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VRS - who has written 38538 posts on Opalesque Commodities Briefing.


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Hedge Funds’ Bullish Gold Bets Defy Goldman Outlook: Commodities

Posted on 15 December 2014

Hedge funds are the most bullish on gold since August, defying Goldman Sachs Group Inc.’s prediction that the rally in prices will fade. The net-long position in New York futures and options climbed for a fourth week, the longest stretch of increases since July, government data show.

Precious Metals Starting To Show Bullish Signs

Posted on 15 December 2014

We’ve believed that Gold would need to break $1100 before we thought a bottom could start to develop. While that could still be the case, we are starting to see building evidence that precious metals could be forming a bottom.

Australia Sees Iron-Ore at $60 as Commodities Hit Budget

Posted on 15 December 2014

Australia estimates iron ore will trade at about $60 a metric ton as the biggest slump in the nation’s terms of trade since records began more than 50 years ago deepens the budget deficit.

Miners lose billions in commodity plunge

Posted on 15 December 2014

Miners have lost hundreds of billions in revenue from the fall in commodity prices this year, according to a new analysis, underlining the pressure facing an industry that has responded to the tougher backdrop by slashing costs.

You can use ETFs to short commodities, but it’s difficult

Posted on 15 December 2014

Commodity prices have been in a waterfall decline for most of this year, with the largest declines experienced in the fourth quarter. This is due to many factors, including anemic global economic growth which limits demand and a stronger U.S. dollar DXY,Commodities typically respond inversely to dollar movements since commodities are priced in dollars.

Risk Is Back for Hedge Funds Chasing Glut of Mergers: Real M&A

Posted on 15 December 2014

Merger-arbitrage traders didn’t have enough risk last year. This year, they got more than their share — and it’s not going away. Companies announced $2.8 trillion of acquisitions, making 2014 the busiest year since before the financial crisis. Unprecedented amounts of money were spent in some industries, such as pharmaceuticals, and the transactions skewed larger than at any other time this century, according to data compiled by Bloomberg.

Rupee stands tall amid currency slides, likely to take emerging market crown

Posted on 15 December 2014

The Indian rupee is poised to end the year as the best-performing major emerging market currency versus the US dollar as hopes of economic and political stability drew funds despite a slide in peer currencies such as Russia’s rouble and Brazil’s real on fund flow back to the US expecting higher interest rates.

Russia loses trust in its currency

Posted on 15 December 2014

The Russian ruble continues to fall dramatically. The official rate of the dollar for December 13-15, set by the Central Bank, is 56.8919 rubles. The euro has reached 70.5289 rubles. Russian prime minister Dmitry Medvedev said that “the ruble has had many crises, but then it became stronger; we need to stay patient and everything will be good, we should not fuss but simply wait for the future.”

Climate Talks Yield Plan to Spread Burden of Emission Cuts

Posted on 15 December 2014

The U.S. and other wealthy countries persuaded their developing-nation peers to advance a framework that for the first time would spread the burden of economically painful emission cuts across all nations.

Carbon trade in Beijing tops 100 million yuan

Posted on 15 December 2014

Carbon trade volume in Beijing has reached 105 million yuan (17 million U.S. dollars) since a carbon emissions trading scheme was launched in the city a year ago, the Beijing Environment Exchange announced.

Commodities Set Up For A Continued Move Lower

Posted on 12 December 2014

There have been few places to hide for bullish commodity traders since the end of the summer. As you can see from the chart of the iShares S&P GSCI Commodity-Indexed Trust (GSG) shown below, the bears have sent the price lower by more than 28% over the past six months. It’s only natural that many traders are left wondering when the commodities markets will rebound.

Is the commodity crash,volatility in equities a danger sign for global economy?

Posted on 12 December 2014

Energy prices have crashed to the lowest level in five years, so are metals and agri-commodities while volatility in equities have increased raising concerns about global economic growth. In a linear way, it is always easy to say that lower commodity prices signal the strengthening of recessionary trends or absence or recovery signals in the economy.

Why Conventional Commodity Indexes Will Likely Disappoint

Posted on 12 December 2014

I hate to pile on commodities funds, already beaten down by years of underperformance and outflows, but most are terribly flawed in both construction and premise. The static, long-only commodity futures indexes do not capture the biggest sources of profits that accrue to investors in commodity futures.

Is Fracking the Cause of Slumping Commodities?

Posted on 12 December 2014

What is fracking? Fracking is the process of injecting liquid at high pressure into subterranean rocks, fissures, etc., in order to force them open and allow more oil and gas to flow out of the formation, allowing it to be extracted at greater volumes.

US oil price below $60 a barrel

Posted on 12 December 2014

US crude closed below $60 a barrel for the first time in five and-a-half years, sliding amid new concerns consumption will lag far behind surging output. Ian Taylor, chief executive of Vitol, the world’s largest independent oil trading house, said on Thursday that official estimates on consumption had been overshooting actual demand and suggested the cheapest oil since 2009 could linger.

$60 oil will be norm for next 5 years: Economist

Posted on 12 December 2014

Oil prices will stay around $60 a barrel for the next five years as China’s economy cools down, economist Andy Xie told CNBC on Thursday. Oil prices had risen so high because of China’s boom, the former Morgan Stanley and IMF senior economist said in a “Squawk Box” interview.

Oil’s Drop Spills Into Other Assets

Posted on 12 December 2014

The benchmark U.S. oil price tumbled below $60 a barrel for the first time in five years, intensifying the pain across financial markets and jolting the central banks of some oil-dependent economies into action.

Opec veteran says oil price a ‘disaster’ and cartel powerless

Posted on 12 December 2014

Opec is now “powerless” on its own to prevent oil prices falling further because of a 2m barrels per day (bpd) surplus of supply in the market and the cartel should seek a deal with Russia, Norway and Mexico to arrest the decline, according to a senior Gulf official.

OPEC: RIP? Not So Fast

Posted on 12 December 2014

Many observers have proclaimed the death of OPEC. This seems to be a premature judgment, and may reflect a misunderstanding of oligopolistic practices. The decision not to cut production is not a sign of the OPEC impotence as has been argued. If OPEC would have cut output, and lost market share as a consequence, would OPEC’s future really been brighter?

Oil Wars: Why OPEC Will Win

Posted on 12 December 2014

In the green corner we have the US shale producers. In the red corner we have the oil exporting countries of OPEC. Assuming the fight is fought to a conclusion, who wins? OPEC wins. The US shale producers will shut down first. The reasons are: The US shale producers are motivated by economics, and all other things being equal will have an incentive to cut production at or around the point where production cost exceeds sales price.

Do oil and gold mix?

Posted on 12 December 2014

Has gold finally bottomed out? And what does its prospects tell us about the outlook for oil? Three weeks ago, you may recall, I reached a bearish conclusion from my array of gold timing indicators that are based on the performance of the top-performing advisers.

Gold forecasts for 2015 - Scotiabank mining panel

Posted on 12 December 2014

The most direct question to Scotiabank’s gold panel came from the audience at the end of a wide-ranging discussion of the gold market at the bank’s recently held mining conference: where would the price of gold go by the end of 2015?

Gold Prices Manipulated for Past Two Years?

Posted on 12 December 2014

Since the beginning of 2013, gold’s price action has been irrational. The fundamentals are getting better for gold in respect to demand and supply, but we see sudden, wild swings, often to the downside, on no news and for no apparent reason.

Three Events Driving Gold Prices Higher in 2015

Posted on 12 December 2014

Uncertainty and fear are two of the biggest factors that move gold prices. If they increase, investors buy the yellow metal to hedge and protect their wealth. Going into 2015, I see these two factors coming into play and taking the precious metal’s prices higher.

Industrial demand for Silver will surge by 27%: Silver Institute

Posted on 12 December 2014

The total silver industrial demand is forecast to grow 27 percent, adding an additional 142 million ounces of silver demand through 2018 compared with 2013 levels, according to a new report issued today by the Silver Institute.

Zinc Rebounds With Base Metals as Dollar Retreats

Posted on 12 December 2014

Zinc rebounded along with most industrial metals as the dollar headed for the longest losing streak since July, making commodities priced in greenbacks more attractive to investors. Zinc climbed as much as 0.6 percent after falling to the lowest since June yesterday.

Aluminium slips, other base metals up

Posted on 12 December 2014

Aluminium slipped while some other base metals eked out modest gains on Thursday after diverging signals about global growth from China and the United States. Zinc sunk to a near six-month low before rebounding and closing firmer while aluminium touched an eight-week low.

BHP moves away from iron ore to focus on new darling: copper

Posted on 12 December 2014

Global mining giant BHP Billiton has decided to move away from iron ore and direct upcoming investment to new copper projects, in an effort to meet demand from China, its main customer.

Consolidating gold price prompts trickle into ETFs

Posted on 12 December 2014

A bounce back on equity markets, oil at fresh five-year lows and a stronger dollar did little damage on gold markets Thursday with the metal hovering near 7-week highs. On the Comex division of the New York Mercantile Exchange gold for February delivery was changing hands for $1,226.20 an ounce in afternoon trade, down $3.10 or 0.3% from Wednesday close after recovering from a dip to $1,216 an ounce shortly after the open.

An Active Commodity ETF That Optimizes Returns

Posted on 12 December 2014

When investing in the commodities market, exchange traded fund investors should understand how the underlying market works to best diversify an investment portfolio and optimize potential returns. On the recent webcast, The Evolved Commodity ETF Landscape and Diversification Benefits, Kevin Baum, vice president and senior portfolio manager at Invesco PowerShares, points out that commodities act as a diversifier to traditional asset classes.

Drop in energy ETF draws bullish options bet on oil rebound

Posted on 12 December 2014

The sharp drop in the shares of a popular energy ETF in tandem with oil’s recent swoon attracted a bullish bet on Thursday in the options market that oil prices will rebound significantly through the first quarter of 2015.

Russia Currency Derivatives Aren’t a Threat, Nabiullina Says

Posted on 12 December 2014

Russia’s financial stability isn’t under threat from currency-derivative operations conducted by companies as the ruble slides, central bank Governor Elvira Nabiullina said. Most of the over-the-counter derivatives have already been terminated and the central bank doesn’t expect more risks to emerge, Nabiullina said.

The digital currency boom: Britain can claim first-mover advantage by acting now

Posted on 12 December 2014

The UK has always been at the forefront of financial innovation, and we continue to lead the way today. This year, we became the first Western country to issue sukuk sovereign bonds. But we risk being caught on the hop in the emerging digital world.

U.N. carbon scheme investors unlikely to get lifeline from Lima

Posted on 12 December 2014

Hundreds of companies in developing countries that invested in projects to generate UN-backed carbon credits had hoped the Lima climate talks would yield measures boosting the price of the credits, but they are likely to be disappointed.

Cutting carbon a good business opportunity, private sector told

Posted on 12 December 2014

Whatever the global climate agreement reached next year in Paris looks like, the private sector will need to dramatically step up efforts to cut global carbon emissions, negotiators and analysts said at U.N. climate talks in Lima Thursday.

Lead EU Carbon-Fix Lawmakers Optimistic on Early Start

Posted on 12 December 2014

European Union lawmakers will most likely agree to bring forward the start of a carbon-market fix to 2017, according to three parliamentarians overseeing the draft measure for the Conservatives, Liberals and Greens.

What Does 2015 Hold for Commodities?

Posted on 11 December 2014

Year to date all the main commodity sub-sectors have lost money and the main index was down another 6% in November led by a very weak energy sector that collapsed by 13%. This continued a long, difficult period since the commodity index peaked in April 2011 since when it has fallen 27%. Can there be much further downside given that crude oil is down 45%, gold 38% and copper 35% from their 2011 highs, while corn and wheat have collapsed 58% and 35% respectively from 2012 highs?

What Big Banks Are Saying About Commodities in 2015

Posted on 11 December 2014

As 2014 winds to a close, several analysts have already published their predictions for the coming year, with the vast majority seeing the U.S. take the lead in the global economic recovery. On the commodities front, 2014 has been yet another difficult year, as a strong U.S. dollar put downward pressure on commodity prices.

Bull Market Slows to a Jog in 2015

Posted on 11 December 2014

BofA Merrill Lynch Global Research today released its outlook for the markets in 2015, forecasting that the bull market in global equities will continue next year but returns will slow to single-digit rates. Strong fundamentals and healthy growth in the U.S. economy support a case for investor optimism and opportunism; however, in the lower-return, higher-volatility environment projected ahead, selective allocation and defensive portfolio moves will be crucial for performance.

Here’s What Investors Are Freaked Out About For 2015

Posted on 11 December 2014

Global fund managers are most concerned about deflation in the coming year, according to Bank of America Merill Lynch. While the collapse of commodities caused by a rapid decline in China’s economy was investors’ biggest concern last December, deflation wasn’t explicitly on their radar.

Falling Commodities – A Warning Sign of a Global Crash

Posted on 11 December 2014

Three trends have come together that are igniting a deflationary environment. Central banks are fighting them with a fire hose of quantitative easing (inflation). The first trend, and it’s slow at this point, is deleveraging the greatest debt bubble in history. The second is aging populations in the developed world, and the third is falling commodity prices. If governments and central banks are intent on fighting deflation, as they clearly are, they can’t be happy about commodity prices, especially oil, continuing to fall.

Oil and Gold Warning Signs

Posted on 11 December 2014

A big spike in gold prices and continued weakness in oil is sending warning signs about the health of the global economy. As China reported Tuesday its consumer price index rose only 1.4% last month — the slowest pace in five years — global deflation fears are mounting. In Greece, a snap election is causing turmoil in the Greek bond market as they try to negotiate their debt financing and independence away from its European bailout strictures.

Oil hits new five-year low as OPEC trims 2015 demand forecast

Posted on 11 December 2014

Brent crude oil fell more than a dollar to a new five-year low on Wednesday as producers forecast lower demand for their oil next year. In a monthly report, the Organization of the Petroleum Exporting Countries ( OPEC) forecast demand for the group’s oil will drop to 28.92 million barrels per day (bpd) in 2015, down 280,000 bpd from its previous expectation.

Oil Price Hit by OPEC Numbers as Saudis Stand Firm on Output

Posted on 11 December 2014

Crude took a fresh drubbing yesterday as OPEC reduced its estimate for 2015 demand, Kuwait offered new discounts to Asian customers and the Saudi oil minister questioned the need for an output cut.

Opec opens door to emergency meeting with oil downgrade

Posted on 11 December 2014

Drop in global oil demand growth will raise bets that Opec will meet early next year to review output quotas amid ongoing slump in prices. Opec has slashed its oil demand growth forecast for next year in a move that could bring its members to the table in an emergency meeting to agree on cutting production in the first quarter of 2015.

Oil Resumes Drop as Iran Sees $40 If There’s OPEC Discord

Posted on 11 December 2014

Brent crude fell near to a five-year low as OPEC said it expects demand for its crude next year to be the lowest since 2003. West Texas Intermediate also sank. Futures slid as much as 2.2 percent in London. The Organization of Petroleum Exporting Countries lowered its estimate for demand for its crude in 2015 by about 300,000 barrels a day to 28.9 million.

Oil price falls below $65 for first time in 5 years

Posted on 11 December 2014

The price of internationally traded oil fell below $65 for the first time in more than five years on Wednesday after Opec lowered forecasts of demand for its crude to their lowest level in a decade.

Oil price fall a ‘golden’ chance to shift to clean energy: IEA

Posted on 11 December 2014

World leaders have a “golden opportunity” with plunging oil prices to put a price on carbon emissions since cheaper fuel makes the move less risky politically, the International Energy Agency (IEA) said on Tuesday.

Gold forecasts for 2015 - Scotiabank mining panel

Posted on 11 December 2014

The most direct question to Scotiabank’s gold panel came from the audience at the end of a wide-ranging discussion of the gold market at the bank’s recently held mining conference: where would the price of gold go by the end of 2015?

Gold Prices Manipulated for Past Two Years?

Posted on 11 December 2014

Since the beginning of 2013, gold’s price action has been irrational. The fundamentals are getting better for gold in respect to demand and supply, but we see sudden, wild swings, often to the downside, on no news and for no apparent reason.

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