2024-09-04 03:21

MUMBAI, Sept 4 (Reuters) - The Indian rupee is expected to hold near lifetime lows on Wednesday amid a selloff in risk assets on concerns over the U.S. growth outlook. The 1-month non-deliverable forward indicated the rupee will open at 83.96-83.97 to the U.S. dollar compared with 83.9675 in the previous session. The local currency's all-time low is 83.9725, hit in the first week of last month. Japan led Asian equity gauges lower with a more than 3% decline following the selloff on Wall Street. The S&P 500 Index had its worst day in a month and futures indicated a further decline. Data that indicated U.S. manufacturing activity remained weak and a plunge in shares of Nvidia soured risk appetite. In wake of the risk off, the rupee will take support from the "always present" Reserve Bank of India, the slump in oil prices and the decline in U.S. Treasury yields, a currency trader at a bank said. "And, it's not like the equity selloff is having an impact on Asian currencies," he said. The rupee "should spend the day" in a 83.94-83.97 range. ODDS OF 50 BPS FED CUT RISE On the back of the equity drawdown and the disappointing U.S. manufacturing data, investors took on bets that the Federal Reserve will cut rates by 50 basis points at this month's meeting. Investors are pricing in a 42% probability of a 50-basis-point rate cut at the Sept. 17-18 meeting, up from 30%, per CME FedWatch Tool. U.S. Treasury yields dropped amid the growth worries. The U.S. manufacturing data is still indicating a contracting sector with the key new orders and production components remaining "in the doldrums", ING Bank said in a note. Meanwhile, oil prices dropped in Asia to add to Tuesday's plunge on concerns over demand. Brent crude is now down 15% this quarter, a welcome relief for the rupee and other Asian oil importers. KEY INDICATORS: ** One-month non-deliverable rupee forward at 84.04; onshore one-month forward premium at 8 paise ** Dollar index at 101.66 ** Brent crude futures down 0.6% at $73.3 per barrel ** Ten-year U.S. note yield at 3.83% ** As per NSDL data, foreign investors bought a net $686.7 mln worth of Indian shares on Sep. 2 ** NSDL data shows foreign investors bought a net $4.4 mln worth of Indian bonds on Sep. 2 Sign up here. https://www.reuters.com/markets/currencies/rupee-remain-mired-near-all-time-low-global-risk-aversion-2024-09-04/

2024-09-04 00:54

Wall St stocks in the red after European index ends off 1% Oil prices fall more than 1% adding to Tuesday's ~4% sell off U.S. Treasury yields off; dollar falls against Japan's yen NEW YORK/ LONDON, Sept 4 (Reuters) - MSCI's global equities gauge fell for a third day in a row and oil prices lost ground on Wednesday, while safe-haven assets such as U.S. Treasuries and Japan's yen were in demand as mixed batch of economic data fueled concerns about slowing growth. Crude oil futures settled down more than 1% in their third straight day of declines, including a more than 4% loss on Tuesday, due to fears about demand for coming months. In U.S. Treasuries, yields were lower and earlier in the day, the closely watched yield curve between two-year and 10-year notes turned positive after data showed that U.S. job openings fell to a 3-1/2-year low in July. On Tuesday, Wall Street stock indexes had registered their biggest daily percentage drops since early August as investors took profits while weak U.S. manufacturing data did little to boost risk appetites. On Wednesday, the S&P 500 (.SPX) , opens new tab ended lower after spending the morning flitting between red and green as investors waited anxiously for more economic data. Thursday will bring a reading on the U.S. services industry with jobless claims data. Then Friday's hotly anticipated August report for nonfarm payrolls is expected to provide the clearest clues as to the health of the U.S. economy and whether the Federal Reserve will cut interest rates this month by a quarter or a half of a percentage point. "In a historically weak month for stocks, investors are acting more cautious and more concerned about the growth outlook than the inflation outlook," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan. Wednesday's data was already a mixed bag. A Commerce Department report showed new orders for U.S.-manufactured goods increased more than expected in July, boosted by defense aircraft. But demand elsewhere was moderate with borrowing costs high. U.S. job openings in July dropped to their lowest level since January 2021, suggesting the labor market was losing steam and leading traders to add to bets that the Fed will deliver a half-a-percentage-point cut in rates at its meeting this month. "The setup is changing. Maybe three-four months ago, markets would feel good about a 50 basis point cut. Now a 50 basis point cut would signal that growth is slowing more than expected and that the Fed is behind the curve," said Ameriprise's Saglimbene. Also on Wednesday, Atlanta Federal Reserve President Raphael Bostic said the U.S. central bank must not keep interest rates too high much longer or it risks harming employment too much. On Wall Street the Dow Jones Industrial Average (.DJI) , opens new tab rose 38.04 points, or 0.09%, to 40,974.97, the S&P 500 (.SPX) , opens new tab lost 8.86 points, or 0.16%, to 5,520.07 and the Nasdaq Composite (.IXIC) , opens new tab lost 52.00 points, or 0.30%, to 17,084.30. MSCI's gauge of stocks across the globe (.MIWD00000PUS) , opens new tab fell 4.40 points, or 0.54%, to 815.07. Earlier Europe's STOXX 600 (.STOXX) , opens new tab index fell had closed down 0.97%. In foreign exchange markets, the dollar eased against most major currencies after the July U.S. job openings data tilted the odds further in favor of larger U.S. rate cuts while the yen benefited from a safe haven bid. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, fell 0.39% at 101.30. The euro was up 0.34% at $1.108 while against the Japanese yen , the dollar weakened 1.17% to 143.77. "Stock market instability and dropping U.S. yields have made the yen a strong performer," said Marc Chandler, chief market strategist at Bannockburn Global Forex. In Treasuries, the yield on benchmark U.S. 10-year notes fell 8.9 basis points to 3.755%, from 3.844% late on Tuesday while the 2-year note yield, which typically moves in step with interest rate expectations, fell 12.8 basis points to 3.76%. A closely watched part of the U.S. Treasury yield curve measuring the gap between yields on two- and 10-year Treasury notes , seen as an indicator of economic expectations, was at a negative 0.7 basis points. “The big event of the week comes in the form of Friday's payrolls print,” said Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets in New York. “That's to a large extent going to give us the road map for what to expect from the Fed. The employment data is now overshadowing inflation as the biggest risk to near-term policy expectations.” Crude oil prices fell on pessimism about demand in the coming months as crude producers offered mixed signals about supply increases. Lackluster data from the U.S. and China have added to persistent expectations for a weaker global economy. U.S. crude settled down 1.6% at $69.20 a barrel while Brent ended 1.4% lower at $72.70 per barrel. Gold prices reversed course to gain ground with help from a softer dollar and lower yields after the weak data on U.S. job openings. Spot gold inched up 0.07% to $2,494.43 an ounce. Sign up here. https://www.reuters.com/markets/global-markets-wrapup-1-2024-09-04/

2024-09-04 00:22

PORT-AU-PRINCE, Sept 3 (Reuters) - Haitian state-owned power firm Electricite d'Haiti (EDH) said on Tuesday that output at Peligre, the Caribbean nation's largest hydroelectric plant, was down to zero after protests over distribution of the country's flailing power supplies. Output at Peligre has been down since Monday, EDH said, after people stormed the plant demanding other areas be supplied before the capital, Port-au-Prince, where some residents are relying on diesel-powered generators and solar batteries. The capital's poorest residents cannot afford either alternative. "Such actions, far from helping meet the population's electricity needs, make EDH's challenges even more difficult as the equipment used to operate plants are expensive and hard to repair, maintain or replace," EDH said in a statement. It called on authorities to urgently take necessary measures to secure the plant, a structure of "strategic importance to the Haitian state." With a capacity of 54 megawatts (MW), Peligre provides nearly all of EDH's 60 MW of hydroelectric power, Haiti's largest source of electricity after fossil fuels. Just 49% of people in the Caribbean nation have access to the electricity grid, according to the latest World Bank data. EDH said two transformers had been irreversibly broken, and it was unable to bring in technical assistance because the Ouest department, where Port-au-Prince is located, has been virtually cut off from the rest of the country. Haiti is battling a humanitarian crisis that has seen violent and powerful armed gangs take over much of the capital and surrounding areas, cutting off safe transport as well of key supplies of goods such as medicine and food. Nearly 580,000 people have been internally displaced and close to 5 million are facing severe hunger. E-Power, a private firm that operates a 30 MW heavy fuel oil power plant in Cite Soleil, one of the capital's hardest-hit neighborhoods, is another key energy supplier in Haiti. Prime Minister Garry Conille visited the plant alongside the head of EDH last month, which his office said was in order to evaluate the facility and consider how best to improve Haiti's electricity challenges. Sign up here. https://www.reuters.com/world/americas/haiti-power-firm-says-main-hydroelectric-plant-down-after-protest-2024-09-04/

2024-09-03 23:04

Tesla fall after report on six-seat Model Y plans Boeing drops after brokerage's rating downgrade Nvidia sheds record $279 billion in market value US manufacturing edges up in August from 8-month low Indexes fall: S&P 500 2.1%; Nasdaq 3.3%, Dow 1.5% NEW YORK, Sept 3 (Reuters) - U.S. stocks slumped on Tuesday, at the start of one of the market's historically worst months, ahead of data likely to influence how much the Federal Reserve will lower interest rates. The benchmark S&P 500 index, Nasdaq Composite Index and the Dow Jones Industrial Average recorded their biggest daily percentage declines since early August. Nine out of 11 S&P 500 sectors fell, led by declines in technology, energy, communication services and materials. Market sentiment weakened as Institute for Supply Management data on Tuesday showed U.S. manufacturing remained subdued despite a modest improvement in August from an eight-month low in July. September is widely regarded as one of the worst months for stock market performance based on data stretching back to the 1950s, said Jason Browne, president at Alexis Investment Partners in Montgomery, Texas. "We had a weak ISM report come out this morning, but we do believe seasonality is a big factor here especially when you've had such a solid performance for the year until the end of last month," Browne said. "Everybody is reporting about how September is such a horrible month and that tends to feed on itself." The so-called Magnificent Seven megacap technology stocks, which have led this year's rally, slumped. Nvidia (NVDA.O) , opens new tab dropped nearly 10%, shedding a record $279 billion from its market capitalization, which ended at $2.65 trillion. That is the biggest ever single-day decline in market value for a U.S. company. Alphabet (GOOGL.O) , opens new tab fell 3.6%, Apple (AAPL.O) , opens new tab lost 2.7% and Microsoft (MSFT.O) , opens new tab shed 1.8%. The Philadelphia SE Semiconductor index (.SOX) , opens new tab fell 7.8%. The Dow (.DJI) , opens new tab fell 626.15 points, or 1.51%, to 40,936.93, the S&P 500 (.SPX) , opens new tab dropped 119.47 points, or 2.12%, to 5,528.93 and the Nasdaq Composite (.IXIC) , opens new tab slid 577.33 points, or 3.26%, to 17,136.30. The CBOE Volatility Index (.VIX) , opens new tab, Wall Street's fear gauge that measures market expectations of stock market swings, jumped 33.2% to 20.72, the biggest daily percentage gain and highest close since early August. Traders are awaiting several labor market reports ahead of Friday's non-farm payrolls data for August. The Fed's meeting on Sept. 17-18 will be closely observed following Chair Jerome Powell's recent support for easing monetary policy. Odds of a 25-basis point interest rate cut are at 63%, the CME Group's FedWatch Tool showed, while those for a bigger 50 bps reduction are at 37%. Tesla (TSLA.O) , opens new tab fell 1.6% after Reuters reported that the electric vehicle maker plans to produce a six-seat variant of its Model Y car in China from late 2025. Boeing (BA.N) , opens new tab dropped 7.3% after Wells Fargo downgraded the aircraft manufacturer's shares to "underweight" from "equal weight." Declining issues outnumbered advancers by a 2.52-to-1 ratio on the NYSE, which had 297 new highs and 83 new lows. On the Nasdaq, 946 stocks rose and 3,315 fell as declining issues outnumbered advancers by 3.5 to 1. Volume across U.S. exchanges totaled 12.14 billion shares, up from nearly 11 billion for the 20-day moving average. Sign up here. https://www.reuters.com/markets/us/futures-drop-markets-brace-data-heavy-week-2024-09-03/

2024-09-03 22:51

Sept 3 (Reuters) - The West Coast of the United States is bracing for extreme heat with temperatures in desert towns expected to soar as high as 120 Fahrenheit (49 Celsius) and Phoenix likely to extend its streak of 100 days over 100 degrees, forecasters said on Tuesday. The southwestern U.S. can expect multiple days of supercharged heat beginning on Tuesday, with the homeless, elderly, children, and people with health issues at the highest risk for heat illness, the U.S. National Weather Service said. The worst is likely to dissipate by the weekend but in the meantime much of California can expect sizzling temperatures, even on the Pacific coast which typically gets cooled by an ocean breeze, said Rich Bann, a meteorologist with the weather service's Weather Prediction Center. Washington and Oregon are also in line to get baked, Bann said. "We're expecting multiple days with widespread high temperatures into the triple digits," Bann said. A high pressure ridge is forming, depriving the region of clouds, cooling winds, showers or thunderstorms that might otherwise offset the intense solar radiation, Bann said. "When you're looking at the desert southwest, which is an arid place anyway, all indirect sunlight is going to go into heating the ground," Bann said. In Arizona, Phoenix on Tuesday recorded its 100th straight day at or above 100 F (38 C). "The streak is expected to continue, with no end currently in sight," the weather service said on X. The previous record streak was 76 straight days in 1993, the weather service said. Sign up here. https://www.reuters.com/world/us/western-us-braces-extreme-heat-phoenix-passes-100-days-over-100-degrees-2024-09-03/

2024-09-03 21:59

Sept 4 (Reuters) - A look at the day ahead in Asian markets. World markets will open on an extremely shaky footing on Wednesday after a gloomy snapshot of U.S. factory activity on Tuesday reignited fears about the U.S. economy's 'soft landing' and slammed stocks, oil prices and bond yields sharply lower. It was the first trading day of September for U.S. markets after the Labor Day holiday weekend, and for those who put greater store in 'seasonal' factors, it is an ominous start to what is traditionally a weak month for stocks and risk appetite. Many market moves on Tuesday were the largest since the historic volatility burst on Aug. 5 - Wall Street, world stocks and Treasury yields had their biggest declines and U.S. equity volatility had its biggest rise since that day. Others were even more eye-opening and ominous. Oil slumped 5%, its biggest fall this year and a reflection of investors' worries over U.S. and Chinese growth. If demand and economic activity are wavering in the world's top two economies, Houston, we have a problem. On top of that, Nvidia shares tanked 10%, wiping around $265 billion off the company's value in one of the biggest one-day market cap losses on record. If Nvidia has been responsible for much of the tech- and AI-fueled equity rally over the past 18 months, selloffs of this magnitude are a worry. Weak purchasing managers index data from China and the United States are setting the negative tone, and there are more Asia and Pacific PMI reports scheduled for release on Wednesday, including China's 'unofficial' Caixin service sector PMI. China's 'official' PMI figures from Beijing over the weekend showed that manufacturing activity sank to a six-month low in August as factory gate prices tumbled and owners struggled for orders. Shanghai stocks open on Wednesday at a seven-month low. Australian GDP figures are also on tap on Wednesday. Economists polled by Reuters predict growth in the second quarter accelerated to 0.3% from 0.1% at a quarter-on-quarter pace, but year-on-year growth held broadly steady at 1.0%. After the broad-based and aggressive selloff in U.S. stocks on Tuesday, Asian markets will almost certainly open in the red on Wednesday - the old adage still stands: when the U.S. catches a cold, the rest of the world sneezes. Institute for Supply Management figures show that U.S. manufacturing activity has contracted every single month since October 2022, with the exception of March this year. That's nearly two years of uninterrupted manufacturing recession. This has been offset by expansion in services activity, but rates traders are now attaching a near 40% chance of the Fed beginning its easing cycle later this month with a 50 basis point cut. Here are key developments that could provide more direction to Asian markets on Wednesday: - China 'unofficial' Caixin services PMI (August) - Australia GDP (Q2) - South African President Ramaphosa State Visit to China Sign up here. https://www.reuters.com/markets/asia/global-markets-view-asia-graphic-pix-2024-09-03/