2024-05-30 10:48
MOSCOW, May 30 (Reuters) - Natalia Komarova, the governor of Siberia's oil-rich Khanty-Mansiisk region who was last year criticised for remarks she made about the war in Ukraine, announced on Thursday that she was resigning from her post. In a video posted on her Telegram channel, Komarova, who oversaw a region also known as Yugra, which accounts for more than 40% of Russia's total oil output, said she was moving to another undisclosed job even though her term in office does not expire until next year. Hours later, the Kremlin released video of President Vladimir Putin meeting Ruslan Kukharuk, the mayor of the city of Tyumen, offering him Komarova's job. "I wish you success and good luck in your new job," Putin told Kukharuk. When asked about the change, Kremlin spokesman Dmitry Peskov told reporters Putin had praised Komarova's work as governor. "Yugra is developing and has been developing all these years very dynamically," he said, declining to comment on Komarova's future. Komarova, who did not explain why she stepped down, was censured by an anti-war activist last year who called for her to be prosecuted for discrediting the Russian army. That criticism came after she appeared to suggest Moscow had not needed or been ready for what it calls its special military operation in Ukraine. Aides said her remarks had been taken out of context and that Komarova supported the military. In her resignation video, she thanked Putin for his trust and spoke of the efforts being made by Russian forces on the frontline. Komarova, 68, was the only serving female governor and had been at the helm of the regional administration since 2010. Before that, she had headed the committee on natural resources at Russia's State Duma lower house of parliament. Sign up here. https://www.reuters.com/world/europe/governor-russian-oil-capital-region-criticised-war-comments-resigns-2024-05-30/
2024-05-30 10:48
LONDON, May 30 (Reuters) - Sterling inched higher on Thursday after falling sharply the previous day as a jump in U.S. bond yields boosted the dollar. The pound was up 0.1% at $1.2709 on Thursday, after falling 0.5% on Wednesday to trade as low as $1.2681 overnight. Britain's currency was pulled down from a more-than-one-month high reached on Tuesday by a rally in the dollar. The U.S. currency has benefited from rising Treasury yields, driven by strong economic data, tough talk from Federal Reserve policymakers, and a run of weak bond auctions. Global markets have been grappling with strong U.S. economic data, most recently an improvement in consumer sentiment, which has cast doubt on when developed market central banks can lower interest rates. The strong U.S. figures, along with better-than-expected UK growth and inflation data in recent weeks, have caused traders to reduce their bets on Bank of England rate cuts this year to 27 basis points, implying just one reduction in 2024. The expectations for higher-for-longer interest rates have supported the pound, helping it reach its highest level since 2022 against the euro on Wednesday. It held steady against the single currency on Thursday, with one euro trading hands for 85.06 pence. "We think the market has gone too far with this pricing," said Chris Turner, head of global markets at ING. "We're going for an August rate cut, we're pretty confident about that." Turner added: "Our view would be that sterling doesn't hold its recent gains and it's been a bit of an overreaction." There are few signs so far that the UK election campaign is having an impact on the markets, with analysts saying inflation and central bank interest rate policy are the main drivers. The U.S. dollar index was last down 0.17% on Thursday at 104.96 after rising to a two-week high overnight. Sign up here. https://www.reuters.com/markets/currencies/sterling-ticks-higher-after-sharp-selloff-2024-05-30/
2024-05-30 10:21
JOHANNESBURG, May 30 (Reuters) - South Africa's currency, stocks and bonds fell on Thursday amid political uncertainty after election projections showed the African National Congress (ANC) was set to lose its parliamentary majority for the first time in 30 years. If confirmed by final results, the ANC will have to make a deal with one or more other parties to govern - a situation that could lead to political volatility and uncertainty over economic and fiscal policy in Africa's most industrialised nation. The rand fell more than 1% against the U.S. dollar at one point and at 1530 GMT was trading at 18.5900, over 0.7% weaker than its previous close. The dollar was last down over 0.45% against a basket of major currencies, though not far off a two week high hit earlier in the week. "We have seen underperformance of South African assets, implying that election results so far may have come as negative surprise to market expectations," said Andrew Matheny at Goldman Sachs in London. On the Johannesburg Stock Exchange, the blue-chip Top-40 (.JTOPI) New Tab, opens new tab index closed down 1.7% compared to a 1.46% decline across wider emerging markets (.MSCIEF) New Tab, opens new tab, while both local and international bonds also came under pressure. The Council for Scientific and Industrial Research projected the ANC would get 42% of the national vote, while broadcaster eNCA estimated 45%. So far, the election commission has only released results from 27.18% of polling stations. Those partial results put the ANC at 42.54% of the vote, the biggest opposition party Democratic Alliance (DA) at 25.40% and radical leftist Economic Freedom Fighters (EFF) at 8.76%. "A tie up with the market friendly DA is likely to be seen positively by markets while coalescing with the populist MK party or Marxist EFF will likely be negative for rates, credit and the currency," said Michael Kafe, strategist at Barclays in London. Yields on the domestic 10-year benchmark spiked as high as 10.743% - levels last seen in late April - before pulling back to 10.58%, LSEG data showed. Bond yields move inversely to prices. Among international dollar bonds, longer-dated maturities slipped nearly 1 cent in early trading to hit four week lows before retracing some of the losses. At 1544 GMT, the 2052 bond traded at 86.665 cents , Tradeweb data showed. The cost of insuring exposure to South Africa's debt rose. Five-year credit default swaps rose 3 basis points (bps) from Wednesday's close to 230 bps, the highest in a month, according to data from S&P Global Market Intelligence. Sign up here. https://www.reuters.com/markets/currencies/south-africas-rand-stocks-bonds-slip-projections-show-anc-losing-majority-2024-05-30/
2024-05-30 10:21
JOHANNESBURG, May 30 (Reuters) - The South African rand fell on Thursday as early poll results showed the governing African National Congress was on course to lose its majority, a scenario that could lead to weeks of uncertainty as it tries to negotiate a coalition with one or more smaller parties. At 0716 GMT, the rand traded at 18.6525 against the dollar , over 1% weaker than its previous close. The dollar last traded around 0.1% weaker against a basket of global currencies. Vote counting was underway on Thursday after South Africans took to the polls on Wednesday in the most contested election since the end of apartheid. The governing African National Congress is projected to get roughly 42% of the national vote, the country's Council for Scientific and Industrial Research told the public broadcaster on Thursday. Around 11.37% of the votes had been tallied at 0716 GMT, and markets are likely to get a clearer picture of the outcome as counting continues. South Africa's benchmark 2030 government bond was weaker in early deals, with the yield up 17 basis points to 10.695%. Sign up here. https://www.reuters.com/markets/currencies/south-african-rand-falls-election-vote-count-gets-underway-2024-05-30/
2024-05-30 10:14
LONDON, May 30 (Reuters) - The European Union said on Thursday it had given final approval to roll out the remaining batch of tougher bank capital rules from January 2025, building on safeguards introduced after taxpayers had to bail out lenders in the global financial crisis over a decade ago. The bulk of the Basel III rules, written by the Basel Committee of banking regulators from the world's major economies, has already been implemented, but the final batch includes a major addition known as an 'output floor'. This safeguard aims to stop big banks, who can use their own computer models to calculate capital buffers, from gaming the system at the expense of smaller rivals, who must use more conservative calculation methods set out by regulators. "The rules adopted today will ensure that European banks can continue to operate in the face of economic shocks," Vincent Van Peteghem, minister for finance for Belgium, which holds the EU presidency, said in a statement. "They will also make the banking sector more sustainable and better able to deal with the green and digital transitions. This is an important step towards deepening the Banking Union." The bloc has included other rules, not part of the Basel norms, to harmonise the minimum requirements across the 27-country bloc for authorising branches of banks that are headquartered outside the EU. The package also includes transitional capital requirements for banks' holdings of crypto assets, and changes to enhance how lenders manage environmental, social and governance (ESG) risks. EU states said the rules would start to be rolled out from January 2025, though European Central Bank policymaker Francois Villeroy de Galhau on Wednesday said they should be delayed if the United States is late, to avoid a competitive disadvantage for European banks. The Federal Reserve has proposed applying the final Basel rules from mid-2025, the same time as Britain, but huge U.S. industry pushback against the Fed's "Basel Endgame" package has cast doubt on timings. Sign up here. https://www.reuters.com/business/finance/eu-sticks-january-2025-start-final-batch-basel-bank-capital-rules-2024-05-30/
2024-05-30 10:11
A look at the day ahead in U.S. and global markets from Mike Dolan This week's bout of bond market anxiety eased a touch on Thursday, but investors wary of heavy sovereign debt sales and election uncertainty are bracing for a jumpy June. And the dollar (.DXY) New Tab, opens new tab is lapping it all up. At the root of the week's angst has been more evidence of still-brisk U.S. economic growth and sticky worldwide inflation that questions the degree of interest rate cuts ahead that have been long-assumed by markets. Jobless updates and a GDP revision top today's diary. And as the Federal Reserve and other central banks turn incrementally more hawkish, they're complicating the heavy debt auction schedules for many governments over the month ahead. This week has seen a blizzard of new Treasuries and signs of some indigestion were evident in tepid demand for near $300 billion of notes and bonds sold on Tuesday and some $44 billion of 7-year paper yesterday. The combination of rates worries and debt sales has taken its toll. U.S. 10-year yields topped 4.75% on Wednesday for the first time in four weeks, though they have pulled back a touch from that level ahead of today's U.S. open. And despite a European Central Bank rate cut being a nailed-on certainty for next week, the jump back in long-term yields spread to Europe too. Euro zone benchmark German 10-year yields hit another six-month high on Thursday with above-forecast German annual inflation numbers for May cause for concern ahead of Friday's euro-wide readout and dragging full-year ECB easing bets lower. All of which makes an uncomfortable backdrop to what's set to be the heaviest month of the year for net sovereign debt issuance. New government bond supply net of redemptions and central bank purchases is due to rise to $340 billion in June for the United States, euro zone and Britain, according to data from lender BNP Paribas. The European debt world is also keeping tabs on credit rating updates for Italy, France, Greece and Ireland due tomorrow. The latest bond market judder has spilled over to equity markets again, dragging Wall St stocks back from new highs on Wednesday and weighing on stocks across Asia earlier too. S&P500 futures remained in the red first thing on Thursday - with implied volatility (.VIX) New Tab, opens new tab for the next month jumping back close to 15 for the first time since May 2. What's more that month ahead now captures a wave of electoral uncertainty - the first televised U.S. presidential debate on June 27, European Parliament elections on June 6-9, India's election result next week, this weekend's Mexican elections and the run-up to UK elections on July 4. South Africa's rand fell 1% on Thursday and the country's benchmark equity index (.JTOPI) New Tab, opens new tab dropped more than 2% after early election results there showed the African National Congress on course to lose the parliamentary majority it has held for 30 years - ushering in an uncertain period of messy coalition building. In company news, Salesforce (CRM.N) New Tab, opens new tab forecast second-quarter profit and revenue below Wall Street estimates on Wednesday due to weak client spending on its cloud and enterprise business products, sending its shares down more than 16% after the bell. Top U.S. independent oil and gas producer ConocoPhillips (COP.N) New Tab, opens new tab agreed to buy Marathon Oil (MRO.N) New Tab, opens new tab for $22.5 billion, the latest in a series of mega-deals in the energy industry. Shares of Marathon Oil rose 9% on Wednesday while ConocoPhillips fell 4%. BHP's (BHP.AX) New Tab, opens new tab investors welcomed the top global miner's decision to walk away from a $49 billion plan to take over Anglo American (AAL.L) New Tab, opens new tab, which rejected three proposed offers from its bigger rival over the past six weeks. And Saudi Arabia may announce a landmark secondary share offering in oil giant Aramco later on Thursday, pending final approval, people with knowledge of the matter said. Key diary items that may provide direction to U.S. markets later on Wednesday: * U.S. second estimate of Q1 GDP and PCE, preliminary Q1 corporate profits, weekly jobless claims, April international trade balance, April wholesale/retail inventories, April pending home sales * Dallas Federal Reserve President Lorie Logan and New York Fed chief John Williams speak; Bank of England Governor Andrew Bailey speaks; European Central Bank policymaker and Irish Central Bank chief Gabriel Makhlouf speaks; Reserve Bank of New Zealand governor Adrian Orr speaks * South Africa Reserve Bank policy decision * NATO foreign ministers hold informal meeting in Prague * US Treasury sells 4-week bills * US corporate earnings: Costco, Best Buy, Dollar General, Hormel Foods, Ulta Beauty, NetApp, Cooper Companies Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-graphics-2024-05-30/
