2024-09-26 11:30

TSX ends up 0.5% at 24,033.83 Materials group rises 1.5% as gold climbs Technology advances 2% Energy falls 3.1%; oil settles 2.9% lower Sept 26 (Reuters) - Canada's commodity-linked main stock index closed above the 24,000 threshold for the first time on Thursday as China's assurance of more stimulus offset pressure on energy shares after oil prices tumbled. The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) , opens new tab ended up 127.95 points, or 0.5%, at 24,033.83, eclipsing the record closing high it posted on Tuesday. China plans to issue special sovereign bonds worth about 2 trillion yuan ($284.43 billion) this year as part of a fresh fiscal stimulus, said two sources with knowledge of the matter. "China is obviously a big industrial consumer of things like copper and metals," said Brian Madden, chief investment officer at First Avenue Investment Counsel. The stimulus is positive "for global economic growth, Chinese economic growth and by extension demand for Canadian resources," Madden added. The materials sector, which includes fertilizer companies and metal mining shares, was up 1.5% as gold extended its record-setting run and copper jumped more than 3%. Technology rose 2%, tracking gains for Wall Street's tech-heavy Nasdaq following Micron Technology's (MU.O) , opens new tab upbeat first-quarter forecast. Consumer discretionary was also a standout, adding 1.8%, as shares of auto parts supplier Magna International (MG.TO) , opens new tab clawed back much of the previous day's sharp decline. TD Bank (TD.TO) , opens new tab named Andy Bregenzer and Jill Gateman as co-heads of its U.S. commercial banking business, replacing Chris Giamo, who retired earlier this year. Shares of the bank rose 0.6%, while the heavily weighted financials sector was up 0.9%. Energy was a drag, falling 3.1%, as the price of oil settled 2.9% lower at $67.67 a barrel on a report that top exporter Saudi Arabia will give up its $100 price target in preparation for raising output. Sign up here. https://www.reuters.com/markets/tsx-futures-rise-ahead-fed-chair-powells-remarks-2024-09-26/

2024-09-26 11:16

LONDON, Sept 26 (Reuters) - Hedge funds trading China stocks saw gains this week after China's central bank unveiled its biggest stimulus since the 2020 COVID pandemic, a note from Goldman Sachs (GS.N) , opens new tab prime brokerage showed. China stock picking hedge funds have posted a 1.7% return so far this week to Wednesday, bringing the funds' September performance to 3.2% and year-to-date returns up to an estimated 7.5%, Goldman Sachs said in a note sent to clients on Wednesday and seen by Reuters on Thursday. After the policy easing measures announced on Tuesday, Goldman Sachs' prime brokerage saw its largest single day buying spree since March 2021, and the second highest on record, said the bank. Hedge funds mostly bought single stocks across several sectors including consumer products, industrials, tech and materials, the bank note said. Though hedge fund stock exposure to China this week jumped sharply, it's still below historical records and hovering near five-year lows compared with higher levels at the start of 2023 and 2020, bank data showed. China-focused hedge funds have struggled in recent years, as growth prospects in the world's No.2 economy dimmed. August economic data broadly missed expectations, adding urgency for policymakers to roll out more support. Investment banks including Goldman Sachs, UBS and Bank of America recently cut their 2024 China growth forecasts. Hedge fund investors in a recent Bank of America survey said their allocations to China-focused hedge funds were down, including in the United States where allocators surveyed said their China focused hedge fund investments fell as much as 15% this year. On Tuesday, hedge funds trading stocks in the wider Asia region also posted a 1.1% uptick, bringing their monthly performance to 2.4% and their year to date returns to 9.3%, said the Goldman Sachs note from Wednesday. In August, hedge funds trading stocks in the wider Asia region returned a negative 0.4% but were still up 9.2% for the year, said another note by Goldman Sachs, released earlier this month. Sign up here. https://www.reuters.com/markets/hedge-flow-china-focused-hedge-fund-performance-juiced-by-stimulus-says-goldman-2024-09-26/

2024-09-26 11:13

OSLO, Sept 26 (Reuters) - Shell (SHEL.L) , opens new tab, Equinor (EQNR.OL) , opens new tab and TotalEnergies (TTEF.PA) , opens new tab said on Thursday their carbon dioxide (CO2) storage project on Norway's west coast is now completed and ready to receive CO2, with its first deliveries expected next year. Carbon capture and storage (CCS) has long been highlighted as a way to reduce CO2 emissions but there are few commercial projects in existence, with Norway in 2020 launching the Longship project, which includes the Northern Lights site. "Today we achieved an important milestone on our journey to demonstrate CCS as a viable option to help achieve climate goals," Tim Heijn, managing director of the joint venture said at the unveiling of the facility. The partners look forward to receiving the first volumes in 2025, said Arnaud Le Foll, a senior vice-president at TotalEnergies. The site consists of 12 metal tanks onshore, capable of temporarily storing a 7,500 cubic metres cargo from one of the custom-made ships commissioned to deliver liquefied CO2. This is then sent via a 110 kilometre pipeline for permanent storage in a rock formation 2,600 metres below sea level. Northern Lights' first phase can inject 37.5 million metric tons of CO2 over a 25-year period, or 1.5 million tons per year. A second phase targets an additional 3.5 million tons a year. The first delivery will come from a capture facility at the Brevik cement plant in southern Norway owned by Heidelberg Materials, which is also part of the Longship project. The German group told Reuters it plans to complete the facility by year-end, followed by a period of tests, but did not specify a timing for the first shipment. Northern Lights also has agreements to transport and store CO2 for fertiliser maker Yara and Denmark's Orsted , opens new tab from 2025 and 2026 respectively, while an Oslo waste plant capture project is on hold over budgeting issues. Sign up here. https://www.reuters.com/sustainability/climate-energy/shell-equinor-totalenergies-open-norwegian-co2-storage-facility-2024-09-26/

2024-09-26 10:16

A look at the day ahead in U.S. and global markets from Mike Dolan With quarter-end fast approaching, tech excitement returned to Wall Street overnight with another AI-driven earnings beat from Micron Technology (MU.O) , opens new tab, while China's stocks (.CSI300) , opens new tab surged anew after this week's monetary easing blitz. The artificial intelligence theme had gone a bit flat in recent weeks as attention switched to aggressive Federal Reserve interest rate cuts - but Micron added fresh fizz overnight. Its stock surged 14% after the bell as it revealed the highest quarterly revenue growth in more than a decade on the back of booming demand for its AI-related memory chips. With investor attention turning to the upcoming third-quarter earnings season, Micron's results typically set the tone for the chip sector as it reports ahead of peers and serves a broad client base spanning PCs, data centers and smartphone industries. And that's lifted Wall Street futures again after a downbeat Wednesday, with Nasdaq futures up more than 1% ahead of Thursday's open. Perhaps due to some erratic flows related to the end of the third quarter, global market moves have turned somewhat scattergun. But the dominant themes remain: worldwide interest rate cuts and a U.S. 'soft landing', disinflation encouraged by a fresh oil price plunge, China's latest stimulus push, and the looming U.S. election. The Swiss National Bank became the latest major central bank to cut interest rates - its third cut of the year, knocking another quarter point off its policy rate to just 1% and flagging further easing ahead. The franc weathered the expected move well against a generally firmed dollar index (.DXY) , opens new tab. Disinflation pressures mounted in the energy markets again on Thursday, with crude oil prices sliding on a Financial Times report that Saudi Arabia is preparing to abandon its unofficial price target of $100 a barrel as it prepares to increase output. U.S. crude prices slumped back below $70 per barrel, magnifying year-on-year declines to some 25% - a likely powerful downward force on headline annual inflation rates throughout September. Fed Governor Adriana Kugler kept U.S. easing hopes on the boil overnight too. While insisting that the inflation target was not yet in the bag and further moves were "data dependent", she added that rapid disinflation meant the Fed needed to cut just to keep the level of restrictiveness in policy steady. China's market revival this week also took a new leg higher, with another 4%-plus leap in both mainland Chinese shares (.CSI300) , opens new tab and in Hong Kong (.HSI) , opens new tab. Led by gains in the embattled property sector, the latest spur came after Beijing pledged more policy measures on growth just days after announcing a series of big rate cuts and funding for the markets. State media, citing a Politburo meeting on the economic situation, reported that China would step up counter-cyclical adjustments of fiscal and monetary policy and strive to achieve full-year economic and social development targets. Reuters sources said China plans to issue special sovereign bonds worth about 2 trillion yuan ($284.43 billion) this year as part of a fresh fiscal stimulus. The offshore yuan continued to test 7 per dollar, close to its best levels since May of last year. Back on Wall Street, Wednesday's stalling near record highs looks set to be a temporary setback, with the tech news overnight adding to upbeat new homes sales during the session that has aided economic 'soft landing' hopes. Super-sensitive soundings from the labor market are back on the slate on Thursday with weekly jobless readings, and the August PCE inflation report - which Fed governor Christopher Waller said last week was one decisive factor in the outsize rate cut - is due on Friday. Treasury yields held up on Thursday amid this week's series of auctions, with the two-year hovering around 3.55% and the 10-year yield at 3.77%. The newly positive 2-10 year yield curve gap held just above 20 basis points. The U.S. Congress passed a stopgap bill on Wednesday to avert a partial government shutdown beginning next week, even as a large number of House Republicans revolted against their leadership for failing to achieve new federal spending cuts. The measure will maintain the government's current level of roughly $1.2 trillion in annual discretionary funding through Dec. 20, avoiding the furloughing of thousands of federal workers and the shutdown of a wide swath of government services just weeks before the Nov. 5 election. U.S. Vice President Kamala Harris said on Wednesday she would offer tax credits to domestic manufacturers and invest in sectors that will "define the next century", as she detailed her economic plan to boost the U.S. middle class. Key developments that should provide more direction to U.S. markets later on Thursday: * U.S. weekly jobless claims, August pending home sales, August durables goods orders, Q2 GDP revision, Kansas City Fed Sept business survey * Mexico central bank policy decision * Federal Reserve Board Governor Michelle Bowman and Lisa Cook both speak, New York Fed President John Williams, Boston Fed chief Susan Collins, Minneapolis Fed chief Neel Kashkari and Fed Vice Chair for Supervision Michael Barr all speak; European Central Bank President Christine Lagarde and ECB board members Luis de Guindos and Isabel Schnabel all speak * US corporate earnings: Costco, Carmax, Jabil, Accenture * US Treasury sells $44 billion of 7-year notes, auctions $90 billion of 4-week bills Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2024-09-26/

2024-09-26 10:13

MUMBAI, Sept 26 (Reuters) - The Indian rupee closed weaker on Thursday as importer and interbank dollar bids outweighed cues from a rise in most Asian currencies, ahead of closely watched remarks from Federal Reserve Chair Jerome Powell. The rupee closed at 83.6425 against the U.S. dollar, down from its close at 83.5925 in the previous session. Importers' dollar-buying, related to month-end payments, along with the unwinding of some interbank long positions kept the rupee on the backfoot despite gains in its Asian peers, traders said. The dollar index was little changed at 100.9. Most Asian currencies rose, with the offshore Chinese yuan up 0.3% at 7. The rupee has traded with a positive bias since the US Federal Reserve kicked off policy easing with a larger-than-usual 50 basis points cut last week, but has struggled to rise above a key resistance level at 83.50 despite strong portfolio inflows. Overseas investors have net bought about $10 billion in local stocks and debt so far in September, the strongest monthly inflow in 2024. Dollar buying interest from importers, speculative positioning and also likely "passive absorption," of dollar inflows by the Reserve Bank of India have limited the currency's gains, a trader at a state-run bank said. Meanwhile, dollar-rupee forward premiums rose on Thursday with the 1-year implied touching an over 16-month peak of 2.41%, buoyed by wagers that the Fed will deliver another 50 bps rate cut in November. "Ultimately, stronger US data is needed to convince markets to abandon 50 bps cut bets ... there is still a substantial risk the dollar will stay capped into the US election," ING Bank said in a note. Fed Chair Powell is scheduled to speak later in the day in New York, while other policymakers will also deliver remarks that may cues on the future path of US policy rates. Sign up here. https://www.reuters.com/markets/currencies/rupee-ends-lower-despite-rise-most-asian-peers-powells-remarks-focus-2024-09-26/

2024-09-26 09:56

Sept 26 (Reuters) - Sterling rose on Thursday to within striking distance of its two-and-a-half-year peak against the dollar after China's stimulus plan boosted investors' risk appetite. The pound usually appreciates when investors go for risky assets such as equities, which jumped on Thursday. Monetary policy divergence between the Bank of England and other major central banks is also providing support to the British currency. Stickier-than-expected UK inflation has fed expectations for a more gradual BoE easing cycle, while the Federal Reserve's focus has shifted to the need to support the labour market by easing monetary conditions. "We think higher yield differentials will support the pound against the dollar over time," said Patrick Ernst, director of forex investment strategy at UBS. "We expect the pair (sterling versus dollar) to gradually move higher but note that temporary setbacks are possible following the latest rally," he added. Sterling rose 0.24% in morning trade to $1.3350 after hitting $1.34275 on Wednesday, its highest level since February 2022. Analysts forecast similar economic and monetary policies in the UK and in the euro area. "Higher yield differentials and a further pricing out of political risks will lend modest support to the pound over time (versus the euro)," UBS' Ernst said, adding that he expects the pound to remain range-bound at 83-85 pence per euro. Against the common currency , the pound rose 0.15% to 83.45 pence after trading on Tuesday around its highest level since April 2022, at 83.15. CAUTION ON RATES The Bank of England , opens new tab should be cautious about cutting interest rates due to the risk of longer-term inflation pressures, Monetary Policy Committee member Megan Greene said in a speech on Wednesday. Some analysts said the BoE's monetary easing cycle could be more intense than the market currently expects in 2025, weighing on the British currency. "We think the pound is quite toppish at the moment as the decline in inflation lagged other countries," said Nick Andrews, forex strategist at HSBC. "The impact will fade next year, and we expect the BoE to cut rates more quickly than markets currently forecast." Investors will also focus on finance minister Rachel Reeves setting out her first budget on Oct. 30. On Tuesday, British Prime Minister Keir Starmer said the cost of fixing shortfalls in the public finances would be shared fairly and that all his government's policies would still be properly funded. Sign up here. https://www.reuters.com/markets/currencies/sterling-rises-versus-dollar-euro-strong-risk-appetite-2024-09-26/