Global News Round-up: 31/01/23

The euro area has avoided a recession after its GDP rose by 0.1% in the last quarter of 2022, despite expectations of a contraction. The growth was driven by expanding economies in France and Spain, and a 3.5% expansion in Ireland that added 0.1 percentage points to the euro-area figure. However, economists expect output to drop in the current period due to rising interest rates, which the ECB is set to hike again this week. 

Meanwhile, the IMF has raised its world growth outlook, but not for advanced economies. 

Europe’s largest lenders are genersting returns of over $12 billion to shareholders due to higher rates. 

Exxon saw a quarterly beat with a full-year profit of $59 billion, but faced criticism for not resuming buybacks. McDonald’s sales topped estimates, while Pfizer expects a weaker 2023 due to lower demand for Covid treatments. 

In India, Gautam Adani’s $2.5 billion equity sale was fully subscribed despite a recent selloff that cost him about $34 billion. Additionally, Indian markets are adopting a cautious approach before the budget day. Positive economic outlook for the country has left the market flat with a positive sentiment going forward.

In the radar today:

The oil industry saw some significant market movers in January 2023.
A group of Greenpeace activists occupied Shell’s FPSO in the North Sea, while French oil major TotalEnergies bought an additional 6.65% stake in Alberta’s Fort Hills oil sands project.

ExxonMobil wants to start up its first-ever large-scale hydrogen plant in 2027 or 2028. The bumper profits reported by oil majors, including Exxon’s $56 billion profit for the entire year of 2022, and Marathon and Philips66 both seeing their profits rise by 50-60%, caused ripples in the market.

OPEC+ is expected to recommend keeping the current production targets at their February meeting, while the Biden administration accused US oil companies of not increasing production with their windfall profits. Russia banned domestic oil exporters from adhering to oil price caps. The House of Representatives passed a bill limiting the use of the US strategic oil reserve, but President Biden vowed to veto it.

Chevron’s production in Venezuela almost doubled to 90,000 b/d.

Asian coal markets cooled down due to weak demand, while a $8 billion offshore gas deal signed by Libya’s National Oil Corporation and ENI was rejected by the oil ministry.

Iraqi Shia militias pledged to derail a 1 million b/d pipeline from Basrah to Jordan’s Red Sea port of Aqaba.

Texas issued a notice to secure equipment and facilities due to expected snowstorms.

China started buying Australian coal again, while Japan and the Netherlands joined the US’ exports restrictions of semiconductor manufacturing equipment to China.

Norway may open its offshore zones to deep-sea mining after finding substantial reserves of metals and rare earth minerals.

Portfolio investors and money managers purchased 70 million barrels in key oil futures and options contracts, marking the second straight week of increased interest.

Before we switch off for the day:

The cryptocurrency market is lower ahead of the US Fed decision on interest rates and the Indian Union Budget 2023. Bitcoin dropped 4% to $22,788 and Ethereum was down 3% to below $1,600. Dogecoin, on the other hand, gained 5% after Elon Musk’s tweet about accommodating crypto in the Twitter payment system. The cryptocurrency market cap is around $1.04 trillion, a decrease of 3.29% in the last 24 hours. Bitcoin’s dominance is around 42.32% and its market cap is $439.77 billion. The digital asset market may see a change after the Fed meeting, if it continues to hike rates, it could cause individuals to move away, says Mahin Gupta, Founder of Liminal.