2024-07-09 07:48
FTSE 100 up 0.1%, FTSE 250 down 0.1% BP falls after flagging hit to Q2 profit Indivior lowers profit forecast, plans job cuts; shares plummet U.S. Fed Chair Powell's testimony on tap July 9 (Reuters) - London's FTSE 100 was muted on Tuesday, as a decline in shares of energy firm BP was offset by broader gains, while investors waited for Federal Reserve Chair Jerome Powell's testimony before the U.S. Congress. The blue-chip FTSE 100 (.FTSE) New Tab, opens new tab was up 0.1%, while the mid-cap FTSE 250 (.FTMC) New Tab, opens new tab, in the limelight following the Labour Party's election win, was down 0.1% at 0725 GMT. The energy sector (.FTNMX601010) New Tab, opens new tab weighed with a 0.7% decline, pulled down by a 2.4% loss in BP (BP.L) New Tab, opens new tab. The oil giant fell to the bottom of the FTSE 100 after warning about a hit to its second-quarter earnings from lower realised refining margins and weak oil trading. Precious (.FTNMX551030) New Tab, opens new tab and industrial metal miners (.FTNMX551020) New Tab, opens new tab rose 0.7% and 0.8%, respectively, in tandem with gold and copper prices. Investors were cautious ahead of Fed Chair Powell's two-day testimony before the Congress, which comes against the backdrop of soft labour market data increasing bets of a September rate cut. "Investors are waiting for big figures due later this week in the US that might give some impetus to the market. Partly it's the dearth of earnings, (so) there's nothing to drive the market," Nick Saunders, CEO at trading platform Webull UK said. U.S. consumer prices index figures and Britain's GDP are due later in the week and could influence the future trajectories of interest rate cuts in the economies. In corporate news, Indivior Plc (INDV.L) New Tab, opens new tab plummeted 36.7% after the drugmaker said it would cut about 130 jobs and lowered its profit forecast for the year. Recruiter PageGroup (PAGE.L) New Tab, opens new tab tumbled 11.2% to the bottom of the FTSE 250 after warning of lower annual profit, citing weaker-than-expected hiring in June and a more cautious view for the second half of the year. Sign up here. https://www.reuters.com/world/uk/london-stocks-subdued-broader-gains-offset-fall-bp-powells-testimony-focus-2024-07-09/
2024-07-09 07:47
DUBAI, July 9 (Reuters) - Yemen's Houthis said on Tuesday they targeted the Maersk Sentosa ship in the Arabian sea with several ballistic and wing missiles. "The American ship Maersk Sentosa was targeted in the Arabian Sea by naval forces and missile force in a joint operation," Yahya Sarea, the Yemeni group's military spokesperson, said in a televised speech. Earlier on Tuesday, shipping giant Maersk said one of its vessels, the Maersk Sentosa, reported being targeted by a flying object in the north of the Gulf of Aden. Maersk (MAERSKb.CO) New Tab, opens new tab told Reuters that no injuries to the crew or damage to the ship or cargo were reported. A spokesperson for the Copenhagen-based company said the ship was one of its U.S.-flagged vessels sailing for the subsidiary Maersk Line, Limited. The captain of an unnamed merchant ship reported an explosion close to the vessel some 180 nautical miles (333 km) east of Yemen's Nishtun, the United Kingdom Maritime Trade Operations (UKMTO) said in an advisory note on Tuesday. UKMTO added that the vessel and its crew are safe. Sarea also said the group targeted the Marathopolis ship in the Arabian Sea and the MSC Patnaree ship in the Gulf of Aden with a number of drones. Houthi militants in Yemen have launched drone and missile attacks on shipping in the Red Sea, Bab al-Mandab Strait and Gulf of Aden since November. They say they are acting in solidarity with Palestinians over the war in Gaza. Sign up here. https://www.reuters.com/world/middle-east/vessel-reports-nearby-explosion-east-yemens-nishtun-ukmto-says-2024-07-09/
2024-07-09 07:43
LONDON, July 9 (Reuters) - Weak refining margins and lower oil trading results will dent BP's (BP.L) New Tab, opens new tab second-quarter profit by up to $700 million, the company said on Tuesday, sending its shares down by over 3%. The warning, which led several analysts to lower their earnings estimates, will weigh on CEO Murray Auchincloss' efforts to rebuild investor confidence in BP's strategy. U.S. oil major Exxon Mobil (XOM.N) New Tab, opens new tab on Monday also signalled that lower refining margins and natural gas prices would reduce its second-quarter profit. The London-listed company said refining margins will be significantly lower in the quarter due to weak diesel prices and narrower North American heavy crude oil differentials that impact its large refinery in Whiting, Indiana. As a result, earnings in the second quarter will be between $500 million and $700 million lower than for the previous three months. A high level of refinery maintenance compared with the first quarter will be offset in part as the Whiting refinery resumes operations in the quarter, resulting in an earnings uplift of around $500 million, BP said. BP also expects to record $1 billion to $2 billion in charges in the second quarter, mainly tied to its review of Gelsenkirchen refinery in Germany. BP shares were down 3.8% at 1008 GMT, compared with a small gain in rival Shell's (SHEL.L) New Tab, opens new tab shares. Citi analysts lowered their Q2 earnings per share estimate by 9% while Jefferies analysts expected the update to result in a 20% earnings downgrade. Investors expect BP's second-quarter underlying replacement cost profit, the company's definition of net income, to come in at $3.13 billion, according to LSEG data. Reuters reported earlier this year that BP had imposed a hiring freeze and paused renewables projects as part of Auchincloss' plan to boost returns and cut costs by $2 billion. "Alongside any major strategic shifts, BP needs to demonstrate competence in the day-to-day running of the business and today's update doesn't help in that sense," AJ Bell investment director Russ Mould said in a note. BP, which is set to post its quarterly results on July 30, said its upstream production in the second quarter is expected to be broadly flat compared with the prior three months. Oil and gas production stood at 2.38 million barrels of oil equivalent per day (boepd) in the first quarter, following field start-ups in Azerbaijan and the United States. Higher realised oil prices in the second quarter will boost profits by $100 to $300 million, BP said. Last week, Shell had said it would take an impairment charge of up to $2 billion relating to the sale of its Singapore refinery and the pause of construction at one of Europe's largest biofuel plants in the Netherlands. Sign up here. https://www.reuters.com/business/energy/bp-expects-second-quarter-earnings-hit-lower-refining-margins-2024-07-09/
2024-07-09 07:24
July 9 (Reuters) - European shares slid on Tuesday ahead of a crucial testimony from U.S. Federal Reserve Chair Jerome Powell before a congressional panel, while Indivior slipped to about three-year lows after cutting its profit forecast. The pan-European STOXX 600 index (.STOXX) New Tab, opens new tab was down 0.3% by 0707 GMT, led by losses in energy shares (.SXEP) New Tab, opens new tab, tracking lower oil prices. Miners (.SXPP) New Tab, opens new tab were the top gainers, rising 0.5%, as copper prices rose slightly. All eyes will be on Powell, who is scheduled to deliver his semi-annual monetary policy testimony before Congress at 10 a.m. ET (1400 GMT). Comments from European Central Bank board (ECB) member Piero Cipollone later in the day will also be on investors' radar to gauge the ECB's interest rate trajectory. Among individual stocks, Dassault Systemes (DAST.PA) New Tab, opens new tab declined 3.7% as the French software company cut its full-year earnings target, saying its customers were being cautious with spending and were delaying the signing of contracts. BP (BP.L) New Tab, opens new tab slipped 3.3% as it expects lower realised refining margins and weak oil trading to hurt its second-quarter earnings. Indivior Plc (INDV.L) New Tab, opens new tab lost the most among index peers, dropping 27.7% to a near three-year low after it lowered its profit forecast for the year while announcing it would discontinue sales of its schizophrenia drug Perseris and cut about 130 jobs. Sign up here. https://www.reuters.com/markets/europe/european-shares-fall-ahead-powell-testimony-indivior-drops-2024-07-09/
2024-07-09 07:21
SINGAPORE, July 9 (Reuters) - Singapore state fund Temasek will consider investing in fossil fuel and other carbon-intensive projects if they make environmental as well as commercial sense, it said on Tuesday, even as it aims to cut portfolio emissions to net zero by 2050. "One of the things we realised when we set this original (net-zero) goal for ourselves, it does create an incentive to invest only in low-carbon emitting industries," said Temasek chief investment officer Rohit Sipahimalani. "But there is a case for investing also in high-emitting industries if you could transform them." He cited a shelved bid with Brookfield to acquire Origin Energy (ORG.AX) New Tab, opens new tab in Australia, which would have involved the purchase of coal-fired plants that would have eventually been decommissioned and replaced with renewables. Other potential targets include projects involving metals used in batteries or electric vehicles. Temasek said in its first annual sustainability report that S$44 billion ($32.6 billion) of its assets are aligned with its "sustainable living" goals. That is equivalent to 12% of its total portfolio and includes green steel and electric cars, "It is still the smallest part of our portfolio but it is the fastest growing," said Sipahimalani. Temasek plans to raise its internal carbon price from $65 per metric ton this year to $100 in 2030. The price is used to assess the long-term viability of investments and set incentives for management at portfolio companies. Total emissions from Temasek portfolio companies peaked at 30 million tons in 2021 and it aims to cut them to 11 million tons by 2030. Net emissions fell by 22% to 21 million tons last year. The fall was partly attributed to a decision by Temasek-controlled Sembcorp Industries (SCIL.SI) New Tab, opens new tab to sell off its Indian coal power subsidiary. ($1 = 1.3485 Singapore dollars) Sign up here. https://www.reuters.com/markets/carbon/singapores-temasek-doesnt-rule-out-high-carbon-investments-road-net-zero-2024-07-09/
2024-07-09 07:19
SINGAPORE, July 9 (Reuters) - Singapore state investor Temasek said on Tuesday its net portfolio value had swung back to growth with a 1.8% gain, adding that profits from investments in the United States and India helped cushion the impact of underperformance in China. Significantly, Temasek's (TEM.UL) exposure to the Americas surpassed China for the first time in a decade, accounting for 22% of its portfolio versus China's 19% during the year ended March. Temasek said it is taking a cautious approach to China and would continue to monitor the country's government policies this year. Aside from Singapore - its biggest market accounting for 27% of its portfolio, the U.S. would continue to be a leading destination for its capital, followed by India and Europe. The firm added it plans to step up investments in Japan and Southeast Asia. Temasek is also considering building its presence in the Middle East, Deputy CEO Chia Song Hwee told Reuters in an interview. "The economies (in the Middle East) are going through transformation and opening up and also the policy directions are more investor friendly as well as market-driven," he said. "So we are clearly seeing the change and we are beginning to spend time looking at opportunities and evaluating." The rise in the value of Temasek's portfolio to S$389 billion ($288.5 billion) compares with last year's 5.2% drop which had marked the first decline since 2020 amid global economic uncertainties and a higher interest rate environment. Chia said the firm would continue to "reshape" its portfolio. That includes in China where geopolitical tensions remain a concern and focusing on companies that are centred on the domestic market and rely less on exports, he said. "Portfolio never stays static. And what we try to do is to reshape our portfolio time and time again to be future-proof, future-ready while making sure that we can earn a long-term sustainable return," he added. "Our portfolio is still very large in China, even at 19% it is still a large portfolio for us." Chinese companies that Temasek has invested in include Alibaba Group (9988.HK) New Tab, opens new tab and Tencent Holdings (0700.HK) New Tab, opens new tab, owning stakes of less than 1% in both. It also invested in Chinese electric vehicle company BYD during the latest financial year. The size of that holding was not disclosed. In the United States, its investments include its stake of around 3% in asset manager BlackRock (BLK.N) New Tab, opens new tab and holdings of less than 1% in credit card payment companies Visa (V.N) New Tab, opens new tab and Mastercard (MA.N) New Tab, opens new tab. Regardless of the outcome of the U.S. election in November, the world's largest economy will continue to be an "interesting market" for Temasek due to innovation and opportunities in the private credit and technology sectors, Chief Financial Officer Png Chin Yee said in a separate interview. Temasek will continue to seek investment opportunities in artificial intelligence and green transition, its head of financial services Connie Chan also said. In May, Temasek partnered with Canada's Brookfield (BN.TO) New Tab, opens new tab to invest in Neoen (NEOEN.PA) New Tab, opens new tab, a deal that valued the French renewable power producer at around 6.1 billion euros ($6.6 billion). Other global investors have also posted gains driven by a better-than-expected U.S. economy and growing expectations of lower interest rates. This month, Japan's Government Pension Investment Fund posted an investment gain of $133.3 billion for the January-March quarter, while Saudi Arabia's sovereign wealth fund PIF reported it swung to a profit of $36.8 billion in 2023. ($1 = 1.3484 Singapore dollars) ($1 = 0.9228 euros) Sign up here. https://www.reuters.com/business/finance/temasek-portfolio-value-logs-modest-rise-has-cautious-approach-china-2024-07-09/
