2025-08-05 07:50
US earnings boost market sentiment, tech stocks surge Fed rate cut odds rise to 94% after weak US jobs data Oil tumbles as demand outlook darkens TOKYO/LONDON, Aug 5 (Reuters) - Global stocks rose for a second session on Tuesday and the U.S. dollar steadied as investors raised bets the Federal Reserve would act to prop up the world's largest economy. U.S. shares rallied on Monday on generally positive earnings reports and increasing bets for a September rate cut from the Fed after disappointing jobs data on Friday. Sign up here. Oil prices edged lower after output increases by OPEC+, while gold hovered near a one-week high. "There are signs of weakness in parts of the U.S. economy, that plays to the view that maybe not in September, but certainly this year that the Fed's still on course to ease potentially twice," said Rodrigo Catril, senior currency strategist at National Australia Bank. In Europe, the STOXX 600 (.STOXX) , opens new tab rose 0.4% in early trading, up for a second day, echoing the strength across Asia markets, where MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) , opens new tab was up 0.8%. "The question is whether bad news is bad news (economy slowing down) or it's good news (Fed moving towards rate cuts). Our view is that depends on how bad is the data and what's priced in," Jefferies strategist Mohit Kumar said. "A modest weakening of the economy would be good news as it should be more easing from the Fed. However, a sustained and sharp rise in unemployment rates would be a negative as it would raise concerns over growth and earnings," he said. In currencies, the dollar edged up modestly, rising 0.35% against the Japanese yen at 147.6, while the euro fell 0.25% to $1.1543. The dollar index , which tracks the greenback against a basket of six other currencies, rallied 0.34% after a two-day decline. Friday's soft U.S. nonfarm payrolls data added to the case for a cut by the Fed, and took on another layer of drama with President Donald Trump's decision to fire the head of labour statistics responsible for the figures. Odds for a September rate cut now stand at about 94%, according to CME Fedwatch, from a 63% chance seen on July 28. Market participants see at least two quarter-point cuts by the end of this year. News that Trump would get to fill a governorship position at the Fed early also added to worries about politicization of interest rate policy. Trump again threatened to raise tariffs on goods from India from the 25% level announced last month due to its Russian oil purchases, while New Delhi called his attack "unjustified" and vowed to protect its economic interests. With concern mounting about the fragility of the underlying economy and the potential for oversupply, oil prices dropped for a fourth day, leaving Brent crude futures down 1% at two-week lows at $68.05 a barrel. "Whether the threat of secondary sanctions on India's financing of Russia is the core goal remains to be seen. Or indeed, this move may be increased U.S. leverage on India to open up its domestic economy to agricultural imports or commitments to buy U.S. energy instead," strategists at ING said. Second-quarter U.S. earnings season is winding down, but investors are still looking forward to reports this week from companies including Walt Disney (DIS.N) , opens new tab and Caterpillar (CAT.N) , opens new tab. Tech heavyweights Nvidia (NVDA.O) , opens new tab, Alphabet (GOOGL.O) , opens new tab and Meta (META.O) , opens new tab surged overnight, and Palantir Technologies (PLTR.O) , opens new tab raised its revenue forecast for the second time this year on expectations of sustained demand for its artificial intelligence services. U.S. stock index futures , were up 0.2-0.4%, pointing to a modest rise at the start of trading. Data on Tuesday showed business activity in the euro zone grew at a slightly faster pace in July than in June, but remained sluggish. A separate UK survey showed British businesses recorded their largest drop in new orders in almost three years in July and cutting staff by most in six months. Data from Asia's two biggest economies showed resilience in their service sectors. In Japan, the S&P Global final services purchasing managers' index (PMI) to 53.6 in July from 51.7 in June for the strongest expansion since February. China's services activity last month at its fastest pace in more than a year. Bitcoin , meanwhile, fell 0.6% to $114,235, while gold rose 0.1% to $3,375 an ounce. https://www.reuters.com/world/china/global-markets-wrapup-4-2025-08-05/
2025-08-05 07:37
BP to review upstream portfolio and consider more cost cuts BP shares have underperformed rivals for years BP Q2 profit $2.4 billion vs forecast $1.8 billion Raises dividend by 4%, keeps share buyback pace LONDON, Aug 5 (Reuters) - BP (BP.L) , opens new tab will launch a review of how best to develop and monetise its oil and gas production assets and consider more cost cuts to boost shareholder returns, the oil major said on Tuesday, as it beat second-quarter profit expectations. BP, under pressure from investors after years of underperforming rivals and also the target of activist investor Elliott, reaffirmed plans to divest $20 billion in assets by 2027 and reduce debt and costs. Sign up here. "We will conduct a thorough review of our portfolio of businesses to ensure we are maximizing shareholder value moving forward – allocating capital effectively. We are also initiating a further cost review," CEO Murray Auchincloss said. "BP can and will do better for its investors." The company raised its quarterly dividend by 4% to 8.32 cents and will repurchase $750 million in shares before third-quarter results, keeping its buyback pace steady. The portfolio review will guide how and in what sequence BP will allocate its $13–$15 billion annual investment budget, given new projects in Azerbaijan, Iraq, Libya, and Abu Dhabi and exploration successes in Namibia and Brazil, Auchincloss told Reuters. BP, which also has a plan to boost its U.S. production both onshore and offshore, on Monday called its Brazil Bumerangue block discovery its largest in 25 years. Auchincloss said BP may seek partners for some upstream assets. "It's a nice problem to have," he said. BP has already achieved $1.7 billion of its $4–$5 billion cost-cutting target for 2023–2027. Finance Chief Kate Thomson said benchmarking data coming in over the summer could prompt further reductions. The review comes after Auchincloss talked to incoming Chair Albert Manifold, who replaces Helge Lund next month. Lund had come under pressure for supporting BP’s previous pivot to renewables, which has weighed on its share performance since 2020. Rumours have abounded about BP becoming a takeover target, pushing rival Shell (SHEL.L) , opens new tab to deny media reports in June that it was in merger talks with BP. BP reported second-quarter adjusted net income of $2.4 billion, down 14% year-on-year, but ahead of analysts' average forecast of $1.8 billion. Its shares were up 2.6% at 1032 GMT, outperforming the European energy index (.SXEP) , opens new tab. BP's quarterly performance was boosted by a 33% profit increase at its customers and products division, driven by strong oil trading, higher volumes, and a 20% rise in earnings at its Castrol unit. That contrasted with a weaker quarter in oil trading at Shell. Auchincloss said the process to sell Castrol, the biggest piece of its divestment programme, was going "fine". BP's gas and low-carbon earnings also exceeded expectations. BP has completed $3 billion in divestments towards its $3–$4 billion 2025 goal. Net debt fell by $1 billion to $26 billion, compared with a target range of $14–$18 billion by 2027. Brent crude oil averaged $67 per barrel in April-June, down from $75 in the previous quarter and $85 a year earlier. https://www.reuters.com/business/energy/bp-vows-do-better-investors-profit-tops-forecast-2025-08-05/
2025-08-05 07:25
NEW DELHI/SINGAPORE, Aug 5 (Reuters) - Russia-backed Indian refiner Nayara Energy has exported its first gasoline cargo since the privately-owned company was sanctioned by the European Union on July 18, according to four shipping sources and LSEG data. Oil tanker Tempest Dream, carrying about 43,000 metric tons of gasoline, sailed out on August 4, according to the sources and shipping data. Sign up here. The vessel is heading to Sohar, Oman, the shipping data showed. https://www.reuters.com/business/energy/indias-nayara-energy-ships-out-first-gasoline-exports-since-sanctions-sources-2025-08-05/
2025-08-05 07:10
TOKYO, Aug 5 (Reuters) - Japan recorded its highest-ever temperature of 41.8 degrees Celsius (107.2 degrees Fahrenheit) on Tuesday, prompting the government to advise residents to stay indoors and promise steps to ease weather-related damage to rice crops. Readings in the eastern city of Isesaki, in Gunma prefecture, surpassed the previous high of 41.2 C marked last week in the western city of Tamba in Hyogo prefecture, the country's meteorological agency said. Sign up here. So far this summer, more than 53,000 people have been taken to hospital for heat stroke, according to the Fire and Disaster Management Agency. "Today is murderously hot," said 63-year-old auto worker Takeshi Ishikawa, who was filling his water bottle at a fountain in central Tokyo. "If it gets to 42 degrees, it would be hotter than my bath that I prepare at 40 degrees." Average temperatures across Japan have continued to climb after marking a record high in July for the third year in a row, while the northeastern region along the Sea of Japan has registered critically low levels of rainfall, raising concerns over the rice harvest. High temperatures have caused a proliferation of stink bugs in some rice-growing areas, even as the government is set to officially adopt a new policy on Tuesday of increased rice production to prevent future shortages. "We need to act with speed and a sense of crisis to prevent damage" from high temperatures, Farm Minister Shinjiro Koizumi said at a press conference. The government will offer support for pest control and measures to tackle drought, he said. Extreme heat in 2023 had damaged the quality of rice, causing an acute shortage last year that was exacerbated by the government's misreading of supply and demand. That led to historically high prices of the all-important staple food, causing a national crisis. https://www.reuters.com/business/environment/japan-sets-record-high-temperatures-worries-mount-over-rice-crops-2025-08-05/
2025-08-05 07:08
Grid has struggled to provide adequate supply for over a decade Upfront solar costs can be absorbed within around two years Government is also working to boost solar power MOSUL, Aug 5 (Reuters) - Weary of paying big bills for power supplies that are often cut off, wheat grower Abdallah al-Ali is among the rising number of farmers to have turned to solar panels to keep their irrigation systems running during the searing heat of the Iraqi summer. A member of the Organization of the Petroleum Exporting Countries, and one of the world's leading oil producers, Iraq has struggled to provide its citizens with energy since the 2003 U.S.-led invasion that toppled Saddam Hussein. Sign up here. In the ensuing turmoil, under-investment and mismanagement have left the national grid unable to cope with demand. On some summer days when temperatures can exceed 40 degrees Celsius (104°F), it provides electricity for only around half of the time, according to a Reuters witness in Mosul, in the northern agricultural province of Nineveh. The monthly power bill for al-Ali was nearly a million Iraqi dinars ($763.94). Since installing solar, he said he has been paying the national grid 80,000 Iraqi dinars and his supply has become reliable. "Farmers are turning to solar to reduce their bills and lower the load on water pumps. The electricity from solar is stable," he said. Apart from its oil riches, Iraq has vast solar potential that the authorities say they will use to close the gap between supply and demand, at the same time, reducing carbon emissions. The country has a plan to install 12 gigawatts of solar capacity by 2030, according to the ministry of electricity, which includes delivering a 1 GW solar plant for Basra this year. Peak summer demand in 2025, meanwhile, is expected to reach 55 GW, while supply stands at just 27 GW, according to estimates by Iraq's electricity minister in January. CITIZEN POWER Al-Ali is not the only citizen who has not waited for the government to act. Farmers across Nineveh can use both rooftop panels and ground-mounted arrays, placed on farmland, to power irrigation systems and supply household needs. In urban areas, panels are tightly packed on the flat roofs, which characterise Mosul homes, to maximise energy generation. Hassan Taher, a Mosul resident and agricultural engineer, said switching to solar had transformed his home life. "My bills are now very low, and the panels even helped reduce the heat in our kitchen by insulating the roof," he told Reuters. The surge in demand has also been felt by local businesses. Mohammed al-Qattan, who runs Mosul Solar, a solar installation company, said interest soared in 2024 and 2025, especially from rural communities, where he said 70% of his clients lived. Although increasingly cost-effective, solar panel systems in Iraq still cost between 5 and 10 million Iraqi dinars, with the average 5–6 kilowatt system priced around 5 million dinars. Many users say they recoup the upfront cost within one-to-three years, and most systems come with a 15-year warranty. They also avoid the need for costly diesel generators, which emit high levels of carbon dioxide and other pollutants. In urban areas, many householders take out a subscription for backup from a generator, which costs between 50,000 and 100,000 dinars per month. "Compared to generators, this cost can be recovered within two years, and the system lasts for 30 years,” al-Qattan said of solar. Solar systems installed are off-grid, meaning their owners are nearly self-sufficient in energy, said Ahmed Mahmoud Fathi, a director in the Nineveh branch of the state electricity company. Users only pay the electricity department for night-time use of the national grid, which is especially attractive to farmers who use high-voltage pumps during the day and do not need electricity at night. Omar Abdul Kareem Shukr, who heads Sama al-Sharq Company, which sells solar panels, told Reuters that even middle- and low-income citizens are buying solar systems as government initiatives have been put in place to encourage solar panel use. The Central Bank has also introduced low-interest loans for citizens buying solar panels, although farmer Abdallah al-Ali said he had managed without. "Currently, I rely on myself as a farmer. I heard there’s government support through a Central Bank initiative, but I haven’t approached it,” he said. ($1 = 1,309.0000 Iraqi dinars) https://www.reuters.com/business/energy/farmland-rooftops-iraqis-turn-solar-power-grid-falters-2025-08-05/
2025-08-05 07:02
Q2 growth at 5.12% y/y, vs poll's 4.80% Investment growth at highest since Q2 2021 Household consumption supported by holiday spending JAKARTA, Aug 5 (Reuters) - Indonesia's second quarter growth was better than expected, driven by robust investment and household spending, and showed the fastest pace since the second quarter of 2023, but economists said more support may be needed to protect growth in the second half. Gross domestic product accelerated to 5.12% from 4.87% in the previous quarter, data from the statistics bureau showed on Tuesday, and beat growth of 4.80% forecast in a Reuters poll. Sign up here. "GDP growth registered an upside surprise in the second quarter compared to our expectations, with the gap likely explained by a supportive net exports balance on account of frontloading," said DBS Bank economist Radhika Rao. The growth pace defied concerns over weakening economic indicators, including falling car sales, softening consumer confidence and contracting purchasing managers' index, which had pointed to slowing activity. Ahead of Tuesday's data, Bank Indonesia, which has cut policy rates four times since September, forecasts economic growth would be in a range of 4.6% to 5.4% this year. Household spending, which makes up over half of Indonesia's GDP, accelerated slightly to 4.97% year on year in the second quarter, compared to 4.95% in the previous quarter, supported by higher spending for food and travel during a number of religious holidays and a school break. Investment growth surged to a four-year high of 6.99% in the second quarter, from 2.12% previously, helped by infrastructure projects including the expansion of the Jakarta mass rapid transit, Statistics Indonesia Deputy Chief Moh. Edy Mahmud, said. Government spending contracted by an annual 0.33%. Meanwhile, exports were boosted by shipments of vegetable oil, metals, electronics and auto parts. Frontloading of export orders as buyers sought to get ahead of U.S. tariffs has seen the value of exports rise in the first half of the year. Brian Lee, an economist at Maybank, warned the trade surplus could narrow further as export growth cools while slower global trade weighs on demand for Indonesia's key commodities. "We expect a further 50 bps of rate cuts before year-end while the government has laid out plans to introduce a third package of stimulus towards year-end, albeit scaled down in size," Lee said. Rao of DBS also expects slower export momentum. "We continue to expect moderation to set in (in) the second half, partly on account of payback in trade," she said. On a non-seasonally adjusted, quarter-on-quarter basis, gross domestic product expanded 4.04% in April-June, Statistics Indonesia said. Indonesia's government will continue its fiscal support to boost growth in the second half by extending a tax break on purchases of homes of certain values until December, and airfares discounts to increase year-end holiday spending, Senior Economic Minister Airlangga Hartarto said in a press conference. Jakarta also preparing other stimulus for labour intensive industry by giving investment credits to revitalise machinery and cheap loans for certain home developers. Airlangga did not provide the size of the stimulus for the second half, but Jakarta launched 24.4 trillion rupiah ($1.49 billion) worth of incentives in the first half. ($1 = 16,375.0000 rupiah) https://www.reuters.com/world/asia-pacific/indonesia-q2-gdp-beats-expectations-with-fastest-growth-two-years-2025-08-05/
