2024-06-28 21:47

A 150% surge in chipmaker Nvidia has led rally in world stocks Yen has slumped to 38-year low against stronger US dollar Elections have triggered big moves from Mexico to France Cocoa has soared almost 85% in commodity markets Graphic: World FX rates LONDON/NEW YORK, July 1 (Reuters) - The unstoppable march of the mega caps, sloth-like central bank pivots, political palpitations aplenty and M&A is back - the first half of 2024 has been another whirlwind in world markets. Forecasts for a global interest-rate-cutting frenzy may not have materialized, but Nvidia (NVDA.O) New Tab, opens new tab and the rest of the Magnificent 7 soared another $3.6 trillion in market value. MSCI's 47-country world stocks index (.MIWD00000PUS) New Tab, opens new tab has clocked up a punchy 11% since January. Good yes, but nowhere near the 30% leap of team tech, or the frankly eye-popping 150% gain of chip champ Nvidia. "Thirty percent of the S&P's returns this year have come from Nvidia alone," the chief investment officer of IBOSS Asset Management Chris Metcalfe said, pointing out it was now the most expensive stock on the most expensive market in the world. It is not just equity markets where milestones have been set. Japan's yen has bowed to a 38-year low against the dollar (.DXY) New Tab, opens new tab in currency markets. Cocoa had one of its best-ever runs while French bond risk has exploded to its highest level since the euro crisis after French President Emmanuel Macron's drubbing by the far right in EU elections drove him to call a snap parliamentary election, the first round of which was held on Sunday. Government bonds had been having a tough time anyway. Predictions of a gush of rate cuts have turned out to be just a dribble in a few parts of Europe and emerging markets and certainly not in the United States yet. As a result, anyone owning a basket of benchmark bonds has lost around 1.5% of their money. "At the end of last year, the markets expected seven (U.S.) rate cuts and now they are expecting just one or two," Nadege Dufosse, the head of multi-asset at Candriam said. "That has been the big driver and explains the (poor) performance." A shaky showing from U.S. President Joe Biden in his latest TV debate against Donald Trump has just ratcheted November's U.S. election uncertainty up substantially. There's also a general election in Britain on July 4 although there aren't expected to be many market fireworks despite it being almost certainly the first change of government in 14 years. Polar Capital fund manager Georgina Hamilton explained that was because unlike in France and the U.S., the two main candidates to lead the UK are fairly centrist. "Having had quite a lot of turmoil in recent years ... you can't underestimate that calmer political backdrop," she added. GOLD SHINES The big story in commodities has been cocoa sky-rocketing almost 85% due to shortages which is already its second-biggest annual leap of all time, although certainly is not good news for chocoholics. Gold hit a record high of just shy of $2,450 an ounce in May. Oil is up a respectable 12% while bitcoin broke though $70,000 and set a flurry of new highs after U.S. watchdogs gave bitcoin exchange-traded funds the green light. The value of global M&A activity is up 5% compared to the first half of last year. That's mainly down to a brace of $35-billion deals that saw credit-card firm Capital One (COF.N) New Tab, opens new tab take over Discover Financial (DFS.N) New Tab, opens new tab and chip designer Synopsys (SNPS.O) New Tab, opens new tab buy out rival Ansys (ANSS.O) New Tab, opens new tab, although it could have been much more though if BHP's (BHP.AX) New Tab, opens new tab gripping $49-billion pursuit of Anglo American (AAL.L) New Tab, opens new tab had succeeded. DISTRESSED TO IMPRESS Off the beaten track, Ecuador's bonds have made 46% despite lingering debt concerns and Argentina's new chainsaw-wielding President Javier Milei has helped its bonds jump 32%. Emerging-market veteran Kevin Daly at Aberdeen said there has been a "distressed to impress" move, with the bonds of crashed countries like Zambia, Ghana and Sri Lanka all rallying between 16%-23% as their years-long debt restructurings have neared an end. As always though, there has still been plenty of downs in emerging markets too. Chinese property stocks have fallen for the ninth quarter in a row (.CSI000952) New Tab, opens new tab. Devaluations have shoved Nigeria's and Egypt's currencies down 42% and 36% respectively, while Mexico's peso is down nearly 8% this month after a resounding presidential election result fed worries about its future path. Sign up here. https://www.reuters.com/markets/global-markets-h1-graphics-pix-2024-06-28/

2024-06-28 20:26

June 28 (Reuters) - The U.S. Treasury Department finalized a rule on Friday requiring cryptocurrency brokers, including exchanges and payment processors, to report new information on users' sales and exchanges of digital assets to the Internal Revenue Service. The new requirements aim to crack down on crypto users who may be failing to pay their taxes, and stem from the $1 trillion bipartisan 2021 Infrastructure Investment and Jobs Act. At the time the bill was passed, it was estimated that the new rules could bring in close to $28 billion over a decade. The rule, which would be phased in starting next year for the 2026 tax filing season, align the tax requirements for cryptocurrencies with existing tax reporting requirements for brokers for other financial instruments, such as bonds and stocks, Treasury said. The final rule was modified from Treasury's original proposal in order to limit some burdens on brokers and to phase in the new requirements in stages, Treasury officials said. It also includes a $10,000 threshold for reporting on transactions involving stablecoins, a type of crypto token typically pegged to an asset like the U.S. dollar. The cryptocurrency industry had waged a comment letter campaign after Treasury proposed the rule last year, arguing that the scope of the proposal's definition of a broker was too broad and that the requirements violated the privacy of crypto owners. Treasury said it reviewed more than 44,000 comments on the proposal. It also said it anticipates issuing additional rules later this year to establish tax reporting requirements for non-custodial brokers, including decentralized crypto exchanges. In a release, Treasury emphasized that crypto owners "have always owed tax on the sale or exchange of digital assets" and that the new rule "simply created reporting requirements... to help taxpayers file accurate returns and pay taxes owed under current law." The rule introduces a new tax reporting form called Form 1099-DA, meant to help taxpayers determine if they owe taxes, and would help crypto users avoid having to make complicated calculations to determine their gains, according to the Treasury Department. Brokers would need to send the forms to both the IRS and digital asset holders to assist with their tax preparation. The IRS currently requires crypto users to report many digital asset activities on their tax returns, regardless of whether the transactions resulted in a gain. Users are required to make that calculation themselves, and the platforms on which digital assets trade do not give the IRS that information. Sign up here. https://www.reuters.com/technology/us-treasury-finalizes-new-crypto-tax-reporting-rules-2024-06-28/

2024-06-28 20:20

TSX ends down 0.3% at 21,875.79 For June, the index loses 1.8% First Quantum shares fall 7.2% Canadian GDP rises 0.3% in April June 28 (Reuters) - Canada's main stock index ended lower on Friday, adding to its monthly decline, as shares of First Quantum Minerals tumbled and Wall Street was unable to hang on to the gains it made after the release of cooler U.S. inflation data. The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) New Tab, opens new tab ended down 66.37 points, or 0.3%, at 21,875.79. For the month, the TSX was down 1.8% as investors shunned resource shares in favor of technology, while it posted a quarterly decline of 1.3%. First Quantum Minerals Ltd (FM.TO) New Tab, opens new tab shares fell 7.2% as Reuters reported the miner will launch formal arbitration proceedings against Panama in July over the country's decision to close the Cobre Panama mine last November. The materials group (.GSPTTMT) New Tab, opens new tab, which includes metal miners and fertilizer companies, lost 1.1%, while energy was down 0.2% as the price of oil settled 0.2% lower at $81.54 a barrel. U.S. monthly inflation was unchanged in May as a modest increase in the cost of services was offset by the largest drop in goods prices in six months, drawing the Federal Reserve closer to start cutting interest rates later this year. "I suspect Fed would take another month of confirmation of the inflation data, but I continue to believe that September is a reasonable starting point for rate cuts," said Youssef Zohny, founder of The Zohny Group of Graystone Consulting at Morgan Stanley. The Bank of Canada has already started its easing cycle but investors have become doubtful the central bank would cut again at its next policy decision on July 24 after the release of hotter-than-expected domestic inflation data on Tuesday. Data on Friday showed Canada's gross domestic product increased 0.3% in April, matching market expectations, while a preliminary estimate showed the economy expanded by a further 0.1% in May. Sign up here. https://www.reuters.com/markets/tsx-futures-rise-ahead-crucial-us-inflation-data-2024-06-28/

2024-06-28 20:04

TORONTO/PANAMA CITY, June 28 (Reuters) - Canadian miner First Quantum Minerals (FM.TO) New Tab, opens new tab will launch formal arbitration proceedings against Panama in July over the country's decision to close the giant Cobre Panama mine in November, two people familiar with the matter told Reuters. The move coincides with the start of a new administration in the Central American country that could determine the future of one of the world's newest and biggest copper mines that had been responsible for 1% of global output prior to being shuttered. Shares of First Quantum closed down 8% at C$17.86 on the Toronto Stock Exchange on Friday. First Quantum said in December it had initiated proceedings against Panama at the International Court of Arbitration in Miami, Florida, seeking $20 billion over the shut-down of the mine after the country's Supreme Court declared its contract unconstitutional. In the initial stage of arbitration, concerned parties negotiate for six months in a bid to avoid moving on to formally launching proceedings. The miner will now go ahead with the next stage of the process, the sources said. "First Quantum will meet the July 30 deadline of launching a formal arbitration against Panama as it has a fiduciary duty to do so," one of the people with knowledge of the developments said, asking to remain anonymous as they are not authorised to speak to the media. In response to a Reuters query, First Quantum declined to comment on the arbitration but directed Reuters to its statement on May 6 where the company said it looked forward to a dialogue with the new administration. Fallout from the crisis sparked over Cobre Panama hit the company hard, wiping some C$9 billion ($6.57 billion) from its market capital and prompting a series of capital restructuring measures to strengthen its balance sheet. For Panama, the dispute is seen having a material impact on growth. First Quantum's share price has since recovered to C$19 on the Toronto Stock Exchange from C$10 in December last year. Panama's President-elect, Jose Raul Mulino, in May ruled out talks with First Quantum over the future of the shuttered mine unless the company dropped its arbitration claims. However, the sources said the Canadian miner is pressing on regardless as missing the July deadline would mean having to file a new intent of arbitration with a further six months of negotiations. Riyaz Dattu, Canada legal practice leader of law firm Arentfox Schiff LLP, said on average it takes four years for an arbitration proceeding against a government to conclude. First Quantum had also been negotiating with the outgoing Panama administration to allow it to sell 130,000 tonnes of copper concentrate currently stuck at the mine. Panama's new cabinet will be sworn in on July 1. The cabinet ministers of industry and environment will have a key role to play in determining the future of the mine. The outgoing industry minister did not respond to a query on whether the government would look for a settlement. In a separate event on Thursday in Panama City, incoming industry minister Julio Molto said the issue of the disputed mine was a priority for the new government. "What I can tell you is that whatever solution we agree on, it is most likely that this issue will not be resolved with another contract," Molto said at the American Chamber of Commerce and Industries of Panama. On Thursday, a new report from the International Monetary Fund said Panama's GDP was expected to drop by 2.5% in 2024 due to the closure of Cobre Panama mine. "Key risks include the loss of investment grade (credit rating), further social unrest, the fallout from the end of copper production (including from international arbitration proceedings), and external risks," the IMF said. ($1 = 1.3696 Canadian dollars) Sign up here. https://www.reuters.com/markets/commodities/fqm-launch-formal-arbitration-versus-panama-july-2024-06-28/

2024-06-28 20:03

June 28 (Reuters) - Dozens of climate activists were arrested after protesting at Citigroup's (C.N) New Tab, opens new tab headquarters in New York on Friday as part of what they called a "Summer of Heat" campaign. Climate groups have been targeting Wall Street banks in a campaign against their financing of fossil fuel projects. Police arrested 61 protesters on Friday, with charges pending, while two people were given summonses, according to the New York City Police Department. "Our family and friends were willing to be arrested because their lives are on the line in our communities that are surrounded by the pollution that Citi is financing," said Roishetta Ozane, one of the protest organizers. Protesting in front of the company's headquarters in Manhattan, demonstrators chanted: "Hey Citi, get off it, the planet over profit." Activists held signs reading, "Citi Earns While the World Burns." The bank said it welcomed engagement with stakeholders and was transparent about its climate-related work. "We are supporting the transition to a low-carbon economy through our net zero commitments and our $1 trillion sustainable finance goal," a bank spokesperson said in a statement. "Our approach reflects the need to transition while also continuing to meet global energy needs." The activists expected more than 1,000 people to participate in the demonstration, according to a statement ahead of the protest. It was unclear how many people had gathered outside Citi's building. The group had largely dissipated by Friday afternoon, according to a Reuters witness. Citi employees were alerted on Thursday to anticipate "significant protest" activity on Friday, according to a source at the bank who shared the security notification with Reuters. On June 10, multiple demonstrators were taken into custody outside Citi's headquarters, and 23 individuals were later released with criminal court summonses, the NYPD said on Thursday. Sign up here. https://www.reuters.com/world/us/climate-activists-plan-protests-citis-new-york-headquarters-2024-06-28/

2024-06-28 20:00

LOZNICA, Serbia, June 28 (Reuters) - Scores of people in western Serbia's town of Loznica rallied on Friday to protest the contested Rio Tinto (RIO.L) New Tab, opens new tab lithium project in the Balkan country, fearing its development will damage the environment. Regarded as a critical material by the EU and the United States, lithium is used in batteries for EVs and mobile devices. In 2022, the Serbian government revoked licences for Rio Tinto's $2.4 billion Jadar lithium project near Loznica after protests by green groups who say the mine will irreversibly pollute land and water in the lush Jadar valley and the nearby River Drina. Protesters demanded that parliament adopt a law on a ban of geological research and exploitation of lithium and borates within 40 days. "If they fail, on the 41st day we will block Serbia, we will block key points, railroads ... and that's only the beginning," Marijana Petkovic, a green activist told the crowd. Throngs of people from across Serbia, including a group of about two dozen activists who for three days hiked 80 miles from the capital Belgrade, waved national flags, chanted "Uprising," "Rio Tinto go away from the Drina," and sung patriotic songs. Last week, Serbia's President Aleksandar Vucic said Belgrade is preparing to give Rio Tinto the green light to develop Europe's largest lithium mine, for which the company said it would be safe for the environment. "If they open the mine, our children will eat polluted food," said Milena, a 62-year-old farmer from the nearby village of Trsic. If completed, the Jadar project could supply 90% of Europe's current lithium needs and help to make the company a leading lithium producer. In 2021 and 2022 Serbian environmentalists collected 30,000 signatures in a petition demanding that parliament enact legislation to halt lithium exploration in the country. To bolster economic growth, Belgrade has offered mineral resources to other foreign investors including China's Zijin (601899.SS) copper miner. Sign up here. https://www.reuters.com/markets/commodities/serbias-green-activists-rally-against-rio-tinto-lithium-project-2024-06-28/