China Shanghai Composite index surge 1.04%
Asian stocks ended on a cautious note Wednesday after rising sharply in the previous session on Israel-Iran ceasefire relief.
A U.S.-brokered ceasefire between Israel and Iran appeared to be holding but elsewhere, Israel's army said seven of its soldiers were killed in combat in Gaza, where the war with Palestinian militant group Hamas continued.
The U.S. dollar struggled to regain lost ground in Asian trade after Federal Reserve Chair Jerome Powell gave balanced comments on prospects for rate cuts.
Gold edged up slightly after sharp losses in the prior session. Oil prices jumped nearly 2 percent but held near multi-week lows on the prospect that crude oil flows would not be disrupted.
China's Shanghai Composite surged 1.04 percent to 3,455.97 and Hong Kong's Hang Seng index jumped 1.23 percent to 24,474.67 amid bets that Fed rate cuts amid a slump in oil prices will weaken the U.S. dollar and spur inflows to Asian markets.
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Business Standard
12 minutes ago
- Business Standard
Domestic economic activity resilient amid global flux: RBI report
Economic activity is holding firm in India amid a challenging global environment, and financial conditions remained conducive to facilitate an efficient transmission of interest rate cuts to the credit market, Reserve Bank of India officials said in a report on the 'State of the Economy' in its monthly bulletin. The rate setting panel of the central bank has cut the policy repo rate by 100 basis points (bps) to 5.5 per cent in quick succession between February and June. Moreover, the 100 bps cut in banks' cash reserve ratio requirements to be implemented in phases, starting from the fortnight beginning 6 September 2025, will release primary liquidity of Rs 2.5 trillion. This will reduce the cost of funds for banks, thereby facilitating monetary policy transmission to the credit market, the report noted. 'Overall, financial conditions remained conducive to facilitate an efficient transmission of rate cuts to the credit market,' it underlined. Following the 50 bps rate cut through February and April, the weighted average lending rate on fresh and outstanding rupee loans of scheduled commercial banks declined by 6 bps and 17 bps, respectively, during the period February-April 2025. On the deposit side, the weighted average domestic term deposit rates on fresh and outstanding deposits moderated 27 bps and 1 bp, respectively, during the same period. The report pointed to a significant softening in average bank credit growth to various sectors of the economy between April 2024 and April 2025. While credit growth decelerated in April – notably in the agriculture and services sectors – non-bank sources of credit, including external commercial borrowing (ECB) inflows continued to be healthy, although it moderated from March. Scheduled commercial banks credit growth moderated to 9.9 per cent, as on May 30, 2025 from 16.2 per cent a year ago, and the report attributed this to weaker momentum as well as unfavourable base effects. 'The global economy is in a state of flux, reeling from the twin shocks of trade policy uncertainties and a spike in geo-political tensions,' the report authored by RBI staffers said, with guidance and comments of Poonam Gupta, deputy governor in charge of the monetary policy department. The views expressed in the report are those of the authors, not the central bank, it is clarified. The report said that the optimism from a temporary tariff freeze and trade deals has kept financial market sentiments buoyed in May and early-June 2025, but following the outbreak of the Iran-Israel conflict, heightened uncertainty and volatility have once again gripped financial markets. Highlighting the possibility of a marked deterioration in medium-term economic prospects amidst rising trade barriers, the report said protracted trade policy uncertainties pose the risk of significantly scarring the global economy. 'The intensifying geopolitical tensions too may further debilitate the already-weakened growth impulses. In this context, the trade policy outcomes in July, after the temporary tariff hiatus is over, and the future course of geo-political events would likely shape the medium-term economic prospects,' it averred. 'In this state of elevated global uncertainty, various high-frequency indicators for May 2025 point towards resilient economic activity in India across the industrial and services sectors,' the report said. 'On the domestic front, the provisional estimates released in May have reaffirmed growth to be 6.5 per cent in 2024-25, with a significant sequential pickup in Q4,' it said. Capacity utilisation by manufacturing firms remained above its long-period average, and high-frequency indicators of aggregate demand for May also suggested a pick-up in rural demand, especially given the strong performance of the agricultural sector, the report noted. Among the countries surveyed for the Purchasing Managers' Index (PMI), overall activity expansion was the highest in India with new export orders' uptick in May being an outlier amidst the contraction seen in other major economies. 'All of these indicate considerable resilience of the Indian economy, notwithstanding the global economic, trade, and geopolitical uncertainties,' the report said. Domestic inflation remains benign with headline inflation remaining below the target for the fourth consecutive month in May. 'Steady core [Consumer Price Index (CPI) excluding food and fuel inflation], with indications of some softening after excluding the impact of volatile and elevated gold and silver prices, indicates that underlying inflationary pressures remain muted,' it said. The report further added the external sector continued to be robust, with adequate forex reserve cover for imports and external debt.
Time of India
16 minutes ago
- Time of India
Bengaluru techies are not even earning one-tenth of Silicon Valley salaries, AI may worsen the gap further
Bengaluru, India's tech capital, offers the most cost-effective software engineering talent globally, with average annual salaries of just $12,000—nearly one-tenth of the $125,000 average in Silicon Valley, according to a report of the Times of India.t The report, based on WeAreCity report published by UnboxingBLR, highlights a stark wage gap: engineers in cities like Sydney ($78,000), Tel Aviv ($77,000), Toronto ($75,000), and London ($65,000) earn five to six times more. Even in Asian hubs such as Tokyo ($62,000), Seoul ($51,000), Singapore ($47,000), and Beijing ($46,000), salaries are significantly higher than in Bengaluru. Despite the disparity, Bengaluru remains a magnet for global tech firms, thanks to its skilled, English-speaking workforce and deep-rooted software ecosystem. The city's competitive costs continue to make it a preferred destination for outsourcing and tech innovation. However, the global tech job market is in flux. Post-pandemic cost pressures and AI-driven automation have triggered widespread layoffs, particularly in high-cost economies like the U.S. But India, too, is beginning to feel the ripple effects. Amazon CEO Andy Jassy recently hinted at future workforce reductions, citing AI's growing impact on job structures. Jassy said Amazon already has more than 1,000 generative AI projects either built or in development. These include the upgraded Alexa+ assistant, AI-driven shopping tools, and a revamped customer service chatbot. The company is also using AI in its fulfillment network to improve inventory placement and demand forecasting. Live Events 'Today, in virtually every corner of the company, we're using Generative AI to make customers' lives better and easier,' Jassy said in the memo. He described AI as a once-in-a-generation technology that is quickly transforming how Amazon serves its customers. Notably, Microsoft is preparing layoffs in its sales division, while Google has offered voluntary exits across several departments, including Communications, Marketing, and Research. These shifts underscore a broader transformation in global hiring priorities—where affordability, adaptability, and AI readiness are reshaping workforce strategies. In this evolving landscape, Bengaluru's low-cost advantage could be both a strategic asset and a looming challenge.
Mint
25 minutes ago
- Mint
Post-ceasefire hangover: The world is awash in crude oil right now
After the war, the hangover. While hysteria about the closure of the Strait of Hormuz gripped the oil market for the last few days, the reality could not be more different: a wave of Gulf crude oil was forming. Now, the swell is heading into a global oil market that's already oversupplied—hence Brent crude was trading below $70 a barrel on Tuesday [after US President Donald Trump announced a surprise ceasefire between Israel and Iran]. The Northern hemisphere summer, which provides a seasonal lift to demand, is the last obstacle before the glut becomes plainly obvious. Oil prices are heading down—quite a lot. If anything, the Israel-Iran '12-Day War' has worsened the supply-versus-demand imbalance even further—not just for the rest of 2025, but perhaps into 2026 too. Also Read: Javier Blas: An Israel-Iran war may not rattle the oil market On the demand side, geopolitical chaos is bad for business—let alone tourism. Petroleum consumption growth, already quite anaemic, is set to slow further, particularly in West Asia. But the biggest change comes from the supply side: The market finds itself swimming in oil. Ironically, one of the big producers pumping more than a month ago is Iran. Hard data is difficult to come by, as Iran does its best to obfuscate its petroleum exports. Still, available satellite photos and other shipping data suggests that Iranian production will reach a fresh seven-year high above 3.5 million barrels a day this month, slightly up from May. That bears repeating: Iranian oil production is up, not down, despite nearly two weeks of heavy Israeli and American bombing. Reading between the lines, Trump has made two things clear: One, he doesn't want oil prices above $70 a barrel; and two, he still thinks Washington and Tehran can sit down to talk. So it's very unlikely that the White House will tighten oil sanctions on Iran, an issue where Trump is very similar to former President Joe Biden: Lots of talk, very little action. Also Read: Mint Quick Edit | West Asia's ceasefire: The oil market got lucky Across the Gulf, Saudi Arabia, Kuwait, Iraq and the United Arab Emirates are all pumping more than a month ago. True, a large chunk of the increase was expected after the Opec+ oil cartel agreed to hike production quotas. Still, early shipping data suggests that exports are rising a touch more than expected, particularly from Saudi Arabia, which leads Opec+. Petro-Logistics, an oil tanker-tracking firm used by many commodity trading houses and hedge funds, estimates that Saudi Arabia will supply the market with 9.6 million barrels a day of crude in June, its highest level in two years. The firm measures the flow of barrels into the market, offsetting stockpiling moves, rather than well-head output (the latter is Opec's preferred measure). 'Looking at the first half of the month, there has been a large rush of oil flowing out of the Persian Gulf region," Daniel Gerber, the head of Petro-Logistics, tells me. Data covering the first couple of weeks of June shows strong exports from Iraq and the United Arab Emirates, two countries that typically cheat on their Opec+ production quotas [designed to keep prices up]. The risk here is more, not less. And then there's US shale output. In May, the American oil industry was on the ropes, with crude approaching $55 a barrel. At those prices, US oil production was set to start a gentle decline in the second half of the year and fall further in 2026. The recent conflict that drove crude to a peak of $78.40 a barrel handed US shale producers an unexpected opportunity to lock in forward prices, helping them to keep drilling higher than otherwise. Anecdotally, I hear from Wall Street oil bankers that their trading desks saw some of the largest shale hedging in years. Also Read: Counter-intuitive: Why Opec wants lower oil prices With shale oil, small price shifts matter a lot: The difference between booming production and declining output is measured in a fistful of dollars, perhaps as little as $10 to $20 a barrel. At $50, many companies would be staring at financial calamity and production would be in free-fall; $55 is survivable; $60 isn't great, but money still flows and output holds; at $65, everyone is back to more drilling; and at $70 and above, the industry is printing money and output is soaring. In the oil market, history is a very good guide. Look at what happened after the first Gulf War in 1990-1991, or the second one in 2003. Amid the carnage, oil kept flowing—often in greater quantities. When those conflicts ended, these flows increased further. The Iran-Israel conflict isn't quite over yet. The ceasefire is, at best, tentative. And other supply disruptions may change the outlook. But, right now the world has more oil than it needs. ©Bloomberg The author is a Bloomberg Opinion columnist covering energy and commodities.
