TMR

MALAYSIA released two aging tankers it detained for conducting a ship-to-ship transfer of oil without permission on a bond, following a request from a representative for the vessels, according to maritime authorities.

The supertanker Nora was transferring crude oil to Rcelebra at the time of the arrest, the Malaysian Maritime Enforcement Agency said in a statement Tuesday. They were detained by the group’s Penang unit for conducting a cargo transfer without permission and anchoring in a non-anchorage area, it added.

The vessels were released with a bond valued at RM300,000 ($76,378) due to maritime safety and upkeep, MMEA said. The oil originated from Basrah, Iraq, based on the bill of lading and certificate of origin, it said. The MMEA first announced the detention of the tankers on Saturday.

The Rcelebra, a 2005-built very-large crude carrier, is now sailing past Singapore, with draft readings suggesting it’s fully laden with nearly 2 million barrels of crude, according to ship-tracking compiled by Bloomberg, Kpler and Vortexa. The vessel had arrived in waters off Penang island, in Malaysia’s west, in the last week of January, and conducted a ship-to-ship transfer in that area with Nora, tracking data and satellite images show.

Nora, built in 2002, is now heading westwards, entering the Indian Ocean. –BLOOMBERG

The post Malaysia frees ships it says conducted unlicensed oil transfer appeared first on The Malaysian Reserve.

CHINA’S state-backed metals industry group is calling for more copper in the country’s strategic stockpiles, a move that would add to upward pressure on prices and highlight a growing push by governments to bolster supply security.

Industry experts suggest the country should expand strategic copper reserves, while working with major state-owned producers to boost commercial inventories, according to the China Nonferrous Metals Industry Association, which held an annual briefing to review trends in the sector on Tuesday.

The comments come just days after copper prices spiked to a record high, and is the latest sign that copper is becoming even more of a strategic asset as major economies fret about supply-chain risks. The Trump administration unveiled a major commodity stockpiling program earlier this week.

China already maintains strategic stockpiles of commodities such as copper, oil and cobalt to support industrial activity and protect Asia’s biggest economy from supply disruptions. It taps those reserves to stabilize commodity prices and ease raw material cost pressures on companies. Commercial inventories are mostly held by traders.

US President Donald Trump unveiled “Project Vault” on Monday — a planned $12 billion fund aimed at building strategic mineral reserves to insulate manufacturers and slash America’s reliance on Chinese supplies. Copper wasn’t explicitly mentioned, though the metal was classified as a critical mineral last year.    

Investors have piled into precious and base metals amid doubts over the US dollar and a shift away from currencies and sovereign bonds, fueling sharp rallies across the commodities sector. Some analysts have also pointed to a potential geopolitical premium for copper given growing competition for resources. 

Market experts also suggested to assess the possibility of adding copper concentrate into reserves, according to CNIA.  –BLOOMBERG

The post China’s association calls for more copper stockpiling appeared first on The Malaysian Reserve.

BITCOIN remained under pressure Tuesday, stalling after a brief rebound from a 10-month low as trader caution persisted in options activity.

Trading was mostly flat, with the original cryptocurrency hovering below $78,500 a day after bearish sentiment nearly pushed it to the lowest level since US President Donald Trump returned to the White House just over a year ago.

Put options — contracts that protect against downside risk — have eased, but strike price concentrations show the market has not shaken off its jitters. The highest concentrations of put options indicate buy-side support at $75,000, making it a key support level, according to Deribit data. The token dropped as low as $74,541 on Monday before recovering. The next key support level is $70,000.

“The BTC options market is showing signs of stabilizing as extreme downside fear begins to mean-revert,” said Sean McNulty, APAC derivatives trading lead at FalconX. “However, a weekly close below $75,000 would invalidate the current bounce higher, and potentially open a vacuum toward that $69,000 to $70,000 zone.”

Bitcoin perpetual futures — derivatives that do not expire and make up the bulk of crypto trading volume — also signal a more pessimistic mood in the market. Funding rates, which help keep the contracts’ prices aligned with Bitcoin, have turned negative, falling to their lowest level since the August 2024 unwind of the yen carry trade, according to CryptoQuant data. When rates turn negative, short sellers make up the majority of the market and pay those holding long positions to keep their trades open.

Bitcoin was up as much as 0.8% in early Asia trading on Tuesday, breaking past $79,100 before giving up those gains. The cryptocurrency’s implied volatility index remained elevated at around 48.8, similar to Monday’s level, according to charting platform TradingView.

“Turnaround Tuesday seems to be in effect,” said Jeff Anderson, head of Asia at STS Digital. “Markets got over their skis selling risk assets, and now that everyone has calmed down a bit, things rally off the lows.” —BLOOMBERG

The post Bitcoin stalls after weak rebound as options signal caution appeared first on The Malaysian Reserve.

WALL Street has been skeptical about software stocks for a while, but sentiment has gone from bearish to doomsday lately with traders gripped by fears about the destruction to be wrought by artificial intelligence.

“We call it the ‘SaaSpocalypse,’ an apocalypse for software-as-a-service stocks,” said Jeffrey Favuzza, who works on the equity trading desk at Jefferies. “Trading is very much ‘get me out’ style selling.”

The issue was underscored last week, when a historic selloff in shares of Microsoft Corp. showed that even the biggest names aren’t immune from the pressure. In addition, Take-Two Interactive Software Inc. posted its worst week since November 2022 after plummeting 10% alongside other video-game stocks after Alphabet Inc. began to roll out Project Genie, which can create immersive worlds with text or image prompts. 

Perceived risks to the software industry have been piling up. The January release of a new AI tool from startup Anthropic has supercharged the disruption fears, with its latest tool for the firm’s in-house lawyers sending shares of legal software companies tumbling on Tuesday. The S&P North American software index is on a three-week losing streak that pushed it to a 15% drop in January, its biggest monthly decline since October 2008.

“I ask clients, ‘what’s your hold-your-nose level?’ and even with all the capitulation, I haven’t heard any conviction on where that is,” Favuzza said. “People are just selling everything and don’t care about the price.”

So far this earnings season, just 71% of software companies in the S&P 500 have beaten revenue expectations, according to data compiled by Bloomberg. That compares to 85% for the overall tech sector. While all software stocks have beaten earnings expectations, that’s mattered little in the face of concerns about long-term prospects.

For example, Microsoft reported solid earnings on Wednesday, but investors’ focus on slowing growth in cloud sales put fresh scrutiny on the amount it’s spending on AI, sending the stock tumbling 10% on Thursday. January was the worst month for Microsoft shares in more than a decade. Meanwhile, earnings reports from ServiceNow Inc. and SAP SE gave investors additional reasons to be cautious about growth prospects for software companies.

On the flipside, Palantir Technologies Inc. gave a bullish revenue forecast when it reported earnings after the bell on Monday. It also posted fourth-quarter revenue growth of 70%, exceeding Wall Street estimates.

“The fear with AI is that there’s more competition, more pricing pressure, and that their competitive moats have gotten shallower, meaning they could be easier to replace with AI,” said Thomas Shipp, head of equity research at LPL Financial, which has $2.4 trillion in brokerage and advisory assets. “The range of outcomes for their growth has gotten wider, which means it’s harder to assign fair valuations or see what looks cheap.”

Those AI-related fears led Piper Sandler to downgrade software firms Adobe Inc., Freshworks Inc., and Vertex Inc. on Monday. “Our concern is that the seat-compression and vibe coding narratives could set a ceiling on multiples,” analyst Billy Fitzsimmons wrote.

To be sure, some investing pros view the selloff in software stocks as an opportunity. The Sycomore Sustainable Tech fund, a European open-end fund that has beaten 99% of its peers over the past three years, bought Microsoft shares amid the downturn on the expectation that the company will eventually emerge as an AI winner.

It doesn’t hurt that the software giant’s stock looks cheap at the moment, trading for less than 24 times estimated earnings, the lowest in about three years. And from a technical perspective, its 14-day relative strength index is approaching oversold levels. More broadly, the software index’s multiple is the lowest in years, and its RSI indicates it’s oversold.

The software sector is “probably oversold enough for a bounce,” Jonathan Krinsky, BTIG’s chief market technician, wrote in a note to clients last week. However, he added, “it is going to take a long time to repair and build a new base,” and that “we have not been fans of software for a while given the deteriorating relative strength that really accelerated” in the fourth-quarter of last year. 

The central issue facing investors who want to buy software stocks is separating the AI winners from the losers. Clearly, some of these companies are going to thrive, meaning their stocks are effectively on sale after the recent rout. But it may be too early to determine who they are. 

“The draconian view is that software will be the next print media or department stores, in terms of their prospects,” said Favuzza at Jefferies. “That the pendulum has swung so far to the sell-everything side suggests there will be super-attractive opportunities that come out of this. However, we’re all waiting for an acceleration, and when I look out to 2026 or 2027 numbers, it is hard to see the upside. If Microsoft is struggling, imagine how bad it could be for companies more in the path of disruption, or without its dominant position.” —BLOOMBERG

The post ‘Get me out’: Traders dump software stocks as AI fears take hold appeared first on The Malaysian Reserve.