2025-09-29 07:19

Investors eye fiscal policy benefits to industries, not just AI Infrastructure, energy, healthcare, defence draw interest Fiscal stimulus seen as key to market performance MUMBAI, Sept 29 - Some of the world's biggest investors are looking beyond a boom in artificial intelligence to longer-term spending by governments tackling geopolitical, technological and demographic pressures set to reshape markets over the next few years. Asset managers are spreading bets across infrastructure, energy transition, healthcare and defence, to capitalise on fiscal stimulus from governments, even as Wall Street debates whether the AI-powered rally in stocks is sustainable. Sign up here. As concerns over some countries' ballooning fiscal debts draw attention, many investors "underestimated the impact that (stimulus) could have on real and financial assets," said Mark Haefele, chief investment officer of UBS Global Wealth Management. Hafele told the Reuters Global Markets Forum , opens new tab his firm, which oversees $4.5 trillion in assets, is "investing thematically along with what governments are doing", diversifying into areas such as power, resources, healthcare and defence. July's sweeping U.S. tax-cut and spending bill will add trillions to government debt by extending tax cuts from U.S. President Donald Trump's first term, ramping up funding for border security and defence, and trimming Medicare and Medicaid. Europe's fiscal support is just as dramatic, with sentiment boosted by Germany's 500-billion-euro ($586 billion) infrastructure fund exempt from its strict debt brake and NATO members' pledges to lift defence spending to 3.5% of GDP. "Fiscal stimulus is always a big element of the performance of the financial markets," said Antonio Cavarero, head of investments at Generali Asset Management, which manages $430 billion in assets. The magnitude and persistence of these fiscal commitments on both sides of the Atlantic were unprecedented compared to previous market cycles, he said, adding that the structural realignment they drive would last for years. "It takes time before those moneys actually percolate (through) the system ... before you see them becoming reality," Cavarero said. Nuclear power, energy infrastructure, biotech innovation and defense were industries that "cannot be ignored by the market", he added, while warning, "At some point, we will need to deal with these debts." A rise of nearly 14% this year in the S&P 500 (.SPX) , opens new tab index has largely been powered by AI-related momentum, versus more modest gains of 9.5% in Europe's benchmark STOXX 600 (.STOXX) , opens new tab. But the aerospace and defence index (.SXPARO) , opens new tab of the latter has surged almost 68%, showing that fiscal priorities are lifting defence and industrial plays even in a broader market environment still dominated by AI. Saira Malik, chief investment officer at U.S. asset manager Nuveen, which manages $1.3 trillion in assets, expects equity gains to broaden beyond the U.S. tech-heavy trade to cyclical sectors, small-caps and value plays. "U.S. outperformance is not the only game in town this year, thanks to a weaker dollar," she said. Malik advised investors to stay balanced, but with a tilt toward U.S. markets. "I don't think investors should just own U.S. (assets) at the expense of everything else, but I would fully argue against betting against the U.S." Malik also sees opportunities in infrastructure, utilities and waste management, describing them as resilient and effective hedges against inflation. Both UBS and Nuveen stressed active management over passive bets. "It's less of a time for beta and more of a time for active investing," Haefele said. (Join GMF , opens new tab on LSEG Messenger: https://lseg.group/3KFHrhe , opens new tab) https://www.reuters.com/markets/wealth/investors-look-past-ai-hype-long-term-opportunities-government-spending-2025-09-29/

2025-09-29 07:03

HOUSTON, Sept 29 (Reuters) - British oil major BP (BP.L) , opens new tab said on Monday it will move ahead with a $5 billion offshore drilling project in the U.S. Gulf of Mexico called Tiber-Guadalupe, marking another step in the company's strategy shift to refocus on its core oil and gas business. The project, expected to begin oil and gas production in 2030, will include a new floating platform with the capacity to produce 80,000 barrels of crude per day. Sign up here. After underperforming rivals like Shell (SHEL.L) , opens new tab and Exxon Mobil (XOM.N) , opens new tab in recent years with rising debt, BP announced in February it would slash investment in renewable energy and grow oil and gas production to turn around its business and win back investors. The U.S. is key to that goal, with BP aiming to reach at least 400,000 barrels of oil equivalent per day from the Gulf by 2030, up from 341,000 boepd last year. The new platform will develop the Tiber and Guadalupe fields, located about 300 miles (480 km) southwest of New Orleans, which are estimated to hold about 350 million barrels of oil equivalent in recoverable resources, BP said. Tiber-Guadalupe will be BP's second project in the Gulf to produce from ultra-high pressures of 20,000 pounds per square inch, a breakthrough technological advancement. U.S. oil producer Chevron (CVX.N) , opens new tab was the first to drill at that pressure from its Anchor project last year. Development costs for Tiber-Guadalupe are expected to be about $3 per barrel lower than BP's nearby Kaskida project after using 85% of the same design, BP said. https://www.reuters.com/business/energy/bp-greenlights-5-billion-tiber-guadalupe-drilling-project-us-gulf-2025-09-29/

2025-09-29 06:44

Gold hits record high of $3,833.37 per ounce Trump hopes to strike deal to keep government open Silver hits more than 14-year high Platinum at 12-year high Sept 29 (Reuters) - Gold prices surged past $3,800 an ounce for the first time on Monday, setting a new record as investors flocked to the safe-haven asset on U.S. rate cut expectations, fears of a potential government shutdown and escalating geopolitical tensions. Spot gold was up 1.9% at $3,829.63 per ounce by 2:00 p.m. ET (1800 GMT), after hitting a record high of $3,833.37 earlier in the session. Sign up here. U.S. gold futures for December delivery settled 1.2% higher at $3,855.2. The U.S. dollar index (.DXY) , opens new tab fell 0.2%, making greenback-priced bullion less expensive for overseas buyers. "Safe-haven demand focused on the potential U.S. government shutdown" is one of the driving factors behind gold's rally, said David Meger, director of metals trading at High Ridge Futures. "The dollar is under some light pressure in response to that, certainly supporting the precious metals complex." U.S. President Donald Trump is scheduled to meet with top congressional leaders from both parties later on Monday to negotiate an extension of government funding. Without a deal, a federal shutdown would begin on Wednesday. Meanwhile, Russia's defence ministry said its forces had taken control of the village of Shandryholove in Ukraine's eastern Donetsk region. Gold, which tends to perform well in low-interest-rate environments and during times of uncertainty, has climbed more than 43% so far this year. The U.S. Personal Consumption Expenditures Price Index came in line with expectations on Friday, bolstering market confidence in potential rate cuts by the Federal Reserve at its October and December meetings. "The PCE data from last week was viewed as not standing in the way of an additional one or two Fed rate cuts ... they continue to be a supportive factor for gold and silver," Meger said. Separately, Newmont said CEO Tom Palmer would retire by the year-end, after spending more than a decade with the world's largest gold miner. Rival Barrick also announced the resignation of CEO Mark Bristow earlier in the day. Elsewhere, spot silver climbed 1.9% to $46.85 per ounce, hitting a more than 14-year high. Platinum gained 1.5% to $1,592.65, a 12-year high, while Palladium fell 1.1% to $1,255.61. https://www.reuters.com/world/india/gold-hits-record-high-soft-dollar-rate-cut-bets-lift-appeal-2025-09-29/

2025-09-29 06:43

Typhoon Bualoi causes severe damage in Vietnam, kills 13 people 13 people remain missing, 46 others injured Storm weakens to depression as it moves into Laos NGHE AN/HANOI, Sept 29 (Reuters) - Typhoon Bualoi tore through Vietnam's coast on Monday, killing at least 13 people and injuring 46, the government said, while accompanying strong winds and rains damaged homes, snapped power links and flooded roads. Bualoi weakened into a depression heading for Laos after having made landfall early on Monday, and had whipped up waves as much as 8 m (26 ft) high as it moved along the northern central coast, the national weather agency said. Sign up here. Among the missing are fishermen whose boats were washed away off the province of Quang Tri, while another fishing boat lost contact, the government's disaster management agency said. "I stayed awake the whole night, fearing the door would be pulled off by strong winds," said Ho Van Quynh of Nghe An province. TRYING TO PROTECT HOMES His neighbours said they spent the night trying to protect their homes after their apartment building lost power. "I've witnessed many storms, and this is one of the strongest," said 45-year-old Nguyen Tuan Vinh. The government evacuated more than 28,500 people before the typhoon hit, while hundreds of flights were delayed or cancelled by the closure of four airports in central provinces. Strong winds killed nine people and injured seven in the province of Ninh Binh, the Vietnam News Agency said. One person died in floodwaters in Hue city, and a falling tree killed another in Thanh Hoa province, the disaster management agency said. Bualoi has damaged more than 44,000 homes, inundated nearly 6,000 hectares (14,800 acres) of rice and other crops, and cut access to several areas, the government said. NO MAJOR INDUSTRIAL DAMAGE REPORTED It mentioned no major damage to industrial properties, though large factories in or near the typhoon's path included some owned by Foxconn (2354.TW) , opens new tab, Formosa Plastics (1301.TW) , opens new tab, Luxshare (002475.SZ) , opens new tab and Vinfast (VFS.O) , opens new tab. Prime Minister Pham Minh Chinh ordered the defence and public security ministries to urgently send troops and policemen to help tackle the storm's aftermath. The cyclone has triggered heavy rains across most of Vietnam since Saturday, prompting authorities to warn of a high risk of severe floods and landslides. Water rose to alarming levels in rivers and reservoirs in the provinces of Nghe An, Ha Tinh and Thanh Hoa, the government said, with tens of thousands of families also hit by power blackouts. Rainfall of 500 mm (20 inches) was forecast in several areas over the period from Sunday night through Tuesday, weather authorities said. With a long coastline facing the South China Sea, Vietnam is prone to typhoons that often form east of the Philippines, where Bualoi killed at least 10 people last week. https://www.reuters.com/business/environment/one-dead-12-missing-typhoon-bualoi-makes-landfall-vietnam-2025-09-29/

2025-09-29 06:25

Total to sell 50% of US solar portfolio for $950 million Bought 49% of upstream US gas assets for undisclosed sum CEO under pressure to lower 18% net debt-to-equity ratio with divestments Company last week announced trimmed buybacks to cut spending Sept 29 (Reuters) - TotalEnergies (TTEF.PA) , opens new tab will raise $950 million from the sale of a stake in a U.S. solar portfolio, it said, as the company seeks to soothe investor fears over slow asset sales and rising debt that are likely to be in focus at an Investor Day in New York on Monday. As other energy majors reduce renewables spending, Total has bucked the trend by continuing to build wind and solar projects, then selling minority stakes to raise cash that it invests in natural gas assets to grow its portfolio as global demand rises. Sign up here. Under the solar deal, investment company KKR (KKR.N) , opens new tab will take 50% of six utility-scale solar assets and 41 distributed generation assets, mostly in the United States. Total will keep the remaining half of the 1.4-gigawatt portfolio, with an enterprise value of $1.25 billion. DEBT HAS MORE THAN DOUBLED CEO Patrick Pouyanne has said the sale is one of several meant to bring in $3.5 billion by year-end, to offset more than $3 billion in acquisitions that have contributed to a more than doubling of Total's debt in the first six months of 2025. The French major also announced on Monday it would purchase a 49% stake in Continental Resources' upstream gas fields in the U.S. state of Oklahoma, for an undisclosed sum. STRUGGLING ASSET SALES Last week TotalEnergies sold an oilfield stake to Shell for $510 million, but two other deals are in jeopardy. An $860 million divestment of Nigerian oil assets fell through last week as buyer Chappal Energies failed to raise enough money. In July, the sale of Total's West of Shetland gas assets in Britain for an undisclosed sum also fell apart, after would-be buyer Prax Group went bankrupt. Total's gearing - a measure of net debt to equity - has leapt to 18% from about 8% in the first six months of this year. That figure rises to 28% when including $8.9 billion in leases and 9.75 billion euros ($11.37 billion) of hybrid debt. Quarterly earnings hit a four-year-low this summer. Last week the board of directors announced a 25% cut to its buyback in the fourth quarter, with potentially deeper cuts next year, citing the need to lower debt levels in case oil prices fall further. Brent crude is trading below $70 per barrel, a 40% drop since 2022 when Total initiated its $8 billion annual buyback scheme. https://www.reuters.com/business/energy/totalenergies-sell-50-solar-portfolio-north-america-2025-09-29/

2025-09-29 06:08

LONDON, Sept 29 (Reuters) - The copper market is long accustomed to unexpected supply hits but the catastrophic events at Freeport-McMoRan's (FCX.N) , opens new tab Grasberg mine in Indonesia are unprecedented in terms of scale and potential impact. Grasberg is the world's second-largest copper mine after Escondida in Chile. Last year's production of 815,000 metric tons represented 4% of global output. Sign up here. What happened on the night of Sept. 8 in the Block Cave part of the mine was the stuff of nightmares. A colossal 800,000-ton mud rush erupted into the mine, traveling rapidly to multiple sections and blocking access routes. Two workers were killed. All mining activity has been suspended while the company works to locate another five missing personnel. Freeport's best guess is that Grasberg may return to pre-accident operating rates in 2027. It's a big hit to an already stretched supply chain, which is why the London Metal Exchange copper price jumped to a 15-month high of $10,485 per ton when Freeport declared force majeure last week. COUNTING THE COST Freeport expects , opens new tab that other unaffected parts of Grasberg could restart operations around the middle of the fourth quarter. A ramp-up of the Block Cave mine itself could begin in the first half of next year. Copper production will be "insignificant" in the fourth quarter and sales guidance next year has been cut by 35%. The cumulative loss of units between September 8 and the end of 2026 will be almost 600,000 tons of contained copper, according to analysts at Benchmark Mineral Intelligence (BMI). The output drop in the fourth quarter alone will be equivalent to next year's forecast production at Collahuasi, the world's third largest mine, BMI said. These are only very preliminary assessments. Freeport's priority will be to find the missing workers. How much damage has been caused to the mine's infrastructure is unknown. More critically, there will have to be an investigation into what went wrong. Freeport has been using block mining techniques at Grasberg for decades without any precedent for this month's disaster. The timeline to full recovery is unlikely to shorten but could well stretch. SUPPLY STRESS The Grasberg incident changes copper's global supply landscape. BMI has widened its expected 2026 market supply shortfall from a marginal 72,000 tons to 400,000 tons. Citi has also revised its global market balance estimates and projects a similar-sized deficit in 2026 and a potential further 350,000-ton shortfall in 2027 unless prices rise significantly to incentivise more supply. The flow-through to the refined segment of the market could be faster than would normally be the case with a mine production hit. Grasberg has historically supplied copper concentrates to a domestic 340,000-ton per year smelter-refinery and exported the rest. But raw material exports were already due to stop in October to prioritise feed for the new Manyar smelter , opens new tab, which after a fire-induced delay was expected to reach full 480,000-ton per year refined production capacity by the end of this year. That schedule may now be in doubt, depending on how much concentrate has been stocked to feed the ramp-up. DANGEROUS BUSINESS Copper mining can be a dangerous and unpredictable business as producers dig ever deeper and take on ever more challenging environments to get the stuff out of the ground. Grasberg is the third major incident this year. Ivanhoe Mines' (IVN.TO) , opens new tab Kakula mine in the Democratic Republic of Congo was hit by seismic activity and subsequent flooding in May. The company is still in the process of pumping water out , opens new tab of the most affected section. State Chilean producer Codelco experienced a tunnel collapse at its El Teniente mine in July resulting in six fatalities. The causes are still being investigated. Copper's vulnerability to such extreme events is well understood by the market. Analysts factor in a disruption allowance in their supply forecasts, although most will likely be adjusting it wider after this year's string of mine hits. But risk is becoming more concentrated as the world relies on a small group of mega mines to sustain production growth. BMI estimates that the world's 20 largest copper mines will account for 36% of global output this year and each of them faces its own unique combination of geological, operational and social challenges. Their sheer size means that if something goes wrong, it is likely to go wrong at scale, meaning an outsize impact on the global supply chain - as the market has just found out. The opinions expressed here are those of the author, a columnist for Reuters. https://www.reuters.com/markets/commodities/grasberg-disaster-highlights-fragility-copper-supply-chain-2025-09-29/