UK stocks rise after Trump backtracks on remarks over Fed
April 23 (Reuters) - UK shares climbed on Wednesday, led by the gains in chemical companies and metal mining firms, while markets also found relief in U.S. President Donald Trump's reversal of his threats to fire Federal Reserve Chair Jerome Powell.
As of 1045 GMT, the blue-chip FTSE 100 index (.FTSE), opens new tab was up 1.3% and the midcap index (.FTMC), opens new tab gained 1.2%.
Hopes for trade negotiations between the U.S. and China, which have been locked in an escalating tit-for-tat tariff war, also helped lift sentiment after Trump expressed optimism that a trade deal with the country could "substantially" lower tariffs on Chinese goods.
The chemicals index (.FTNMX552010), opens new tab led the gains with Croda International (CRDA.L), opens new tab jumping 10.7% after the company reported 8% growth in first quarter group sales. Croda also topped the FTSE 100 index.
BP (BP.L), opens new tab climbed 5% after activist investor Elliott increased its stake in the oil major to just over 5%. An index of UK's energy companies (.FTNMX601010), opens new tab rose 3.6% after oil prices climbed more than 1% on a fresh round of U.S. sanctions on Iran and a drop in U.S. crude stocks.
Industrial metal miners (.FTNMX551020), opens new tab were also up 4.5% in the day as copper prices in London hit a near three-week high.
Babcock (BAB.L), opens new tab rose 2% after the engineering firm said it expects, opens new tab fiscal 2025 operating profit to jump 17%.
On the data front, British businesses faced a sharp downturn in April as activity contracted to its lowest level since November 2022, the S&P Global's Composite PMI showed on Wednesday.
The sharp drop in business activity is likely to further cement expectations that the Bank of England will cut interest rates next month.
Reckitt (RKT.L), opens new tab was among the worst performers on the blue-chip index as the maker of Dettol and Lysol cleaning products missed first-quarter like-for-like net sales growth estimates. Its shares dropped 5.9%.
On the midcap index, Hochschild Mining (HOCM.L), opens new tab tumbled 16.9% and was set for the biggest loss in more than three years after the precious metal miner missed first quarter production esimates.
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The Guardian
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US and China ease trade war tensions by agreeing ‘framework' truce in London
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Reuters
an hour ago
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Rising Asia temperatures bode well for US LNG export prospects
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Average temperatures in Japan - the second largest LNG importer after China in 2024 - are expected to register around 6% above the long-term average from now through the end of August, data from LSEG shows. South Korea, Taiwan, Hong Kong and several cities in China are forecast to register similar readings. As the northern hemisphere summer coincides with the rainy season across much of Asia, the forecasted hot temperatures are likely to be mixed with high humidity levels. That in turn will likely spur heavy use of air conditioning systems, which can push power demand levels sharply higher during heatwaves and strain regional power grids. Asia's electricity producers are used to the summer climb in electricity demand and adjust output levels accordingly. In 2024, average electricity demand during June, July and August - the hottest months of the year - was around 9% above the monthly average for the year as a whole. To accommodate that higher load, utilities lifted output from all power sources, but especially from fossil fuel plants which supply power that can be dispatched on command when output from renewable sources drops off. Both gas-fired and coal-fired generation across Asia during June, July and August last year averaged around 5% more than the 2024 monthly average, Ember data shows. To feed the higher demand for power anticipated during June, July and August, Asian LNG importers tend to book higher LNG volumes during May, June and July than during other months. Between 2021 and 2024, U.S. LNG exports to Asia during May, June and July averaged around 7.8 million metric tons a month, according to data from commodity intelligence firm Kpler. That compares to an average of 2.23 million tons a month to Asia overall for the 2021 to 2024 period, and underscores how important LNG is as a power fuel during the Asian summer. A key driver of potential Asian purchases will be the price of LNG, which needs to compete with coal in power generation and has recently proved too dear for many Asian consumers. U.S. LNG export prices have averaged around $8.54 per thousand cubic feet so far in 2025, up 35% from the 2024 average, according to data from LSEG. That said, any rise in Asian LNG purchases would likely come just as LNG orders by Europe tend to retreat to their annual lows, which could apply downward pressure to prices. Over the first half of 2025, European markets accounted for 70% of all U.S. LNG exports, Kpler data shows, while Asian markets accounted for just under 20%. Average monthly volumes of U.S. LNG dispatched to Europe during January to June were around 6 million tons, compared to around 1.6 million tons a month to Asia. A key caveat that will govern Europe's LNG appetite going forward is how quickly gas storage operators there want to replenish inventories, which were depleted over the past winter and must be restocked ahead of next winter. Currently, Europe's gas stockpiles are around half full, which compares to around 70% full at this time of year in 2023 and 2024, according to LSEG. If gas storage operators opt to restock as quickly as possible, then Europe's imports of LNG could remain quite strong over the coming months. But if Europe's storage firms opt instead to wait until the autumn to replenish stocks, or refill tanks from pipelined supplies, then Europe's LNG purchase volumes could drop sharply. Such a sudden wilt in European orders would likely trigger an aggressive markdown in prices, however, and in turn lure fresh buying interest in Asia where power firms are already primed to boost output. That suggests that overall U.S. LNG export volumes should remain fairly robust for the near term at least, regardless of where the buyers reside. The opinions expressed here are those of the author, a columnist for Reuters. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, opens new tab and X, opens new tab.
NBC News
2 hours ago
- NBC News
In China, fears grow of an EV financial crisis amid pricing war
At a used car market in Beijing, salesman Ma Hui said he fears China's electric vehicle industry is in a race to the bottom. EV makers, led by the country's market leader BYD, have been engaged in a bruising price war, depressing profits for the brands, as well as sellers such as Ma. 'All of us were losing money last year,' Ma said about his fellow used car sellers in the market. 'There are too many companies making too many new energy cars.' China's trading partners have often accused the country of flooding the global market with cheap Chinese EVs. These days, similar accusations are flying within China, raising concerns about financial stress in the industry. The official Communist Party paper, the People's Daily, for example, published a commentary on Monday, titled 'The 'Price War' in the Automotive Industry Leads Nowhere and Has No Future.' 'Disorderly 'price wars' squeeze profits across the chain, impacting the entire ecosystem and risking income declines for workers,' the paper warned. 'Long-term, this 'race to the bottom' competition is unsustainable.' BYD is drawing the most fire after it announced price cuts in late May for many of its models. Some of the discounts are as steep as 34%. Its cheapest car, the Seagull mini hatchback, now costs only about $7,700, down from about $10,000. The intense price war has led high-profile auto executives to sound the alarm — with the head of Great Wall Motor calling the industry 'unhealthy.' In an interview with Chinese news outlet Sina Finance on May 23, Great Wall Motor Chairman Wei Jianjun drew parallels to China's moribund property sector and its now defunct poster child, developer Evergrande. 'An 'Evergrande-like' crisis already exists in the automotive industry,' he said. 'It just hasn't erupted yet.' A government-backed industry group has also called on companies not to 'dump' vehicles below the cost of production. In a statement, the China Association of Automobile Manufacturers took a veiled swipe at BYD. 'A certain automaker has taken the lead in launching significant price cuts and many companies have followed suit, triggering a new round of 'price war' panic,' the group said. BYD dismissed Wei's comment as alarmist and said it believes in fair competition in response to CAAM's criticism. In a sign of further strain, sellers at the Beijing used car market told CNBC about a phenomenon known as 'zero mileage used cars,' which is meant to help auto manufacturers and dealers inflate sales volumes. This happens when cars are registered and plated and then marked as sold, but haven't ever been driven. Ma said he is worried about where the fierce competition leads. He told CNBC he sees the impact of the intense competition on consumers who are already shy about spending in the down economy. 'With the price dropping like this, a lot of buyers might wait,' he said.
