2025-07-31 08:45

Microsoft shares jump 8.5% premarket after results Shares rebound 50% from April 2025 lows AI advancements boost stock value post-ChatGPT launch July 31 (Reuters) - Microsoft (MSFT.O) , opens new tab is set to soar past $4 trillion in market valuation for the first time on Thursday, as a blockbuster earnings report helps the tech behemoth become the second company after Nvidia to surpass the milestone. The software company forecast a record $30 billion in capital spending for the current fiscal first quarter and reported booming sales in its Azure cloud computing business on Wednesday. Sign up here. Shares of Microsoft were up 8.5% at $557.03 in early premarket trading, valuing it at $4.14 trillion. Redmond, Washington-headquartered Microsoft first cracked the $1 trillion mark in April 2019. Its move to $3 trillion was more measured than other tech giants, Nvidia (NVDA.O) , opens new tab and Apple (AAPL.O) , opens new tab, with AI bellwether Nvidia tripling its value in just about a year and clinching the $4 trillion milestone before any other company on July 9. Apple was last valued at $3.12 trillion. Lately, breakthroughs in trade talks between the U.S. and its trading partners ahead of President Donald Trump's August 1 tariff deadline have buoyed stocks, propelling the S&P 500 and the Nasdaq to record highs. Microsoft, the second largest U.S. company, has rebounded nearly 50% from its April 2025 lows, when global markets were rattled by Trump's tariff offensive. Microsoft's multibillion-dollar bet on OpenAI is proving to be a game-changer, powering its Office Suite and Azure offerings with cutting-edge AI and fueling the stock to more than double its value since ChatGPT's late-2022 debut. Armed with exclusive access to OpenAI's models, Microsoft has raced to the front of the generative AI pack - supercharging its Azure cloud business, now the company's top revenue driver, and solidifying its dominance in the tech landscape, compared to Google's cloud and Amazon's web services. Wall Street's surging confidence in the company comes on the heels of back-to-back record revenues for the tech giant since September 2022. The stock's rally had also received an extra boost as the tech giant trimmed its workforce and doubled down on AI investments — determined to cement its lead as businesses everywhere race to harness the technology. While sweeping U.S. tariffs had investors bracing for tighter business spending, Microsoft's strong earnings have shown that the company's books are yet to take a hit from the levies. https://www.reuters.com/business/retail-consumer/microsoft-poised-4-trillion-valuation-after-solid-results-2025-07-31/

2025-07-31 07:58

LONDON, July 31 (Reuters) - British power company Drax Group's (DRX.L) , opens new tab first-half adjusted core profit fell by about 11%, hit by a decline in biomass generation and lower UK wholesale power prices, it said on Thursday. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) fell to 460 million pounds ($611 million) in the first half, against 515 million pounds in the same period last year. Sign up here. Drax, which has converted coal plants to run on biomass, provides about 6% of Britain’s electricity. ($1 = 0.7535 pounds) https://www.reuters.com/business/energy/uk-power-company-drax-posts-first-half-profit-fall-2025-07-31/

2025-07-31 07:56

Retreat from US assets slows on tariff deals, GDP 'Rest of the world trade' follows bets against the dollar Trend-tracking hedge funds close bets against Treasuries US rebound would weigh on international stocks, gold, EM LONDON, July 31 (Reuters) - Investors' conviction that U.S. President Donald Trump's tariffs and debt spree would spark long-term pain for the dollar and U.S. stocks is crumbling, signaling pain ahead for assets across Europe and emerging markets that were boosted by this view. The dollar is heading for its first monthly gain this year, boosted by robust economic data, fading concern about the outlook for U.S. assets and a growing belief that the Federal Reserve may not cut interest rates again for some time. Sign up here. With artificial intelligence euphoria powering U.S. stock markets to consecutive daily peaks and relentless selling of the greenback going into reverse, European equity outperformance has stalled as the euro slides and a blistering gold rally stalls. "It's one of the biggest positions people have, being negative on the dollar and the U.S.," Pictet Asset Management co-head of multi-asset Shaniel Ramjee said. He was preparing to raise his dollar exposure from what he described as "practically zero", on expectations that U.S. economic trends and company earnings would start outshining Europe. A broad dollar revival, he added, might bring 2025's big market trends to a halt. The so-called "rest of the world trade", where investors have favoured international assets over the U.S., was led by a rush of speculative bets against the U.S. currency that has now slowed, Barclays analysis showed. COMEBACK European stocks (.STOXX) , opens new tab, which posted their best-ever quarter relative to the U.S. in the three months to March, are now merely keeping pace with Wall Street's S&P 500 (.SPX) , opens new tab as both indices clock an approximately 8.4% year-to-date rise. As recently as mid-July, conviction that the dollar would weaken was the most crowded trade among global fund managers, Bank of America research showed. But currency traders who were making short-term bets against the greenback, which this year suffered its worst first-half slump since 1973, are now backing out. The dollar index is trading at two-month highs and is set for a 3% rise in July, the first monthly increase this year. The euro, which scored the best six-month run of its 26-year lifetime in the half-year to June, has fallen below $1.15, heading for its largest monthly drop since May 2023. . "We're seeing a rotation into U.S. equities, a rotation in currency markets and a rotation in (market) momentum," Edmond de Rothschild Asset Management multi-asset head Michael Nizard said. He cited Sunday's framework trade deal between Washington and Brussels as a major reason for the trend, which he did not expect to last until the end of the year, adding that he would buy the euro at around $1.14. TEMPORARY? Monica Defend, head of the investment institute at Europe's largest asset manager Amundi, said she was sticking to a long-term view that the dollar was set to decline because of Trump's borrowing plans and consistent attacks on Federal Reserve independence. But she said she was also prepared to change her view "if growth in the U.S. surprises nicely on the upside," in a persistent trend from here. Sterling has fallen 1.4% against the greenback this week and an index of emerging market equities (.dMIEF00000PUS) , opens new tab has drooped for three days as a stunning year-to-date rally stalls. Gold , the standout trade of 2025, is heading for its first three-week losing streak since November, trading around $3,300 an ounce. Amundi's Defend expected U.S. tech stocks and AI exuberance to keep Wall Street equities outperforming from here. But she also expected U.S. growth to stall once tariffs started raising consumer prices. "The U.S. might continue to be exceptional, probably not on the macro (economic) front, but more on the equity market," she said. Nutshell Asset Management CIO Mark Ellis, whose UK-based fund changes the composition of its portfolios around twice a month, said he was not certain the U.S. market bounce-back could last beyond next week. For 50 years, August and September have been the S&P’s worst months for returns compared to volatility, he said. "Around the end of this week is a good time to take risk off and I'll be more defensive going into historical summer volatility and weakness," he said. Barclays head of European equity strategy Emmanuel Cau, in a July 30 note to clients, issued a different warning. He noted that trend-following hedge funds called CTAs, whose trades are viewed as a barometer of the dominant market mood, had closed out bets against U.S. Treasuries and cut exposure to European stocks. A more persistent dollar bounce-back, he said, would be "a key pain trade" for global investors from here. https://www.reuters.com/business/finance/global-markets-dollar-graphic-2025-07-31/

2025-07-31 07:47

Oil price in second quarter dropped on OPEC+ output hikes Quarterly profit at $4.26 bln vs estimate average of $3.74 bln Keeps pace of share buybacks at $3.5 bln/quarter LONDON, July 31 (Reuters) - Shell's (SHEL.L) , opens new tab second-quarter net profit tumbled by almost a third on Thursday, dragged down by a drop in oil prices, lower gas trading results and outage-related losses from its chemicals operations, but it still easily beat analysts' forecasts. The oil major's shares were up 1.8% following the announcement in which it also said it would maintain the pace of its share buyback programme at $3.5 billion over the next three months, the 15th consecutive quarter of at least $3 billion. Sign up here. "We definitely saw macro continuing to be challenging on multiple fronts and against definitely a backdrop of geopolitical and economic uncertainty," Shell's finance chief Sinead Gorman told reporters. "We saw that knock-on impact on both physical trade flows as well as commodity prices and margins. Despite that, we delivered a robust set of results," she said. Shell said it achieved $3.9 billion in cost cuts compared with 2022, part of a programme aimed at saving between $5 billion and $7 billion by the end of 2028. It recorded cash flow from operations of $11.9 billion in the quarter, down from $13.5 billion a year ago. The buybacks together with $2.1 billion in dividends brought shareholder distributions to 46% of operating cash flow, within its 40% to 50% guided range. Shell's adjusted earnings, its definition of net profit, reached $4.264 billion in the quarter, smashing the $3.74 billion average in an analyst poll provided by the company but down 32% from a year ago. The company had guided in a trading update that it expected earnings to be hit by weaker trading in its integrated gas division and losses at its chemicals and products operations after an outage at its U.S. Monaca polymer plant. Crude oil prices fell in the quarter as OPEC+, made up of the Organization of the Petroleum Exporting Countries and allies such as Russia, began unwinding self-imposed production cuts that had been aimed at supporting the market. Their most recent decision calls for an oil output increase of 548,000 barrels per day in August. Global benchmark Brent crude prices averaged around $67 a barrel during the April-to-June quarter, compared with $75 a barrel in the first quarter and $85 a year earlier. Prices spiked briefly in June on the back of the conflict between Israel and Iran. Gorman said Shell had taken a cautious, risk-off approach to oil trading in the quarter, because it saw a disconnect between price movements and supply-demand fundamentals. She said that after seeing muted demand for liquefied natural gas from Asia in the first half of the year, which allowed Europe to restock, LNG markets could tighten again after the summer. https://www.reuters.com/business/energy/shells-profit-drops-by-almost-third-lower-oil-prices-beats-expectations-2025-07-31/

2025-07-31 07:37

HONG KONG, July 31 (Reuters) - The Hong Kong Monetary Authority (HKMA) kept the base rate it charges via its overnight discount window unchanged at 4.75% on Thursday, tracking a move by the U.S. Federal Reserve to keep rates steady. The U.S. central bank held interest rates steady on Wednesday, and Federal Reserve Chair Jerome Powell's comments after the decision dented confidence that borrowing costs would begin to fall in September. Sign up here. HKMA said , opens new tab Hong Kong's monetary and financial markets have continued to operate in an orderly manner. The territory's de facto central bank stepped into the foreign exchange market as the Hong Kong dollar hit the weak end of its trading band against the U.S. currency since the end of June. HKMA said it will buy Hong Kong dollars and sell U.S. dollars if the local currency faces weakness again in the future. Hong Kong's monetary policy moves in lock-step with the United States as the city's currency is pegged to the dollar in a tight range of 7.75-7.85 per dollar. HSBC Holdings on Thursday said its best lending rate in Hong Kong remains unchanged at 5.25%. Bank of China (Hong Kong) and Hang Seng Bank (0011.HK) , opens new tab also said they would keep their Hong Kong dollar prime rate unchanged at 5.25%. https://www.reuters.com/world/asia-pacific/hong-kong-central-bank-keeps-key-rate-steady-tracking-fed-2025-07-31/

2025-07-31 07:32

SINGAPORE/HOUSTON, July 31 (Reuters) - Asia is expected to step up imports of U.S. West Texas Intermediate crude in the fourth quarter after Middle East oil prices strengthened and opened the arbitrage window, trade sources said. Middle East crude benchmarks Dubai and Murban gained this month on the back of robust demand for high-sulphur oil in Asia, narrowing their price gaps with light-sweet U.S. WTI oil, they said. Sign up here. WTI's arbitrage has been wide open to Asia for the past week for cargoes arriving in early November, said June Goh, a senior analyst at Sparta Commodities. U.S. producer Occidental (OXY.N) , opens new tab has sold WTI crude to Japanese refiner Taiyo Oil, the sources said. The cargo was sold at a premium of about $3.50 a barrel to October Dubai quotes for October delivery, one of the sources said. WTI crude could be delivered at 50-75 cents a barrel lower versus similar quality Murban oil to North Asian refiners depending on suppliers, a Singapore-based trader said. Two other traders said WTI is at least 30 cents cheaper than the light-sour Murban grade. Falling costs for a very large crude carrier to send 2 million barrels of crude from the U.S. Gulf Coast to Asia are also enabling the trade. The costs for a VLCC to ship U.S. crude to China, Singapore and West Coast India fell $200,000 to $6.5 million, $5.5 million and $5.35 million, respectively, on Wednesday, SSY's daily tanker rates on LSEG Workspace showed. Murban's supply has also tightened after Abu Dhabi National Oil Co reduced exports of its flagship grade by diverting the oil to its domestic refinery, the sources said, supporting the benchmark. "We anticipate more Asian buyers to secure WTI cargoes especially with Murban looking expensive whilst taking opportunity to diversify against AG (Arabian Gulf) crude," Goh said. Middle East crude prices are also supported by a threat by U.S. President Donald Trump to impose secondary tariffs on countries that buy Russian oil, she said, adding that Indian refiners would look to buy oil from the Gulf to replace Russian supplies. Trump on Monday shortened a deadline for Moscow to make progress toward a Ukraine war peace deal or see its oil customers slapped with secondary tariffs of 100% in 10 to 12 days, reflecting his growing frustration with Russia's actions. China, India and Turkey are the key importers of Russian crude. https://www.reuters.com/business/energy/asia-steps-up-us-wti-oil-imports-middle-east-prices-rise-sources-say-2025-07-31/