By Samer Hasn, Senior Market Analyst at XS.com

Oil prices rose for a second day today after a downward trend that prevailed throughout the past week. Both Brent and WTI crudes rose by about 0.3%.

The recovery in oil prices comes amid more positive signs about the ability of the Chinese economy to recover and the effectiveness of support packages. This in turn comes in light of the November manufacturing and services PMI surveys, in addition to the introduction of plans that will boost domestic spending and provide support to the real estate market.

Despite slower-than-expected growth in services activities in China last month, sentiment in this sector rose to its highest level since last April, according to the Caixin/S&P Global report. While the recovery in corporate sentiment is driven by optimism about better economic conditions and the effectiveness of government support in boosting sales, risks to international trade and increased competition remain a concern for other companies.

The narrative is similar in the manufacturing sector, as seen in yesterday’s PMI report for the sector. Sentiment there rose to its highest level since March. Manufacturing activity also accelerated faster than expected.

More structural overhaul plans have been floated that could boost the local economy. Some cities are considering reforming the household registration system, known as hukou. The reform is primarily aimed at supporting the real estate sector, which is suffering from a persistent downturn in housing prices, by giving urban homebuyers access to vital social, health and education benefits. Migrants from rural areas who do not have “residency” in the cities cannot access these benefits. However, these plans may increase their desire to buy property in cities in order to access these benefits.

However, according to The Wall Street Journal, these plans are unlikely to boost the real estate market in general, as the markets of major cities – the subject of these reforms – are more resilient than smaller ones.

However, the impact of these reforms may be positively reflected by reviving consumer spending with greater abundance of social benefits, according to The Journal, which also said in its reporting of these plans that they will be one of the most important initiatives launched by China in years.

Despite all this, markets may become more optimistic about the future of domestic demand in China, which will enhance the growth needed to lift oil prices from their low levels. However, uncertainty is evident in the future of Chinese exports, which are counted on to drive the economy in light of the weak domestic demand environment so far, and these risks around global trade represent one of the most prominent negative factors facing crude prices today.

But despite this pessimism about the expected trade wars with Donald Trump’s return to the White House next January, the door is still open to de-escalation through negotiations between the two economic poles. The massive tariffs threatened by Trump may not be enforced, given the interdependence of the two economies in so many vital areas.

This week, after the U.S. Commerce Department banned the export of advanced microchips to 140 Chinese companies, China responded by blocking the export of several minerals critical to the chip, electronics, battery, and military industries. Losing them could pose a threat to the U.S. economy and national security.

The supply of these minerals will be a significant and weighty factor for China in potential trade negotiations. The potential impact on the U.S. economy, including inflation, medium-term growth weakness, and damage to the agricultural sector, is would likely make Trump more hesitant.

Therefore, an agreement between Trump and China on favorable trade terms for the United States and less severe obstacles to the flow of trade between the two countries than are currently threatened, could ease downward pressure on crude prices in the coming months.

Aside from China, this week hosts a series of vital labor market data in the United States. While a better-than-expected flow of data – as seen in yesterday’s JOLTS report – would reinforce the positive outlook for the US economy which could also help to propel crude prices.

India, 5th December 2024: Allcargo Group, Indian-born global logistics conglomerate, has released its Environmental, Social, and Governance (ESG) 2023-2024 report with the theme ‘Charting Sustainable Pathways with Ingenuity.’ The report highlights the Group’s commitment to achieve carbon neutrality by 2040 through its sustainable ways. It has also spelt out in detail the Group’s ESG goals which include energy and emissions, occupational health and safety, diversity, equity, and inclusion (DEI), community development, labour practices and human rights, cybersecurity, and corporate governance.

Commenting on the launch of the ESG report, Shashi Kiran Shetty, Founder & Chairman, Allcargo Group said, “ I am delighted to unveil our Environmental, Social, and Governance (ESG) 2023-2024 report, which reflects our steadfast commitment to building a sustainable and inclusive future for all. At Allcargo Group, we believe sustainability goes beyond compliance, it’s about creating lasting value for people, the planet, and our stakeholders. This report highlights our progress across three core pillars Environment (with a focus on renewable energy transitions), Social (ensuring employee safety, diversity, equity, and inclusivity, while driving community impact), and Governance (strengthening ethical practices, sustainable supply chain management, and data security). With a global footprint spanning 180 countries and robust multimodal operations within India, we recognize our responsibility to lead by example. Guided by the theme, ‘Charting Sustainable Pathways with Ingenuity,’ we aim to drive innovation, adopt sustainable practices across our global facilities, and foster ESG-driven collaborations. Together with our partners, we will continue to advance our ESG goals, shaping a future where business growth and sustainability go hand in hand.

India is working on to achieve its net zero emission targets by 2070 and working towards attaining 45% reduction in emissions intensity of GDP by 2030 from the 2005 level. The ESG efforts are aligned with those broader goals.

Key actions:

• Allcargo Gati, an Allcargo Group Company is adopting sustainable transportation through adoption of alternate fuel vehicles (AFVs). It has expanded the scale of its eco-conscious operations to enable more businesses to go green. Allcargo Gati has set a clear target of 2026 to convert its entire first and last mile deliveries to alternative fuels in India.
• Through its community development initiatives, Allcargo Group is majorly contributing to the United Nations Sustainable Development Goals of Good Health and Well-being (3), Quality Education (4), Sustainable Cities and Communities (11) and Life below Water (14).
• ECU Worldwide’s cutting-edge digital platform ECU360 will play an important role in optimizing end-to-end shipping transactions and making it more feasible to implement sustainability measures. Example, 90 percent online booking to reduce paper work.
• Increase in S&P CSA score by 4x – Having taken a strategic approach to ESG just last year, Allcargo Group has demonstrated remarkable progress in the S&P Corporate Sustainability Assessment (CSA) for FY 2023 by achieving an almost four-fold increase over the previous year’s score which highlights Allcargo’s unwavering commitment to sustainable growth and responsible business practices.
• Driving Carbon Reduction Through Renewable Energy and Electric MHEs

o Doubling Solar Consumption – As a significant step towards transitioning to 100% renewable electricity at all owned sites by 2040, we have more than doubled our energy consumption using renewables.

o 100% Electric Material Handling Equipment (MHEs) –Contract logistics business has reduced scope 1 and scope 3 emissions by converting their entire MHE fleet to Electric MHEs in their warehousing operations.

o Sustainable Ocean Freight Practice – At ECU Worldwide, we have taken a pioneering step in sustainable logistics by becoming the first independent cargo consolidator to offer instant access to renewable fuel options for maritime transport. Our book-and-claim tool allows customers to increase the share of liquefied biomethane (LBM) in the shipping industry, cutting CO2 emissions by 25% to 100% for less than Container Load (LCL) shipments.

· Committed to Corporate Governance: The Allcargo Group targets to ‘maintain zero instances of non-compliance with regulatory requirements year-on-year.’

o Our critical information assets and IT infrastructure are certified to ISO 27001:2022, ensuring that our data handling practices meet the highest standards of security, regulatory compliance, and industry best practice.

o A key area of the Group’s strategic ESG approach, involves computing emissions based on the Greenhouse Gas (GHG) Protocol: A Corporate Accounting and Reporting Standard (Revised Edition) (2015) with Global Logistics Emissions Council (GLEC) Framework, and identifying ways to mitigate them.

This year, we are continuing to advance towards our goals and targets established based on our Material areas – Environment (Energy & Emissions), Social (Occupational Health and Safety, Community Development, Labour Practice and Human Rights, Diversity, Equity, and Inclusion), and Governance (Sustainable Supply Chain, Customer Satisfaction Corporate Governance, and Cybersecurity). The most notable of our ESG goals is to achieve carbon Neutrality (scope 1, 2, & 3) by 2040 by investing in cleaner alternate fuels and renewable technologies.

5th December 2024 Gold remains range-bound as markets adopt a cautious stance ahead of key U.S. employment data and Federal Reserve Chair Jerome Powell’s upcoming remarks. Powell’s comments, that come before the Federal Reserve’s December 18 meeting, are highly anticipated for potential insights into the central bank’s approach to interest rate adjustments. The measured tone from Fed officials emphasizes the uncertainty surrounding policy direction.

Market participants are closely monitoring the potential impact of Donald Trump’s re-election, with expectations that expansionary fiscal policies could add to inflationary pressures. This has led to speculation that the Federal Reserve may take a more conservative approach to interest rate cuts, possibly extending into 2025, which could weigh on gold. Additionally, today’s ADP employment report and Friday’s U.S. payrolls data are expected to provide key insights for the Fed’s upcoming policy decisions, particularly as it focuses on labor market strength.

At the same time, gold could continue to find support as traders face key geopolitical risks, concerns over President-elect Trump’s proposed tariff measures, and political instability in South Korea and France. These factors could reinforce the demand for gold as a safe-haven asset amidst broader economic and political uncertainties.