2024-02-27 12:03

JOHANNESBURG, Feb 27 (Reuters) - South Africa's delay in taking coal-fired power stations offline will only harm its commitment to net-zero emissions by 2050 if the plants continue to burn well into the 2030s, the head of its donor-funded green energy plan said on Tuesday. Officials admitted privately in November that South Africa will miss its binding 2030 carbon emissions targets under the Paris climate agreement, as Africa's most industrialised country will run eight coal-fired power plants for longer than planned. Countries around the world, including Canada, Britain and Germany have delayed or watered down energy transition plans. South Africa is the 15th biggest emitter in the world, according to the Global Carbon Atlas, a significant drop from previous years. This is mostly owing to power shortages at state power provider Eskom. But its emissions are still much bigger than more developed economies like Britain, Vietnam or Italy. "I think that if we delay well into the 2030s, we will have a problem in meeting our NDC (nationally determined contribution) commitments," said Joanne Yawitch, head of the green energy overhaul which Western and multilateral donors are partly funding. "(But) I don't think South Africa is backtracked from (its climate commitments) in any way whatsoever," she added. The country committed under the Paris deal to cut emissions to between 350 and 420 million tonnes annually by 2030, from 442 million tonnes this decade. To do this, it planned to decommission eight coal-fired power plants, six by 2030 and the remaining by 2034, but has since backed away from closing them. The economy has been hit by brutal daily power shortages. "Over the last couple of years, we have certainly been on track to be below reasonably below that 420 megatons of carbon equivalent (the 2030 goal)," Yawitch said, adding that "we haven't had any indications that there is risk to the (donor) ... financing" from delays to decommissioning coal plants. https://www.reuters.com/business/environment/south-africa-says-climate-targets-track-if-coal-switch-not-delayed-again-2024-02-27/

2024-02-27 11:46

Feb 27 (Reuters) - Lowe's Cos (LOW.N) , opens new tab forecast annual sales and profit below Wall Street estimates on Tuesday, in signs that a recovery would take longer than expected as spending on home-improvement projects remained under pressure. Shares edged higher in choppy premarket trading after the company topped market estimates for fourth-quarter comparable sales while the downbeat outlook was largely expected as larger rival Home Depot (HD.N) , opens new tab had tempered expectations last week. Higher prices of essentials have squeezed household budgets across the U.S., prompting customers to allocate fewer dollars to large-scale home remodeling and instead take up only necessary maintenance projects. Lowe's is also more exposed to DIY customers, who have pulled back on spending on appliances and other discretionary categories such as kitchen and flooring. DIY accounts for about 75% of the company's total sales, compared with roughly half at Home Depot. The forecasts come as investors had pinned their hopes on a rebound in 2024 after a transition year in 2023 following the surge seen during the pandemic. Lowe's expects comparable sales to be down 2% to 3% in fiscal 2024, while analysts on average expect a 1.13% drop, according to LSEG data. It projected annual earnings per share between $12.00 and $12.30, compared with estimate of $12.75. Although green shoots are starting to show in the U.S. housing market as existing home sales climbed to a five-month high in January, tight supplies and a resumption in an upward trend in mortgage rates have pressured the market. Lowe's posted a profit of $1.77 per share in the fourth quarter, beating estimates of $1.68. Same-store sales declined 6.2% during the period, compared with expectations for a decline of 7.06%. https://www.reuters.com/business/retail-consumer/lowes-forecasts-2024-sales-profit-below-estimates-2024-02-27/

2024-02-27 11:16

MUMBAI, Feb 27 (Reuters) - Vietnam has imported husked brown rice from India for the first time in decades to process the grain and export the refined, white variety, trade and government sources said, as Hanoi tries to cash in on strong global demand for the staple. Vietnam, the world's third biggest rice exporter, has imported at least 200,000 metric tons of husked brown rice from India between December and February, the sources said. Vietnam is receiving brisk export orders for rice after India, the world's biggest exporter, imposed a ban on white rice exports in 2023. Rice shipments from Vietnam surged to a record 8.3 million metric tons in 2023. Surging exports have led to a drawdown in stockpiles in Vietnam, which is still keen to meet rising global demand, said an exporter in the eastern Indian city of Kolkata. Since rice paddy was not available in Vietnam for milling, some traders imported husked rice from India and made a good profit by processing and exporting the grain, he said. Soon, other traders followed suit, the exporter said. While India's husked brown rice was offered at around $500 per metric ton on a free-on-board (FOB) basis on the east coast, Vietnamese dealers sold the polished grain at over $600, the sources said. Vietnam started buying husked brown from India only recently, and it now accounts for around 95% of India's total husked brown rice exports, they said. Hanoi is currently importing around 70,000 metric tons of husked brown rice from India every month, said a government official, who declined to be identified, as he's not authorised to talk to the media. Although the new season's supplies have started trickling in in Vietnam, Indian rice is still cheaper, the Kolkata-based exporter said. Before India imposed the rice export ban, Vietnam imported 100% broken white rice to make animal feed and beer. The Philippines, Indonesia, Nigeria, Senegal, Ivory Coast, and Malaysia are leading importers of rice, and they depend on exports from India, Thailand, Vietnam, Pakistan, and Myanmar. India currently allows exports of only parboiled and premium basmati rice varieties. https://www.reuters.com/markets/commodities/vietnam-imports-husked-brown-rice-india-re-exports-sources-say-2024-02-27/

2024-02-27 11:08

Feb 27 (Reuters) - Buoyed by the successful launch of U.S. bitcoin exchange-traded funds (ETFs), asset managers are lining up to list a second wave of more complex crypto products, setting the stage for another tussle with the U.S. securities regulator. The Securities and Exchange Commission (SEC) rejected spot bitcoin ETFs for more than a decade, hoping to protect investors from market manipulation. But the SEC was forced to approve them last month after Grayscale Investments won a court challenge. A federal appeals court ruled that the SEC had not sufficiently detailed its reasoning for rejecting the products. That decision encouraged 12 asset managers, including Grayscale, ProShares, VanEck, Invesco, Fidelity and Ark Investments to file applications to launch 25 next-generation cryptocurrency ETFs. Many are complex products that would use options to amplify bitcoin's volatility. Others would track the price of ether, the No. 2 cryptocurrency after bitcoin. Investors hope the new products will help drive crypto further into the mainstream. Bitcoin hit $50,000 on Feb. 12 for the first time in over two years and ether has climbed more than 12% this year on hopes the SEC will approve the spot products. Yet the SEC remains uncomfortable with cryptocurrencies and complex exchange-traded products, and lawyers and industry sources said they expect the agency to move cautiously. The legal status of ether is also ambiguous, they noted. "It doesn't seem like there's a rush to approve a second wave of products," said Yesha Yadav, a professor focusing on digital asset regulation at Vanderbilt University, adding the SEC would have to "grapple with" how much risk it can stomach. SEC Chair Gary Gensler remains a crypto critic, and when approving the bitcoin ETFs, he warned they were highly risky and said the decision did not signal the SEC was willing to approve listing standards for crypto assets more broadly. An executive at one issuer said it was unclear whether SEC approval of the bitcoin ETFs would pave the way for other products. Some applications before the SEC are for products designed for day traders: Leveraged exchange-traded bitcoin products would seek to juice returns by further amplifying the cryptocurrency's significant volatility. Other applications are for inverse products that allow speculators to bet on a decline in the price. The SEC has approved many inverse and leveraged ETFs, but has been cautious after a volatility-tracking exchange-traded note went bust in 2018, costing investors $2 billion in losses. In 2020, it capped ETF leverage at 200%, and the agency is due to review its rules on ETF risks this year, according to its regulatory agenda. Gensler and Democratic SEC Commissioner Caroline Crenshaw have also warned , opens new tababout risks of inverse and leveraged ETFs. The SEC would only formally stop these products from launching if it found their disclosures to be materially misleading, people familiar with the matter said, but they added it could delay the effective date of a filing or suggest an issuer withdraw it if staff have concerns. James Angel, associate professor of finance at Georgetown University, said the SEC would likely avoid outright rejection of applications, which could invite a legal challenge. "I think they will look for every possible detail or excuse they can to delay the process," he added. There is no clear process for SEC approval of options on the bitcoin ETFs, which have usually been approved days after an ETF launch, so approval could take months going forward, Reuters reported this month. ProShares, Invesco, Fidelity and Ark Investments declined to comment or did not respond to requests for comment. ETHER CLASH? Because the spot ether ETFs would be a new product and require a rule change, the SEC must approve or deny them by a set deadline. VanEck's filing is first in line for a decision on May 23, while the deadline for Grayscale's ether application is June 18. The SEC has yet to engage substantively with issuers on the applications, but is expected to begin meetings next month, said two other people familiar with the matter. The agency has not yet disclosed meetings on the products in its public log. Asked about the spot ether ETF filings this month, Gensler told CNBC the SEC's five commissioners would review them. Both Democrat commissioners voted against the bitcoin ETFs, while the two Republicans voted for them. That means Gensler would likely have the deciding vote. The arguments Grayscale used to defeat the SEC in its bitcoin ETF suit could apply to the ether products because the circumstances are similar. But some regulatory experts and issuers said Gensler could argue ether is a different type of asset. The SEC has said bitcoin is a commodity, but has not made a determination on ether. Unlike bitcoin, ether is traded on a so-called "proof-of-stake" blockchain that allows users to earn yield in exchange for locking up tokens for a period of time. Gensler has questioned whether this setup resembles a traditional security. "There are different circumstances the SEC will consider. The biggest circumstance is that they consider bitcoin to be a commodity and not a security," said Frank Borger Gilligan, a securities attorney at Dickinson Wright who said the SEC would want assurances that any new products had investor safeguards. Asked by CNBC last week if it will take another lawsuit to force the SEC to approve ether ETFs, Grayscale CEO Michael Sonnenshein said it was "too early to say." https://www.reuters.com/technology/us-sec-expected-drag-its-feet-new-wave-crypto-etfs-2024-02-27/

2024-02-27 11:05

TORONTO, Feb 27 (Reuters) - A year after Canada tightened foreign investment rules for the critical minerals sector, Chinese money has continued to pour into Toronto-listed miners, according to proprietary research conducted by the University of Alberta. The inbound flow is raising hopes among some junior miners that it will be easier to find Chinese funding. Canada had forced three Chinese investors to sell their stakes in Canadian critical mineral companies in 2022. Some of these companies did not have their mines in Canada. In October 2022, the government added an extra layer of scrutiny for inbound deals in critical minerals. The changes did not specify which country's investments would be scrutinized, but the government says it wants to secure the critical minerals sector, which is strategic to Canada's national security. Still, Canada's critical miners received at least a dozen investments worth C$2.2 billion ($1.6 billion) in 2023 from new and existing investors in China and Hong Kong, a huge increase over C$62 million in 2022, data compiled by the University of Alberta's The China Institute shows. "What you are seeing is the reality, that there is no blockade of Chinese investments in Canada... it is a perception issue," said Dean McPherson Head of Mining, TMX Group Ltd (X.TO) , opens new tab. "Chinese investors are not shy to risk, they are willing to stick in and ride it out (in Canada)," Mcpherson added. Daniel Lincoln, a researcher with The China Institute, told Reuters Canada may find it difficult to regulate all Chinese mining acquisitions notwithstanding the provisions in the Investment Canada Act, especially when both buyer and seller are keen for the transaction. In a latest test of Canada's new rules, China's state-owned Zijin Mining Group (601899.SS) , opens new tab last month offered to buy a 15% stake in Solaris Resources Inc (SLS.TO) , opens new tab for C$130 million. While Canada lists copper as a critical mineral, the deal is likely to be approved since the funds will be used to develop Solaris' copper-gold project in Ecuador, two sources familiar with the deal told Reuters. Solaris and Zijin did not respond to an email query by Reuters. A spokesperson for the Ministry for Innovation, Science and Industry declined to comment on the Zijin deal, but said the government must examine each investment on its merit to ensure Canada remains open to necessary foreign direct investment. COPPER ASSETS IN DEMAND Chinese investors have been among the most active in Canada's mining industry, plowing C$21 billion between 1993 and 2023, according to data from The China Institute. Last year, copper companies were the most targeted by Chinese investors. MMG Africa Ventures, a unit of state-backed China Minmetals Corp, bought a copper mine from Vancouver-based Cuprous Capital Ltd for C$1.7 billion, and Hong Kong-based Greenwater invested C$13 million in Gowest Gold (GWA.V) , opens new tab, the data shows. Jiangxi Copper Co Ltd (600362.SS) , opens new tab increased its stake in First Quantum Minerals Ltd (FM.TO) , opens new tab to 18.5% from 18.3% and the Chinese company also bought $20 million worth of senior notes in the Canadian company last year, regulatory filings show. Some smaller miners and explorers have been lobbying the Canadian government to allow more Chinese investments, citing difficulty in raising capital. On Sunday, Chinese miner Yintai Gold (000975.SZ) , opens new tab agreed to buy Vancouver-based Osino Resources (OSI.V) , opens new tab for C$368 million. Osino and Yintai did not respond to a Reuters query about if they are seeking Canadian government approval for the deal. Gold is not considered a critical metal by Canada. Michelle DeCecco, chief operating officer of Lithium Chile (LITH.V) , opens new tab, one of the three companies that Canada ordered to get rid of its Chinese investor, told Reuters there was no softening in Ottawa's stance because of which companies are finding alternative ways to secure Chinese funding. Soon after SRG Mining Inc (SRG.V) , opens new tab received a C$16.9 million investment proposal from C-ONE, backed by Chinese entrepreneur Yue Min, the Montreal-based graphite miner announced plans to change the country where it is incorporated. On Monday, it said it would incorporate in Abu Dhabi Global Markets while maintaining its Canadian stock market listing. SRG Mining did not respond to an email query by Reuters. "Unfortunately, it is often to take their companies out of Canada; away from Five Eyes," DeCecco said, referring to the intelligence sharing network comprising of the United States, Britain, Canada, Australia and New Zealand. ($1 = 1.3522 Canadian dollars) https://www.reuters.com/markets/commodities/chinese-money-still-chasing-canadian-critical-mining-deals-despite-ottawas-2024-02-27/

2024-02-27 11:02

A look at the day ahead in U.S. and global markets from Mike Dolan With stocks holding the bulk of recent stellar gains, more anxious bonds are back in focus - but Treasuries caught a decent break Tuesday during a heavy week for new debt sales and inflation updates. Debt markets were unsettled on Monday as a record $127 billion of coupon debt was sold at two auctions of two- and five-year Treasury notes, with another $42 billion of seven-year notes under the hammer on Tuesday. Demand for the paper managed to keep a lid on yields at last week's two-month highs. And two- and 10-year yields ticked lower again overnight, with a mix of weather-related softness in U.S. new home sales data for January and this week's latest congressional standoff over government funding in view. While such heavy supply of new debt has become a feature of the market, tension has been added by the Federal Reserve's stubborn refusal to cut interest rates early as it continues to scour the inflation landscape for signs of heat. Kansas City Fed boss Jeffrey Schmid toed that line again on Monday and used a debut speech on policy to restate the focus on the threat of high inflation and patience in cutting rates. And that picture is not going to be any clearer before the important PCE inflation gauge is released on Thursday. In the meantime, the energy price backdrop to the inflation story remained confused amid conflicting signals from the Middle East. Renewed attacks on shipping in the Red Sea were juxtaposed with some signs of a breakthrough in Gaza ceasefire talks. While also due to meet congressional leaders today over the government funding hiatus, U.S. President Joe Biden said overnight that Israel had agreed to halt its Gaza attacks for the Muslim holy month of Ramadan - as Hamas reviewed a truce deal that includes a prisoner-hostage swap. With the two issues linked, Biden's comments came as U.S. Central Command claimed Yemen's Iran-aligned Houthis had unsuccessfully fired a missile at the U.S.-flagged oil tanker Torm Thor in the Gulf of Aden on Feb. 24. Adding to mix, Russia ordered a six-month ban on gasoline exports from March 1. Parsing all of that, U.S. crude prices were a fraction higher on Tuesday - although well off last week's 3-month highs. Back on Wall St, the tail end of the corporate earnings season plays out while the macro diary is topped by February consumer confidence readings. Overseas, Japan's core consumer inflation slowed for a third straight month in January but failed to fall below the central bank's 2% target as expected, keeping alive expectations the Bank of Japan will end negative interest rates by April. However, questions about longer-term deflationary conditions in the world's fourth-biggest economy were underlined by data showing the number of babies born in Japan fell for an eighth straight year to a fresh record low in 2023. The buoyant Nikkei 225 (.N225) , opens new tab held steady at new record highs, but the yen firmed up a touch. Stocks were generally higher across the world on Tuesday - with China's main indexes (.CSI300) , opens new tab advancing again and artificial intelligence stocks there (.CSI930713) , opens new tab jumped 5.2%. With many now awaiting the next policy moves from the National People's Congress on March 5, much of the focus remained on new regulatory moves to stem capital flight and market speculation. Standard Chartered (STAN.L) , opens new tab said it had suspended new investments by its clients in China into offshore products via a quota-based channel amid a surge in demand for overseas investments due to weakness in the local market and currency. Elsewhere, Bitcoin - now up more than 10% in two sessions - hit a two-year high on Tuesday on signs of large players buying cryptocurrency, while smaller rival ether topped $3,200 for the first time since 2022. A bitcoin 'halving' event in April - a process designed to slow the release of bitcoin - is now on the radar. Key diary items that may provide direction to U.S. markets later on Tuesday: * U.S. Feb consumer confidence, Jan durable goods orders, Dec home prices, Richmond Fed Feb business survey, Dallas Fed service sector survey * Kansas City Federal Reserve President Jeffrey Schmid, Fed Vice Chair for Supervision Michael Barr speak; Bank of England Deputy Governor Dave Ramsden speaks * U.S. Treasury Secretary Janet Yellen holds a press conference ahead of G20 and G7 finance meetings in Brazil * U.S. Treasury auctions 7-year notes * U.S. corp earnings: Workday, Universal Health, eBay, Agilent, Axon, Constellation Energy, Sempra, Lowe's, JM Smucker, American Tower, Republic Services, First Solar, American Electric Power Co, Henry Schein, Pinnacle West, Norwegian Cruise Line https://www.reuters.com/markets/global-markets-view-usa-2024-02-27/