VOW3

MARKET MOVEMENTS:

-- Brent crude oil is down 2.2% at $78.96 a barrel

-- European benchmark gas is down 4.6% at EUR 47.30 a megawatt hour

-- Gold futures are down 0.5% at $1,906.30 a troy ounce

-- LME three-month copper futures are 0.9% lower at $8,851 a metric ton

-- Wheat futures are 0.9% lower at $6.79 a bushel

TOP STORY:

Volkswagen Plans $192 Billion Investment Focusing on EVs, New Tech

Volkswagen AG is planning a $192 billion spending spree over the next five years to fix its struggling business in China and try to hoist the German car maker out of its niche as an also-ran in the U.S., the company said Tuesday.

VW said it would target two-thirds of that investment, or about $127 billion, on the development of electric vehicles and new technology, with a particular focus on the expansion of its business in China and the U.S.

The move is the first major strategy announcement by Chief Executive Oliver Blume since he took the reins at VW in September after the board ousted his predecessor, Herbert Diess. With the company's new five-year investment plan, Mr. Blume is now starting a spending war with rival auto makers as he tries to claw back market share in China and make the company's U.S. business relevant after decades of failed attempts to build significant market share.

OTHER STORIES:

Sustainable Aviation Fuel No Quick Fix to Greening Air Travel

United Airlines Holdings Inc. has turned to an apt pitchman for a new advertising campaign touting the environmental benefits of jet fuel made from waste: Oscar the Grouch.

But the "Sesame Street" character's cynical worldview may be ideally suited to the airline's campaign for another reason. The reality is that flying planes on sustainable aviation fuel--known as SAF--faces big hurdles, and the airline acknowledged in the ad that it currently uses less than 0.1% of SAF for its fuel needs.

Aviation produces more than 2% of global energy-related carbon-dioxide emissions, according to the International Energy Agency, and that is on track to rise as more of the world's population takes to the skies. It is one of the hardest industries to decarbonize because it requires very energy-dense fuels to travel long distances.

MARKET TALKS:

Steel Price Rally Expected to Lead to Margin Recovery

1012 GMT - Steel prices are recovering on both sides of the Atlantic with the U.S. market in particular accelerating in recent weeks on the back of brighter market sentiment in Asia, Deutsche Bank analyst Bastian Synagowitz says in a research note. Prices are expected to keep recovering in the near term despite the fragility of the current environment, he says. "Hence, we expect margins to recover into 2023, and we believe steel stocks are still attractive, based on valuation and underlying cash generation," Synagowitz says. Deutsche Bank's top picks are ArcelorMittal and Voestalpine in carbon steel and Aperam and Outokumpu in stainless steel. (pierre.bertrand@wsj.com)

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Palm Oil Prices Fall Amid Oversupply of Vegetable Oils

1005 GMT - Crude palm oil prices declined in late trading amid an oversupply of vegetable oils, Affin Hwang analyst Nadia Aquidah says in a note. The prospect of a global recession could also curb palm oil consumption in many markets and pressure prices, she says. The Bursa Malaysia Derivatives contract for May delivery closed MYR61 lower at MYR3,982 a metric ton. (yiwei.wong@wsj.com)

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Metals Slip Ahead of U.S. CPI Print

0835 GMT - Metals prices are moving lower, with traders looking to today's consumer price inflation print in the U.S. Three-month copper is down 1% to $8,839 a metric ton while aluminum is 0.6% lower at $2,306 a ton. Gold meanwhile is flat at $1,916.80 a troy ounce. Peak Trading Research says that interest-rate expectations changed dramatically during the past 24 hours due to the fallout from the regional banking collapse, noting that "last week the market was pricing four rate hikes by September--today [it is] zero." Peak in a note says, "the big drop in rate expectations yesterday levered the U.S. dollar lower, which helped limit the macro damage to our commodity markets," adding that "now it is all eyes on today's CPI inflation print." (yusuf.khan@wsj.com)

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Oil Slips Ahead of US Inflation Data

0813 GMT - Oil prices weaken further as concerns over the fallout from Silicon Valley Bank's collapse reverberate through commodity markets and investors await crucial inflation data. Brent crude, the international oil benchmark, declines 1.1% to $79.85 a barrel. Prices slumped as low as $78.37 on Monday, before paring losses to close down 2.4%. "The oil market was unable to escape the broader risk-off move as markets grappled with the spillover from the SVB collapse," ING says in a note. SVB's end has prompted worries about the impact of interest rate rises on banks and driven some investors to anticipate the Fed will ease off on its interest rate rising. U.S. CPI data due later Tuesday would be key for gauging the Fed's plans. (william.horner@wsj.com)

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Indonesia's Nickel Miners Seen Raising Significant Capital for Expansion

0534 GMT - Nickel miners and processors in Indonesia are expected to raise "significant" capital over the next two to three years, as they expand operations amid climbing demand for battery materials, S&P Global Ratings says in a report. Roughly $30 billion in announced investments in Indonesia's capital-intensive nickel industry "will prompt external financings, including dollar-bond issuance," the report says. Indonesian miners have typically been well funded by domestic banks and the domestic bond market, it notes. (rhiannon.hoyle@wsj.com; @RhiannonHoyle)

Write to Yusuf Khan at yusuf.khan@wsj.com

(END) Dow Jones Newswires

March 14, 2023 07:18 ET (11:18 GMT)

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