2024-07-04 04:49

MUMBAI, July 4 (Reuters) - The Indian rupee could not mirror the gains in its Asian peers on Thursday due to dollar demand related to the Indian central bank's intervention to support the rupee one month back during the country's unexpected election outcome. The rupee was at 83.5275 against the U.S. dollar as of 10:10 a.m. IST, barely changed form its close at 83.53 in the previous session. The central bank had intervened to support the rupee as the currency slumped on June 4 because of a narrower than expected victory margin for Prime Minister Narendra Modi's alliance. Its intervention in the one-month non-deliverable forwards matures on Thursday, which is likely fuelling the elevated demand for dollars, traders said. The dollar index fell 0.3% on Wednesday and Treasury yields dipped after data signalled the U.S. economy is cooling, boosting hopes of rate cuts by the Federal Reserve. While most Asian currencies rose by 0.1% to 0.2%, the rupee was unable to gain due to heightened demand for dollars. The dollar/rupee fix was last dealt at a premium to the daily reference rate that the Reserve Bank of India (RBI) releases in the afternoon. The premium signals elevated demand for dollars. The rupee could face some pressure but "since the RBI is aware, they may try to manage and limit weakness", a senior FX trader at a foreign bank said. Odds of a Fed rate cut in September have climbed above 70%, according to CME's FedWatch tool, on growing signs of weakness in U.S. manufacturing and the jobs market. The U.S. economy on a cooling path would allow the Fed to embark on calibrated easing of two cuts this year, DBS Bank said in a note. Sign up here. https://www.reuters.com/markets/currencies/rupee-lags-asian-peers-aftermath-cenbanks-election-result-day-intervention-2024-07-04/

2024-07-04 03:08

MUMBAI, July 4 (Reuters) - The Indian rupee is expected to open higher on Thursday after weak U.S. services and labor data prompted a drop in the dollar index and U.S. Treasury yields, spurring a recovery in Asian currencies. Non-deliverable forwards indicate the rupee will open at 83.50 to the U.S. dollar, compared with 83.53 in the previous session. The dollar index dropped on Wednesday and dipped further during Asian hours. Asian currencies, which have broadly been under pressure, recovered on the day. The respite for Asia would mean a "minor dip" on the dollar/rupee that is "highly unlikely" to extend beyond 83.35-83.40, a currency trader at a bank said. The dollar/rupee has repeatedly been supported at the 83.35 handle over the last month. A measure of U.S. service sector activity slumped to a four-year low in June, data released on Wednesday showed, indicating that growth in the world's largest economy was cooling. Further, U.S. initial claims for unemployment rose 238,000 slightly above expectations and private payrolls jumped by 150,000 jobs in June, below consensus estimates, signalling that the labour market was softening. U.S. Treasury yields declined after the data, and the odds of Federal Reserve rate cut in September inched up. The soft U.S. labour market report, coupled with weakness in the services sector saw U.S. markets price-in about a 10% higher chance of a Fed cut by September, ANZ Bank said in a note. Meanwhile, minutes from the Fed's previous meeting showed that policymakers approve of wait-and-see approach before cutting rates. While the minutes echoed a more cautious stance to rate cuts, they have been overshadowed by recent (mostly weaker) data, so "they didn’t have any real impact", ANZ said. KEY INDICATORS: ** One-month non-deliverable rupee forward at 83.58; onshore one-month forward premium at 7.5 paise ** Dollar index at 105.29 ** Brent crude futures down 0.5% at $86.9 per barrel ** Ten-year U.S. note yield at 4.35% ** As per NSDL data, foreign investors sold a net $300.2mln worth of Indian shares on July 2 ** NSDL data shows foreign investors bought a net $36.2mln worth of Indian bonds on July 2 Sign up here. https://www.reuters.com/markets/currencies/rupee-inch-up-relief-asia-fx-after-weak-us-data-2024-07-04/

2024-07-04 02:50

Saudi Aramco, ADNOC making preliminary evaluations of Santos as a target Santos could attract other buyers Santos shares were up just over 1% YTD as of Wednesday's close July 4 (Reuters) - Saudi Aramco (2223.SE) New Tab, opens new tab and Abu Dhabi National Oil Company (ADNOC) have been separately considering bids for Santos (STO.AX) New Tab, opens new tab, Bloomberg News reported, sending shares of the Australian gas producer up 6.5% on Thursday. Both Saudi Aramco and ADNOC have been conducting preliminary evaluations of Santos as a possible acquisition target, the report said, citing sources who declined to be named as the information was private. The sources said Santos could attract interest from other potential buyers, according to the report. Deliberations are on, and the suitors have not decided whether to proceed with any proposals, it added. "Santos does not comment on media speculation," a company spokesperson said. Saudi Aramco did not immediately respond to Reuters' request for comment, while ADNOC declined to comment. Santos shares rose to a high of A$8.18 and last traded up 5% at A$8.09, outpacing a 1% rise in the benchmark S&P/ASX200 (.AXJO) New Tab, opens new tab. Adelaide-based Santos had a market capitalisation of $16.63 billion as of Wednesday's close, up 1% since the start of the year. Santos, with assets stretching across Australia to Alaska and Papua New Guinea (PNG), has been eyed by suitors over the past several years for its liquefied natural gas (LNG) business, especially its stake in PNG LNG. The company produced 91.7 million barrels of oil equivalent (mmboe) last year and had proven plus probable reserves of 1,661 mmboe as of the end of last year. Its biggest development project is the Barossa gas project in waters off northwestern Australia, which has faced delays and cost increases following court fights with an Indigenous group over the planned route for a gas pipeline from the field. DOUBTS ON A DEAL A Santos shareholder and an analyst both played down the likelihood of an offer from Aramco or ADNOC. "I think Santos is an attractively priced company with a handful of great assets, but despite this, I find it hard to imagine a would-be buyer flagging its interest prior to making an offer," said Simon Mawhinney, managing director of fund manager Allan Gray. "So I’m inclined not to put too much, if any, weight on these reports and happily be proven wrong on this point." MST Financial senior analyst Saul Kavonic said Aramco and ADNOC have been looking at a number of LNG opportunities but Santos would be "a big step out of their comfort zone", politically, operationally and by size. Australia's Woodside Energy (WDS.AX) New Tab, opens new tab held preliminary talks with Santos earlier this year to form a $52 billion energy giant, however discussions collapsed, and Santos said it would continue to review options to unlock value for its shareholders. "Santos has been shopping itself for a while, so there could be quite a few players out there who have pursued preliminary assessments," Kavonic said, adding that Santos' domestic assets might be an obstacle to any buyout. "We remain of the view that a bid for Santos at a material premium is unlikely to emerge, despite Santos shopping itself for some time," he said. Sign up here. https://www.reuters.com/business/energy/saudi-aramco-adnoc-likely-studying-bids-australias-santos-bloomberg-news-reports-2024-07-03/

2024-07-04 02:44

SINGAPORE, July 4 (Reuters) - India's solar power generation grew at the slowest pace in six years in the first half of 2024, an analysis of data from the federal grid regulator showed, as the country further stepped up reliance on coal to address surging power demand. Electricity generated from coal grew 10.4% during six months ended June 30, a review of daily load despatch data from Grid-India showed, outpacing overall power generation growth of 9.7% during the period. Solar power generation in the third-largest producer of electricity from the sun rose to 63.6 billion kilowatt-hours (kWh) in the first half of 2024, the data showed, up 14.7% compared with the same period last year and 18.5% in the calendar year 2023. The world's fastest growing major economy has prioritised coal to address a surge in power demand in recent years, with coal-fired power output last year outpacing renewable energy output for the first time since the Paris accord in 2015. The south Asian nation's fuel use patterns since emerging from the COVID-19 pandemic have largely been in line with trends in the region, with Indonesia, Philippines, Vietnam and Bangladesh all firing up coal for generating inexpensive power. The share of the fossil fuel in power output rose to 77.1% in the first half of 2024, compared with 76.6% in the same period last year, putting it on track to rise for the fourth straight year. India expects total electricity generation during the fiscal year ended March 2025 to grow at the fastest pace in over a decade, forecast to be mainly powered by an 8.9% growth in coal-fired power output, outpacing renewable energy growth of 8.2%. Analysts expect renewable generation to grow faster from the next fiscal year, as tendering and commissioning of green energy projects have started picking up steam. Moody's unit ICRA expects renewable energy installations to rise by over a third to 25 gigawatts (GW) this fiscal year ending March 2025. Sign up here. https://www.reuters.com/world/india/indias-solar-output-grows-slowest-pace-six-years-first-half-2024-2024-07-04/

2024-07-04 02:04

BENGALURU, July 4 (Reuters) - The Indian rupee will trade within the narrowest range in nearly three decades over the coming year as the Reserve Bank of India (RBI) continues to maintain its tight grip on the currency's movements, according to a Reuters poll. While most emerging market currencies fared badly against the dollar in the past two years, the rupee has stayed remarkably stable due to the RBI's nearly $650 billion forex reserves which it has deployed regularly to curb volatility. The currency's implied volatility , hovering at its lowest level in nearly two decades, is expected to hold ground at least until the year-end, the July 1-3 Reuters poll of 40 foreign exchange strategists found. Median forecasts showed the rupee would trade at 83.41 per dollar by end-September, and by end-2024 the currency would touch 83.20, around the level it was trading on Wednesday. The rupee was forecast to gain 0.6% to 83.00 per dollar in a year. "The rupee continues to be dominated by the RBI's steadfast focus on curbing volatility, limiting any impact of portfolio flows or changes in fundamental outlook," said Abhay Gupta, emerging Asia fixed income and forex strategist at BofA Securities. "Despite the short-term benefits, too much of a good thing can have its side-effects. The RBI may have gone overboard in containing volatility by driving it to levels that are well-below the historical ranges for rupee and are comparable with a pegged currency." Analysis showed the standard deviation of forecasts for the six-month outlook was around the lowest in at least two years, suggesting the RBI will only allow the rupee to trade in a tight range. Still, a handful of FX strategists expected the currency to reach a lifetime low by this time next year. "With the Fed being a late entrant in the global monetary easing cycle, the dollar could likely remain supported. Against this backdrop, we expect the rupee to post a modest weakness in 2024-25," said Vivek Kumar, economist at QuantEco Research. Federal Reserve Chair Jerome Powell said on Tuesday the U.S. is back on a "disinflationary path", but cautioned that inflation may not reach the 2% target until late next year or even 2026. "Although the rupee might continue to weaken, the magnitude is not going to be concerning," QuantEco's Kumar said. He expected the rupee to weaken to a fresh low of 84.50 per dollar by end-2024. (For other stories from the July Reuters foreign exchange poll:) Sign up here. https://www.reuters.com/markets/currencies/rupee-trade-narrowest-range-about-30-years-rbis-actions-2024-07-03/

2024-07-04 00:37

July 4 (Reuters) - Oil prices for Brent crude hit their highest level since April on Thursday, holding above $87 after data the previous day showed a decline in U.S. inventories. Brent crude futures were up 21 cents, or 0.2%, at $87.55 a barrel by 1922 GMT. U.S. West Texas Intermediate (WTI) crude futures were up 18 cents at $84.06 in trade thinned by the U.S. Independence Day holiday. In the previous session, Brent gained 1.3% to settle at $87.34 for its highest close since April 30. WTI, meanwhile, had settled at an 11-week high of $83.88. Those gains followed a larger than expected decline in U.S. crude stocks. The U.S. Energy Information Administration (EIA) reported a 12.2 million draw in inventories. Analysts polled by Reuters had expected a draw of 680,000 barrels. Traders were also tracking the war in Gaza and elections in France and the United Kingdom, said RBN Energy analyst Martin King. "Trade is quiet and people are watching the physical market and geopolitical situation," King said. Oil prices had earlier dropped by as much as 83 cents, but the dip was expected not to last given dollar weakness and a brighter outlook for U.S. fuel demand after the EIA data, said PVM analyst Tamas Varga. However, German industrial orders fell unexpectedly in May, adding to signs that a recovery for Europe's largest economy remains elusive. Demand concerns were heightened by U.S. data on Wednesday showing that first-time applications for U.S. unemployment benefits increased last week while jobless numbers also rose. Countering that, weaker economic data could hasten interest rate cuts by the U.S. Federal Reserve, analysts said, which could be supportive for oil markets. On Thursday, Reuters reported that Russia's oil producers Rosneft (ROSN.MM) New Tab, opens new tab and Lukoil (LKOH.MM) New Tab, opens new tab will sharply cut oil exports from the Black Sea port of Novorossiisk in July, according to two sources familiar with a loading plan. Meanwhile, Saudi Arabia's Saudi Aramco cut the price for the flagship Arab light crude it will sell to Asia in August to $1.80 a barrel above the Oman/Dubai average. The potential price reduction for Asia, which accounts for about 80% of Saudi's oil exports, underscores the pressure faced by OPEC producers as non-OPEC supply continues to grow while the global economy faces headwinds. Swiss bank UBS expects Brent crude to reach $90 a barrel this quarter, it said in a note to clients, citing OPEC+ production cuts and projected declines in oil inventories. Sign up here. https://www.reuters.com/markets/commodities/oil-prices-slip-after-data-points-cooling-us-economy-2024-07-04/