2025-11-14 12:12

LONDON, Nov 14 (Reuters) - The UK government's commitment to its own fiscal rules to balance the budget by 2029/30 remains vital for the country's AA- credit rating, credit agency Fitch said. UK bond markets reacted badly on Friday to a report that British finance minister Rachel Reeves had scrapped plans to raise income tax rates in this month's budget in a bid to avoid further political backlash for the government. Sign up here. "We’re not saying that the growth side is not necessarily relevant, but for the way that we think about it, to have the commitment to the fiscal framework is very important," Fitch's head of Western Europe Sovereigns ratings Federico Barriga-Salazar told Reuters on Friday. "If we see that there is less of that, then the risk on the fiscal side will be higher." Barriga-Salazar said there was bound to be plenty of "political noise" about plans to fill the fiscal gaps, but that it didn't fundamentally change Fitch's baseline assumptions. It reaffirmed the 'stable' outlook on its AA- UK rating in August, forecasting that the government's deficit would narrow 0.6 percentage points to 5.3% of GDP this year, dropping to 4.7% in 2026 and 4.4% in 2027. Those levels, however, are well above the 2% median AA rating bracket countries are predicted to have in 2027. The UK's forecast 106% debt-to-GDP ratio at that point is also almost double the projected AA-rated sovereign median of 52%. "We still think that they have that commitment to following the fiscal rules, so there, for example, we see less of a risk at the moment than in France." https://www.reuters.com/world/uk/uks-commitment-fiscal-rules-crucial-credit-rating-fitch-says-2025-11-14/

2025-11-14 11:42

14 Nov - Everything Mike Dolan and the ROI team are excited to read, watch and listen to over the weekend. From the Editor Sign up here. Hello Morning Bid readers! The end of the U.S. government shutdown may be an example of “buying the rumor and selling the news”, as Wall Street tumbled on Thursday after rallying earlier in the week. Though with Nvidia and other AI leaders recording meaningful losses yesterday, and bets on Federal Reserve cuts getting pared back, the major market-moving issues clearly remain “AI bubble” fears and the trajectory for policy easing. One reason the end of the longest-ever government shutdown – 43 days, if you were counting – had only a modest impact on markets is that economic clarity – one of investors’ biggest concerns related to the closure – is unlikely to clear up, even with Washington DC open, as ROI markets columnist Jamie McGeever and ROI editor-at-large Mike Dolan both explained this week. That lack of clarity is bad news for Fed Chair Jay Powell, and can help explain why the U.S. central bank may pause next month, as Mike Dolan argues. Over in Asia, the yen fell to its weakest level in nine months on Wednesday, brushing up against the crucial 155 level. Jamie McGeever argues that government intervention to prop up the yen may not yet be a given, but investors should still remain on high alert. Staying in Japan, a peculiar similarity is emerging between new Prime Minister Sanae Takaichi and U.S. President Donald Trump. They both appear set on using fiscal stimulus to combat cost-of-living concerns – which, as Jamie McGeever argues, is a bit like trying to bring a fire under control by dousing it with gasoline. Meanwhile, in energy markets, the International Energy Agency on Wednesday published its World Energy Outlook, which introduced a new scenario showing that, given current government policies, oil demand will not plateau in 2030 as previously expected, but will instead keep rising through mid-century. It’s sobering reading for world leaders meeting in Brazil for COP30, explains ROI energy columnist Ron Bousso examines. Speaking of the climate summit, ROI energy transition columnist Gavin Maguire looks at what has – and what hasn’t – changed since the landmark COP21 Paris agreement ten years ago. The growing bullishness about the outlook for oil and gas demand was certainty apparent in energy giant Chevron’s latest strategy update, also released on Wednesday. Ron Bousso argues that it shrugs off long-term anxieties about the transition toward low-carbon energy as well as near-term concerns about a potential looming oversupply. On the topic of oversupply, ROI Asia commodities columnist Clyde Russell wrote this week that the LNG market is bracing for a surge in supply next year, with significant uncertainty about how low spot prices will have to drop to clear the additional volumes. Finally, over in the metals markets, ROI metals columnist Andy Home notes that copper has been added to the U.S. government's list of critical minerals, even though the U.S. has the world's second largest copper stockpile. As we head into the weekend, check out the ROI team’s recommendations for what you should read, listen to, and watch to stay informed and ready for the week ahead. I’d love to hear from you, so please reach out to me at [email protected] , opens new tab . , opens new tab This weekend, we're reading... CLYDE RUSSELL, ROI Asia Commodities and Energy Columnist: This in-depth new report from the think tank Asia House , opens new tab looks at the expanding trade between the Middle East Gulf and Asia, noting that – for the first time ever – trade between the Gulf and China is now bigger than the region’s trade with the West. While energy remains the foundation of the trade relationship, it also is expanding into other sectors such as construction and electronics. MIKE DOLAN, ROI Financial Markets Editor-at-Large: This piece by economic historian Marc-William Palen for the IMF's Finance & Development , opens new tab magazine is a nice sweep of economic history that compares the current attempt to roll back globalization with the prior free trade waves going back into the 18th and 19th centuries - and the periodic, sometimes, disastrous retreats to economic nationalism. The piece asks whether we’re at a unique juncture now or just experiencing another cyclical wave. JAMIE MCGEEVER, ROI Markets Columnist: “Bubble or Nothing” is deep-dive by the Center for Public Enterprise into the AI boom – its funding and energy needs, its ‘circular’ financing, the revenues it may or may not generate, and the potential economic risks if the bubble pops. It has some excellent – and simple – graphics too. It’s long and detailed, though, so it’s perhaps one to bookmark. , opens new tab GAVIN MAGUIRE, ROI Global Energy Transition Columnist: While the IEA's latest report may have grabbed attention for saying that fossil fuels will linger in the global energy mix for longer that previously forecast, this outlook from Ember expects that clean energy sources will continue to squeeze out coal and gas in world electricity generation. It also features great detail on trends in key markets. , opens new tab We're listening to... RON BOUSSO, ROI Energy Columnist: How effective are U.S. sanctions on Russia’s oil and gas industry? The answer is a mixed picture. This Carnegie Politika podcast , opens new tab with Edward Fishman offers some great insights. And we're watching... ANNA SZYMANSKI, ROI Editor-in-Charge: Our very own Mike Dolan joined the Reuters Econ World podcast , opens new tab for part two of the “AI bubble” discussion. Mike spoke with host Carmel Crimmins about the real-world impact of the artificial intelligence capex frenzy and the role national security is playing in the multi-billion dollar spending spree. Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here. You can find ROI on the Reuters website , opens new tab, and you can follow us on LinkedIn , opens new tab and X. , opens new tab Opinions expressed are those of the authors. They do not reflect the views of Reuters News, which, under the Trust Principles , opens new tab, is committed to integrity, independence, and freedom from bias. https://www.reuters.com/business/finance/global-markets-view-usa-2025-11-14/

2025-11-14 11:39

ECB is drafting proposals to streamline regulations Banks say they are at a disadvantage versus US peers Elderson suggests including more banks in regime for smallest lenders FRANKFURT, Nov 14 (Reuters) - European Central Bank supervisor Frank Elderson on Friday backed simplifying rules for smaller lenders and capital requirements for the sector as a whole. The ECB is drafting proposals to whittle down regulation in the European Union, responding to banks' complaints that they are at a disadvantage to their U.S. peers, also due to U.S. President Donald Trump'sderegulation drive. Sign up here. Elderson proposed expanding a regime currently reserved for the region's tiniest and simplest institutions, which requires them to report just 30% of the data that larger banks must produce. Those lenders are also subject to fewer inspections from supervisors. "One could consider a more systematic application of this regime, as well as an increased scope," the Dutch legal expert told an ECB conference. He added this could be done within the existing rulebook, maintaining a framework in which assets are weighed based on their risk. Speaking later at the same event, chief ECB supervisor Claudia Buch said international banking rules should be applied to all banks "but with a lot of proportionality". The ECB will publish its proposals next month. ECB COULD MAKE ITS REQUIREMENTS MORE PREDICTABLE The Small and Non-Complex Institution regime is currently applied to banks with assets of less than 5 billion euros ($5.83 billion), a small trading book and little exposure to derivatives, among other criteria. Germany, where regional and smaller lenders still make up nearly half of total assets, has been lobbying to create an entirely separate regime for smaller banks, something that would require difficult-to-pass changes to EU legislation. Elderson said the ECB could make its requirements more predictable and that there was scope for making the capital stack, which is currently comprised of nine layers, simpler. In cases of failure, France has proposed subjecting Europe's biggest banks to a single buffer, rather than the current two. The ECB proposals are part of a broader simplification initiative being carried out by the European Commission. An ECB task force will consider all proposals before making its recommendations to the Commission by the end of the year. ($1 = 0.8575 euros) https://www.reuters.com/sustainability/boards-policy-regulation/ecbs-elderson-backs-easier-rules-small-banks-fewer-requirements-2025-11-14/

2025-11-14 11:18

Individuals will receive certification for holdings, easing path to future sales Levy is about half the tax on full value of gold sales lacking proof of purchase Supporters say measure will improve transparency, legal gold circulation Proposal targets 4,500–5,000 metric tons of privately held gold ROME, Nov 14 (Reuters) - Italy is considering a one-off levy for households to declare gold held off the books, an amendment to the 2026 budget law showed, in a move that could potentially yield the state more than 2 billion euros ($2.3 billion). The proposal would allow individuals to pay a 12.5% tax to certify the market value of bullion, gold jewellery and collectible coins for which purchase records are missing, the same rate as on government bonds. The certification has to be done by June 2026. Sign up here. Under current rules, the lack of proof of purchase can lead to a 26% tax on the entire sale value, rather than just the actual capital gain. This has discouraged people from selling their inherited gold on the official market and pushed some transactions into informal or undeclared channels, limiting market liquidity and tax revenues, lawmakers from the co-ruling League and Forza Italia party said. Some estimates put privately held gold in Italy at 4,500–5,000 metric tons, worth roughly 500 billion euros at current prices. Italy's network of "Compro Oro" shops — businesses that buy and sell gold — has seen a sharp rise in activity as prices hit record highs. Sales of used gold jumped by around 25% in 2025, with more than 1.2 million transactions per month, driven by households cashing in old jewellery and coins, according to Metropolitan Magazine, an Italian publication. Under the proposed measure, taxpayers opting in would declare their holdings at market value, pay the substitute tax in one or three annual instalments, and obtain a stepped-up fiscal value basis for future sales. The process would be overseen by authorised intermediaries and advisers, with strict anti–money-laundering checks. Supporters say the measure could generate significant one-off revenues for the Treasury, while improving transparency in a market long characterised by opaque holdings and informal family transfers. Based on an assumption that 10% of privately held investment gold is certified, the draft estimates additional revenue of up to 2.08 billion euros. The proposal also seeks to encourage the "legal circulation" of gold by removing what stakeholders see as a punitive regime for individuals unable to document purchases made years—or generations—ago. The amendment still needs to clear parliamentary scrutiny and government vetting. ($1 = 0.8575 euros) https://www.reuters.com/business/italy-weighs-one-off-levy-bring-private-gold-holdings-into-formal-economy-2025-11-14/

2025-11-14 11:15

BRUSSELS, Nov 14 (Reuters) - Abu Dhabi state oil firm ADNOC has received the EU's conditional greenlight for its 14.7 billion euro ($17 billion) bid for German chemicals company Covestro (1COVG.DE) , opens new tab, the European Commission said on Friday. It said the approval is conditional upon full compliance with the commitments offered by the parties, including ADNOC's proposed adaptation of its articles of association and sharing of Covestro's patents in the area of sustainability with some other market participants. Sign up here. People with direct knowledge of the matter told Reuters last week that they expected the deal to get approved. The Commission, the EU's competition enforcer, restarted its investigation into the deal on October 24 after stopping the clock on September 3 while waiting for requested information, according to an update on its site last Wednesday. ADNOC last month offered to change its articles of association to address EU concerns on its unlimited state guarantee, and also pledged to retain Covestro's intellectual property in Europe. It subsequently tweaked the latter element following feedback from rivals and customers. The deal, ADNOC's biggest acquisition yet and one of the largest foreign takeovers of an EU company by a Gulf state, has sparked EU concerns that the company may be using state subsidies to acquire Covestro. ($1 = 0.8575 euros) https://www.reuters.com/sustainability/boards-policy-regulation/adnocs-covestro-deal-gets-conditional-european-commission-greenlight-2025-11-14/

2025-11-14 11:02

Nvidia results on Wednesday could be key moment for tech, AI Stocks waffle during week amid shutdown end, rate uncertainty Walmart, Home Depot reports also due in coming week Investors brace for release of shutdown-delayed economic data NEW YORK, Nov 14 (Reuters) - Turbulence in technology stocks could ratchet higher in the coming week as investors react to the quarterly report from Nvidia Corp (NVDA.O) , opens new tab, the world's largest company by market value that is at the heart of Wall Street's artificial intelligence trade. Showing a steadier tone by late Friday, the benchmark S&P 500 (.SPX) , opens new tab equity index ended a volatile few days about flat on the week. Strength in the first three days yielded to a selloff on Thursday as uncertainty about the economic outlook and path for U.S. interest rates undercut optimism over the end of the longest-ever U.S. government shutdown. Sign up here. The Cboe's VIX stock volatility index (.VIX) , opens new tab, the market's so-called fear gauge, reached its highest in about a month early Friday as stock index futures slid in early trade. Investors remained skittish about vulnerability to technology shares, which stumbled this month on concerns AI exuberance has driven up valuations to expensive levels. With its AI chips, semiconductor giant Nvidia has been a bellwether for the theme that has lifted shares of an array of tech names as well as other companies involved in the vast infrastructure expansion to support AI use. Nvidia is the "epicenter" of the build-out of AI, so its results after the bell on Wednesday will be important to the tech sector as well as areas such as industrials and utilities, said Matt Orton, chief market strategist at Raymond James Investment Management. "If you don't see the growth that I think the market is expecting around Nvidia or the positive commentary that we are likely to get from Nvidia going forward, I think you're going to see more of a dent to those sorts of trades," Orton said. Nvidia shares have soared about 1,000% since the launch of ChatGPT in November 2022. This includes a year-to-date gain of more than 40% that made Nvidia the first company to surpass $5 trillion in market value last month. That market heft means the stock's moves can sway equity indexes. Nvidia carries an 8% weight in the S&P 500 and a roughly 10% weight in the widely followed Nasdaq 100 (.NDX) , opens new tab. Analysts on average expect the company to post a 53.8% year-over-year rise in fiscal third-quarter earnings per share, on revenue of $54.8 billion, according to LSEG. Analysts have also been getting more bullish about the company's future performance, with expectations for the company's fiscal 2027 revenue rising 15% since late May to about $285 billion currently, according to LSEG data. "The assumptions that the market is making are positive, it's getting priced into the stock, and how the company guides will be very important," said Melissa Otto, head of research at S&P Global Visible Alpha. Investors will also focus on commentary from Nvidia related to demand or spending trends. Capital expenditures from hyperscalers such as Microsoft (MSFT.O) , opens new tab and Amazon (AMZN.O) , opens new tab earlier in the reporting season indicated no signs of slowing in the build-out of data centers and other AI infrastructure. "You're not supposed to have any weakness given all the capital spending commitments from various companies," said Jimmy Chang, chief investment officer of Rockefeller Global Family Office. "Demand should still be looking pretty solid in the current environment." Nvidia's report is one of the biggest remaining market catalysts in 2025. The S&P 500 is logging a roughly 14% year-to-date gain, but Wall Street is wary of concerns stocks are in an "AI bubble." Investors appear to be bringing more scrutiny to AI investment announcements, said James Ragan, co-CIO and director of investment management research at D.A. Davidson. "We're moving into a stage where investors are going to demand a little bit more proof of concept in terms of what are the returns, what are the cash flows," Ragan said. Aside from Nvidia's results, quarterly earnings from retailers are due in the coming week including from Walmart (WMT.N) , opens new tab and Home Depot (HD.N) , opens new tab. A batch of economic data held up during the shutdown might also be released. While the S&P 500 tech sector has struggled so far this month, other sectors are logging solid gains in that time, including healthcare, materials and financials. "There's a realization that for investors, maybe that AI is not the only game in town," Ragan said. https://www.reuters.com/business/wall-st-week-ahead-skittish-tech-stock-investors-turn-nvidia-results-next-cues-2025-11-14/