2024-07-26 00:30
RIO DE JANEIRO, July 25 (Reuters) - Japan has urged its G20 peers to be increasingly vigilant to excessive foreign exchange rate fluctuations driven by speculation, Tokyo's top currency diplomat Masato Kanda said on Thursday. Speaking at a press conference at the G20 finance ministers and central bank governors meeting in Rio de Janeiro, Kanda said attention needed to be paid to risks of prolonged high interest rates in some countries destabilising financial markets. "Japan has said we must be increasingly vigilant to spillover effects (of such risks) and excessive currency rate fluctuations as a result of speculation," said Kanda, vice finance minister for international affairs. "And we need to respond appropriately based on G20 commitments that excessive currency volatility and disorderly movements have a negative impact on the economy and financial stability," he said. The comments follow recent wild swings in the Japanese yen . The currency rallied for a fourth session against the dollar on Thursday, recovering from 38-year lows hit earlier this month, as investors unwound long-running bets against the currency ahead of a Bank of Japan meeting next week. Analysts had blamed wide U.S.-Japan interest rate differentials for the yen's weakness. The final draft of the G20 joint statement, seen by Reuters, reaffirms their April 2021 exchange rate commitment. The 2021 statement said G20 countries "remain committed that our exchange rates reflect underlying economic fundamentals." Kanda, who led massive bouts of yen-buying intervention in 2022 and 2024, sees his term end next week as vice finance minister for international affairs - a post that oversees Japan's currency policy and coordinates economic policy with other countries. He will be succeeded by Atsushi Mimura, a financial regulation veteran. Sign up here. https://www.reuters.com/markets/currencies/japans-top-currency-diplomat-calls-vigilance-excessive-fx-fluctuations-2024-07-26/
2024-07-26 00:02
HOUSTON, July 25 (Reuters) - Motiva Enterprises was repairing a leak on the shut gasoline-producing fluidic catalytic cracker 3 (FCC-3) at its 626,000 barrel-per-day (bpd) Port Arthur, Texas, refinery on Thursday, said people familiar with plant operations. The 81,000-bpd FCC-3 was shut after a malfunction on Wednesday, the sources said. It was unknown on Thursday how long the repairs would take to complete. A Motiva spokesperson did not reply to a request for a comment on Thursday, Motiva's Port Arthur refinery is the second largest in the United States by capacity, according to the U.S. Energy Information Administration. FCCs use a fine powder catalyst to convert gas oil produced by distillation units into unfinished gasoline. Sign up here. https://www.reuters.com/markets/commodities/motiva-repairing-leak-port-arthur-texas-fcc-sources-say-2024-07-26/
2024-07-25 23:17
US economic growth regains steam in Q2; inflation slows Ford slumps as higher costs, EV unit dent profit growth IBM gets boost from software, AI demand, as consulting slips Gains for small-cap indexes Russell 2000 and S&P Small Cap 600 Indexes: Dow up 0.2%, S&P down 0.51%, Nasdaq 0.93% lower July 25 (Reuters) - The S&P 500 and Nasdaq Composite ended a fickle session weaker on Thursday, failing to regain ground lost in the previous day's tech-triggered sell-off as investors grappled with the likely direction of megacaps. The Dow Jones Industrial Average hung onto early gains to close higher on stronger-than-expected U.S. gross domestic product data. Small-cap stocks also rose as investors sought out value away from the megacaps, with the Russell 2000 (.RUT) , opens new tab rising 1.3% to partially recoup some of Wednesday's losses. Megacap stocks recovered from a shaky start to trade higher at mid-afternoon but many slipped later, with Meta Platforms (META.O) , opens new tab Microsoft (MSFT.O) , opens new tab and Nvidia (NVDA.O) , opens new tab ending between 1.7% and 2.4% down. Alphabet's (GOOGL.O) , opens new tab shares fell for a second straight day, dipping 3.1% to its lowest close since May 6, but Tesla (TSLA.O) , opens new tab rose. Lackluster earnings from the Google parent and the electric vehicle maker had pummeled the so-called Magnificent Seven group of tech stocks on Wednesday, prompting the Nasdaq (.IXIC) , opens new tab and S&P 500 (.SPX) , opens new tab to log their worst day since 2022. The Cboe Volatility Index (.VIX) , opens new tab, known as Wall Street's fear gauge, extended its recent gains to close at 18.46, a fresh 14-week high. "I think the market is kind of lurching," said Yung-Yu Ma, chief investment officer at BMO Wealth Management. "The concern had been building and yesterday was a bit of a crescendo of that concern, but some of that has been alleviated today." While investors are still trying to grapple with Wednesday's disappointing earnings reports, and political and economic uncertainty, Ma said ultimately recent data shows a resilient U.S. economy. Thursday's GDP report showed the U.S. economy expanded 2.8% in the second quarter versus an estimate of 2%. Inflation subsided, leaving expectations of a September Federal Reserve interest rate cut intact. All eyes are now on Friday's personal consumption expenditures price data to confirm bets of an early start to Fed rate cuts. While heavyweight stocks have powered the market to all-time highs this year, Wednesday's sell-off reinforced fears that these stocks might be over-stretched and are in for more turbulence. This concern has driven value investors, speeding up their rotation into smaller-cap stocks and other sectors outside megacap technology. The S&P Small Cap 600 (.SPCY) , opens new tab rose 1.4% on Thursday. The S&P 500 (.SPX) , opens new tab lost 27.91 points, or 0.51%, at 5,399.22 points, while the Nasdaq Composite (.IXIC) , opens new tab fell 160.69 points, or 0.93%, to 17,181.72. The Dow Jones Industrial Average (.DJI) , opens new tab rose 81.20 points, or 0.20%, to 39,935.07. Among earnings-driven moves, IBM (IBM.N) , opens new tab shares jumped 4.3%, also boosting the blue-chip Dow, after the tech company beat estimates for second-quarter revenue and raised the annual growth forecast for its software business. American Airlines (AAL.O) , opens new tab rose 4.2% after cutting its annual profit forecast. Southwest Airlines (LUV.N) , opens new tab climbed 5.5% after saying it would implement changes including ending open seating and offering seats with extra legroom. Advances by airlines and logistics firms, with Old Dominion (ODFL.O) , opens new tab up 5.7% and J B Hunt (JBHT.O) , opens new tab rising 4.3%, helped the Dow Jones Transportation Average (.DJT) , opens new tab gain 1.3%. Ford (F.N) , opens new tab slumped 18.4% after the automaker's second-quarter adjusted profit missed estimates by a wide margin. Edwards Lifesciences (EW.N) , opens new tab tumbled 31.3% after it missed second-quarter revenue estimates. Volume on U.S. exchanges was 13.23 billion shares, compared with the 11.60 billion average for the full session over the last 20 trading days. Sign up here. https://www.reuters.com/markets/us/futures-listless-day-after-megacaps-led-slide-wall-street-2024-07-25/
2024-07-25 22:52
July 25 (Reuters) - More than 97% of Windows sensors are back online, CrowdStrike's (CRWD.O) , opens new tab CEO George Kurtz said on Thursday, nearly a week after a software update by the cybersecurity firm triggered a global outage. The company's Falcon platform sensor is a security agent installed on devices such as laptops and desktops that protects them from threats. The outage happened because the advanced platform contained a fault that forced computers running Microsoft's Windows operating system to crash and show the so-called blue screen of death. Microsoft (MSFT.O) , opens new tab said on Saturday about 8.5 million Windows devices had been affected in the outage that had left flights grounded, forced broadcasters off air and left customers without access to services such as healthcare or banking. "Our recovery efforts have been enhanced thanks to the development of automatic recovery techniques and by mobilizing all our resources to support our customers," Kurtz said in a post , opens new tab on LinkedIn. Sign up here. https://www.reuters.com/technology/cybersecurity/crowdstrike-says-over-97-windows-sensors-back-online-2024-07-25/
2024-07-25 22:38
July 25 (Reuters) - Canadian energy company Pieridae Energy (PEA.TO) , opens new tab said on Thursday it has shut-in the production of about 6,250 barrels of oil equivalent per day (boe/d) that flows to a third-party owned and operated facility, in response to low natural gas prices. Pieridae said the shut-in of the uneconomic sour gas production was due to extremely low AECO natural gas prices and high processing costs. The AECO hub, located in the Canadian province of Alberta, is one of the largest storage facilities in North America and where the benchmark price for Canadian gas is set. The production is expected to be completely shut in by July 26, Pieridae added. Sign up here. https://www.reuters.com/business/energy/canadas-pieridae-energy-shuts-in-production-amid-low-natgas-prices-2024-07-25/
2024-07-25 22:33
Mexico will likely need to import crude after 2030 Zama and Trion fields to lift output but others decline rapidly Mexico could raise output through foreign firm partnerships MEXICO CITY, July 25 (Reuters) - Mexico's incoming President Claudia Sheinbaum will likely face a new challenge fulfilling the dream of energy independence that led her predecessor to spend $17 billion on a new refinery: a shortfall in domestic crude supply. The country is a major crude producer but output from the country's older oil fields, mostly in the Gulf of Mexico, has slumped to more than a four-decade low. Without significant spending on exploration and production, Mexico may find itself importing crude to feed its expanded refinery capacity in the next decade, a once unheard-of change of direction for the key global exporter. For years, state-owned Pemex has failed to meet local fuel demand because its outdated refineries were unable to process the heavy Maya crude that it predominantly pumps. That left Mexico exporting crude while having to import gasoline and diesel, much of it from the United States. Outgoing President Andres Manuel Lopez Obrador vowed to change what he saw as a humiliating dependence on imported motor fuels. He commissioned a new 340,000 barrels per day (bpd) refinery in his home state Tabasco to meet the fuel supply shortfall caused by Pemex's six refineries that had gone decades without sufficient investment to run at capacity. Lopez Obrador's Olmeca refinery in Dos Bocas is over budget and behind schedule, but once it fully starts, Mexico may come close to supplying the motor fuels it consumes for a few years. Previously unreported projections from the energy ministry, seen by Reuters, however, suggest that period would be short-lived, and Pemex would likely have to start importing crude as production will rapidly decline from 2030. Pemex, the energy ministry and the president's office did not respond to requests for comment for this story. Zama, a shallow-water field on the cusp of being a deep-water field, and Trion, an ultra-deep-water field, would temporarily lift production to almost 2.247 million bpd in 2028 from around 1.8 million bpd now, the middle of three scenarios laid out by the energy ministry showed. The most optimistic scenario sees output reaching 2.390 million bpd, and the more pessimistic at 2.164 million bpd. All three scenarios, which factor in some new discoveries, project rapidly declining production from 2030. That means Mexico would have to start importing crude as early as in the next decade if it wants to run its refineries near capacity, one source at the energy ministry familiar with the projections said. It would also no longer export crude. Zama and Trion could also disappoint, the source said, adding that other recent discoveries have. UNEXPLORED POTENTIAL Alma America Porres, who served two terms as a commissioner at the hydrocarbon regulator, including during the landmark energy reform that sought to open up the sector a decade ago, said Mexico's proven crude reserves suggest the shortfall may come even sooner. "The proven reserves give us the most realistic picture of what there is," she said. "I don't see a big discovery, one of the scale of Trion or Zama, in the near term." Earlier this year, Mexico reported that its proven crude reserves had fallen to 5.978 billion barrels from 6.155 billion barrels a year earlier. Its overall proven reserves were lifted by natural gas, though. Production from older fields - including the Cantarell field, once the second largest in the world after Ghawar in Saudi Arabia - has been declining rapidly in recent years. Newer fields have failed to compensate. Lopez Obrador has invested heavily in the six refineries, which increased processing to about 1 million bpd. Even so, its outdated refineries produce record amounts of fuel oil rather than much-needed motor fuels. With the Olmeca refinery starting up and repairs to older ones, the energy ministry forecasts they will process 1.6 million bpd of crude, closer but still below consumption levels of around 1.7 million bpd, International Energy Agency data shows. Experts have said the huge sums spent on the Olmeca refinery could have been better spent on oilfield exploration and production, and diversifying into renewable energy sources. Lopez Obrador, a resource nationalist, has not held auctions for areas that could encourage other oil and gas companies to explore and invest in deepwater and onshore shale production, where Pemex lacks expertise and money. The legal framework to allow participation from companies to operate fields on their own - or in association with Pemex - remains in place even after Lopez Obrador pushed through other reforms that prioritize Pemex. "The exploration part requires a lot of investment, investment that Pemex doesn't necessarily have money for," said Carla Gabriela Gonzalez, another former senior official at the hydrocarbon regulator. "And that was where private companies added value: because they invested in exploration, and that investment didn't cost the Mexican state anything. On the contrary, these companies paid the Mexican state for the right to explore." Three Pemex engineers at the company's exploration and production arm, and the engineer at the energy ministry agreed that the state company could hugely benefit from participation by the private sector. "What we need is a massive exploration strategy, just like Petrobras in Brazil had, instead of one that centers on increasing refining capacities," said the energy ministry source. Pemex puts Sheinbaum in a bind: she has positioned herself as the guardian of her mentor's resource nationalist legacy that requires investment while others are diversifying into renewable energy sources. Sheinbaum has proposed spending more on wind and solar infrastructure for electricity generation. Her plans for Pemex remain unclear and her team did not respond to a request for further comment. With a doctorate in energy engineering from Mexico's National Autonomous University, Sheinbaum was one of the lead authors for the industry chapter of the U.N. Intergovernmental Panel on Climate Change in 2014. One of Sheinbaum's advisors on energy matters said that there would likely be some collaboration with private companies during her presidency to increase exploration and production, with preference given to those already operating in Mexico. Sign up here. https://www.reuters.com/business/energy/declining-mexican-crude-output-could-shatter-energy-independence-dream-2024-07-25/
