Business News Today
Tech Giants Chasing AI Development Relentlessly
Alphabet, Microsoft, Meta and Amazon have all announced plans for higher annual capital expenditures as they pour money into chips and data centres. Additional financial announcements over the last 24 hours show the massive shift in the AI race, with global tech giants falling over themselves to push new acquisitions, developments and data related investments. Amazon’s quarterly financial report shows it’s cloud revenue rose at the fastest pace in almost three years, driven by cloud adoption, helping the company forecast quarterly sales above estimates and driving its share prices up by 14% in after-market trading. This after reports of massive job lay-offs.
Meta announced yesterday that they plan to raise up to $30 billion in its biggest bond offering ever, according to their filing on Thursday, as Big Tech rushes to fund the costly expansion of artificial intelligence infrastructure. Meta, is currently persuing major investments in AI that is creating significant cost pressures, and has flagged that its capital expenditure next year would be “notably larger” than in 2025. Shares of Meta sank more than 11% on Thursday while Microsoft ended the session 3% lower, as investors remain concerned about the timeline for returns on their heavy investments
Reserve Bank Governor Rushes New Inflation Target, while Debt Grows in South Africa
South African Reserve Bank Governor Lesetja Kganyago stated on Thursday, that there was no reason to delay the intended change for a lower inflation target to 3% despite persistent pockets of inflationary pressure from administered prices and wages.Kganyago insisted that state administered prices for electricity and water, as well as multi-year public-sector wage agreements, should not delay efforts to lower the target. The ongoing drive for a lower inflation target seems to be a key focus for the governor who has also continued to maintain high interest rate numbers despite inflation being at lower levels in the country for over a year. Policy continues to hurt businesses as well as consumers in what appears to be a move to reduce the SA bond yields rather than look to grow its stagnant economy.
Meanwhile the National Treasury reporting a budget deficit of R15.36 billion (about US$887 million) for September following a R38.35 Billion Shortfall in August. The figure reflects the government’s failure to balance spending with slower-than-expected revenue growth. There are growing concerns that the country’s fiscal position is weakening in the face of sluggish economic performance and mounting public debt.
Mali’s Mining Sector Mayhem
The military government in Mali has revoked more than 90 mining exploration permits including those held by international companies after officials said operators failed to meet new legal requirements. According to a decree signed by Mines Minister Amadou Keita, all rights under the canceled permits are now released and open for reallocation. The permits, issued between 2015 and 2022, covered exploration for gold, iron ore, bauxite, uranium, and rare earths.The mining ministry said companies were asked to resubmit documents under updated rules, but widespread non-compliance led to the cancellations. It’s unclear if firms can appeal.
Mali, one of Africa’s top gold producers, has faced declining foreign investment amid growing insecurity to mining operations and regulatory shifts. The military-led government has also deepened ties with Russia, signing new energy and mining deals, including fuel supplies and joint ventures in gold and lithium, raising questions surrounding the motivation behind the mining licence cancellations.
Breaking News Shorts:
- Creative suite company Canva launched its own design model yesterday, that is able to design layers and add formats to designs. The company also introduced new products and feature updates to its AI assistant, and the ability to use its spreadsheet tool alongside its app-building feature to create data visualisation widgets.
- Nvidia is reportedly looking to invest around $500 million to as much as $1 billion, in Poolside, a tech group that builds AI models for software development. This investment would be part of a $2 billion funding round Poolside is raising at a $12 billion valuation, according to Bloomberg.
- Botswana’s central bank hiked its main interest rate by 160 basis points yesterday to try to narrow the gap with market lending rates, which have been driven higher by a liquidity squeeze caused by an economic slump.The move lifts their Monetary Policy Rate to 3.5%, up from 1.9% previously.
- Nigeria has approved a 15% import duty on petrol and diesel, according to a presidential memo seen by Reuters yesterday, as the government looks to protect its multi-billion-dollar investments in domestic refining by curbing an inflow of cheaper fuel.
- China’s stock indexes drop on sluggish economic data: The Shanghai Composite fell 0.2% to below 3,980, while the Shenzhen Component dipped 0.05% this morning, extending losses from yesterday, as disappointing manufacturing data weighed on market sentiment. Weaker factory activity reflected renewed Sino-US trade tensions, sluggish domestic demand, and a prolonged property downturn.
Markets by Numbers
Currency markets indicate the US dollar stronger today, with the Euro trading against the US dollar at 1.15697 while the Pound is trading at 1.31504 to the US dollar. The Yen is currently trading at 153.93 to the dollar. The rand (ZAR) is currently at R17.29 to the US dollar.
Commodities:
- Gold futures prices are softer this morning, and are currently trading around $40009.00 per ounce.
- Copper prices have seen a 0.7% drop this morning, with prices currently around $5.0512
- Silver futures prices are trending higher today, and currently trading around $49.100
- Platinum futures are trending higher this morning, and currently trading at $1604.60, While Palladium prices are trending upwards today, and are currently trading around $1481.50 per ounce.
- Brent crude oil prices continue lower today, and currently at $63.91 with WTI trading lower at $60.19
- Cocoa futures continue to gain traction this morning, and currently trading around $6058.00 per ton.
- Coffee futures have risen slightly today, and are currently trading at around $3.9233 per pound
Crypto Currencies:
- Bitcoin prices have seen prices gain some traction today, and currently trading at around $109676 per coin
- Ether prices have gained more traction today, and are currently trading around $3837.27
- $Trumpcoin is trending upwards today, and currently trading around $8.038
(All prices quoted at approximately 08H10 Central African Time)
Africa News Briefs:
- Crowds of protesters took to the streets for a second day of demonstrations in Tanzania on Thursday after a disputed election, while Amnesty International reported that two people have died. After the protests broke out on Wednesday, the government shut down the internet, imposed a curfew and deployed the military to the streets in a growing environment of authoritarianism. this follows the incarceration of the main political party’s leader and the withdrawal of the party from the elections.
- Parts of Mali’s capital have been brought to a near standstill as a group affiliated with al-Qaeda imposes an economic siege on the country by blocking routes used by fuel tankers, in a bid to turn the screw on the military government.
