Market analysts have previously cited Hong Kong, Zurich and London as potential alternatives for a Syngenta listing. The sudden chill in China's IPO market, which was the world's biggest in 2022 and 2023, comes after the securities watchdog, under new chairman Wu Qing, vowed to step up scrutiny of listing candidates and crack down on any lapses. During January-March 2024, money raised via China IPOs plunged two-thirds from a year earlier to just $2.4 billion, the smallest quarterly fundraising since the last quarter of 2018, and down 82% from a year earlier, preliminary LSEG data showed. Executives of the company owned by Sinochem said as recently as last November that Syngenta planned to list in 2024. The partial floatation was expected to raise around $10 billion. The Shanghai Exchange said in a filing that the bourse had terminated its review of Syngenta's IPO application after the company applied to withdraw it. Weak demand in key markets such as Brazil has put pressure on the company's earnings. Sales at the Basel-based company dipped last year by 4% to $32.2 billion from $33.4 billion in 2022, while earnings before interest, tax, depreciation and amortisation fell by 18% to $4.6 billion, Syngenta said later on Friday. Get U.S. personal finance tips and insight straight to your inbox with the Reuters On the Money newsletter. Sign up here. https://www.reuters.com/markets/deals/shanghai-stock-exchange-terminates-review-syngentas-ipo-application-2024-03-29/

2024-03-29 11:20

BENGALURU, March 29 (Reuters) - India's Force Motors (FORC.NS) , opens new tab said on Friday it will close its agricultural tractors business and related activities from March 31. The closure of business is part of the company's product rationalisation programme under which it will focus on its core segments such as shared mobility transportation, last mile mobility and the creation of special vehicles for civil and defence applications, the company added. In financial year 2023, the sale of agricultural tractors accounted for 3.66% of the company's total revenue, Force Motors said. The company, which is known for its multi-seater passenger vehicles and also makes engines for BMW (BMWG.DE) , opens new tab and Mercedes (MBGn.DE) , opens new tab cars in India, earns about 48% of its revenue from vehicle sales, while about 36% revenue comes from contract engine manufacturing, according to its last annual report. Force Motors reported a profit for the fourth-straight quarter in the October-December period as a pickup in post-pandemic economic activity helped the Maharashtra-based company turn profitable. Stay up to date with the latest news, trends and innovations that are driving the global automotive industry with the Reuters Auto File newsletter. Sign up here. https://www.reuters.com/business/autos-transportation/indias-force-motors-shut-down-its-agricultural-tractors-business-2024-03-29/