Day: September 11, 2022

India says it uncovers fraudulent shell companies with Chinese links

India says it uncovers fraudulent shell companies with Chinese links

MUMBAI (Reuters) – Indian authorities on Sunday said they had arrested a man who had masterminded the creation of many shell companies linked to China and appointed dummy directors to run the fraudulent businesses.

The latest arrest was part of a larger probe launched by the federal government’s Serious Fraud Investigation Office (SFIO) against founders of shell companies used to conduct illegal transactions.

Earlier this month the government began cracking down on Indian entities that were providing fake directors to some shell companies linked to China.

The SFIO said it had arrested a man called Dortse, who was on the board of Jillian India Ltd, a wholly owned subsidiary of Jillian Hong Kong Ltd, and had raided multiple places to unearth the scam.

It did not describe the Chinese links of the shell companies nor disclose the nature of frauds allegedly perpetrated.

For directors of the several of the shell companies, Dortse would use the names of Indian citizens who had no education and worked in menial jobs, according to the SFIO.

The Indian Express newspaper reported that local police had arrested two directors of a company, including a Chinese national, for their alleged involvement in providing dummy directors to shell companies linked to China.

UK dismisses Putin assertion on Ukraine grain exports to poor countries

Stock Markets 6 hours ago (Sep 11, 2022 02:40AM ET)

UK dismisses Putin assertion on Ukraine grain exports to poor countries© Reuters. FILE PHOTO: Russian President Vladimir Putin attends the plenary session of the 2022 Eastern Economic Forum (EEF) in Vladivostok, Russia September 7, 2022. Sputnik/Sergey Bobylev/Pool via REUTERS/File Photo

(Reuters) – Britain dismissed as untrue on Sunday Russian President Vladimir Putin’s assertion that only a fraction of grain exported from Ukraine under an international deal was going to poor countries.

Putin said on Wednesday, without citing a source, that only two of 87 ships, carrying 60,000 tonnes of products, had gone to poor countries. The deal to allow grain exports from Ukrainian Black Sea ports, brokered by the United Nations and Turkey, took effect last month.

Quoting U.N. figures, the British Defence Ministry said that around 30% of grains exported under the deal has been supplied to low and middle-income countries in Africa, the Middle East and Asia.

Russia is pursuing a deliberate misinformation strategy as it seeks to deflect blame for food insecurity issues, discredit Ukraine and minimize opposition to its invasion, the ministry said in its daily intelligence bulletin on Twitter (NYSE:).

Swedish right opposition inches ahead in election cliff-hanger

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Commodities 1 hour ago (Sep 12, 2022 02:56AM ET)

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Swedish right opposition inches ahead in election cliff-hanger© Reuters. People cast their votes at a polling station for early voting in the suburb of Rinkeby, Stockholm, Sweden, September 10, 2022. TT News Agency/Ali Lorestani via REUTERS

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By Niklas Pollard, Simon Johnson and Johan Ahlander

STOCKHOLM (Reuters) -Sweden’s right bloc inched into the narrowest of leads with around 90% of votes counted after Sunday’s general election, with results pointing to a new government after eight years of Social Democrat rule.

Early on Monday, figures showed the Moderates, Sweden Democrats, Christian Democrats and Liberals winning 176 seats in the 349-seat parliament against 173 for the centre-left.

In further evidence of a shift to the right, the anti-immigration Sweden Democrats are set to overtake the Moderates as Sweden’s second biggest party and the biggest in the opposition – a historic shift in a country that has long prided itself on tolerance and openness.

Nevertheless, Moderate leader Ulf Kristersson is likely to be the right’s candidate for prime minister.

“We don’t know what the result will be,” Kristersson told supporters. “But I am ready to do all I can to form a new, stable and vigorous government for the whole of Sweden and all its citizens.”

With overseas and some postal votes yet to be counted and the margin between the two blocs wafer-thin, results could still change. Social Democrat Prime Minister Magdalena Andersson did not concede defeat on election night, saying results were too close to call.

The election authority said a preliminary result would be available at Wednesday at the earliest.

Kristersson has said he would seek to form a government with the small Christian Democrats and, possibly, the Liberals, and only rely on Sweden Democrat support in parliament. But it may be hard for him to keep at arms length a party that is set to be bigger than his own.

“Right now it looks like there will be a change of power. Our ambition is to sit in the government,” Sweden Democrat leader Jimmie Akesson told jubilant supporters at a post-election party.

“Twelve years ago we got into parliament, I think we got 5.7% finally. Right now we have 20.7%.”

TOUGH ON CRIME

Campaigning had seen parties battle to be the toughest on gang crime, after a steady rise in shootings that has unnerved voters, while surging inflation and the energy crisis following the invasion of Ukraine have increasingly taken centre-stage.

While law and order issues are home turf for the right, gathering economic clouds as households and companies face sky-high power prices had been seen boosting Prime Minister Andersson, viewed as a safe pair of hands and more popular than her party. [L8N30D1RY]

Andersson was finance minister for many years before becoming Sweden’s first female prime minister a year ago.

Kristersson had cast himself as the only candidate who could unite the right and unseat her.

INTO THE MAINSTREAM

When Kristersson took over as leader of the Moderates in 2017, the Sweden Democrats, an anti-immigration party with white supremacists among its founders, were shunned by the right and left. But Kristersson has gradually deepened cross-party ties since a 2018 election loss and the Sweden Democrats are increasingly seen as part of the mainstream right.

The prospect of the Sweden Democrats having a say in government policy or joining the cabinet has divided voters.

“I’m fearing very much a repressive, very right-wing government coming,” Malin (OTC:) Ericsson (BS:), 53, a travel consultant, said earlier on Sunday at a voting station in central Stockholm.

The strong result for the Sweden Democrats fits a pattern of gains for the anti-immigration right wing across Europe where Italy looks poised to elect a conservative bloc including Giorgia Meloni’s Brothers of Italy (FdI) and Matteo Salvini’s League later this month.

“I have voted for a change in power,” said Jorgen Hellstrom 47, a small business owner, as he voted near parliament. “Taxes need to come down by quite a bit and we need to sort out crime. The last eight years have gone in the wrong direction.”

Whichever bloc wins, negotiations to form a government in a polarised and emotionally-charged political landscape are likely to be long and difficult.

Andersson will need to get support from the Centre Party and the Left, who are ideological opposites, and the Green Party as well, if she wants a second term as prime minister.

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UK Bond Market Braces for More Losses After Truss’s Energy Plan

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Economy 13 hours ago (Sep 11, 2022 05:20AM ET)

UK Bond Market Braces for More Losses After Truss’s Energy Plan

(Bloomberg) — Prime Minister Liz Truss’s plan to spend billions of pounds capping energy prices may help shield British households this winter, but for investors in UK government bonds there’s only more pain in store.

Investors have eased bets on the Bank of England cutting interest rates next year following the prime minister’s first major policy announcement last week. They’re also worried that longer-dated bonds will suffer from rising inflation expectations and more government borrowing.

Truss’s bailout could add around £200 billion of extra gilt issuance over this fiscal year and next, according to Deutsche Bank AG (NYSE:). That’s unwelcome news for a market already grappling with the fastest pace of inflation in 40 years. The UK central bank has signaled it will act “forcefully” to curb prices by tightening monetary policy.

“I think the quantum of extra debt, the greater risks around the twin deficits will mean higher yields further out,” said Howard Cunningham, a portfolio manager at Newton Investment Management. “The energy price cap is likely to lead to lower headline inflation, but more persistent core inflation because consumers will keep spending.”

He sees 10-year gilt yields rising to around 3.5% from about 3% currently. They’ve already increased 1.3 percentage points from the beginning of August.

Money markets responded to Truss’s program by dialing down short-term inflation expectations but also anticipating that interest rates will remain elevated for longer into 2023. Traders are wagering on just 15 basis points of cuts from June to December 2023, as opposed to around 25 basis points of cuts in the last month.

The BOE delayed its next rates decision a week until Sept. 22 after the death of Queen Elizabeth II, giving policy makers more time to analyze the Truss energy plan as well as key data on jobs and inflation due out next week.

Economists from JPMorgan (NYSE:) Securities, BNP Paribas (OTC:) and Credit Suisse already are anticipating the BOE will deliver a 75 basis-point increase in the base rate to 2.5% this month. That’s on top of the half-point rise in August, the biggest boost in 27 years.

Policy makers have two conflicting forces to assess in the coming months. Truss says that her plan to freeze energy bills will shave up to 5 points off the headline inflation rate, which economists surveyed by the Treasury estimate will peak around 15%. The concern is that cushioning consumers now will add to strains in the economy and push up prices later.

“Recent measures lower short-term inflation and may reduce the urgency from the BOE,” said Rohan Khanna, rates strategist at UBS. “But that may mean more stickier inflation as purchasing power gets hit less than previously thought, hence less easing after a peak in rates.”

Higher rates in financial markets and from the BOE would add to the strains facing consumers, who are struggling with the worst squeeze on their spending power in a century. 

The timing of the BOE’s next decision adds to the complexity of the assessment. Policy makers were to meet on Sept. 15, before Chancellor of the Exchequer Kwasi Kwarteng plans to deliver more detailed estimates of the cost of the Truss energy package. By delaying a week, it’s possible the BOE will now decide on rates after seeing those estimates.

The BOE also was planning to use this month’s meeting to confirm sales of some of the bonds it built up during the years of quantitative easing, when it amassed £895 billion of assets to stimulate the economy. Those sales now may crash into Kwarteng’s own fund-raising plans.

“This will mark a huge step change in net gilt issuance that will clash with Bank of England quantitative tightening and hikes,” wrote Citigroup (NYSE:) strategist Jamie Searle in a note to clients. 

NatWest Markets UK rates strategist Imogen Bachra is envisaging a “regime shift” for gilts due to these headwinds, forecasting 10-year gilt yields hitting 4% by year-end. Gilts could also suffer from the faltering demand from pension funds and foreign investors, according to HSBC.

A remark earlier this week from BOE Chief Economist Huw Pill that the Truss plan would cut inflation in the immediate term was interpreted as a dovish sign and led to a surge in two-year gilts. But that’s balanced by the BOE’s ambition to return inflation back to its 2% target quickly.

“The Bank of England will likely still feel under immense pressure to prove its commitment to returning inflation, and a 75 basis point rate hike next week is a very real possibility,” said JPMorgan Asset Management global market strategist Hugh Gimber. 

This Week

  • There are no BOE policy maker speeches scheduled due to an extended ‘quiet’ period. However, European Central Bank officials will be out in force with scheduled speeches including from Philip Lane and Isabel Schnabel.
  • UK inflation numbers for August, July growth figures as well as employment and wage data will also be monitored.
  • The German ZEW survey for September will be closely watched for clues on business sentiment ahead of the following week’s Ifo numbers. Otherwise data is mostly second-tier and backward-looking.
  • Bond sales from Germany, Italy, France, Spain and Portugal are set to total almost 30 billion euros ($30.2 billion), according to Commerzbank AG (OTC:), which flags the EU and Belgium may sell debt via banks. The UK will not sell bonds this week.

©2022 Bloomberg L.P.

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Canada's real problem is not job losses, it's the rush to retire

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Top 5 Things to Watch in Markets in the Week Ahead

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Queen Elizabeth’s coffin arrives in Edinburgh as mourners line streets

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Queen Elizabeth's coffin arrives in Edinburgh as mourners line streets© Reuters. A view of floral tributes outside Balmoral Castle, following the passing of Britain’s Queen Elizabeth, in Balmoral, Scotland, Britain, September 11, 2022.REUTERS/Phil Noble

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By Andrew MacAskill and Michael Holden

EDINBURGH, Scotland (Reuters) -Queen Elizabeth’s coffin arrived in Edinburgh on Sunday after a six-hour journey from her summer home in the Scottish Highlands, past tens of thousands of mourners lining the route, many in sombre silence, some applauding and others in tears.

At the end of its slow journey through picturesque Scottish countryside, villages, small towns and cities, soldiers wearing kilts carried the coffin to the throne room of the Palace of Holyroodhouse, Elizabeth’s official Scottish residence, where it will remain overnight.

In an emotional tribute to his mother on Friday, the queen’s eldest son and the new monarch, King Charles, said she had begun a “last great journey” to join Prince Philip, her husband of 73 years who died last year.

Earlier, the hearse carrying the oak coffin emerged from the gates of Balmoral Castle, where she died on Thursday aged 96, at the start of the drive to the Scottish capital.

Her coffin was draped in the Royal Standard of Scotland with a wreath on top made of flowers taken from the Balmoral estate including sweet peas, one of Elizabeth’s favourites.

Crowds, fifteen deep in places, massed in the centre of Edinburgh to greet the cortege as it made its way to Holyroodhouse, where it was met by a military guard of honour.

The queen’s daughter Anne, flanked by the queen’s younger sons, Princes Andrew and Edward, curtsied as the coffin was carried inside by soldiers from the Royal Regiment of Scotland.

“There was no way I could miss this. I would regret it for the rest of my life,” said Eilidh Mackintosh, 62, who left her home at 6 a.m. to be sure of a good view among the large crowds on Edinburgh’s famous Royal Mile.

Rachel Lindsay (NYSE:), 24, was left in tears as the coffin passed. “It’s just very sad,” she said. “I don’t think we expected it to ever happen. I just thought she’d live forever. I didn’t think it was real until I saw it.”

The journey from Balmoral https://www.reuters.com/world/uk/queen-elizabeths-close-connection-scotland-2022-09-11 was the first of a series of events https://www.reuters.com/world/uk/plans-run-up-queen-elizabeths-funeral-2022-09-10 leading up to the state funeral at Westminster Abbey in London on Sept. 19.

Her death has drawn tears, sadness and warm tributes, not just from the queen’s own close family and many in Britain, but also from around the globe – reflecting her presence on the world stage for seven decades.

Wherever the cortege went, people lined the road or stopped their cars to get out and watch. At one point, it passed a guard of honour formed by dozens of tractors lined up in adjacent fields by farmers.

Many watched silently in bright sunshine. Some threw flowers into the road. For others, the emotion of the moment moved them to tears.

“It’s just very, very sad. I’m happy I was here to say our goodbyes,” said Elizabeth Alexander, 69, who was born on the day the queen was crowned in 1953.

Many thousands are continuing to gather at the royal palaces across Britain, bringing bouquet after bouquet of flowers. In Green Park near London’s Buckingham Palace, where some of the tributes are being taken, long lines of bouquets snake around the park allowing mourners to read the tributes.

Other well-wishers have attached their messages of condolence to trees.

Charles became king immediately after his mother’s death and was officially proclaimed the new monarch at a ceremony on Saturday, full of pageantry and centuries-old traditions.

Similar proclamations are following across the United Kingdom and the other 14 realms of which Charles is now head of state, including Australia, Canada, Jamaica, New Zealand and Papua New Guinea.

Canada’s Prime Minister Justin Trudeau said parliament would be recalled on Thursday to allow members to pay tribute.

The queen came to the throne following the death of her father King George VI on Feb. 6, 1952, when she was just 25. Her coronation took place a year later.

While Elizabeth’s death was not totally unexpected given her age and deteriorating health, there was still a sense of shock at the news.

“We all thought she was invincible,” her grandson Prince William https://www.reuters.com/world/uk/prince-william-pledges-support-king-charles-every-way-he-can-2022-09-10, now the heir to the throne, told a well-wisher on Saturday as he met crowds at Windsor castle.

FUNERAL

The highly-choreographed mourning plans will continue on Monday. Charles will join the other senior royals in Edinburgh when the coffin will be taken in a procession from Holyroodhouse to the city’s St Giles Cathedral for a service.

There it will remain for 24 hours to allow people to pay their last respects and the new king and members of the royal family will also hold a vigil.

The day of the queen’s funeral will be a public holiday in Britain, officials have announced. U.S. President Joe Biden said he would be there, although full details of the event and the attendees have not yet been released.

Before that, her coffin will be flown to London and there will be a sombre procession when it is later moved from Buckingham Palace to Westminster Hall to lie in state for four days.

“It goes without saying that we can expect large numbers of people,” a spokesperson for Prime Minister Liz Truss told reporters.

Truss, whose appointment as prime minister on Tuesday was the queen’s last public act, will join King Charles as both the new head of state and prime minister tour the four nations of the United Kingdom in the next few days.

Charles, 73, is now the 41st monarch in a line that traces its origins to the Norman King William the Conqueror who captured the English throne in 1066.

Elizabeth’s death has capped a difficult couple of years for the royal family.

The most high-profile issue has involved her grandson Prince Harry and his wife Meghan, who stepped down from royal life in 2020 to move to California from where they both have heavily criticised the institution.

That has left them alienated from the rest of the family, with Harry and his older brother William said to be barely on speaking terms. But the death of their grandmother has seen differences put aside, as they appeared together with their wives outside Windsor Castle to meet the crowds on Saturday.

A royal source described it as an important show of unity at an incredibly difficult time for the family.

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Dutch rail stoppage ends with bumper 8%-plus pay deal

Dutch rail stoppage ends with bumper 8%-plus pay deal

AMSTERDAM (Reuters) -Dutch rail unions on Sunday reached a deal with employers to increase workers’ pay by more than 8% over 18 months, ending a wage dispute.

Strikes have periodically paralysed the rail service in recent weeks and a further stoppage had been planned for this week.

Sunday’s deal comes amid surging inflation in the Netherlands and the wider European Union, and is significantly higher than average wage settlements in the country so far this year.

State owned NS Railways said pay would rise retroactively from July by 5%, or a minimum of 185 euros ($186) a month, with an additional 3.45% in January. It called the deal good news for passengers and rail workers.

Trade union FNV Spoor said the average combined increase would be 9.25%.

Unions said they also secured agreement on a minimum wage of 14 euros per hour and two additional payments of 1,000 euros ($1,000) per worker. The company had 38,600 staff as of 2020.

The average pay increase negotiated so far in 2022 in collective labour agreements for roughly 2.5 million Dutch workers is 3.2%, according to data from employers association AWVN.

Policymakers in Europe have expressed concerns that if inflation stays high for too long, businesses will start to adjust their pay settlements, setting off a hard-to-break wage-price spiral.

Dutch inflation hit 12% in August, Statistics Netherlands said on Tuesday, driven largely by a 151% year-on-year leap in gas and electricity prices.

($1 = 0.9961 euros)

Tennis-Swiatek swats aside Jabeur to claim first U.S. Open title

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Tennis-Swiatek swats aside Jabeur to claim first U.S. Open title© Reuters. Sep 10, 2022; Flushing, NY, USA; Iga Swiatek (POL) hits a forehand against Ons Jabeur (TUN) during a second set tiebreaker in the women’s singles final on day thirteen of the 2022 U.S. Open tennis tournament at USTA Billie Jean King Tennis Center. Mandato

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By Rory Carroll

NEW YORK (Reuters) – World number one Iga Swiatek swept to a 6-2 7-6(5) victory over Tunisia’s Ons Jabeur in the U.S. Open final on Saturday to clinch her maiden trophy at Flushing Meadows and third Grand Slam crown.

Poland’s Swiatek fell on her back and covered her face with her hands after prevailing in the tight second-set tiebreak, having sealed the win when fifth seed Jabeur’s shot sailed long.

It was twice French Open champion Swiatek’s first Grand Slam title on a hard court and the 21-year-old is the first Polish woman to win the U.S. Open.

“I really needed to stay composed and focused on the goals, and at this tournament it was really challenging,” Swiatek said during the on-court trophy ceremony.

“It’s New York, it’s so loud, it’s so crazy. There were so many temptations in the city … I’m so proud I could handle it mentally.”

In addition to the trophy, Swiatek also leaves New York with a $2.6 million winner’s check.

“I’m really glad that it’s not in cash,” she said to laughs from the sold-out crowd at Arthur Ashe Stadium.

Swiatek did well during the match to tune out the crowd, who at times whistled and made other noises while she was serving, earning stern rebukes from the chair umpire.

The demonstrative Jabeur was able to harness the energy of her fans at times but it was not enough to overcome the focused and determined Swiatek.

“Ons, such an amazing tournament, such an amazing season,” Swiatek said after improving to 3-2 lifetime against Jabeur.

“I know that this is already a pretty nice rivalry and we’re going to have many more. I’m pretty sure you’re going to win some of them so don’t worry.”

Despite the defeat, Wimbledon finalist Jabeur will regain her world number two ranking when the tournament concludes on Sunday.

“I really tried but Iga didn’t make it easy for me,” Jabeur said.

“She deserved to win today. I don’t like her very much right now but it’s okay,” she added with a smile.

“I’m going to keep fighting hard and we’ll get that title sometime soon.”

Jabeur made history at Wimbledon when she became the first Arab woman to reach a Grand Slam final. She added another line in the history books in New York, becoming the first African woman to reach the U.S. Open championship match.

“Hopefully I can inspire more and more generations, that’s the goal,” she said. “This is just the beginning of so many things.”

TIEBREAKER ERRORS

Swiatek came out firing on Saturday, pushing Jabeur to the back of the court with her precise serve and deep groundstrokes to race to a 3-0 lead.

Jabeur found the range with her forehand to win back-to-back games for 3-2 but the momentum was short-lived as Swiatek broke back and took the 30-minute first set when the Tunisian’s backhand landed in the net.

A confident front-runner, Swiatek kept the pressure on early in the second as frustration began to mount for Jabeur, who dropped her racket in dismay when her normally trusty drop shot landed short of the net in the second game of the set.

Swiatek blasted a backhand winner down the line for a 3-0 second set lead and it seemed the match would be a brief affair.

But Jabeur rallied, saving a match point at 6-5 and forcing a tiebreak.

She made some costly unforced errors in the tiebreaker, however, which opened the door for Swiatek, who exchanged a warm embrace with the Tunisian after the match.

ONE IN 40 MILLION

Swiatek’s title in New York is the latest triumph in a season overflowing with them.

She ascended to world number one following the surprising retirement of Australian Ash Barty in March and quickly showed she was worthy of the position, winning 37 consecutive matches, including the French Open.

The claycourt specialist showed she could be successful on hard courts, too, with wins at Indian Wells and Miami, but finally looked vulnerable after early exits at U.S. Open tune-up events in Toronto and Cincinnati.

She made headlines coming into New York by criticizing the balls being used at the U.S. Open and said her expectations for herself were low.

Swiatek’s path to the title was not plain sailing.

She needed to battle back from a set down in her fourth-round match with 108th-ranked Jule Niemeier and from 4-2 down in the third set against Aryna Sabalenka in the semi-final.

But she peaked at the right time, playing her best tennis of the tournament to see off Jabeur and etch her name once again into Poland’s sporting history.

“Being raised in Poland, it’s not so sure for us that we will to be tennis superstars,” she told ESPN while white-and-red clad Polish tennis fans chanted “Iga! Iga!”.

“When I was younger I just logically thought that I’m just one of 40 million people in the country. What’s the possibility that I will be the one to be out there?

“I just worked hard day by day.”

Energy & Precious Metals – Weekly Review and Outlook

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Commodities Sep 11, 2022 07:19AM ET

Energy & Precious Metals - Weekly Review and Outlook© Reuters.

By Barani Krishnan

Investing.com – Let’s take a moment to say a prayer in memory of all of those who gave their lives on this fateful day 21 years ago. To the victims of 9/11, you live on in our hearts.

Thank you. Now, back to the business of energy and precious metals and the week that was. 

For those surprised with how much gasoline prices had fallen at the pump since the height of summer demand — from a record $5.01 a gallon in mid-June to below $3.50 in several spots in the U.S. East Coast this weekend — here’s some news: Those prices could fall further.

John Treanor, a spokesman at the American Automobile Association, told Salt Lake City, Utah-based station KSL-TV that the price at the pump is expected to drop even more as we head into colder months. 

Treanor said customers could see a decrease of 7 to 10 cents per gallon when gas switches from a summer blend to a winter blend.

“In the winter months, what’s called the Reid Vapor Pressure — it’s a gauge that the EPA uses to regulate how much emissions your fuel can have — changes. In the winter months that range can be higher,” Treanor said. 

The EPA refers to the Environmental Protection Agency, which is tasked with environmental protection matters.

While the forthcoming fuel blend switch at the pump may be even friendlier to consumers’ wallets, the drawback might be a slight hit to the environment — in terms of air quality, that is. EPA regulations passed in 1990 allow more butane in gas during winter months and that makes the gas less expensive.

“That means you can put more butane in,” said Treanor, explaining. “Butane is essentially a filler there. It helps your fuel burn a little faster, burn a little hotter, but it does cause more vapor.”

Treanor’s remarks come after comments by Patrick De Haan, head of petroleum analysis for GasBuddy, who told TheStreet a few weeks ago that prices in a few states could even drop below $3 soon. The states most likely to benefit from such a steep dip would be Texas, South Carolina, Oklahoma, Georgia, Arkansas, Tennessee, Mississippi, Alabama, Louisiana and Kentucky.

Such a circumstance would put prices lower than this time last year, when the national average was $3.18 for regular unleaded, based on AAA figures.

Why are gas prices falling? 

Pump prices are primarily determined by the price of crude oil, which varies based on supply, consumer demand and other factors. Taxes also play into prices, and many states have enacted “gas tax holidays” this summer to help consumers fill their tanks.

Leaving taxes aside, let’s look at the price of crude first. From its March 7 peak of $139.13 a barrel two weeks after the invasion of Ukraine and the start of Western sanctions on Russia that caused the global upheaval of commodities, Brent hit a seven-month low of $87.25 in the just-ended week. While it ended the week higher at $92.84 a barrel, it was still down some $46, or 33%, from its March peak.

U.S. crude’s West Texas Intermediate benchmark, hit a seven-month low of $81.20 per barrel but settled the week at $86.79. That was still down almost $44, or 34%, from its March 7 peak of $130.50.

Demand-wise, U.S. crude stockpile numbers have been quite volatile in recent months, though leaning bearish of late.

rose by 8.844 million last week, the highest for a week since the week ended April 8, when there was a build of 9.382 million. Industry analysts tracked by Investing.com had expected a crude drawdown of 250,000 barrels instead for last week. The crude build indicated weakening demand for fuels with the winding down of the peak summer travel period.

Inventories of , America’s top automobile fuel, climbed by a modest 333,000 barrels against expectations for a draw of 1.667 million barrels.

Stocks of — the oil variant required for making the diesel needed for trucks, buses and trains, as well as the fuel for jets — rose by 95,000 barrels, less than the rise of 530,000 that had been expected. 

Exports of U.S. crude, another important component of the weekly data, slowed to 3.433 million barrels per day (bpd) last week from the prior week’s 3.967 million bpd.

But analysts — especially oil bulls — contend that statistics on crude have been messed up by the release of tens of million barrels from the U.S. emergency stockpile, or Strategic Petroleum Reserve, known as the SPR. 

The SPR again saw a large outflow of 7.5 million barrels last week that brought the stockpile there to 442.5 million — its lowest since November 1984. 

The Biden administration has been drawing down the SPR since November 2021 to make up the shortfall in crude supply on the domestic market for fuels. But outflows from the reserve really accelerated in May when the administration embarked on a battle to bring down the spiraling pump price of gasoline that had bumped US inflation to 40-year highs. 

The president has committed to draw down 180 million barrels from the reserve over a six-month period — or roughly one million barrels per day — between May and October.  

At latest count, the SPR had released a total of 173.8 million barrels since March, a figure that includes volumes associated with an earlier round of tenders, Bloomberg reported on Thursday.

Which brings us to the question of what happens after October. Those long oil are betting the house that post-October, when excess crude hanging over the market clears, the WTI price for a barrel would shoot back to above $100 — with Brent fetching about $10 more than whatever the U.S. benchmark does.

This week, it appeared initially that the Biden administration might hamper those bets when Energy Secretary Jennifer Granholm told Reuters in an interview that the SPR drawdowns might be extended beyond October. But White House officials, speaking anonymously, told CNN later that there were no plans as of now to continue with SPR withdrawals after October.

Besides the end of SPR drawdowns, oil bulls might benefit from the increasingly bellicose position of Russian President Vladimir Putin towards the West for its ever-tightening sanctions against his country. 

Furious with the latest G7-endorsed cap on the selling price of Russian oil, Putin is eager to hit back and hurt the U.S. and its allies in the most painful way possible. His plan, which almost everyone other than probably his gardener knew from day one, is to shut all oil and gas supplies to the world. Such action would presumably send oil prices spiraling back to high $100s. But some analysts say the global economy, especially Europe’s, is almost certain to go into an unmitigated recession in such a case, and that could bring energy prices back down. 

Also, some meteorologists are cautioning that a warmer-than-usual start to the 2022/23 winter could result in more surprises for oil bulls.

The National Oceanic and Atmospheric Administration recently announced that there was a 91% chance that La Niña conditions would stay in place through November with a 53% chance of La Niña continuing through March 2023. 

During the winter, La Niña events typically bring warmer and drier weather to North Texas. Warmer than normal waters in the Gulf of Mexico can help increase the warmth of the air and moisture content, fueling strong storms.

There’s just no easy way out for either side on this.

Oil: Market Settlements and Activity 

U.S. crude’s did a final trade of $86.10, after settling Friday’s official session up $3.35, or 3.9%, at $86.79 per barrel. For the week, WTI was off by just 8 cents or less than 0.1%. Prior to the rebound, it hit a seven-month low of $81.20 this week, pulverized by new Covid-19 lockdowns in top oil importer China.

London-traded , which serves as the global benchmark for oil, did a final trade of $92.42 after settling the official session up $3.69, or 4.1%, at $92.84.  For the week, it was off by 18 cents or 0.2%. Prior to the rebound, Brent hit a seven-month low of $87.25 this week.

Oil: Price Outlook

WTI continues to remain bearish for the fourth month in a row and for more than ten weeks, with WTI settling below the weekly middle Bollinger Band, noted SKCharting.com’s chief technical strategist Sunil Kumar Dixit.

Weekly stochastics have been struggling to rebel out of long oversold territories, Dixit said, although he added that this week’s drop to $81.20 witnessed some resilience as prices rebounded from the monthly middle Bollinger Band of $82.50.

“A short-term rebound towards the daily middle Bollinger Band of $89.40 is a high probability,” Dixit said.

“If WTI makes a sustained break above a swing high of $90.40, we expect a further upside towards the 50 Week EMA of $92.35 and the 50 Day EMA of $93.90 followed by the 200 Day SMA $96.40,” he said, referring to the Exponential Moving Average and Simple Moving Average, respectively.

But he said the risk of a further drop wasn’t over yet, either. 

“On the downside, weakness below $82.50 will call for a drop to the 100-Week SMA of $76.70,” Dixit said. “However, bears may prefer to wait for better positioning, when prices approach the 200-Day SMA of $96.40, before pulling the trigger.”

Gold: Market Settlements and Activity 

Gold had its first weekly gain in four as the dollar retreated further on Friday from its biggest rally in two decades, allowing bullion to somewhat reinforce its standing as a safe haven.

The benchmark gold futures contract on New York’s Comex, , did a final trade of $1,727.60 per ounce, after settling Friday’s official session up $8.40, or 0.8%, at $1,728.60. For the week, it gained 0.3% after a cumulative 5.2% loss over three previous weeks.

The , which pits itself against six major currencies led by the , slid for the third day in a row, reaching a low of 108.35 from Wednesday’s 20-year high of 110.79. The greenback slid even as Federal Reserve officials pushed on Friday for another outsized to keep inflation down, when the central bank meets on Sept. 21.

The , which is more closely followed than futures by some traders, was last traded at $1,717.62, up $9.03, or 0.5%.

“Gold is higher as the historic run higher in the dollar appears to have run out of steam,” said Ed Moya, analyst at online trading platform OANDA.  “It seems Wall Street is getting comfortable with the idea of another 75-basis point rate hike by the Fed.”

Gold: Price Outlook 

SKCharting’s Dixit, who tracks spot gold instead of futures, said the risk of a further drop to the 200-Week SMA of $1,675 and the 50-Month EMA of $1,672 remain on the cards.

“Gold’s rebound attempts from $1,688 has witnessed a cautious approach from buyers as prices tested $1,730,” Dixit said. “Gold needs to break above or below the $1746-$1688 range of the previous week.”

He referred to Tuesday’s scheduled release of the August as one that may have a major say in gold’s price move for the coming week. 

“In the short term, a sustained move above $1,712 indicates buying towards $1,728 and the 5-Day EMA of $1,732. A sustained break below $1,712 indicates sellers are pushing gold towards $1,705 and $1,700, below which $1,690 can be tested.”

“Gold actually needs to clear the $1,750-$1,760 zone in order to reclaim the $1,800-$1,808 swing top.”

Disclaimer: Barani Krishnan does not hold positions in the commodities and securities he writes about.

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Top 5 Things to Watch in Markets in the Week Ahead

Investing.com - Financial Markets Worldwide

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Economy Sep 11, 2022 08:30AM ET

Top 5 Things to Watch in Markets in the Week Ahead© Reuters.

By Daniel Shvartsman

Investing.com – Markets started September on a strong note, with the closing up 3.4% in the first full week of the month and the jumping 4.1%, while the climbed only 2.4%. Whether that was just a market positioning adjustment or the sign of anything more sustained will be on watch this week, especially as a new set of inflation reports comes out. Corporate news is on the lighter side, though some big earnings reports and a rare major IPO are on the docket for the week ahead. This weekend served as a reminder of the ongoing and changing nature of the Russia-Ukraine war, and while the recent developments may not have a direct market impact, the repercussions could certainly reverberate through the financial world.

Here’s what you need to know for the week ahead in financial markets:

1. CPI and PPI Reports

A bevy of consumer price index (CPI) reports for August come out this week. India releases its on Monday, , , and the all release on Tuesday, the releases its report on Wednesday, releases its report on Thursday, and and the as a whole release theirs on Friday.

Producer Price Index (PPI) reports are also due out from , (Tuesday), the (Wednesday), and

The expectations are for inflation to be easing in the U.S., with expected at 0.3%, matching last month’s number; this would mark the lowest back-to-back readings since last fall. is expected to be -0.1%, as dropping gas prices continue to take pressure off inflation. is expected to be 0.3%, a rise from last month’s 0.2%, while the is also expected to be -0.1%.

Those expectations are quite different in Europe; the U.K. is forecast to see of 0.8%, a significant jump, while is expected to jump another 0.6%. The Eurozone is forecast to see a 0.5% rise in the , a jump from last month’s revised figure of 0.1%. The same is expected of , as energy prices still loom large with the seasons changing.

The ECB has already made its latest move, hiking interest rates by 75 basis points last week. The Fed is expected to stick to at least a , and the inflation reports are not expected to shake it, but no doubt Chair Jerome Powell would welcome signs that inflation is at least moderating meaningfully.

The Bank of England, whose meeting was due this week but postponed in the wake of Queen Elizabeth II’s death, faces a more fluctuating environment with new Prime Minister Liz Truss in charge and already having issued a . Its effect on the market is among the things the BOE will have to weigh; it will also get an as an additional piece of data to throw into the mix.

2. Pair of Key Earnings Reports

While Q2 earnings season has just about played itself out, there are two key software companies reporting results that are worth watching.

Software giant Oracle (NYSE:) reports Monday after the close, and is expected to show 4% earnings growth in its first quarter including newest acquisition Cerner (NASDAQ:). Oracle received a recent from a Global Equities analyst in light of the Cerner deal, as well as a from Guggenheim, but like many in the software and tech industry, has been adjusting to a more difficult macro environment, as the company has been . So the earnings report and conference call may be revealing.

Adobe Systems (NASDAQ:) reports Thursday after the market close. The company is expected to post 7.3% earnings growth and 12.6% revenue growth. A Jefferies analyst that the company hasn’t adjusted guidance for macro headwinds, only forex effects, so there could be more room to disappoint. The company disappointed in but the share price has since more than recovered. Adobe’s role as one of the original software companies that transitioned successfully to a SaaS (software as a service) model makes its report a useful bellwether.

3. Corebridge Financial IPO

2022’s volatile trading has left the IPO market as a casualty, with most IPOs that have made it to market being of the thinly traded, relatively obscure type. Corebridge Financial is a spin-off from AIG (NYSE:) but will come to market via an IPO rather than a direct issuing to AIG shareholders. It focuses on retirement solutions and insurance plans. The company is due to start trading on Thursday, and seeks to raise $1.68-$1.92B before factoring in fees or underwriter share purchases, vs. a valuation range of $13.6-$15.6B.

Read more about the IPO here:

4. Big Investment Conferences and Starbucks’ Investors Day

With the summer over and earnings season in its quietest moments, many companies are hitting the road to meet with investors. Investor conferences and presentations often feature strategic updates and announcements, shifts in sell-side analyst and market thinking, and even dealmaking.

A few notable conferences or analyst days this week:

Goldman Sachs Communicopia + Technology Conference, featuring companies such as: MongoDB (NASDAQ:), Warner Bros Discovery (NASDAQ:), Dynatrace (NYSE:), Dell Technologies Inc (NYSE:), Airbnb Inc (NASDAQ:), Snowflake Inc (NYSE:), ServiceNow (NYSE:), T-Mobile US Inc (NASDAQ:), Pinterest (NYSE:), and Visa (NYSE:)

Morgan Stanley 20th Annual Global Healthcare Conference, featuring companies like Moderna (NASDAQ:), Pfizer (NYSE:), Quidel (NASDAQ:), Merck & Company Inc (NYSE:), Bausch + Lomb Corp (NYSE:), AbbVie Inc (NYSE:), Eli Lilly (NYSE:), Insulet (NASDAQ:), and Quest Diagnostics (NYSE:).

Barclays) Global Financial Services Conference, featuring Cboe Global Markets Inc (NYSE:), US Bancorp (NYSE:), Huntington Bancshares (NASDAQ:), American Express (NYSE:), JPMorgan (NYSE:), Allstate (NYSE:), and Robinhood (NASDAQ:), among other companies.

On the analyst days front, Workday (NASDAQ:), Workiva (NYSE:), Corteva (NYSE:), and Starbucks (NASDAQ:) all have investor or analyst days on Tuesday, with Starbucks especially in close watch given the appointment of its new CEO recently.

5. Russia-Ukraine Developments and Aftershocks

Ukraine’s surprising recapture of the city of Izium in the country’s northeast has caught observers’ attention around the world as a potential turning point in the war. Ukraine is also attacking Russian positions in the south of the country, near Kherson, and should they be able to maintain an attack on two fronts and take and hold territory, it would mark a different tone.

Russia has continued to escalate economic pressure on Europe with the shutting down of the Nord Stream 1 gas pipeline. While the military landscape is shifting and uncertain, it is not hard to imagine that Russian setbacks could only increase Russia’s willingness to use its economic leverage with Ukraine and with Ukraine’s supporters in predictable and unpredictable ways, which could put more pressure on European countries to resolve their energy situation before the winter arrives, and which makes the inflation reports mentioned at the top of the article all the more relevant.

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Ukraine hails snowballing offensive, blames Russia for blackouts

5/5

Ukraine hails snowballing offensive, blames Russia for blackouts© Reuters. A view shows a Russian armoured fighting vehicle captured by the Ukrainian Armed Forces during a counteroffensive operation, amid Russia’s attack on Ukraine, in Kharkiv region, Ukraine, in this handout picture released September 11, 2022. Press service of

2/5

By Pavel Polityuk and Tom Balmforth

KYIV, KHARKIV/Ukraine (Reuters) -Ukrainian forces kept pushing north in the Kharkiv region and advancing to its south and east, Ukraine’s army chief said on Sunday, a day after their rapid surge forward drove Russia to abandon its main bastion in the area.

Ukrainian officials accused retreating Russian forces of launching retaliatory attacks on civilian infrastructure, including a thermal power station in Kharkiv, that the authorities in Kyiv said caused widespread blackouts.

“No military facilities, the goal is to deprive people of light & heat,” Ukrainian President Volodymyr Zelenskiy wrote on Twitter (NYSE:) of the attacks.

Moscow denies its forces deliberately target civilians.

Zelenskiy has described Ukraine’s offensive as a potential breakthrough in the six-month-old war, and said the winter could see further territorial gains if Kyiv received more powerful weapons.

In the worst defeat for Moscow’s forces since they were repelled from the outskirts of the capital Kyiv in March, thousands of Russian soldiers left behind ammunition and equipment as they fled the city of Izium, which they had used as a logistics hub.

Ukraine’s chief commander, General Valeriy Zaluzhnyi, said the armed forces had regained control of more than 3,000 square km (1,158 square miles) since the start of this month.

Moscow’s almost total silence on the defeat – or any explanation for what had taken place in northeastern Ukraine – provoked significant anger among some pro-war commentators and Russian nationalists on social media. Some called on Sunday for President Vladimir Putin to make immediate changes to ensure ultimate victory in the war.

‘CYNICAL REVENGE’

Zelenskiy said late on Sunday that Russian attacks caused a total blackout in the Kharkiv and Donetsk regions, and partial blackouts in the Zaporizhzhia, Dnipropetrovsk and Sumy regions.

“They are unable to reconcile themselves to defeats on the battlefield,” Dnipropetrovsk Governor Valentyn Reznichenko wrote on Telegram.

Kyrylo Tymoshenko, the deputy head of the president’s office, posted an image on Telegram of a power station on fire but added power had been restored in some regions.

Kharkiv Mayor Ihor Terekhov described attacks on infrastructure as “cynical revenge” for the success of Ukrainian troops at the front, particularly in Kharkiv.

Ukraine’s gains are important politically for Zelenskiy as he seeks to keep Europe united behind Ukraine – supplying weapons and money – even as an energy crisis looms this winter following cuts in Russian gas supplies to European customers.

Zelenskiy said Ukrainian forces would continue to advance.

“We will not be standing still,” he said in a CNN interview recorded on Friday in Kyiv. “We will be slowly, gradually moving forward.”

‘SNOWBALL ROLLING DOWN A HILL’

Defence Minister Oleksii Reznikov said Ukraine needed to secure retaken territory against a possible Russian counterattack on stretched Ukrainian supply lines. He told the Financial Times that Ukrainian forces could be encircled by fresh Russian troops if they advanced too far.

But he said the offensive had gone far better than expected, describing it as a “snowball rolling down a hill”.

“It’s a sign that Russia can be defeated,” he said.

Kyiv-based military analyst Oleh Zhdanov said the gains could bring a further push into Luhansk region, whose capture Russia claimed at the beginning of July.

“If you look at the map, it is logical to assume that the offensive will develop in the direction of Svatove – Starobelsk, and Sievierodonetsk – Lysychansk,” he said.

The head of Russia’s administration in Kharkiv told residents to evacuate the province and flee to Russia, TASS reported on Saturday. Witnesses described traffic jams with people leaving Russian-held territory.

Washington appeared to take a cautious public posture, with the Pentagon referring Reuters to Defense Secretary Lloyd Austin’s remarks on Thursday about Kyiv’s “encouraging” battlefield successes.

Britain’s defence ministry said on Sunday that fighting continued around Izium and the city of Kupiansk, the sole rail hub supplying Russia’s front line across northeastern Ukraine, which has been retaken by Ukraine’s forces.

NUCLEAR REACTOR SHUTS DOWN

As the war entered its 200th day, Ukraine on Sunday shut down the last operating reactor at Europe’s biggest nuclear power plant to guard against a catastrophe as fighting rages nearby.

Russia and Ukraine accuse each other of shelling around the Russian-held Zaporizhzhia plant, risking a release of radiation.

The International Atomic Energy Agency said a backup power line to the plant had been restored, providing the external electricity it needed to carry out the shutdown while defending against the risk of a meltdown.

French President Emmanuel Macron told Putin in a phone call on Sunday that the plant’s occupation by Russian troops is the reason why its security is compromised, the French presidency said. Putin blamed Ukrainian forces, according to a Kremlin statement.

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