The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.
0857 GMT - Harbour Energy's second-half free cash flow will be hit by Norway and U.K. tax payments, J.P. Morgan analysts Alejandra Magana and Riddhi Agarwal write. The company has guided for free cash flow of around $1.8 billion over the year but delivered this in the first-half. This means cash flow over the remainder of the year will be broadly neutral, they write. Shares rise 7% to 248.4 pence.(adam.whittaker@wsj.com)
0825 GMT - Harbour Energy investors will want to know if there is further upside to returns, Jefferies analysts write. The company upgrades its free cash flow guidance to around $1.8 billion but already delivered this over the first half of the year. The company plans to return a minimum of $800 million to shareholders over 2026. This comes after it was able to capture the higher oil and gas prices with a strong operational performance, they write. Shares rise 7% to 248.4 pence. (adam.whittaker@wsj.com)
0757 GMT - Gold prices hold above the $4,300-an-ounce mark after Wednesday's rally amid growing optimism that a deal to reopen the Strait of Hormuz will ease inflationary pressures and interest-rate hike expectations. "The market is increasingly focusing on the disinflationary implications of lower energy prices," analysts at ING say. "Expectations for Federal Reserve tightening have eased, improving the outlook for non-yielding assets such as gold." Oil prices are headed for a weekly loss of more than 8%, with Brent crude trading below $80 a barrel as investors grow optimistic about negotiations between Iran and Oman on reopening of the Strait of Hormuz. In early trading, New York gold futures rise 0.2% to $4,314 a troy ounce, up nearly 4% on the week. (giulia.petroni@wsj.com)
0749 GMT - Oil prices tick higher in early trading, but Brent crude remains below $80 a barrel as investors await the outcome of Iran-Oman talks to reopen the Strait of Hormuz. The two parties were finalizing a draft agreement on Wednesday that would give Tehran oversight of ships entering the Persian Gulf but wouldn't let it levy tolls or service fees, The Wall Street Journal reported. "Markets have seen plenty of false dawns throughout this conflict," analysts at Deutsche Bank say. "Nevertheless, [they] continue to lean towards a positive outcome, although much of the good news now appears priced in." Meanwhile, the latest U.S. data showed domestic crude oil stocks rose by 2.5 million barrels last week, contrary to market expectations for a moderate withdrawal. Brent is up 0.5% to $79.84 a barrel, while WTI futures rises 0.2% to $75.38 a barrel. (giulia.petroni@wsj.com)
0746 GMT - Harbour Energy posts a positive first-half update as integration of the LLOG portfolio in the U.S. helps deliver record production, Berenberg analysts write. Production growth coincides with a supportive macroeconomic backdrop that is driving cash flow and cutting net debt, they write. The energy company is also making good progress on longer-term growth projects, especially in Mexico and Argentina, they say. Harbour bought Louisiana-based LLOG Exploration in a $3.2 billion deal last December. Shares rise 3.7% to 241 pence.(adam.whittaker@wsj.com)
0738 GMT - Yields on U.K. government bonds, or gilts, rise as markets price in the possibility of the U.S. Federal Reserve raising rates in the coming months. Recently-released U.S. economic data, including the ADP labor market data and PMI data, show resilient activity, raising concerns that inflationary pressures could force the Fed to raise rates. Investors also eye developments in the Middle East. Iran and Oman are finalizing a draft agreement to reopen the Strait of Hormuz which would allow the U.S. and Iran to return to the negotiating table, The Wall Street Journal reports. Ten-year gilt-yields climb 1.1 basis points to 4.893%, Tradeweb data show. (miriam.mukuru@wsj.com)
0734 GMT - Bitcoin rises slightly on hopes for a resolution to the Middle East conflict, although the cryptocurrency continues to trade in a narrow range. Iran and Oman are finalizing a draft agreement to reopen the Strait of Hormuz which would allow the U.S. and Iran to return to the negotiating table, The Wall Street Journal reports. Investors are balancing optimism over the reopening of the Strait against a "messier U.S. macroeconomic picture," Tickmill Group's Patrick Munnelly says in a note. Oil has softened, giving risky assets some relief, but U.S. services prices are still high, labor market data are cooling and Federal Reserve policymakers aren't fully aligned, he says. Bitcoin rises 0.1% to $64,877, LSEG data show. (renae.dyer@wsj.com)
0728 GMT - Harbour Energy is delivering operational excellence as first-half earnings demonstrate the benefits of the rapid integration of its U.S. assets, Barclays analyst Lydia Rainforth writes. With conflict in the Middle East pushing oil and gas prices higher, Harbour has upgraded its free cash flow guidance. It has also launched a $250 million buyback for 2026 and has scope for further returns later in the year, she says. Shares rise 3.7% to 241 pence. (adam.whittaker@wsj.com)
0723 GMT - Eurozone government bond yields rise slightly in early trade. Investors are focused on the prospect of the reopening of Strait of Hormuz and also await key U.S. monthly jobs data Friday. Iran and Oman were finalizing a draft agreement Wednesday to reopen the Strait of Hormuz, The Wall Street Journal reported. Eurozone government bonds "remain largely a function of the oil and Strait of Hormuz," Mizuho analysts say in a note. Government bond auctions are due from Spain and France, while Germany will detail next Wednesday's long-end bond auction. Local economic data, including eurozone retail trade, could provide some input. The 10-year Bund yield rises 0.9 basis points to 3.111%, according to LSEG. (emese.bartha@wsj.com)
0652 GMT - The dollar rises slightly as markets continue to bet on the Federal Reserve raising interest rates this year despite more positive headlines on the Iran war easing oil prices. Fed governor Lisa Cook said Wednesday she's prepared to support a rate rise if necessary as inflation is too high. The market prices a 60% probability of a Fed rate rise in September and fully prices a move by December, LSEG data show. Meanwhile, the WSJ reports that Iran and Oman are finalizing a draft agreement to reopen the Strait of Hormuz. If a deal is announced, the U.S. and Iran would return to the negotiating table. The DXY dollar index rises 0.1% to 99.758.(renae.dyer@wsj.com)
0640 GMT - Nordic markets are seen opening slightly higher, with IG calling the OMXS30 up 0.1% at around 3330. U.S. stock markets fell back slightly Wednesday after four consecutive days of gains, with the tech sector leading the decline, SEB head of analysis Karl Steiner writes. Iran said that it has reached an agreement with Oman on a shipping route through the Strait of Hormuz, but the U.S. has not yet made any official comments on the proposal. "Therefore, until a more positive development in the Middle East is confirmed, and ahead of tomorrow's important U.S. employment data, markets have taken a wait-and-see stance," Steiner says. OMXS30 closed at 3326.93, OMXN40 at 2705.99 and OBX at 1951.32. (dominic.chopping@wsj.com)
0558 GMT - Sticky oil prices could limit the potential for 10-year German Bund yields to fall swiftly towards early July levels--below 2.90%--, while setbacks in Bunds remain better buying opportunities, Commerzbank's Erik Liem and Rainer Guntermann say in a note. Risk sentiment is expected to improve on hopes for resuming traffic via the Strait of Hormuz, the rates strategists say. "Hopes for a more tangible announcement of a deal between U.S. and Iran and prospects of resuming vessel traffic through the Strait of Hormuz, alongside signals that the U.S. is poised to lift Iran-related sanctions, should bolster risk sentiment further," they say. Thursday's government bond issuance in the eurozone will come from Spain and France. The 10-year Bund yield closed at 3.104% on Wednesday, according to LSEG.
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