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VRS - who has written 46471 posts on Opalesque Commodities Briefing.


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Iron ore inches higher

Posted on 20 June 2016

The iron ore price has edged higher despite another projection that the commodity could fall sharply over the second half of the year and remain at depressed levels until 2020. Iron ore rose 1 per cent to $US50.70 a tonne in the most recent session, according to The Steel Index.

Options market maps zinc bulls’ upside ambitions: Andy Home

Posted on 20 June 2016

Zinc continues to shine amid the general gloom pervading the base metals complex. On the London Metal Exchange (LME) benchmark three-month zinc has eased back from the near one-year high of $2,105.50 per tonne hit earlier this month.

Father of ETFs urges ever more creative disruption

Posted on 20 June 2016

Disrupt or die – that was the message to the exchange-traded funds industry from Lee Kranefuss, the man who engineered the ETFs that led to the products’ global success. Although global assets in ETFs have soared to trillions of dollars, there is still immense scope to devise creative versions of the products that subvert conventional approaches to asset management, Kranefuss, chairman of ETF provider Source, said.

Hot ETF Options to Track Popular Hedge Fund Positions

Posted on 20 June 2016

The S&P 500 utilities sector rose 15% in the first quarter, as investors sought out the relative safety of these dividend-paying domestically focused companies amid elevated global market volatility. Meanwhile, demand for in gold ETFs was quite strong in the first quarter, as SDDR Gold’s $6.8 billion of inflows was nearly twice as much as any other product regardless of investment style, though not all institutional managers were in agreement to start 2016.

AfDB to invest $24b in agriculture

Posted on 20 June 2016

African Development Bank(AfDB) President, DrAkinwumiAdesina said the bank plans to invest about $24 billion (or $2.4 billion yearly) over the next 10 years to help drive the agricultural transformation inAfrica.

Brexit Angst Leaves Almost No Currency Untouched With Days to Go

Posted on 20 June 2016

Brexit stresses are seeping into virtually every corner of the global foreign-exchange market. Of 16 major currencies tracked by Bloomberg, all but three have seen a jump in the cost to hedge against big declines as Britain’s referendum on whether to stay in the European Union approaches.

Five ways Nigeria’s currency flotation will affect life

Posted on 20 June 2016

Nigeria is allowing its struggling currency, the naira, to trade freely in a move to tackle the financial crisis in Africa’s most populous nation. Financial blogger Feyi Fawehinmi looks at how it will affect people’s lives.

China climate goals trigger launch of new derivatives

Posted on 20 June 2016

China’s clean energy pledges are prompting a supply of new financing tools to fund the estimated 43 trillion yuan ($6.53 trillion) needed to switch from heavy, polluting industries to clean projects. The Beijing Environment Exchange endorsed a call option backed by 20,000 local carbon permits on Thursday, the first of its kind in China, which was bought by trading firm CMB Sinolink.

Crib notes: A Brexit from EU climate plans?

Posted on 20 June 2016

As EU environment ministers meet to discuss essential climate plans, the UK heads for a referendum to decide its membership of the bloc once and for all. Britain decides on Thursday whether to leave the European Union or stay in.

World waits for global commodity bubble to deflate

Posted on 17 June 2016

When the Federal Reserve raised rates in December, it thought the fallout would be minimal. It had telegraphed the increase for a year and it was, after all, just a quarter of a percentage point. Yet since then both the US and, even more so, the global economies have slowed. The reason isn’t because a quarter-point rate increase by itself represents a stringent tightening of monetary policy.

China Plans to Boost Metals Reserves Amid Commodities Glut

Posted on 17 June 2016

China, the world’s top consumer of base metals, will boost stockpiles, accelerate the closure of excess capacity and provide tax breaks for producers as the country grapples with a raw-materials glut amid the slowest growth in decades.

Commodities stage broad retreat on economic worries

Posted on 17 June 2016

Oil, copper and grains slide as Federal Reserve’s caution adds to anxiety over growth. Global economic growth fears gripped commodity investors on Thursday, depressing oil, industrial metals and grain markets.

Global Oil Market to Reach Supply-Demand Balance by End of 2016

Posted on 17 June 2016

The global oil market will reach the balance of supply and demand by the end of the year, BP Head Bob Dudley said. “We continue to think that before the end of 2016 on a daily basis supply and demand we think will balance. There is still a lot in storage around the world. But we do think that the fundamental point will likely happen before the end of the year,” Dudley said.

Global Oil Market to Reach Equilibrium By Mid-2017

Posted on 17 June 2016

Oil prices are likely to reach $65 per barrel within three or four years, before the next cycle of high oil prices possibly taking prices to $150 per barrel within 10-15 years, he said. “Keeping production and supply at the given level, the imbalance can be reduced by rising consumption, and it will fall by the start of 2017…Supply and demand will be in equilibrium in the middle of next year,” Novak said.

Oil Prices Fall to One-Month Low

Posted on 17 June 2016

Concerns about the U.K. referendum and possible rise in U.S. oil production trigger largest one-day price loss since April. U.S. oil prices on Thursday posted their largest one-day loss since April, dragged down by market jitters over the looming U.K referendum.

Opec revenue seen down for 3rd straight year

Posted on 17 June 2016

The Organization of the Petroleum Exporting Countries (Opec’s) full-year 2016 oil export revenues will probably fall 15 per cent, down for the third straight year and possibly the lowest in more than a decade before rising in 2017, the US Energy Information Administration (EIA) said.

OPEC’s Chasm of Doom

Posted on 17 June 2016

OPEC’s members are divided by many things: language; size; politics; sometimes outright war.And money. Don’t forget money.If you want to understand why OPEC has responded to its current crisis with all the cohesion of cat herding, some numbers in the Energy Information Administration’s “OPEC Revenue Fact Sheet,” published on Tuesday, provide some important clues.

Gold price nears two-year high

Posted on 17 June 2016

Gold prices soared to their highest level in nearly two years Thursday, a day after the Federal Reserve lowered projections for how much they expect to tighten monetary policy in the next few years. Gold for August delivery closed up 0.8 per cent at $US1,298.40 a troy ounce on the Comex division of the New York Mercantile Exchange.

Gold price bulls kept faith as hedge funds wavered

Posted on 17 June 2016

A big factor supporting the gold rally – the best start to the year in more than a decade – have been investors in physical gold-backed exchange traded funds. Global vault holdings have swelled to 1,883 tonnes, the highest since December 2013 following net inflows of more than 400 tonnes so far this year – a dramatic reversal of the trend during the last three years when a staggering 1,198 tonnes left funds.

Not falling short: The rise of inverse ETFs

Posted on 17 June 2016

While flows to short and leveraged ETFs as a group have been consistently strong in 2015 and 2016, the products into which the money is going has changed considerably in recent months. In 2016, investors have favoured short products – also known as inverse ETFs.

Understanding Gold And Silver ETFs

Posted on 17 June 2016

If you have begun recently to consider investing in gold or silver — congratulations for thinking outside the box of conventional asset classes. Whether you’ve arrived at this point due to the recent turbulence in the stock market, or you’d like to diversify into an asset class that will always maintain some intrinsic value, or you’d simply like to profit from an increase in the price of gold or silver, you’ve made an important step toward protecting your wealth and profiting in the future.

U.S. derivatives regulator rethinks algorithmic trading proposal

Posted on 17 June 2016

The U.S. derivatives regulator is rethinking parts of its proposal to regulate automated trading and looking into whether the rule could affect too many people, it said on Thursday. The Commodity Futures Trading Commission, announcing it had reopened the public comment period on the rule through June 26, also said it is considering who should mitigate the risks of algorithmic trades and how the rule would apply when traders purchase their algorithms and systems.

These two commodities will get a boost from Brexit

Posted on 17 June 2016

Most investors anticipate a global selloff and flight to safety in the event of a British exit from the European Union, but two commodities are expected to rally. The cocoa and U.K. natural-gas markets are two of the last remaining commodities contracts still denominated in sterling. Most commodities, from oil to copper to gold, are priced in dollars.

Nigeria floats its currency

Posted on 17 June 2016

Bare shelves in supermarkets and soaring inflation would worry any central-bank governor. For Godwin Emefiele in Nigeria, the added twist is that both problems are partly his fault. The central bank’s policy of trying to maintain the value of the naira, Nigeria’s currency, in the face of a slump in the price of oil, which used to account for about 90% of the country’s export earnings, has failed miserably. Now it is being scrapped.

Lew warns China not to weaken its currency

Posted on 17 June 2016

Treasury Secretary Jacob Lew on Thursday warned China not to revert to past foreign-exchange policy in which it kept its currency artificially low to boost its exports.

Currency Traders Flee Euro, Pound as Brexit Fear Fuels Haven Bid

Posted on 17 June 2016

Currency traders in the $5.3-trillion-a-day market abandoned the euro and pound and piled into the dollar and yen, seeking safety before the U.K. votes on whether to leave the European Union.

Climate and energy group calls for EU emissions trading reform to match historic Paris climate deal

Posted on 17 June 2016

At their meeting next week (21 June) the European Parliament’s environment, public health and food safety committee will discuss reform of the emissions trading scheme. The most troubling aspect of the current ETS debate is that MEPs have been silent on the most important part of the reform to bring the ETS in line with the COP 21 Paris agreement and to turn it into a functioning climate policy.

ICIS Launches China Carbon Price Assessment

Posted on 17 June 2016

ICIS has launched a price assessment for the national emissions trading scheme in China. On a weekly basis, the company is assessing how Chinese and international companies value Chinese Certified Emission Reductions (CCERs), a unit that can be used to comply with the Chinese national emissions trading scheme that is poised to launch next year.

Commodities making a comeback as best performing asset class

Posted on 16 June 2016

Commodities have performed strongly so far this year, returning 14.0%, outperforming Bonds at 6.6% and Equities at 0.5%. Nitesh Shah, Director – Commodities Strategist, ETF Securities, identifies an improved outlook for global growth, and signs of a commodity supply deficit, as key stimulants of the comeback.

China’s Investors Shifting to Global Commodities

Posted on 16 June 2016

China’s cash-rich investors are increasingly looking to trade on offshore commodities markets after a regulatory crackdown and amid fears over the depreciation of the yuan, according to Marex Spectron Group.

Multi-asset managers turn to passives for commodity exposure

Posted on 16 June 2016

Multi-managers hoping to take advantage of the recent commodities bull run and rebuild their exposure have been forced to allocate to passive vehicles, as many active equity fund managers are holding “material underweights” to the unloved energy and mining sectors.

Latin American Markets Tumble with Commodities

Posted on 16 June 2016

Depressed Latin American markets took cues from lower commodity prices on June 10. Investors were trading cautiously as losses were seen in commodity and crude-related indexes. The Brazilian BM&F Bovespa SA and the Mexican IPC index fell 3.3% and 1.1%, respectively.

Oil could shed more than half its value to $20, analyst says

Posted on 16 June 2016

Oil futures have staged a magnificent comeback in recent months. However, if history is any guide, the struggling market isn’t out of the woods. Looking at the performance of West Texas Intermediate crude oil since 1870, Paul Jackson, head of research at exchange-traded-fund provider Source, predicted that prices will tank to $20 a barrel, or about 60% from its current levels, and languish for a while, before recovering.

Oil price retreats from $50 - and will stay lower ‘for months’

Posted on 16 June 2016

The oil market has reversed its fragile gains over the past two weeks to fall back below the $50 a barrel mark, as Goldman Sachs warned that the price is unlikely to return to its 2016 highs “for months”.

Goldman Sachs says oil price gains set to stall

Posted on 16 June 2016

Oil production disruptions may be hitting multi-year highs, but Goldman Sachs predicts the resulting price recovery is likely to stall. “On aggregate, we view the price recovery as fragile,” Goldman Sachs said in a commodities research note published Wednesday.

Oil and gas industry to cut $1 trillion in spending after price slump

Posted on 16 June 2016

The oil and gas industry will cut US$1 trillion from planned spending on exploration and development because of the slump in prices, leading to slower growth in production, according to consultant Wood Mackenzie.

OPEC Turmoil Could Turn IEA’s Balanced Market Into Shortfall

Posted on 16 June 2016

The world’s most prominent oil forecaster, the International Energy Agency, anticipates near-equilibrium between supply and demand in global crude markets next year. If OPEC members can’t resolve some massive output disruptions, that will turn into a significant shortfall.

Opec Oil Revenues Fell By $350bn Last Year, Says EIA

Posted on 16 June 2016

Members of the Organization of the Petroleum Exporting Countries (Opec) saw their revenues from oil sales fall by $349bn last year, according to new analysis by the US Energy Information Administration (EIA).

European investors buy heavily into gold ahead of Brexit poll

Posted on 16 June 2016

Gold prices are spiraling with a rise in uncertainty in the developed world. In America, the ongoing meeting of the Federal Reserve is expected to decide on whether to raise policy rates. And, there is the June 23 referendum in Britain on whether to leave the European Union (’Brexit’).

HSBC: Gold will explode if Britain votes for a Brexit

Posted on 16 June 2016

Gold prices are likely to explode if Britons vote to leave the European Union when they go to the polls next Thursday, gaining as much as 10% in a short space of time.

The Brexit Vote Could Push the Price of Gold to $1,400

Posted on 16 June 2016

Ahead of the June 23 Brexit vote, analysts at the Australia and New Zealand Banking Group (ANZ) have said the price of gold could reach as high as $1,400 an ounce. From today’s opening gold price of $1,288.10, that’s an 8.6% increase. And hitting that mark would be a gain of 31% from when the bull run started at the end of 2015.

Fitch: Gold Price Assumptions Raised amid Global Uncertainty

Posted on 16 June 2016

Fitch Ratings raised its gold price assumption to $1,100/oz from $1,000/oz as uncertainty, driven by negative interest rates in parts of Europe and elsewhere, combined with reduced US rate hike expectations, have driven investment sentiment for gold in first-half 2016.

Should investors be seeking safety in gold?

Posted on 16 June 2016

Global gold investment shot up to the equivalent of 617.6 tonnes in Q1 this year, the second highest quarter on record, according to figures from the Global Gold Council and equivalent to $27.2bn (£18.8bn) based on prices of $1,250 an ounce. The industry body attributed the upsurge in demand to negative interest rates, stock market volatility and concerns about global growth.

Commerzbank: Supply Deficits To Underpin Prices Of Platinum, Palladium

Posted on 16 June 2016

Supply deficits in platinum group metals are likely to continue, thereby supporting prices, says Commerzbank. Analysts project platinum will average $1,000 an ounce in the third quarter, $1,050 in the fourth and $1,100 in the first quarter of 2016. They see palladium at $575 in the third quarter, $625 in the fourth and $650 in the first three months of 2016.

Rising Prices Are the Last Thing Metals, Other Commodity Markets Need

Posted on 16 June 2016

Sounds counter intuitive, doesn’t it? Well, not really when the you look at the reality of the situation as the Financial Times has done in a recent article based on research and commentary by Australia’s Macquarie Bank.

Rare-earth metal prices climb as China builds reserves

Posted on 16 June 2016

International spot prices for rare-earth metals are rising amid moves by China to stockpile those key materials for high-tech consumer electronics and hybrid vehicles.

Commodity ETFs Are Outperforming The S&P

Posted on 16 June 2016

The commodity bear market seems to be over. Outperforming most equities year-to-date, commodities represent a significant investment opportunity while the S&P continues trading sideways. Instead of targeting individual commodities, I am analyzing the pros and cons of investing into a diversified commodity basket via ETFs.

European ETF assets record 20th consecutive month of net inflows

Posted on 16 June 2016

The European exchange-traded funds and exchange-traded products sector recorded its 20th month of positive net inflows by gathering $2.68bn during May, according to ETF consultancy ETFGI. Fixed income ETFs/ETPs gathered the largest net inflows with $2.77bn, followed by commodity ETFs/ETPs with $982m, while equity ETFs/ETPs experienced net outflows of $1.20bn.

Currency-Hedged ETFs for an Uncertain Dollar Outlook

Posted on 16 June 2016

When looking to international markets, traders have turned to both international stocks and even included some currency-hedged strategy to manage foreign exchange currency fluctuations. On the other hand, investors can consider partial currency-hedged exchange traded funds to diminish currency risks.

The Losing Battle Against the World’s Most Powerful Currency

Posted on 16 June 2016

The Swiss franc’s persistent strength has posed challenges for export-dependent Switzerland. The undisputed king of currencies is Switzerland’s franc. And these days no one is more disappointed by that fact than the Swiss.

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