π Market Report.
π° Players in the London bullion market are rushing to borrow gold from central banks stored in London, following a surge in gold deliveries to the United States. The increase in gold deliveries to New York is driven by speculation of potential import tariffs being imposed by the U.S. under President Trump, leading the market to hedge positions on the COMEX exchange. This has boosted demand from London players who are willing to lease their gold to make it available to the OTC market. The Bank of England governor acknowledged that London remains a major gold market, and having gold in London is important for those wanting to trade and use it.
π’οΈ The crude oil market rebounded yesterday, despite its downward trend in recent weeks. Here are the possible reasons. The rebound in prices was driven by signs of tightening supplies, including a report that Russian oil production fell short of its OPEC+ quota in January. Concerns over further supply disruptions were heightened by reports that European countries plan to seize Russia’s “shadow fleet” of oil tankers. However, the gains were limited by concerns that escalating trade tariffs by the U.S. could dampen global economic growth and energy demand. The U.S. Federal Reserve is also expected to hold off on cutting interest rates until next quarter, which could limit economic growth and oil demand.
π¨ President Donald Trump substantially raised tariffs on steel and aluminum imports to a flat 25% “without exceptions or exemptions”, eliminating previous country carve-outs and product-specific tariff exclusions. The tariffs will apply to millions of tons of steel and aluminum imports from countries like Canada, Brazil, Mexico, and South Korea that had previously been entering the U.S. duty-free. Trump said he would also impose a new North American standard requiring steel and aluminum to be “melted and poured” or “smelted and cast” within the region to curb imports of minimally processed Chinese and Russian metals. The move is aimed at aiding the struggling U.S. steel and aluminum industries, which have seen significant plant closures and declining domestic production in recent years.
π¦πΊ Donald Trump agreed to consider exempting Australia from his newly-imposed 25% tariffs on steel and aluminum imports. This comes after a phone call between Trump and Australian Prime Minister Anthony Albanese, where Albanese presented Australia’s case for an exemption. Trump noted that Australia is one of the few countries with which the U.S. has a trade surplus, citing Australia’s purchases of U.S. airplanes as a reason. Australia is a small global exporter of steel, accounting for only 1% of U.S. steel imports, but is the world’s largest exporter of the main steelmaking raw material, iron ore.
βοΈ Trump also threatened to announce reciprocal tariffs on all countries that impose duties on U.S. goods, further escalating the risk of a multi-front trade war.
π₯ Europe is facing an energy crisis with natural-gas prices reaching their highest level in two years. Gas inventories are depleting rapidly, and heavy industry is grappling with the price surge. Pressure on the European Commission is increasing ahead of its plan to reduce energy prices. They have risen by more than 45% since the beginning of the year. Still far from the levels reached after the invasion of Ukraine.
π€ Elon Musk’s consortium has offered $97.4 billion to buy the nonprofit that controls OpenAI, the AI company behind ChatGPT. This is an attempt by Musk to block OpenAI from transitioning to a for-profit firm, which the company says is necessary to secure capital for developing advanced AI models. Musk co-founded OpenAI as a nonprofit in 2015 but left before the company took off. He has since founded a competing AI startup, xAI. Musk’s lawsuit against OpenAI claims the founders violated contract provisions by prioritizing profit over the public good in advancing AI. OpenAI’s CEO Sam Altman has promptly rejected Musk’s offer. His counter-response seemed to be sarcastic: βno, thanks, but if you want, we bought Twitter for $9.74 billionβ. Musk’s bid could complicate OpenAI’s ongoing fundraising efforts, including a potential $40 billion investment from SoftBank at a $300 billion valuation.
π China’s BYD has started offering advanced autonomous driving features on most of its models, including ones priced as low as $9,555 – far undercutting competitors like Tesla. This move by BYD to make these smart driving features available at much lower price points is expected to start a new price war in the electric vehicle market. Previously, such advanced autonomous driving features were only available in higher-end EVs priced from around $30,000 and up. BYD’s aggressive pricing of advanced autonomous driving features is poised to significantly disrupt the EV market in China and potentially globally.
π± A senior legislator from the EU’s biggest political party told Bloomberg that the organisation would release a plan in March to avoid charging manufacturers with carbon emissions while still meeting its ambitious green transportation goals.
π Market View:
π This week started with a positive start in US futures; however, they seem to be weakening again. The S&P 500 has retreated since yesterday afternoon and is back to the 6,075 level. Nasdaq 100 futures, which had also started the week recovering their declines, have shown weakness again in the last hours, currently trading at 21,770 points.
π΅ The dollar continues to strengthen, with the dollar index (DXY) approaching 108.50 points. As a result, the EURUSD continues to lose ground and struggles to hold the 1.03 level.
π©πͺ In contrast, the German market remains solid. DAX 40 futures remain near all-time highs, just four points shy of 22,000 points, while Eurostoxx 50 futures reach interesting levels, reaching 5,370 points.
π₯ Gold futures continue their ascent, getting closer and closer to 3,000 dollars. In the last few hours, a new high of 2,968.50 dollars per ounce was reached.
π’οΈ Crude oil has experienced a sharp turn upwards, the fundamentals of which we have explained in the report. Brent crude is back towards the $76.40 level.
πͺ Finally, Bitcoin has also resumed a bullish tone in recent hours, approaching the $98,400 level at the moment.
π Geopolitics:
π Elon Musk-led Department of Government Efficiency (DOGE) has started taking control over the U.S. Department of Education. Former President Donald Trump has described the Department of Education as ineffective, wasteful and dominated by radical leftists. DOGE officials have gained access to “administrator” email accounts at the Department of Education, according to reports. The potential closure of the Department of Education has drawn criticism, with the president of the National Education Association warning it would be “devastating” for vulnerable students.
π·πΈ Serbian President Aleksandar VuΔiΔ has revealed that foreign countries have invested β¬3 billion over the past decade in attempts to destabilize Serbia and overthrow his government. VuΔiΔ initially reported β¬426 million for coup attempts, but after investigation, the figure increased to β¬3 billion. Russia provided intelligence confirming these attempts, but VuΔiΔ remains committed to Serbia’s EU aspirations and continues diplomatic engagements with Zelensky.
β‘ Welcome to the efficient European Union. The first changes in the price of electricity in Estonia after disconnection from the Russian grid – an increase of more than 120% in a couple of days.
π₯ President Trump: “The gates of hell will open if the hostages are not returned from Gaza. If all the Gaza hostages aren’t returned by Saturday at 12pm, I would say cancel the ceasefire. I think Jordan will accept the Palestinian refugees. I may stop aid to Egypt and Jordan if they donβt accept refugees from Gaza.”
