2024-02-28 11:27

MUMBAI, Feb 28 (Reuters) - The Indian rupee ended slightly weaker on Wednesday, weighed down by weakness in its Asian peers, even as dollar sales from state-run banks helped ease some of the pressure. The rupee ended at 82.9225 against the U.S. dollar, marginally lower compared with its close at 82.8975 in the previous session. The dollar index rose 0.3% to 104.2, while Asian currencies weakened, with the Thai baht and Philippine peso down 0.5% each. The rupee was contained in a tight band through much of the day's session but the local unit slipped towards the close of the session amid an uptick in the dollar index, a foreign exchange trader at a private bank said. In the near term, the rupee is expected to consolidate in its prevailing range between 82.80 and 83.15, said Dilip Parmar, a foreign exchange research analyst at HDFC Securities Meanwhile, dollar-rupee forward premiums fell with the one-year implied yield dropping 3 basis points (bps) to 1.64%, its lowest level in over two-and-a-half months. The one-year implied yield is down 22 bps in February so far, pressured by paring of rate cut expectations from the Federal Reserve and improvement in rupee liquidity conditions, traders said. A pullback in rate cut bets has also boosted U.S. bond yields, with the 10-year and two-year Treasury yield up 33 bps and 46 bps, respectively, in February so far. Investors now await the release of revised U.S. GDP data for the October-December quarter and remarks from Fed officials, due later in the day, which may offer cues about policymakers' thinking about the future trajectory of policy rates. Investors are currently pricing in a 63% chance of a rate cut at the Fed's June policy meeting, down from 73% a week earlier, according to the CME's FedWatch tool. https://www.reuters.com/markets/currencies/rupee-ends-slightly-lower-pressured-by-weakness-asian-peers-2024-02-28/

2024-02-28 11:02

A look at the day ahead in U.S. and global markets from Mike Dolan With world markets partly frozen ahead of this week's U.S. inflation update, attention swung elsewhere from Cupertino to New Zealand. But the prospect of U.S. economic growth coming in above 3% again in Q1 for the third quarter in a row is perhaps the big picture everyone needs to keep tabs on. Even though weather-distorted data updates so far this year look mixed - not least a retreat in consumer confidence in February - the Atlanta Federal Reserve's real-time GDP tracker has climbed back up to 3.1% for the current quarter. Fourth-quarter revisions due later on Wednesday should confirm real annualised growth at 3.3% late last year - and an inflation component of just 2% - and the heat looks to have been sustained into 2024. And while the dramatic disinflation of last year will please the Fed, the ongoing pace of the expansion is forcing it to be patient in cutting rates while it monitors how still-punchy service sector inflation components are behaving. Fed Governor Michelle Bowman was the latest to emphasize that as signalled she was in no rush to cut interest rates. "My baseline outlook continues to be that inflation will decline further with the policy rate held steady." What's more puzzling is how an economy in such rude health hasn't done more for President Joe Biden's approval rates with November's White House election just over eight months away. The latest monthly update on Tuesday of the rolling Reuters/IPSOS opinion poll showed as many as 58% Americans disapprove of the incumbent's performance. Some 39% of poll respondents said likely challenger Donald Trump had a better approach to the economy, compared to 33% who said Biden did. Back on markets, stocks slipped around the world on Wednesday and Wall St futures were in the red. Interest rate markets were relatively calm, with Treasury yields ticking slightly lower after a heavy week of new debt sales. Subdued oil prices - despite OPEC signals on extending supply curbs - helped the bond market mood. The futures market now tallies with the idea that the Fed was correct in December when it signalled 75 basis points of rate cuts this year. The first cut is now not priced until July when - curiously - the Fed, European Central Bank and Bank of England are now all expected to embark on cuts within two weeks of each other. Although the dollar (.DXY) , opens new tab was higher on Wednesday, the lockstep easing expectations have kept it contained in ranges and has subdued currency volatility gauges (.DBCIX) , opens new tab to two-year lows. The dollar was helped overnight by surprisingly dovish soundings from New Zealand's central bank, with hit the kiwi dollar by almost 1%. The Reserve Bank of New Zealand held the cash rate steady at 5.5% and trimmed the forecast peak for rates, catching markets by surprise as policymakers said the risks to the inflation outlook have become more balanced. In companies, Apple's stock price was firmed (AAPL.O) , opens new tab in Frankfurt trading after the firm cancelled work on its electric car after decade - concentrating on artificial intelligence projects instead. Chinese markets (.CSI300) , opens new tab slumped back 1%, with developer Country Garden saying a liquidation petition has been filed against it for non-payment of a $205 million loan, clouding its debt revamp prospects and undermining Beijing's effort to restore confidence in the property sector. Key diary items that may provide direction to U.S. markets later on Wednesday: * U.S. Q4 GDP revision, Jan goods trade balance, Jan wholesale/retail inventories; Canada Q4 current account, Dec weekly earnings * New York Federal Reserve President John Williams, Boston Fed President Susan Collins and Atlanta Fed chief Raphael Bostic all speak; Bank of England policymaker Catherine Mann speaks * G20 finance ministers and central bank chiefs meet in Sao Paulo to prepare for the annual presidential summit in November; G7 ministers meet on sidelines. * U.S. corp earnings: Paramount Global, Salesforce, HP, Monster Beverage, TJX, NRG, Viatris, Liberty Media, Icahn Enterprises etc https://www.reuters.com/markets/us/global-markets-view-usa-2024-02-28/

2024-02-28 08:40

MADRID, Feb 28 (Reuters) - Spanish power utility Endesa (ELE.MC) , opens new tab posted a lower-than- expected 71% decline in its 2023 net profit on Wednesday, hit by falling demand for energy and lower prices. Gas and energy prices have fallen sharply from their 2022 peak but demand has so far failed to rebound, hitting companies with significant gas exposure like Endesa. The firm, owned by Italian energy giant Enel (ENEI.MI) , opens new tab, posted a net profit of 742 million euros ($802.92 million), compared with 2.54 billion euros a year earlier and the 1.06 billion euros expected by analysts polled by LSEG. The amount of natural gas and electricity consumed in Spain has declined for two years in a row, with gas demand falling almost 11% last year. Weaker demand from residential and industrial customers hit the gas business, Endesa said, as did the $570 million arbitration ruling over a liquefied natural gas contract dispute. Gas prices around 64% lower led to a sharp fall in energy prices in the Iberian region, where electricity demand also fell. Endesa also blamed regulatory measures including Spain's windfall tax on energy companies for hitting its results. The results show a weaker-than-expected margin in electricity, and a gas margin that is still negative, RBC analyst Fernando Garcia said. Rival Spanish power company Naturgy (NTGY.MC) , opens new tab was also hit by lower gas prices and sales. However, the effects on its bottom line were offset by the expiry of unprofitable hedges that had weighed on its 2022 performance. Endesa Chief Executive Jose Bogas acknowledged the 2023 decline but was upbeat about the outlook for 2024, confirming annual targets, including an adjusted net profit, used to calculate dividends, of between 1.6 billion euros and 1.7 billion euros. "After a 2023 affected by extraordinary circumstances, we maintain for the current year a return to the growth path based on the normalization of market conditions," he said. The company expects "margins in the gas and conventional generation businesses to normalize" and "a very limited impact of the current price environment thanks to our strategy of selling our own production in advance," he said. ($1 = 0.9241 euros) https://www.reuters.com/business/energy/spains-endesa-misses-expectations-lower-energy-gas-prices-2024-02-28/

2024-02-28 08:03

BEIJING, Feb 28 (Reuters) - China's aviation fuel consumption is likely to expand 13.1% this year, extending a robust recovery last year on passenger travel, but the country's crude oil imports may stay largely flat, according to forecasts by a research arm of state energy giant China National Petroleum Corp (CNPC). Aviation fuel consumption may hit 39.3 million metric tons this year, and crude oil imports are expected to rise 0.1% to 565 million metric tons, or about 11.3 million barrels per day (bpd) CNPC's Economic & Technology Research Institute (ETRI) said in its annual outlook on Wednesday. Kerosene demand has been widely expected to grow further this year, as China's international air travel demand gradually recovers in the post-COVID travel market. International traffic remained depressed, at 53% of pre-COVID levels at the end of 2023, LSEG data showed. Wider economic pressures have weighed on demand for diesel, a key fuel for trucks in the logistics and construction sectors, as CNPC expected diesel use to fall 2.8% this year to 196 million metric tons. Gasoline consumption, however, may grow 1.3% to 165.1 million metric tons, CNPC said. Analysts have forecast China's gasoline demand will likely peak between 2024 and 2025, as a rollout of electric vehicles (EVs) continues at breakneck speed. EV sales are expected to account for 40% of about 23 million total auto sales this year. National crude oil throughput is seen growing 1.8% to a record 752 million tons, or 15.04 million bpd, with average refinery utilisation rate pegged at 78.3%, off slightly from last year's 78.9%, CNPC added. (ton = 7.3 barrels for crude oil conversion) https://www.reuters.com/business/aerospace-defense/chinas-aviation-fuel-demand-seen-up-13-2024-cnpc-research-2024-02-28/

2024-02-28 07:49

ZURICH, Feb 28 (Reuters) - Holcim (HOLN.S) , opens new tab will launch a 1 billion Swiss francs ($1.14 billion) share buyback by the end of the year, the building materials giant said on Wednesday after reporting fourth-quarter earnings slightly ahead of forecasts. The Swiss cement maker, which last month announced plans to spin off its fast-growing American business, was in confident mood after posting record annual operating profit on the back of efficiency gains and price increases. For the fourth quarter, Holcim posted recurring operating profit of 1.12 billion Swiss francs, slightly above analyst expectations of 1.07 billion francs. Sales rose 2.1% to 6.6 billion francs, against the 6.5 billion francs forecast by analysts. Shares were up 2.6% in pre-market trading in Zurich. Chief Executive Jan Jenisch highlighted the company's higher profitability during 2023, supported by 28 acquisitions and a focus on higher-margin businesses. Holcim continued to reshape its portfolio over the year by selling its operations in Uganda, South Africa and Tanzania while boosting its presence in the North American market. "Moving our business from volume to value, we have successfully shifted to the most attractive markets with strong growth drivers and margins," Jenisch said in a statement. For the full year, Holcim increased organic sales - which cut out currency and acquisition effects - by 6.1%, meeting its goal for an increase of 6% or better. However, Holcim - the results of which are widely viewed as a proxy for the broader construction sector - said it expected a slowdown in 2024, with currency adjusted sales forecast to rise by 4%. An additional 2% of growth will come from acquisitions, the company added. Holcim last month announced it plans to spin off its North American business in a New York listing. The business accounts for about 39% of group sales. North America was Holcim's most profitable market last year and its second-biggest by sales behind Europe, contributing nearly a third of operating income. ($1 = 0.8801 Swiss francs) https://www.reuters.com/markets/commodities/holcim-reports-q4-earnings-slightly-above-forecasts-2024-02-28/

2024-02-28 07:46

FRANKFURT/DUESSELDORF, Feb 28 (Reuters) - Bailed-out German utility Uniper (UN0k.DE) , opens new tab expects a significant fall in profit this year, it said on Wednesday, blaming lower wholesale energy prices that have also clouded the outlook for rivals across Europe. The company forecasts adjusted net profit of between 0.7 billion and 1.1 billion euros ($758 million to $1.2 billion) this year. Last year it made a record 4.43 billion euros, helped by one-off gains. The outlook reflects a normalisation of wholesale power and gas prices that had risen sharply when Europe severed most energy ties with Russia. RWE (RWEG.DE) , opens new tab and France's EDF have also warned of lower 2024 profit in recent weeks. Uniper was rescued by the German government at the height of Europe's energy crisis in 2022, resulting in a 13.5 billion euro bailout, after Moscow's halt to gas supplies via the Nord Stream pipeline forced the company to buy replacement volumes at sky-high prices. The company said on Wednesday that the disposal of its North American power business - part of asset sales demanded by Brussels in return for approving the bailout - had been initiated and was at an advanced stage. "Uniper finished 2023 with exceptionally good results. That gives us financial flexibility to systematically implement our strategy," said finance chief Jutta Doenges, referring to the group's 8 billion euro plan to expand its renewables portfolio and cut CO2 emissions. Sources this month told Reuters that the German Government, which owns more than 99% of Uniper, was considering releasing a 20-30% stake in a listing next year as a first step to reversing the bailout. Uniper, which has set aside a 2.2 billion euro provision to start paying back the state money, said its adjusted core profit would decline to between 1.5 billion and 2 billion euros this year, down from 7.16 billion euros in 2023. ($1 = 0.9235 euros) https://www.reuters.com/business/energy/uniper-expects-lower-2024-profits-falling-commodity-prices-2024-02-28/