Gold Futures Rise on Increased Interest-Rate Cut Expectations — Market Talk

Comex gold futures are likely to rebound, based on the daily chart, RHB Retail Research's Joseph Chai says. Although the commodity had a "lower low" close on Tuesday, which showed sentiment remains negative, it also posted a bullish candlestick pattern, the analyst says in a research note. Under a bullish technical setup, support tends to be strong. Hence, the commodity is expected to stage a recovery from immediate support at $3,350/oz, even though the commodity might pull back to test this support level, Chai says. Nearest resistance is pegged at $3,500/oz, the analyst adds. Spot gold is 0.3% higher at $3,359.41/oz. (ronnie.harui@wsj.com)

E.ON delivered a mixed set of second-quarter results, Citi analyst Piotr Dzieciolowski writes. Earnings before interest, taxes, deprecation and amortization came in 4% above consensus expectations following a positive surprise in its networks division, he adds. However, its retail division missed expectations due to margin normalization and a weather impact, Dzieciolowski adds. Shares trade up 1.2% at 16.01 euros. (adam.whittaker@wsj.com)

By Ying Xian Wong

Shares of Petronas Chemicals dropped sharply, after the Malaysian petrochemical company swung to a loss of more than one billion ringgit.

The company's stock plunged as much as 8.8% in afternoon trade Wednesday, and was last 5.3% lower at 3.75 ringgit, bringing year-to-date losses to about 27%.

Petronas Chemicals said earlier Wednesday that it swung to a second-quarter net loss of 1.08 billion ringgit, equivalent to $255.3 million, from a net profit of 777 million ringgit a year earlier. The huge loss was mainly due to lower product spreads, weaker unit contributions, asset impairment and higher depreciation and finance costs. Quarterly revenue fell 17% from a year earlier amid lower sales volume, the ringgit's gains against the dollar and softer product prices.

Looking ahead, Petronas Chemicals expects prices of olefins and derivatives to stay weak, while fertilizer and methanol prices are likely to remain firm, supported by urea demand during the planting season and adequate methanol supply. For the specialties segment, the company remains cautious, anticipating that demand uncertainty will continue across most end markets.

Although market conditions remain tough, the company believes that its solid fundamentals, together with continuing initiatives, will further enhance its resilience, Chief Executive Mazuin Ismail said in a statement.

Write to Ying Xian Wong at yingxian.wong@wsj.com

Iron ore futures hovered around CNY 800 per tonne on Wednesday, holding near two-week highs on expectations of further steel production cuts in China.

Reports indicated that mills in northern China have been ordered to curb output to ensure clear skies during a military parade on September 3.

Such restrictions could help remove excess steel from the market, improve mill margins, and support demand for iron ore.

Market sentiment was also buoyed by the 90-day extension of the US-China trade truce, giving negotiators more time to reach an agreement and helping stabilize trade relations between the world’s two largest economies.

However, seasonal demand remained weak as extreme heat and heavy rainfall continued to disrupt downstream construction activity.

This slowdown has contributed to a build-up in steel inventories despite recent gains in iron ore prices.

Silver prices climbed 1% to around $38.30 per ounce on Wednesday, advancing for the second consecutive session as the latest US inflation data strengthened expectations for a Federal Reserve rate cut next month.

Headline inflation was unchanged at 2.7%, defying forecasts for a tariff-driven increase to 2.8%, while core inflation edged up to 3.1%, its highest level in six months.

Markets are now pricing in a 94% probability of a 25-basis-point cut in September, with another reduction before year-end also reflected in expectations.

Meanwhile, investors awaited this week’s US-Russia talks in Alaska over the war in Ukraine.

The White House described the planned meeting between Presidents Donald Trump and Vladimir Putin as “a listening exercise for the president,” dampening hopes for a breakthrough ceasefire agreement.

Malaysian palm oil futures rose over 1% to around MYR 4,450 per tonne, advancing for the fourth session and holding at their highest since early April.

Gains were supported by higher edible oil prices on the Dalian exchange and strong exports, with cargo surveyors noting shipments in the first ten days of August jumped over 23%.

In top producer Indonesia, Jakarta reaffirmed plans to raise the mandatory palm oil content in biodiesel to 50% next year from 40%, though implementation is unlikely in January.

In India, refiners are expected to lift soyoil imports by 60% to a record in 2024/25 on price advantages over palm oil, pushing the latter’s shipments to a five-year low of 7.8 million tons.

Still, near-term palm oil demand may rise as buyers stock up ahead of the mid-October Diwali festival.

Upside was capped by a stronger ringgit and expectations of higher Malaysian output, with July production up 7.1% to 1.81 million tons and inventories at a near two-year high of 2.11 million tons.