2024-05-23 11:36

NAIROBI, May 23 (Reuters) - Kenya's highways authority and U.S. infrastructure investment manager Everstrong Capital have signed a $3.6 billion agreement to build a 440 km (273 miles) highway between the capital and port city Mombasa, the company said on Thursday. A bigger highway between Mombasa and Nairobi has been on the wish list of successive governments aiming to ease congestion on the busy road to and from the port. "The project anticipates attracting investments totalling $3.6 billion, sourced from international investors, development agencies, pension funds and an exceptionally large number of Kenyan private investors," Everstrong said in its statement. The deal coincides with Kenyan President William Ruto's visit to the United States, the first such state visit by a leader from Sub-Saharan Africa since 2008. Sign up here. https://www.reuters.com/markets/deals/kenya-us-investment-manager-agree-36-bln-highway-deal-2024-05-23/

2024-05-23 11:26

BRUSSELS, May 23 (Reuters) - The European Commission is continuing talks with Germany over a gas tariff Brussels and other countries have said undermines Europe's energy market, the Commission said on Thursday. Germany's gas levy, which charges its neighbours an extra fee for buying gas from its storage, has faced criticism from some EU countries, who say it hurts their efforts to quit Russian gas - by making it more expensive to buy non-Russian gas delivered via Germany. The Commission had prepared legal action against Germany last month over the issue, sources familiar with the matter told Reuters. A Commission spokesperson did not comment on the potential legal action but said, for now, talks with the German government were continuing. "The Commission has encouraged Germany to introduce a solution that removes these obstacles and does not hinder member states' efforts to diversify away from Russian gas," the spokesperson told a regular news conference. Germany's economy and climate ministry did not immediately respond to a request for comment. The ministry has previously said the levy was nondiscriminatory and other EU countries had benefited from Germany rapidly filling its vast gas storage. EU energy commissioner Kadri Simson has written to German Economy and Climate Minister Robert Habeck, urging Berlin to address the issue, the spokesperson said. Simson has previously said Germany's levy put the bloc's solidarity at risk and undermines the EU's gas market. EU single market rules forbid tariffs on trade between member countries. The German tariff is a legacy of the European energy crisis that peaked in 2022 after Moscow slashed gas flows to Europe. To recoup the billions of euros it spent on buying non-Russian gas at elevated prices to fill its storage caverns - the biggest of any country in the EU - Germany introduced what it termed a "neutrality charge" on gas sales to its neighbours. The Czech Republic, Austria, Slovakia and Hungary have been pushing the Commission to take action against the German levy. Sign up here. https://www.reuters.com/business/energy/eu-talks-with-germany-after-criticising-gas-tariff-2024-05-23/

2024-05-23 11:04

SINGAPORE, May 23 (Reuters) - A new case of highly pathogenic avian influenza has been detected at a poultry farm in Australia's southeastern Victoria state, officials said on Thursday, a day after the country reported its first human case of the virus and also a strain on an egg farm. The human case found in Australia is of the same H5N1 strain that has spread rapidly around the world but the ones detected on the farms in Victoria are of the different H7N3 strain. Agriculture Victoria, in a statement, linked the strain detected at the poultry farm in the Terang region to that reported at the egg farm in Meredith, where it said "the H7N3 high pathogenic strain of avian influenza virus has resulted in numerous poultry deaths". "The property in Terang is directly connected with the Meredith property, through joint management, staff and machinery," it said. The statement quoted Victoria's Chief Veterinarian Graeme Cooke as saying that Agriculture Victoria staff were on the ground to help contain and eradicate the virus. Victoria was also the site of an H7N7 outbreak in 2020, the most recent of Australia's nine outbreaks of Highly Pathogenic Avian Influenza (HPAI) since 1976. All were quickly reined in and stamped out, the government says. In the United States, a second human case of bird flu has been confirmed since the virus was first detected in dairy cattle in late March, U.S. officials said on Wednesday. The H5N1 outbreak among dairy cattle in at least nine U.S. states since late March has raised questions over whether it could spread to humans. Sign up here. https://www.reuters.com/business/healthcare-pharmaceuticals/australia-reports-new-avian-flu-case-poultry-farm-2024-05-23/

2024-05-23 10:03

A look at the day ahead in U.S. and global markets from Mike Dolan Yet another quarterly earnings beat from AI-chip behemoth Nvidia (NVDA.O) New Tab, opens new tab catapulted Wall St stock futures higher again on Thursday - batting away hawkish Federal Reserve meeting minutes, military tension around Taiwan and news of a July UK election. Nvidia's extraordinary boom on the scramble for artificial intelligence showed little sign of faltering and its stock - which now accounts for over 5% of the entire S&P500 capitalization - soared 7% out of hours after its latest update. The firm forecast second-quarter revenue of some $28 billion, almost $2 billion above analysts' estimates, and it announced a 10-for-1 stock split. Its shares, which have tripled over the past year, jumped above $1,000 in extended trade and added another $140 billion in stock market value. The news has been enough to lift S&P500 futures out of Wednesday's mild funk and they were up about 0.5% ahead of Thursday's bell. Nasdaq 100 (.NDX) New Tab, opens new tab futures are up almost 1%. And the ongoing rise of Wall Street to ever higher records has seen implied equity volatility crater, with the VIX "fear index" (.VIX) New Tab, opens new tab plumbing its lowest since November 2019 on Thursday at just 11.54. Perhaps even more remarkable given the stubborn Fed noises, equivalent Treasury market volatility gauges are also subsiding and the MOVE index (.MOVE) New Tab, opens new tab fell to its lowest since February 2022 - before the Fed tightening campaign started. That may be partly due to the fact that U.S. central bank appears to prepared to leave interest rates unchanged for several more months. Indeed some private sector bankers, such as Goldman Sachs boss David Solomon, now see no rate cut this year. While there were signs from its latest meeting minutes on Wednesday that some hawkish policymakers were willing to lift rates again if necessary, not least due to a loosening of financial conditions evident in surging stocks, the impact was muted as the meeting was before the softer April inflation data. As a result U.S. Treasury yields ticked up only modestly, with rates markets now homing in on weekly jobless numbers and May business surveys later on Thursday for guidance. Softness in housing data on Wednesday also kept up hopes for a cooling economy, and futures markets still retain 40 basis points of Fed easing for 2024 - significantly more than the 34 bps money markets now seen from the Bank of England. UK ELECTION Stickiness in "core" UK April inflation readings on Wednesday have wiped out hopes of a June BoE rate cut and even left an August move in the balance - complicated perhaps by the surprise announcement of a British election for July 4. Although a win for the opposition Labour Party is widely expected - with opinion polls showing it more than 20 points clear of the ruling Conservatives, and betting markets ascribing a 90% chance to Labour leader Keir Starmer becoming prime minister - sterling volatility perked up to some degree. Two-month implied volatility for the euro/sterling pair popped up half a point to more than 4% for the first time in a month. But the inflation news and BoE rethink was more dominant in rates pricing, with gilt yields backing up and sterling rising to its highest in two months. The UK stock market (.FTSE) New Tab, opens new tab fell only 0.5% after the election announcement on Wednesday, although an index of UK utilities shares (.FTUB6510) New Tab, opens new tab fell almost 6% today on possible political risk in the sector. On the data front, euro zone May business surveys showed activity expanded at its fastest pace in a year this month - while UK equivalents slowed. In Asia, Chinese shares underperformed with losses of more than 1% in mainland and Hong Kong shares (.CSI300) New Tab, opens new tab, (.HSI) New Tab, opens new tab. Geopolitical tensions kept investors nervous as China's military started two days of "punishment" drills held in five areas around Taiwan just days after Taiwan President Lai Ching-te took office. U.S. Treasury Secretary Janet Yellen said on Thursday that G7 finance ministers will discuss their concerns about China's excess industrial capacity and potential responses, adding that without policy changes in Beijing their economies will be hit with a flood of cheap Chinese goods. "This week will be a key opportunity to discuss how China's macroeconomic imbalances and industrial overcapacity can affect our economies," Yellen told a news conference ahead of a Group of Seven finance meeting in Stresa, Italy. Key diary items that may provide direction to U.S. markets later on Thursday: * U.S. April weekly jobless claims, May flash business surveys for the U.S. and around the world from S&P Global, US April new home sales * G7 Finance Ministers and Central Bank Governors meet in Stresa, Italy * Atlanta Federal Reserve President Raphael Bostic * U.S. corporate earnings: Intuit, Medtronic, Ross Stores, Deckers Outdoor * U.S. Treasury auctions 10-year inflation-protected securities, 4-week bills Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2024-05-23/

2024-05-23 09:55

LONDON, May 23 (Reuters) - The Bank of England allotted 16.245 billion pounds ($20.64 billion) of one-week funds in its short-term repo operation on Thursday, the largest usage of the facility since it launched in October 2022 after previous records were set in recent weeks. The BoE uses the weekly repo to help keep money market rates close to its official Bank Rate while it takes reserves out of the financial system with its quantitative tightening (QT) programme. Under QT, the BoE is selling a large chunk of the government bonds that it bought over the past 15 years via its quantitative easing programme, and allowing others to mature. BoE Governor Andrew Bailey said on Tuesday the recent increase in the use of the short-term repo facility was encouraging and showed the benefits of having "tried and tested" liquidity facilities as the central bank ran down its balance sheet. Sign up here. https://www.reuters.com/world/uk/bank-england-allots-latest-record-amount-short-term-repo-operation-2024-05-23/

2024-05-23 07:46

JOHANNESBURG, May 23 (Reuters) - The South African rand weakened on Thursday, after Federal Reserve meeting minutes released on Wednesday hinted that interest rates will remain higher for longer in the world's biggest economy. At 1502 GMT, the rand traded at 18.4450 against the dollar , 0.85% weaker than its previous close. The dollar last traded around 0.02% firmer against a basket of global currencies. "After a stellar month, the ZAR has finally experienced some profit-taking," Danny Greeff, co-head of Africa at ETM Analytics, told Reuters. "The catalyst for this ... was the hawkish tone in the Fed's May meeting minutes, which pointed to a higher-for-longer rates outlook in the US," Greeff added. On Tuesday, the rand had firmed to levels not seen since August last year, before the Fed's minutes on Wednesday after South African markets closed. Like other emerging market currencies, the risk-sensitive rand often takes cues from global drivers like U.S. monetary policy in addition to local data points. Risks around the local currency remain ahead of a general election on May 29, which could see the governing African National Congress lose its parliamentary majority for the first time in 30 years and force the party into a coalition government. "While investors have reduced some of their hedges against a potential ZAR blowout post the elections... uncertainty will likely keep the ZAR undervalued in the lead up to the elections," Greeff added. On the stock market, the Top-40 index (.JTOPI) New Tab, opens new tab closed down about 0.7%. South Africa's benchmark 2030 government bond was weaker, with the yield up 14 basis points at 10.430%. Sign up here. https://www.reuters.com/markets/currencies/south-african-rand-weaker-after-fed-meeting-minutes-2024-05-23/