2023-12-04 10:58
Futures down: Dow 0.16%, S&P 0.22%, Nasdaq 0.31% Dec 4 (Reuters) - U.S. stock index futures slipped on Monday, as investors turned wary ahead of a slew of economic data this week that is likely to test the narrative about a cut in interest rates by the Federal Reserve early next year. Wall Street kicked off December on an upbeat note, extending gains from the previous month that were driven by robust earnings and expectations that the Fed was done with its rate hiking campaign. The benchmark S&P 500 (.SPX) registered its highest close of the year on Friday as remarks from Fed Chair Jerome Powell bolstered the peak rates view. Traders have priced in the likelihood that the central bank will keep rates unchanged next week, with about 61% betting on rate cuts starting as soon as March 2024, according to the CME Group's FedWatch tool. However, some analysts have cautioned that markets have been too quick to price in lower interest rates. "We are not in the camp of early or aggressive cuts. Inflation has been coming down but the path towards 2% is still long," Mohit Kumar, chief European economist at Jefferies, said in a note. A number of economic reports through the week will provide a gauge on the interest rate path as well on the potential for a "soft landing" - where the Fed manages to bring inflation under control while averting a recession. Investors are awaiting readings on U.S. services sector activity and a survey on job openings, while November's non-farm payrolls report is set to grab the spotlight on Friday. Pressuring equities, Treasury yields edged higher on Monday after a sharp fall in the previous week. Also hurting sentiment on Monday were renewed fears about a widening of the war between Israel and Hamas after an attack on three commercial vessels in the southern Red Sea. Shares of Alaska Air Group (ALK.N) dropped 8.6% in premarket trading after the carrier said on Sunday it would acquire peer Hawaiian Holdings (HA.O) for $1.9 billion, including debt. Hawaiian's shares nearly tripled in value. At 5:21 a.m. ET, Dow e-minis were down 57 points, or 0.16%, S&P 500 e-minis were down 10.25 points, or 0.22%, and Nasdaq 100 e-minis were down 49 points, or 0.31%. Shares of cryptocurrency firms such as Coinbase Global (COIN.O), Riot Platforms (RIOT.O) and Marathon Digital (MARA.O) rose between 8% and 14% as bitcoin crossed $40,000 for the first time this year. https://www.reuters.com/markets/us/futures-dip-focus-shifts-economic-data-policy-cues-2023-12-04/
2023-12-04 10:58
UAE banking sector pledges $270 bln in green finances by 2030 Saudi leaders skip flagship event, after crown prince a no show Poorer countries will need $2.4 trln/year by 2030 - report DUBAI, Dec 4 (Reuters) - Money pledges grabbed the spotlight again at COP28 in Dubai on Monday as delegates turned their focus to the yawning gap in the need for climate finance and what's on offer. The United Arab Emirates, the host of this year's conference, pledged $270 billion in green finance by 2030 through its banks, and several development banks made fresh moves to scale up their funding efforts, including by agreeing to pause debt repayments when disaster strikes. But leaders of the region's biggest economy and the world's biggest oil producer Saudi Arabia have so far not attended the U.N. summit, in sharp contrast to their participation in last year's COP27 conference in Sharm el-Sheikh, Egypt. On Monday, Prince Abdulaziz bin Salman, energy minister and the key climate negotiator, for the kingdom, was a no-show at the Saudi Green Initiative. De facto ruler Crown Prince Mohammad bin Salman also did not deliver a speech to world leaders as scheduled on Friday. VAST NEEDS The amount of cash needed for the energy transition, climate adaptation and disaster relief is overwhelming. A report released Monday estimated that emerging markets and developing countries will need $2.4 trillion a year in investment to cap emissions and adapt to the challenges posed by climate change. "The world is not on track to realise the goals of the Paris Agreement. The reason for this failure is a lack of investment, particularly in emerging market and developing countries outside China," said co-author Nicholas Stern, chair of the Grantham Research Institute on Climate Change and the Environment. "The central challenge is to accelerate and implement the fostering and financing of this investment from a range of sources." Vulnerable countries that are already being hit by costly climate disasters are asking for billions more through a newly formed disaster fund, although current pledges are only around $700 million. "Unless we have an urgent set of decision-making, we are going to suffer what every parent suffers from - exciting expectations and being unable to deliver," said Barbados Prime Minister Mia Mottley, who has become a prominent voice in global discussions about mobilising climate finance. In a news conference, she urged countries to go beyond voluntary pledges and pleas to charities and private investors and instead to consider taxes as a way to boost climate funding. A global 0.1% tax on financial services, for example, could raise $420 billion, she said, while a 5% tax on global oil and gas profits in 2022 would have yielded around $200 billion. "The planet needs global governance not in a big stick way, but in a simple way of us cooperating with each other to be able to work with the institutions that we have," she added. Other delegates, including U.N. Secretary-General Antonio Guterres, have called for an end to fossil fuel subsidies which have hit a record $7 trillion per year. Activists with the Asian Peoples' Movement on Debt and Development said they worried the sums pledged would be inadequate. "The climate finance that they have pledged at this COP28 is simply not enough," said Pakistani activist Zaigham Abbas, whose country was devastated last year by widespread flooding. "We are not looking for charity here. We are not looking for peanuts ... The scale of the catastrophe that we are staring is unprecedented." MOVING MONEY The biggest pledge on Monday came from the UAE's banking system, joining peers in other regions in pledging to lend more to green projects. It followed a Friday pledge of $30 billion for climate-related projects from the oil producing Gulf state. Elsewhere, France and Japan said they would support a move by the African Development Bank to leverage IMF Special Drawing Rights for climate and development. The European Bank for Reconstruction and Development, meanwhile, said it would include climate resilient debt clauses in new loan deals with some poorer countries. Danish investment firm Copenhagen Infrastructure Partners announced plans to raise $3 billion for renewable projects in emerging markets. This year also features the biggest-ever representation of business at the annual U.N. summit, amid hopes for more private investment toward climate causes. The emirate of Abu Dhabi teamed up with private sector partners including BlackRock and HSBC to launch a climate research and advisory hub to boost financing options in the region. "The scale of the climate crisis demands urgent and game-changing solutions from every industry," COP28 President Ahmed Al-Jaber said. "Finance plays a critical role in turning our ambitions into actions." For daily comprehensive coverage on COP28 in your inbox, sign up for the Reuters Sustainable Switch newsletter here. https://www.reuters.com/business/environment/climate-finance-takes-centre-stage-cop28-climate-talks-2023-12-04/
2023-12-04 10:46
MUMBAI, Dec 4 (Reuters) - The Indian rupee fell on Monday as a slight recovery in the U.S. dollar and strong dollar demand from local companies blunted positive cues that boosted equity indexes to record highs. The rupee closed at 83.3650 against the U.S. dollar, weaker by 0.09% compared to its close at 83.2875 in the previous session. While the rupee opened higher at 83.26, the gain faded as local corporates rushed to pick up dollars, a foreign exchange trader at a foreign bank said. There were a "lot of buying orders (for dollars) between 83.26-83.27," the trader added. Asian currencies were mostly higher on Monday but the off-shore Chinese yuan fell 0.2%. The dollar index was last quoted higher at 103.43. Indian equity indexes rose to fresh record highs following wins for Prime Minister Narendra Modi's Bharatiya Janata Party in state elections. The poll results will boost market sentiment and ease fears of fiscal populism in the run up to the national elections in 2024, analysts said. The NSE Nifty 50 index (.NSEI) ended higher by 2.07% and touched an intra-day record high of 20,702.65. "The (rupee) market seems to be constantly ignoring positive developments," Dilip Parmar, a foreign exchange research analyst at HDFC Securities said, referring to how the supportive global cues have been unable to lift the local unit. While the dollar index fell 3% in November amid a slump in U.S. yields, the rupee stayed on the sidelines and ended the month slightly weaker even as Asian currencies rallied. Investors now await U.S. economic data due this week, starting with the ISM manufacturing PMI on Tuesday and culminating in closely watched labour market data on Friday. The Reserve Bank of India will also deliver its policy decision later on Friday when it is widely expected to hold rates steady. https://www.reuters.com/world/india/rupee-ends-down-importers-dollar-buys-recovery-greenback-2023-12-04/
2023-12-04 10:44
DUBAI, Dec 4 (Reuters) - The Arab Energy Fund, formerly known as APICORP, plans to invest up to $1 billion over the next five years in decarbonisation technologies, the Middle East and North Africa-focused multilateral financial institution said on Monday. The planned investment and new name are part of a five-year strategy to 2028 to support the regional energy transition towards net-zero goals. The announcement was made during the COP28 climate summit in Dubai. "Our strategy involves diversifying investments by championing technological advancements for enhanced energy efficiencies and driving sustained decarbonisation efforts," Chief Executive of the Arab Energy Fund Khalid Ali Al-Ruwaigh said in a statement. The institution, which carries an investment grade credit rating from all the major ratings agencies, issued a five-year $750 million green bond after setting up a green bond framework in 2021. $610 million has so far been allocated to 11 regional projects. Almost 20% of the institution's loan portfolio of $4.5 billion is currently for environmental and socially responsible initiatives, it said in the statement. APICORP was established in 1974 by 10 Arab oil-exporting states. It is headquartered in Saudi Arabia and has assets of more than $8 billion according to its website. https://www.reuters.com/sustainability/sustainable-finance-reporting/arab-energy-fund-apicorp-plans-up-1-bln-decarbonisation-technologies-2023-12-04/
2023-12-04 10:14
SAO PAULO, Dec 4 (Reuters) - Brazilian bank Itau Unibanco (ITUB4.SA) on Monday launched a cryptocurrency trading service for clients of its investment platform, making the nation's largest lender the latest local player to enter the market for the digital asset's exchange. Initially, Itau's new service will allow trading of bitcoin, the most popular cryptocurrency, as well as ether, but the lender aims to later add others, said digital asset head Guto Antunes in an interview. "It starts with bitcoin, but our overarching strategic plan is to expand to other crypto assets in the future," he said, adding any expansion would depend on how crypto regulation in the country evolved. The move sets Itau up to compete in Brazil with other locals such as crypto exchange MB and investment bank BTG Pactual's (BPAC3.SA) digital assets unit Mynt, as well as global giants like Binance. Itau argues it will stand out from rivals as it also acts as a custodian, safeguarding users' assets, Antunes said. The move comes about a month after two local players announced they were leaving the crypto market. Brokerage and investments company XP (XP.O) did not say why it was shutting down its crypto service, but financial services firm PicPay, owned by conglomerate J&F which also controls meatpacker JBS (JBSS3.SA), cited regulatory uncertainties. https://www.reuters.com/technology/brazilian-lender-itau-launches-crypto-trading-2023-12-04/
2023-12-04 09:40
BUENOS AIRES, Dec 4 (Reuters) - Argentina's incoming government aims to strike a trade agreement between the European Union and Latin American economies, the country's future Foreign Minister Diana Mondino told Reuters, as a deal under the current administration looks increasingly unlikely. Mercosur members Brazil, Argentina, Uruguay and Paraguay are set to gather on Dec. 7 in Rio de Janeiro and Brazilian President Luiz Inacio Lula da Silva said late last month he hoped an agreement could be reached in time for the meeting. But officials and diplomats from Brazil, which will hand the rotating presidency of the trade bloc to Paraguay in December, said on Saturday that the trade deal is now postponed as Argentina's incoming government has to approve the outstanding issues. "The world doesn't end on December 7. If an agreement is not reached by that time, we will keep on negotiating," Mondino said in an interview with Reuters on Saturday in Buenos Aires. "And hopefully, someday, somehow, it will be done." A trade treaty was agreed in principle in 2019 after two decades of talks, but additional environmental commitments demanded by the EU led Brazil and Argentina to seek new concessions that prolonged negotiations. Mondino added that as President-elect Javier Milei will take office on Dec. 10, the incoming administration has only "scant information" on the current state of negotiations. "I hope we can bring a different perspective and reach an agreement," Mondino added. Argentine negotiators, who were due to travel to Brasilia for a final push to close the deal, canceled their trip, a Brazilian government trade official told Reuters. An Argentine source familiar with the talks said the outgoing government's negotiating team had "flipped the chessboard" before the handover to Milei. NO TO BRICS, YES TO OECD Argentina's Mondino said it was not a priority to join the BRICS grouping of developing nations, after the second largest South American economy was among six countries invited to become members at a summit in South Africa in August. Saudi Arabia, the United Arab Emirates and Iran are some of the other nations invited. "The invitation has been sent; there's no due date. We don't have to do anything, neither to decline or accept right now," Mondino said. "If we are wrong, of course, we will review our decision. But so far, we don't see much of a benefit in joining the BRICS." However, Mondino added, Milei's administration will "definitely" work towards the country's membership of the Organisation for Economic Co-operation and Development (OECD). "It's going to be an extremely lengthy procedure, it is going to be difficult. But we have to abide by the rules of countries that are far more developed than we are," Mondino said. "We also have an invitation letter there. And we hope that we can sign that invitation letter," she added. Argentina, Peru, Romania, Bulgaria and Croatia were invited to start the process to join the OECD in January 2022. Brazil filed an initial memorandum of accession more than a year ago, a step forward that Argentina has not so far taken. https://www.reuters.com/world/americas/argentinas-new-government-wants-strike-eu-mercosur-deal-someday-somehow-mondino-2023-12-04/
