2023-11-07 00:16
NEW YORK, Nov 6 (Reuters) - Federal Reserve Bank of Minneapolis President Neel Kashkari said on Monday that the U.S. central bank likely has more work ahead of it to control inflation. “The economy has proved to be really resilient even though we’ve raised interest rates a lot over the past couple of years. That’s good news," Kashkari said in an interview on the Fox News television channel. But he added: "We haven’t completely solved the inflation problem. We still have more work ahead of us to get it done." Kashkari's comments suggested he is still leaning toward raising interest rates again. The Fed met last week in a gathering that kept its overnight short-term interest rate target unchanged at between 5.25% and 5.5% and preserved the option to raise rates again as inflation is still well above its 2% target. But with price pressures falling, many in markets believe the Fed is done with raising rates. Kashkari said recent inflation data has been good and moving lower, which he welcomed. But he added: "I'm a little nervous about declaring victory too soon," noting he wants to see more data before deciding what he thinks the Fed should do next. https://www.reuters.com/markets/us/kashkari-fed-has-more-work-do-control-inflation-2023-11-07/
2023-11-06 23:35
Nov 6 (Reuters) - A possible loss of the Everett Marine LNG terminal can jeopardize the reliability of New England's energy supply during extreme cold weather, the Federal Energy Regulatory Commission (FERC) and the North American Electric Reliability Corp (NERC) said on Monday. Constellation Energy , a U.S. energy firm, owns the 1,413-megawatt Mystic natural gas-fired power plant and the Everett liquefied natural gas (LNG) import facility on the Mystic River in Everett, Massachusetts. The Mystic power facility is scheduled to retire after May 2024. The company provides fuel to its Mystic power plant and to gas providers in New England using the LNG imported at Everett. However, the retirement plan may change if the regional grid operator or another body determines the plant is required to preserve reliability or for other reasons. The regulators noted evidence indicating that Everett's retirement would be "manageable" for the electric system, at least in the near-term. But if these expectations did "not materialize as anticipated", it may become difficult to maintain affordability and reliability in the event of a major winter event, they said in a joint statement. In September, FERC and NERC presented findings and recommendations of their joint inquiry into the power outages and rolling blackouts during winter storm Elliott in December 2022. The inquiry found that the sub-freezing temperatures and extreme cold weather caused unplanned electric generation supply losses exceeding 90,000 megawatts. "Although much of the attention has focused on the electric outages, the storm's effects on the natural gas system, and the local gas distribution system in particular, cannot be overlooked," FERC and NERC warned. The storm lowered flows of natural gas into the pipelines at a time when shippers were requesting increased volumes of natural gas, dramatically lowering line pressures and putting stress on the natural gas system. https://www.reuters.com/business/energy/regulators-say-loss-everett-lng-terminal-threatens-new-england-energy-2023-11-06/
2023-11-06 23:33
SAO PAULO, Nov 6 (Reuters) - Half a million residents of Sao Paulo remained without electricity on Monday three days after a storm knocked down power cables, leaving much of Brazil's largest city in the dark. The storm snapped branches and knocked down hundreds of trees that fell on overhead power lines in many streets of the city, initially cutting off 2.1 million customers in Metropolitan Sao Paulo, energy distribution company ENEL said. "The storm was terrible. I had no electricity, no cellphone and no fuel on Friday," said carpenter Denilson Laurindo, who faulted the city for not pruning trees in the streets. He said ENEL promised to restore power supplies by Tuesday. Thiago Gonzalez, an electrical engineer, had to rent a room in a nearby neighborhood so he and his wife could get a hot shower and sleep with air conditioning. "I saw the tree fall and hit the transformer post. There was an explosion and then the lights went out," he said. He complained the couple had lost food and could not refrigerate medicine in the blackout. School classes were canceled on Monday in the worst-hit neighborhoods of the city, such as Morumbi where Gonzalez lives. ENEL said it had restored its service to 76% of its customers but 500,000 were still without electricity on Monday. The company, which is the second largest energy distributor in Brazil and owned by Italy's energy group ENEL (ENEI.MI), said the gale-force winds that hit Sao Paulo on Friday were the strongest in recent years and caused severe damage to the power grid due to falling trees and branches. Brazil's Justice Minister Flavio Dino said the government will ask the company for an explanation for the blackout. The Sao Paulo's state prosecutors office said it will investigate why so many customers in the city where left for so long without electricity and whether ENEL has enough staff to cope with emergencies in the 24 districts it serves. Alexandre Vieira Monteiro, a condominium administrator, said six of the seven buildings he manages have had power supplies restored, but one was still without electricity in Morumbi. "Alright, it was an unusually strong storm. But what is shocking is that year after year there is not enough investment in burying the power cables. It is all out of date," he said. https://www.reuters.com/world/americas/hundreds-thousands-still-without-power-days-after-storm-hits-brazils-largest-2023-11-06/
2023-11-06 23:30
Nov 6 (Reuters) - U.S. pipeline operator Kinder Morgan (KMI.N) said on Monday it would acquire NextEra Energy Partners' (NEP.N) gas pipelines in South Texas for $1.82 billion. The oil and gas pipeline business has seen increased consolidation this year as U.S. production grows and persisting problems related to permits for new pipelines have made existing operators more valuable. NextEra Energy Partners' (NEP) Texas natural gas pipeline portfolio, STX Midstream, primarily consists of seven pipelines which provide natural gas to Mexico and power producers and municipalities in South Texas. The pipelines together have a transport capacity of 4.9 billion cubic feet per day. "Initially, we plan to fund the transaction with cash on hand and short-term borrowings," Kinder Morgan said in a statement. The deal is expected to close in the first quarter of 2024. Shares of NEP, a unit of NextEra Energy (NEE.N) created to acquire, manage and own contracted energy projects, have lost about 44% of their value since Sept. 27 when the company trimmed its distribution growth forecast through at least 2026. Higher interest rates have raised project costs for NEP, hurting its growth, according to analysts. "Upon closing, the proceeds would be sufficient to pay off the outstanding project-related debt," NextEra Energy Partners' CEO John Ketchum said in a statement. The sale price represents an about 10 times multiple on the estimated calendar-year 2023 adjusted core profit for the Texas natural gas pipeline portfolio, NEP said. "The valuation falls in line with recent trading multiples for midstream sector constituents and below some of the transaction marks," analysts at Guggenheim Securities said. However, the deal provides some flexibility in credit metrics, the analysts added. https://www.reuters.com/markets/deals/kinder-morgan-buy-nextera-energy-partners-stx-midstream-2023-11-06/
2023-11-06 23:29
Nov 6 (Reuters) - Diamondback Energy (FANG.O) on Monday said it expects to be a buyer of rivals, rather than their target, amid consolidation in the shale industry, and raised its full-year oil production forecast. Mergers of U.S. shale oil producers have climbed in the last two years with publicly-traded companies using their high share prices to gobble up smaller firms. Exxon Mobil and Chevron in recent months snapped up rivals' Pioneer Natural Resources, Hess and PDC Energy. "We expect Diamondback to remain a consolidator in the future," Chief Executive Travis Stice wrote in a letter to stockholders. "We believe in the pure-play independent E&P business model, and know we can compete for investor capital in a consolidated space," he added. The company said it closed asset sales for proceeds of about $1.7 billion, adding that it could cash out midstream assets but was not increasing its $1 billion non-core asset sale target. Diamondback also raised its net 2023 production to about 447,000 barrels of oil and gas per day (boepd), compared with a previous forecast for up to 445,000 boepd. Production averaged 452,848 boepd in the third quarter ended Sept 30, higher than the 390,630 boepd a year ago. Production is expected to grow in the fourth quarter to between 455,000 and 460,000 boepd, mainly due to longer wells, multi-well pads and a high mineral interest, the company said. Full-year capital spending is expected to be about $2.68 billion at the midpoint of its range, slightly above previous forecast of $2.64 billion. Average sales prices fell 19% to $54.37 per barrel of oil and gas, reducing net income, which fell nearly 23% to $915 million. On an adjusted basis, the company earned $5.49 per share for the quarter ended Sept. 30, compared with analysts' average estimate of $5.01 per share, according to LSEG data. https://www.reuters.com/business/energy/diamondback-energy-tops-estimates-quarterly-earnings-2023-11-06/
2023-11-06 23:24
Bumble falls as CEO to step down Dish Network tumbles on Q3 revenue miss Nov 6 (Reuters) - U.S. stocks closed slightly higher on Monday as investors awaited guidance from a host of Federal Reserve policymakers later in the week on the central bank's policy path, with a large amount of bond supply also due to hit the market. Equities last week posted their biggest weekly percentage gain in about a year, as a weaker-than-expected U.S. payrolls report on Friday sent Treasury yields lower on the view the Fed was done hiking interest rates and could start cutting them next year. Market expectations that the Fed will hold interest rates steady at its December meeting stand at 90.4%, down from 95.2 on Friday but above the 74.4% a week ago. Expectations for a rate cut of at least 25 basis points have grown to more than 50% at the May 2024 meeting, according to CME's FedWatch Tool. Markets will look for more clarity on the Fed's intentions from officials speaking later in the week, including Chair Jerome Powell, and voting members such as New York Fed chief John Williams and Dallas Fed President Lorie Logan. "Unless something in the economic data prompts it, you won't see them change their tone," said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. Expectations the Fed was likely done with rate hikes sent the S&P 500 up 5.85% last week and the Nasdaq up 6.61%, their biggest weekly jumps since November 2022. "Whatever that buying force was that sort of went rampant on Friday is not around today and so a lot of these names are drifting back down, and yields are a little higher," said Massocca. Meanwhile, the yield on the benchmark 10-year Treasury note , which slid to five-week lows on Friday, reversed course to reach a high of 4.668% on Monday, ahead of this week's Treasury auction of about $112 billion in three-year and 10-year notes , as well as 30-year bonds . The Dow Jones Industrial Average (.DJI) rose 34.54 points, or 0.10%, to 34,095.86; the S&P 500 (.SPX) gained 7.64 points, or 0.18 %, at 4,365.98; and the Nasdaq Composite (.IXIC) gained 40.50 points, or 0.30 %, at 13,518.78. The session marks the sixth straight advance for the Dow and S&P 500 and seventh straight gain for the Nasdaq. The streak is the longest for the S&P 500 since early June, since July for the Dow and since January for the Nasdaq. The economic-data calendar for this week is sparse, with weekly jobless claims numbers due on Thursday and University of Michigan's consumer sentiment report on Friday. Walt Disney (DIS.N), Instacart (CART.O) and Biogen (BIIB.O) are among major companies reporting earnings this week. A total of 403 companies in the S&P 500 have reported profits through Friday the third quarter, with 81.6% surpassing analyst estimates, per LSEG data. Dish Network(DISH.O) plummeted 37.4% to close at $3.44 after touching a 25-year low of $3.41 on news that the pay-TV provider missed third-quarter revenue estimates and CEO Erik Carlson would step down from the role. Bumble(BMBL.O) fell 4.4% as the dating app operator said founder Whitney Wolfe Herd will step down as chief executive. Declining issues outnumbered advancers by a 2.3-to-1 ratio on the NYSE while on the Nasdaq declining issues outnumbered advancers by a 1.8-to-1 ratio. The NYSE had 64 new highs and 43 new lows. The S&P 500 posted nine new 52-week highs and no new lows while the Nasdaq recorded 46 new highs and 113 new lows. https://www.reuters.com/markets/us/futures-edge-up-rate-cut-hopes-fed-speakers-awaited-2023-11-06/
