2025-12-12 05:34

A look at the day ahead in European and global markets from Gregor Stuart Hunter After a banner year for precious metals, industrial metals are in focus today as the prospect of more stimulus from China pushes Shanghai copper futures to a record high. Sign up here. As the U.S. dollar falls to a two-month low after this week's Fed rate cut and policy stance pushed back against the market's hawkish outlook, investors are turning to real assets to protect their purchasing power. So-called dollar debasement trades had already lifted silver, which edged down 0.3% on Friday after hitting a fresh record of $64.31 the day earlier, while gold drew back from a seven-week high. Stock markets in Asia posted gains even though AI bubble jitters undermined tech shares. Strength on Wall Street helped lift the MSCI Asia-Pacific ex-Japan Index 0.8%, while the Topix (.TPX) , opens new tab surged 1.5% to a record high, led by a 6.7% gain for Sumitomo Metal Mining (5713.T) , opens new tab. The tech sector was rattled by a 13% decline in Oracle (ORCL.N) , opens new tab after weaker-than-expected revenue growth forecasts from the OpenAI cloud-computing partner. Investors took some heart after Broadcom (AVGO.O) , opens new tab projected better-than-expected revenue. But the relief was brief as shares tumbled 5% in after-hours trading after the company said it expected a dip in quarterly margins. Nasdaq futures slipped slightly, while S&P 500 e-mini futures were flat. Oil prices also found their footing, but the drivers were geopolitical rather than demand-centred. Brent futures rose 0.7% to $61.70 as renewed threats from U.S. President Trump of strikes on drug routes between the U.S. and Venezuela on land raised supply fears, as several sources told Reuters that the U.S. is preparing to intercept more tankers , opens new tab. In early European trade, pan-region futures , German DAX futures and FTSE futures were all up 0.4% apiece. Key developments that could influence markets on Friday: Economic data: Germany: CPI and HICP for November U.K.: GDP Estimate, Goods Trade Balance, and Industrial, Services and Manufacturing Output for October France: CPI for November Debt auctions: U.K. 1-month, 3-month and 6-month government debt https://www.reuters.com/world/china/global-markets-view-europe-2025-12-12/

2025-12-12 05:32

Silver hit record high at $64.56/oz Weekly jobless claims at 4-1/2-year highs Dollar hovers near two-month low Dec 12 (Reuters) - Gold prices rose 1% to a seven-week high on Friday, bolstered by a soft dollar, expectations of interest rate cuts and safe-haven demand prompted by geopolitical turbulence, while silver hit a record high. Spot gold rose 1% to $4,327.31 per ounce by 1248 GMT, its highest level since October 21, and was set for a 3.1% weekly gain. Sign up here. U.S. gold futures gained 1.2% to $4,363.20. The dollar hovered near a two-month low, and was on track for a third straight weekly drop, making bullion more affordable for overseas buyers. "The sharp rise in U.S. weekly jobless claims as well as U.S.-Venezuela tensions are underpinning gold and keeping haven demand strong," said Zain Vawda, analyst at MarketPulse by OANDA. U.S. jobless claims rose by the most in nearly 4-1/2 years last week, reversing the sharp drop seen in the previous week. The U.S. Federal Reserve trimmed rates by 25 basis points for the third time this year on Wednesday, but indicated caution on additional cuts. Investors are currently pricing in two rate cuts next year, and next week's U.S. non-farm payrolls report could provide further clues on the Fed's future policy path. Non-yielding assets such as gold tend to benefit in low-interest-rate environment. On the geopolitical front, the U.S. is preparing to intercept more ships transporting Venezuelan oil following the seizure of a tanker this week. Meanwhile, India saw widening gold discounts this week as demand remained subdued despite the wedding season, while high spot prices dented demand in China. Spot silver rose 0.8% to $64.09 per ounce, after hitting a new record high of $64.56/oz, and is headed for a 10% weekly gain. Prices have more than doubled this year, supported by strong industrial demand, dwindling inventories and its inclusion on the U.S. critical minerals list. "Silver is supported by industrial demand amid fears of shortages, a continued tight market, and the speculative frenzy, mostly from retail investors which has helped drive inflows to Silver ETFs," said Ole Hansen, head of commodity strategy at Saxo Bank. Elsewhere, platinum was up 3.2% at $1,750.35, while palladium climbed 2.6% to $1,523.10. Both were headed for a weekly rise. https://www.reuters.com/world/india/gold-clings-7-week-high-investors-gauge-fed-trajectory-silver-near-record-peak-2025-12-12/

2025-12-12 05:14

ECB set to hold rates again next week Likely to reiterate it's in a "good place" Traders now betting on an ECB rate hike in 2026 LONDON, Dec 12 (Reuters) - The European Central bank meets next Thursday, with traders suddenly speculating a rate hike could be on the cards in 2026. Since policymakers last met in October, there has been more evidence to back up their mantra that policy remains in a "good place". Having taken further cuts off the table, investors will watch whether the ECB gives them reason to stick with rate hike bets. Sign up here. Here are five key questions for markets: 1/ What will the ECB do next week? Hold its key rate at 2% for a fourth straight meeting. Recent data shows the economy grew 0.3% in the third quarter, much faster than the ECB had forecast in September, and that inflation is proving stickier than expected. ECB chief Christine Lagarde has already set the tone, repeating her "good place" message this week. 2/ What will the 2028 inflation forecast show? Inflation returning to the 2% target or a little higher, economists expect. It's the first time the ECB will forecast for 2028. A return to target should strengthen policymakers' argument that an inflation slump expected over the next two years will be temporary. Part of the reason is the postponement of the EU's new emissions trading system to 2028 from 2027, which also means inflation may be revised further below target in 2027, economists said. For this year and next, some expect inflation to be revised higher. And Lagarde has already pointed to an upward growth revision. "The forecasts will provide more hawkish signals," said Schroders economist Irene Lauro. 3/ What will ECB policy look like next year? Traders reckon the ECB will keep rates steady, but are now pricing in a roughly 30% chance that it will hike rates by the end of 2026. Just last week a cut was the tail risk. Hawkish policymaker Isabel Schnabel saying the next move could be a hike fuelled the shift in expectations on Monday, though she said it wouldn't come soon. What policymakers, dovish or hawkish, seem to agree on is that rates are likely to stay on hold in the foreseeable future - as do economists polled by Reuters. Much depends on how much German fiscal stimulus boosts growth, whether the euro - up 13% this year - appreciates further, and how much lower energy prices and cheap Chinese goods weigh on inflation. "German fiscal stimulus and the EU-wide defence spending will be almost fully offset by the drag from higher U.S. tariffs," said Vanguard senior economist Shaan Raithatha, who said the risk is still further rate cuts. 4/ What do Ukraine talks mean for the ECB? If a peace deal emerges, it should support European growth and lower energy prices. But the immediate economic impact won't change the ECB's thinking, economists said. "We should remember Europe has made it clear it doesn't want Russian gas again," said Schroders' Lauro. An EU plan to use frozen Russian assets to fund a loan to Ukraine is a concern for the ECB if it damages the euro's standing when policymakers want to boost its status as a reserve currency. For now, there's no sign in financial markets that the euro is bothered. Lagarde previously called the use of the assets legally and financially "stretched", but has since said the latest plan is the closest to complying with international law. 5/ What do we know about ECB's board revamp? The ECB has kicked off a two-year process that will replace most of its executive board, starting with Vice President Luis de Guindos early next year. A number of smaller countries have thrown their hats into the race, suggesting that a smaller nation, possibly for the first time from the east, may get a chance. But the next three seats are more important and include the presidency. Bigger economies are likely to continue dominating the board. The process is not expected to have a material impact on ECB policy, with markets more focused on changes at the U.S. Federal Reserve. Morgan Stanley's chief Europe economist Jens Eisenschmidt said Lagarde had given the ECB Governing Council a stronger voice than in the past, taking on more of a moderating role among her peers. Any new president is likely to continue that approach, although the degree will probably differ, he added. https://www.reuters.com/business/finance/will-it-be-hike-next-year-five-questions-ecb-2025-12-12/

2025-12-12 04:44

INR down nearly 6% on year, worst performing Asian currency Analysts reckon rough patch may extend if U.S. tariffs stay on RBI likely intervened to cap rupee's fall on Fri - traders MUMBAI, Dec 12 (Reuters) - The Indian rupee hit a record low on Friday, as sentiment remained bogged down by the absence of a trade deal with the U.S. and portfolio outflows, drawing likely intervention by the Reserve Bank of India to curb the fall. The rupee weakened to 90.55 against the U.S. dollar, slipping past its previous all-time low of 90.4675 hit on December 11. The currency was last at 90.3475 as of 10:00 a.m. IST, little changed on the day. Sign up here. The rupee is Asia's worst performer this year. It has fallen nearly 6% against the dollar year-to-date, as steep U.S. tariffs of up to 50% on Indian goods hurt exports to its biggest market, while also diminishing the appeal of local equities for foreign investors. With negotiations ongoing, Indian Prime Minister Narendra Modi said he spoke with U.S. President Donald Trump by phone on Thursday, as New Delhi seeks relief from 50% U.S. tariffs. "The rupee weakness has further to go if tariffs are here to stay. The expectations are currently one-sided explaining importer demand while exporters remain missing, plus the pressure from portfolio outflows," said Dhiraj Nim, an economist and FX strategist at ANZ. "The RBI will be open to weakness but in a calibrated manner." Foreign investors have net sold $18 billion of Indian shares in 2025 so far, making it one of the hardest-hit markets in terms of portfolio outflows. Traders pointed to firm dollar bids in the non-deliverable forwards market alongside hedging demand from importers as factors behind the rupee's decline on Friday. The central bank, meanwhile, likely stepped in via dollar-sales through state-run banks to curb the rupee's fall, four traders told Reuters. "As the rupee touches an all-time low and remains near it, we continue with our process of asking exporters to continue selling (dollars) in cash and importers to keep buying the dollars on the dip (in USD/INR)," said Anil Bhansali, head of treasury at Finrex Treasury Advisors. Asian currencies were trading mixed while the dollar index wallowed near a two-month low. According to analysts and bankers, U.S. trade negotiations remain the focal point for the rupee, and a breakthrough could help the currency snap from its recent falling streak. The rupee's rough patch has also pushed into undervaluation territory. The currency's trade-weighted real effective exchange rate, which accounts for the variation in inflation with trading partners, declined to 97.47 as of October, RBI data showed. A reading below 100 signals undervaluation. https://www.reuters.com/world/india/rupee-hits-record-low-us-trade-stalemate-drags-outflows-pinch-2025-12-12/

2025-12-12 04:25

Brent and WTI down more than 4% this week Supply glut remains main market focus US plans to seize more tankers off Venezuela, sources say HOUSTON, Dec 12 (Reuters) - Oil prices closed lower on Friday, marking a 4% weekly decline as a supply glut and a potential Russia-Ukraine peace deal outweighed worries about any impact from the U.S. seizure of an oil tanker near Venezuela. Brent crude futures settled 16 cents down at $61.12 a barrel, while U.S. West Texas Intermediate crude was down 16 cents at $57.44. Sign up here. Both benchmarks fell by about 1.5% on Thursday and have lost more than 4% this week. "The market continues to be weighed down by the crude oil supply situation... on the other hand, the oil market is ignoring the tension between the U.S. and Venezuela," said Andrew Lipow, president of Lipow Oil Associates. The U.S. seized a sanctioned oil tanker off the coast of Venezuela, President Donald Trump said on Wednesday. The U.S. is preparing to intercept more ships transporting Venezuelan oil after the seizure of a tanker this week, six sources close to the matter said on Thursday. Traders and analysts largely shrugged off worries about the impact of the tanker seizure, pointing to ample supply in the markets. International Energy Agency forecasts published on Thursday indicated that global oil supply will exceed demand by 3.84 million barrels per day next year - a volume equal to almost 4% of world demand. Data in OPEC's report, also issued on Thursday, indicated that world oil supply will match demand closely in 2026, in contrast to the IEA's view. Some price-supportive factors remain, including the ramping up of tensions between the U.S. and Venezuela, and Ukrainian drone strikes on a Russian oil rig in the Caspian Sea, said Janiv Shah, analyst at Rystad Energy. Russia's seaborne oil product exports in November fell by just 0.8% from October, with the completion of refinery maintenance helping to offset a slump in fuel exports from southern routes such as the Black Sea and Azov Sea, data from industry sources and Reuters calculations showed. https://www.reuters.com/business/energy/oil-prices-up-us-venezuela-tensions-set-weekly-decline-2025-12-12/

2025-12-12 04:20

Current power deal expires in 2028 Government to secure long-term, fixed-price energy supply Tomago to invest A$1 billion in smelter as part of deal SYDNEY, Dec 12 (Reuters) - Prime Minister Anthony Albanese announced on Friday a rescue effort to keep open Australia's largest aluminium smelter, the struggling Tomago facility majority-owned by Rio Tinto AX>, after its current power contract expires in 2028. The news comes after the company warned in October that Tomago Aluminium, employer of more than 1,000 full-time staff and 200 contractors, might be forced to shut down, after failing to secure new, affordable energy supplies. Sign up here. Aluminium was "increasingly a vital product", Albanese said, making it important to keep Tomago open. "If Australia doesn't produce aluminium, then the knock-on effect in other industries is significant," he said at the smelter, located north of Sydney in the state of New South Wales (NSW). "We are working with the company, we are working with the New South Wales government to make sure there are a long-term energy solutions to go forward beyond 2028." The deal, which has yet to be finalised, would involve securing a long-term, fixed-price energy supply for the smelter, the government said. Tomago is the state's biggest power user, and like some other Australian smelters grappling with high energy prices during the transition to renewables, it was built last century to exploit plentiful supplies of cheap coal. "This progress reflects years of collaborative work between Tomago and its joint venture partners, including Rio Tinto, in addressing one of the most complex energy challenges facing Australian industry," Simon Trott, the chief executive of Rio Tinto, said in a statement welcoming the deal. Tomago would also contribute at least A$1 billion ($666.6 million) in capital and major maintenance investment over the next decade, including identifying decarbonisation opportunities, the government said. "We are grateful to both the federal and New South Wales governments," Tomago's chief executive, Jerome Dozol, said in a statement, adding that the company looked forward to working with the government. The smelter is the latest to win support from the government, which has pledged bailout packages in recent months for Glencore's (GLEN.L) , opens new tab Mount Isa copper smelter and Townsville refinery, Trafigura's Nyrstar (NYR.BR) , opens new tab lead and zinc operations and the Whyalla steel plant. Under the Tomago deal, the government will also provide concessional finance arrangements to accelerate renewable energy generation and storage development. The government was still working through the total costs of the agreement, Industry Minister Tim Ayres said. The Australian Workers’ Union backed the deal, calling it a pivotal moment for manufacturing. "We now look forward to seeing the detail of the rescue package and will continue working with all parties to ensure Tomago has a sustainable long-term future," said Tony Callinan, the union's secretary in the state. ($1=A$1.5002) https://www.reuters.com/sustainability/climate-energy/australia-unveils-rescue-bid-rio-tintos-tomago-aluminium-smelter-2025-12-12/