MARKET MOVEMENTS:
--Brent crude oil is up 0.7% at $84.47 a barrel
--European benchmark gas is 5% lower at EUR36.40 a megawatt
hour
--Gold futures are up 0.1% at $1,949 a troy ounce
--LME three-month copper futures are up 0.8% at $8,422 a metric
ton
--Wheat futures are down 0.15 at $6.16 a bushel
TOP STORY:
Chevron Workers in Australia Set Date for Work Bans,
Stoppages
Workers at two giant natural-gas operations run by Chevron in
Australia plan to begin rolling stoppages and some work bans next
month, raising the specter of disruptions to global gas supplies
ahead of the Northern Hemisphere winter.
Labor disputes between energy companies in Australia and their
employees have jolted gas markets worldwide in recent weeks, with
the threat of walkouts fueling concerns of a sudden drop in
liquefied natural gas exports from Australia, which rivals Qatar as
the largest exporter of the supercooled fuel.
Offshore Alliance, a partnership between two local unions, said
its lawyers notified Chevron late Monday of plans for protected
industrial action starting Sep. 7.
Union members at Chevron's Gorgon and Wheatstone LNG
facilities--which account for roughly 5% of global LNG
supply--intend to take part in rolling stoppages as well as bans
and limitations on some work, Offshore Alliance said. The action
will escalate each week until an agreement can be reached, it
said.
--
OTHER STORIES:
Manufacturers Leaving China Find a Home With Indian Startups
In early 2020, as the pandemic was shutting down global
commerce, a Pennsylvania company was having trouble getting its
usual steel parts out of China. It stumbled on another possible
option, in India.
Zetwerk, a two-year-old startup connecting customers and
manufacturers within the country, had never handled a U.S. order,
but tapped its network of suppliers and delivered the parts. It is
now a provider of everything from nail clippers to steel frames for
U.S. customers, and is valued at $2.7 billion, with funding from
Greenoaks Capital, Lightspeed India, Peak XV Partners and
others.
India has been trying to lure some of the world's biggest
companies to set up new factories after repeated lockdowns under
Beijing's zero-Covid-19 policy and rising geopolitical tensions
with the West prompted many firms to look for alternatives to
China, in a strategy referred to as "China plus one."
--
U.S. Steel Can Ride the Coattails of a U.S. Manufacturing
Boom
United States Steel, the third-largest steel producer in the
U.S., has several things going for it--and at least one big
vulnerability.
At 11.8 times the next 12 months' expected earnings according to
FactSet, the stock remains cheap by U.S. equity standards, and a
$35 a share offer from a big suitor waiting in the wings represents
a roughly 17% premium to current prices. The U.S. residential
construction sector, although it has cooled, is holding up
surprisingly well--in part because of low inventories of homes on
the market. And a big structural tailwind for steel demand is
building in the form of massive investments in manufacturing and
green power triggered by the Inflation Reduction Act, America's new
climate-focused industrial-policy law.
After a surprise offer from fellow steelmaker Cleveland-Cliffs,
which became public in early August, shares of U.S. Steel are up by
about a third. U.S. Steel rejected that initial offer and has said
it is considering multiple offers for part or all of its business.
After the steelworkers union put its support behind
Cleveland-Cliffs, the industrial conglomerate Esmark withdrew its
rival bid.
--
MARKET TALKS:
Palm Oil Rises, Tracking Soybean Oil Strength
1005 GMT - Palm oil prices closed higher in Asia, tracking gains
in soybean oil futures on the Chicago Board of Trade. Soybean oil
futures have been supported by falling crop production and export
activity, said analysts, noting that palm oil and soybean oil often
trade in tandem due to their use in similar products. U.S. soybean
production could total 4.110 billion bushels in 2023, advisory
service Pro Farmer said last Friday, below the 4.205 billion
bushels forecast by the U.S. Department of Agriculture, notes
Phillip Capital in an email. The Bursa Malaysia Derivatives
contract for November delivery closed MYR20 higher at MYR3,930 a
ton. (ronnie.harui@wsj.com)
--
Sugar Prices Begin to Steady After Report of Looming India
Export Ban
0827 GMT - Sugar prices are starting to steady after a spike
toward the end of last week amid a report from Reuters, who cited
unnamed government sources, that India is set to implement an
export ban on sugar. Raw sugar prices are down 0.2% Tuesday at
$0.26 a pound, but are up from $0.22 a pound on Aug. 22, up 5.9%
this month and are 27% higher year to date. India recently hiked
export duties on onions and could add further measures for rice
exports, S&P Global says in a note. "The latest moves follow an
acceleration in domestic food price inflation," S&P says,
adding that "further policy actions cannot therefore be ruled out."
(yusuf.khan@wsj.com)
--
Oil Pauses as Demand Outlook Appears Uncertain
0749 GMT - Crude oil prices are steady as traders await fresh
clues on the outlook for demand and supply. Brent crude is flat at
$83.90 a barrel and WTI is also unchanged at $80.11 a barrel. The
market is waiting to see if anything comes from speculation that
the U.S. is considering easing sanctions against Venezuela and
Iran, which could open the door to more crude-oil exports.
Meanwhile, weakness in China's economy and concerns the Federal
Reserve could yet still raise interest rates are hanging over oil's
demand prospects. "The demand outlook in the coming months remains
clouded with uncertainty and will in our opinion cap the upside
potential," Saxo says in a note. (william.horner@wsj.com)
--
Metals Rise as China Looks to Boost Economic Support
0736 GMT - Metal prices are rising after China looked to add
more economic support measures for domestic infrastructure
projects. Three-month copper and aluminum are both up 0.7% to
$8,419.50 a metric ton and $2,167 a ton, respectively. Gold
meanwhile is up 0.2% to $1,950 a troy ounce. ING highlighted that
China introduced support measures on Monday for transport, property
and other infrastructure projects. "These measures have helped
broader sentiment in financial markets," the bank's analysts said
in a note. They added that gold has also gained after the Federal
Reserve indicated rates would hold steady in September. "However,
we will need to keep a close eye on U.S. data releases in the
coming weeks, which could shed more light on what the Fed may do."
(yusuf.khan@wsj.com)
(END) Dow Jones Newswires
August 29, 2023 07:07 ET (11:07 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.
US Steel (NYSE:X)
Historical Stock Chart
From Apr 2024 to May 2024
US Steel (NYSE:X)
Historical Stock Chart
From May 2023 to May 2024