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Commodities Briefing - Category | Index more

Commodities face a severe price downturn, recovery not anytime soon

Posted on 25 August 2015 by VRS  |  Email |Print

The metal index may have corrected 50% in the past one year and metal stocks may appear good value-buys, but given the structural negatives of a slowing China and a strong dollar, it may not be too long before the long-term bearish trend reasserts itself.
According to a recent Barclays report, this is a much more severe commodity price downturn than any the market has experienced in recent history. The Chinese demand across metal commodities is likely to drop to 2-3% from double digits for the next 5 years and China consumes 40-50% of most of these commodities produced globally. The Bloomberg commodity index is back at 2002 levels, eroding almost all the gains of the commodity super cycle………………………………………..Full Article: Source

Commodity indexing embraces new methods

Posted on 20 August 2015 by VRS  |  Email |Print

It was 2012, and energy executives and policy specialists were excited by the promise of shale gas. From Texas to Pennsylvania, a bonanza was under way. But inside the downtown Manhattan offices of S&P Dow Jones Indices, record US gas production was causing a problem. Oversupply was filling storage caverns, reducing returns from futures contracts for the product, disrupting an important benchmark used by investors.
The total return version of the S&P GSCI gas index had collapsed to a value of 0.58 from 100 when it launched. “The index value had declined to such a low level that it became prohibitive for people to price products on it,” recalls Michael McGlone, a former S&P senior director of commodity indexing. “It’s difficult to track an index that’s priced at less than one.”……………………………………….Full Article: Source

Worst-Hit Commodity Investments? Not Commodities

Posted on 07 August 2015 by VRS  |  Email |Print

What is falling harder than commodity prices? Some exchange-traded funds that seek to track the companies that dig and drill for raw materials and fuel. It is no small feat to overshadow recent declines in industrial materials such as oil and metals. The Bloomberg Commodity Index, which tracks the prices of 22 raw materials, this week hit a 13-year low and is down 13% this year.
For 2015, copper prices have slumped 17%, oil prices have dropped 16% and gold prices have fallen 8%. Exchange-traded funds that track these commodities are down by a similar percentage. But some exchange-traded funds that invest in and aim to track the share prices of commodity-producing companies are doing much worse………………………………………..Full Article: Source

Commodities market bearish like it’s 2008 all over again

Posted on 06 August 2015 by VRS  |  Email |Print

Attention commodities investors: Welcome back to 2008! The meltdown has pushed as many commodities into bear markets as there were in the month after the collapse of Lehman Brothers, which spurred the worst financial crisis seven years ago since the Great Depression.
Eighteen of the 22 components in the Bloomberg Commodity Index have dropped at least 20 per cent from recent closing highs, meeting the common definition of a bear market. That’s the same number as at the end of October 2008, when deepening financial turmoil sent global markets into a swoon………………………………………..Full Article: Source

July slaughter sends commodities to 13-year low

Posted on 30 July 2015 by VRS  |  Email |Print

The downward slide in commodity prices is accelerating, surpassing the low reached during the financial crisis in 2008 and reaching a 13-year low. “This is one of the worst months in history for commodities,” said Jodie Gunzberg, global head of commodities at S&P Dow Jones Indices.
The S&P GSCI index, a measure of a basket of 24 commodities, lost 14 percent of its value this month, with nearly every single component trading in negative territory. Indeed, the magnitude of the losses is shaping up to be the seventh worst in 45 years, data from S&P Dow Jones Indices show………………………………………..Full Article: Source

All commodity price indices to decline in 2015 – World Bank

Posted on 23 July 2015 by VRS  |  Email |Print

A new World Bank report forecasts that all main commodity price indices will decline in 2015, owing to “abundant supplies and, in the case of industrial commodities, weak demand”. The July Commodity Markets Outlook is particularly pessimistic on the outlook for metals prices, which are now projected to decline 17%, instead of the 12% forecast in April; a result of capacity increases and slowing Chinese demand.
The largest decline is expected for iron-ore, where a 46% slump is anticipated, owing to new low-cost mining capacity coming online, mainly in Australia. BHP Billiton reported a 13% increase in iron-ore production to a record 254-million tons for the year to June 30, while South Africa’s leading iron-ore producer Kumba Iron Ore has indicted that it is targeting a break-even cash iron-ore price of $45/t, with prices having fallen to around $50/t………………………………………..Full Article: Source

Baltic Exchange ship futures platform examines move into commodities

Posted on 30 June 2015 by VRS  |  Email |Print

London’s Baltic Exchange is studying a potential foray into commodities and is open to proposals on tie-ups as other exchanges attempt to boost volumes, its chief executive said. Baltex, the Baltic’s digital shipping platform, was launched in 2011 as the first central electronic marketplace for freight forward agreements (FFAs), which allow investors to take positions on freight rates at a point in the future.
Since the beginning of this year, the previously loss making platform, has reached break even levels after Baltex became a venue for presenting block futures at the start of December………………………………………..Full Article: Source

Indexology: Drivers of Technology ETFs

Posted on 26 June 2015 by VRS  |  Email |Print

While S&P Capital IQ consensus forecasts for second quarter 2015 EPS has declined sharply since the beginning of 2015, we think that the information technology sector should be one of the bright spots. Meanwhile, the sector is trading at a discounted P/E multiple. We believe investors can gain exposure to a number of favorable trends in the broader sector through diversified technology focused ETFs.
Earnings forecasts have been falling for all S&P 500 index sectors. On January 2, analysts expected second quarter 2015 S&P 500 earnings would increase 4.2% from the prior year. However, driven in part by weakness in the energy and consumer staples sectors, the S&P 500 forecast is now for a 4.2% decrease as of June 23………………………………………..Full Article: Source

Indexes Open China to Millions More

Posted on 08 June 2015 by VRS  |  Email |Print

Global investors are soon going to get a taste of stock trading, China-style. With the major stock-index providers adding or likely adding stocks that trade on China’s domestic markets, millions of foreign investors will own a piece of a market that has some of the highest valuations and volatility in the world.
It is also a market heavily guided by the Chinese government and one that has few protections for investors. The market’s recent performance has been driven by small, fast-trading investors, many with newly opened brokerage accounts, using borrowed cash to juice their returns………………………………………..Full Article: Source

Commodities bulls boosted by oil recovery

Posted on 11 May 2015 by VRS  |  Email |Print

Commodities from copper to iron ore have rebounded, helped by a rising oil price and a weaker US dollar, raising the possibility of investors taking a more positive view on a sector that has suffered years of negative returns. After a poor end to 2014, sentiment has started to improve, helped by a recovery in energy.
The Bloomberg Commodity index, which tracks 22 exchange traded commodities but is weighted towards oil, briefly turned positive for the year on Wednesday as crude approached $60 in the US and $70 in the rest of the world………………………………………..Full Article: Source

RBA expects commodity export prices to stay high

Posted on 11 May 2015 by VRS  |  Email |Print

The outlook for Australia’s commodity exports has been further downgraded by the Reserve Bank but, like Treasury, it still believes prices will remain permanently higher than ever before, even at the peak of the last big boom 40 years ago.
Downgrades in the terms of trade (the ratio of export prices to import prices) will be one of the main sources of revenue writedown in tomorrow’s federal budget, despite Treasury endeavouring to make the estimates included in both last year’s budget and the mid-year budget update published last December more conservative than the market consensus………………………………………..Full Article: Source

Scotiabank’s Commodity Price Index Tumbles in March, but Will Strengthen in April

Posted on 30 April 2015 by VRS  |  Email |Print

After rallying in February, Scotiabank’s Commodity Price Index dropped by 3.7% in March, as oil prices retreated once again. The All Items Index is at its lowest level since January 2007 and is 32.8% below a year earlier.
“The good news is a spring rally has emerged in April, with price gains for oil and base metals,” said Patricia Mohr, Vice President of Economics and Commodity Market Specialist at Scotiabank. “West Texas Intermediate (WTI) oil prices have rallied back over US$57 in late April, as U.S. Department of Energy data indicates that U.S. shale oil production levelled out at about 5.618 million barrels per day (mb/d) in April and may edge down to 5.561 mb/d in May………………………………………..Full Article: Source

Baltic sea freight index down on weak vessel rates

Posted on 30 April 2015 by VRS  |  Email |Print

The Baltic Exchange’s main sea freight index, which tracks rates for ships carrying dry bulk commodities, fell on Wednesday on lower vessel rates. The overall index, which factors in average daily earnings of capesize, panamax, supramax and handysize dry bulk transport vessels, fell six points to 595 points.
The capesize index was up seven points at 558 points. Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, fell $81 to $4,515………………………………………..Full Article: Source

Hedge funds achieve outstanding performance as most indices are in positive territory

Posted on 25 March 2015 by VRS  |  Email |Print

Hedge funds achieved an outstanding performance during last week and were up 1.3%. More than 75% of the funds as well as most hedge funds indices are in positive territory, according to Lyxor Asset Management’s Weekly Briefing. The report said that hedge funds have continued to deliver solid returns in 2015 with the Lyxor HFI up 3.4% year-to-date. The first quarter of 2015 is on track to be the best quarter for hedge funds since Q2-2007 when the Lyxor HFI was up 3.7%.
“CTAs and event driven managers outperformed, both last week and year to date, as a result of the peculiar market environment which continues to see equities and bonds delivering positive returns. Financial markets find themselves in a sweet spot, where economic recovery is supporting consumer confidence but not at such a point that would lead central banks to tighten their monetary policy,” said Philippe Ferreira, Lyxor AM’s head of research, managed account platform………………………………………..Full Article: Source

Taiwan’s commodity price bulletin board to go online soon

Posted on 25 March 2015 by VRS  |  Email |Print

As part of efforts to promote the transparency of data on commodity prices, Taiwan’s Executive Yuan or Cabinet is establishing a commodity price bulletin board that will be put online by the end of the month, Vice Premier Chang San-cheng said Monday.
The planned “Commodity Price Bulletin Platform” will offer viewers information on prices of 60 kinds of vital products and will also have a special page where people can express their opinions and proposals, increasing the opportunities for citizen participation, Chang said during a meeting of the Executive Yuan’s price stabilization panel………………………………………..Full Article: Source

LBMA Gold Price successfully launched

Posted on 23 March 2015 by VRS  |  Email |Print

The LBMA Gold Price has replaced the historic London Gold Fix. The first LBMA Gold Price settled at $1,171.75. ICE Benchmark Administration (IBA) administers the “LBMA Gold Price”. They provide the auction platform, methodology as well as overall independent administration and governance for the LBMA Gold Price. The LBMA holds the intellectual property rights.
The London Gold Fix pricing mechanism has been replaced by a new electronic LBMA price-discovery process from Friday, 20th March 2015. The price continues to be set twice daily (at 10:30 and 15:00 London GMT). The new LBMA Gold Price is operated and administered by an independent third party provider, ICE Benchmark Administration (IBA), who were chosen following consultation with market participants………………………………………..Full Article: Source

Europe’s quantitative easing pushes hedge funds up 2.25% in February

Posted on 19 March 2015 by VRS  |  Email |Print

The European Central Bank’s extension of aid to Greece and its new EUR 1.1tln stimulus package rallied European equity markets, that helped pushed hedge funds to gain 2.2% last month, said data provider BarclayHedge. It added that the quantitative easing also calmed down deflation fears on rising prices for oil and other commodities.
The Barclay Hedge Fund Index was up 2.14% year-to-date. “Risk factors were largely out of the limelight in February,” says Sol Waksman, founder and president of BarclayHedge. All but one of Barclay’s 18 hedge fund indices had gains in February. The Healthcare & Biotechnology Index jumped 4.49%, equity long bias was up 4.02%, the Event Driven Index gained 3.57%, Pacific Rim Equities rose 2.81%, Distressed Securities added 2.18%, and European equities were up 2.09%………………………………………..Full Article: Source

5 Commodities Leading The Price Plunge

Posted on 10 March 2015 by VRS  |  Email |Print

The Bloomberg Commodity Index, which tracks the price of 22 different commodity investments, recently traded at its lowest level since 2002. Stocks of commodity-exposed companies have suffered over the past year, but investors with direct stakes in the commodities themselves have been hit hardest.
Here’s a look at five commodities that have lined the downward-spiral path over the past year. 1. Silver - Silver prices have plummeted as investors anticipate money flowing out of precious metals when the Federal Reserve begins raising interest rates. The iShares Silver Trust (ETF) SLV, -0.59% is down nearly 25 percent in the past year………………………………………..Full Article: Source

Stronger panamaxes drive up Baltic sea freight index

Posted on 06 March 2015 by VRS  |  Email |Print

The Baltic Exchange’s main sea freight index, which tracks rates for ships carrying dry bulk commodities, made minor gains on Thursday on higher rates for the panamax and smaller vessel segments. The overall index, which factors in average daily earnings of capesize, panamax, supramax and handysize vessels, rose two points, or 0.36 percent, to 561 points.
The panamax index was up seven points, or 1.22 percent, at 583 points. Average daily earnings for panamaxes, which usually carry coal or grain cargoes of 60,000 to 70,000 tonnes, were up $54 at $4,669………………………………………..Full Article: Source

Scotiabank Commodity Price Index Hits 8-Year Low

Posted on 24 February 2015 by VRS  |  Email |Print

Scotiabank’s monthly index of commodity prices has plunged to its lowest since January 2007. The bank says global economic conditions are better than during the 2008-09 global downturn, but an extended period of sub-par growth has increased competition and pushed down commodity prices.
Scotiabank says a recent spike in the U.S. dollar against most currencies has also contributed to the decline. The bank’s broadest commodity price index fell to 100.9 points in January, down 8.6 per cent from December and down 27.9 per cent from January 2013………………………………………..Full Article: Source

Intercontinental Exchange to launch new LBMA Gold Price in March

Posted on 20 February 2015 by VRS  |  Email |Print

Intercontinental Exchange, the network of exchanges and clearing houses, has announced that ICE Benchmark Administration (IBA) expects to launch the new LBMA Gold Price, which replaces the long established London Gold Fix, on 20 March 2015.
Finbarr Hutcheson, president, ICE Benchmark Administration said: “Under the administration of IBA, the new LBMA Gold Price will benefit from increased transparency, and the robustness of the data used to calculate the benchmark will give a better representation of the market price. We would like to thank the London Bullion Market Association and the precious metals industry for their work and support in the transition of this globally important benchmark.”……………………………………….Full Article: Source

Bullion Index gains membership of physical-delivery exchange Bullion Capital

Posted on 19 February 2015 by VRS  |  Email |Print

Australian physical bullion firm Bullion Index has been granted a membership with compatriot company Bullion Capital, which operates a membership-based global physical bullion exchange. It also enables Bullion Index to offer the proprietary DMA exchange platform, MetalDesk, to its clients. Bullion Index now gives clients the ability to trade Physical Gold, Silver and Platinum via an intuitive trading platform with access to 18 bullion products over 14 global trading hubs.
Exchange participants are able to trade on live prices for physical precious metal in multiple global locations. Orders are streamed by Bullion Capital’s liquidity providers directly to a displayed central limit order book. All participants have equal access to immediately executable levels and associated sizes, ensuring transparency and fairness………………………………………..Full Article: Source

Baltic Dry Index fall is mainly due to oil, commodity price slump

Posted on 12 February 2015 by VRS  |  Email |Print

The costs of shipping bulk commodities have fallen to a near three-decade low, raising concerns about global economic growth. However, there are a number of elements at play and analysts have warned about reading too much into the slump.
The Baltic Dry Index, a measure of a number of shipping routes and the prices for transporting major bulk commodities, has fallen 29.2 per cent in 2015 to 554 points – the lowest level since 1986. Over the past 12 months it has dropped close to 50 per cent. The World Bank recently downgraded global growth by 20 basis points to 3 per cent for 2015. So it would appear that a drop in the BDI would match the faltering growth narrative in the World Bank’s forecasts………………………………………..Full Article: Source

Baltic Dry Freight Index Plummets Amid Commodities Slump

Posted on 06 February 2015 by VRS  |  Email |Print

The Baltic Dry Index, which tracks freight rates for ships carrying raw materials, has slumped to its lowest point in 29 years, hit by a shipping glut, falling commodity prices and declining import demand from China.
This week, the BDI fell to 577, its lowest level since July 1986, and a far cry from its peak of 11,793 in 2008. The world’s fleet of dry-bulk ships far exceeds demand for the vessels that carry commodities such as iron ore and coal, with capacity estimated around 20% above demand over the past few years………………………………………..Full Article: Source

Commodity prices collapse to lowest in 12 years

Posted on 30 January 2015 by VRS  |  Email |Print

The Bloomberg Commodity index, which tracks the global prices of 22 different commodities such as gold and oil, collapses to lowest level since August 2002. The world’s leading index of commodity prices has slumped to its lowest level in more than 12 years as China slows and America hints at tightening monetary policy.
The Bloomberg Commodity index, which tracks the prices of 22 different commodity prices such as gold, natural gas and oil, fell 0.3pc to 99.84 in early trading, the lowest point since August 2002………………………………………..Full Article: Source

Commodity Shipping Measure Falls to 28-Year Low on China Demand

Posted on 30 January 2015 by VRS  |  Email |Print

A measure of global shipping costs for commodities fell to a 28-year low as slowing growth in China’s demand for cargoes compounds the effect a fleet glut. The Baltic Dry Index plunged 5.1 percent to 632 points, the lowest since Aug. 22, 1986, according to data from the Baltic Exchange in London on Thursday. Freight rates for all the vessel types within the measure declined.
China, the world’s biggest buyer of of coal and iron ore, will increase imports of the two commodities by 6 percent this year, down from a growth rate of 8.7 percent in 2014, according to estimates from Clarkson Plc, the world’s largest shipbroker. The nation’s economic expansion this year will be the slowest since 1990, the average of 67 economists’ forecasts compiled by Bloomberg shows………………………………………..Full Article: Source

Long/short funds top 2014 Lipper commodity league table

Posted on 19 January 2015 by VRS  |  Email |Print

Below are tables of the best and worst performers in the fourth quarter of 2014 and for last year as a whole, among the actively managed commodity funds in the Lipper Global database.
The return performance is calculated in the fund’s local currency. The tables use the latest available data provided to Lipper and strip out enhanced index funds that use a very simple rules-based system of rebalancing, as well as funds that are wholly focused on natural resource equities………………………………………..Full Article: Source

How to Track Gold Price Trends with the Kitco Gold Index

Posted on 13 January 2015 by VRS  |  Email |Print

While gold price trends mostly stem from changes in supply and demand, that’s not the full story. Sometimes the value of the U.S. dollar changes the gold price – and this can cause a misleading view of the true value of gold…
You see, most of us track gold priced in U.S. dollars. As the dollar gains strength, it takes fewer of them to buy the same quantity of gold. The opposite is true when the dollar weakens. Part of the reason gold prices move up or down is they reflect this change in U.S. dollar value. So higher gold prices do not always mean higher demand………………………………………..Full Article: Source

Why Conventional Commodity Indexes Will Likely Disappoint

Posted on 12 December 2014 by VRS  |  Email |Print

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.
In fact, unlike with stocks and bonds, a long-only position in commodity futures is not always expected to provide an excess return above the risk-free rate. To understand why, it helps to think of the commodities futures market as an insurance market, where hedgers and speculators trade risks………………………………………..Full Article: Source

ETFs compared: Broad Commodity Index

Posted on 02 December 2014 by VRS  |  Email |Print

In recent years, the function of diversification and inflation protection has always been attributed to raw materials has been questioned. From 2005 onwards, in fact, the correlation between commodities and traditional asset classes is gradually increased, reaching its peak in 2008. We’ll see if in the coming years will come down to the historical averages, or if the “new normal” (the new normal) has also touched this area.
Meanwhile, the outlook for 2015 remains fairly weak. In general, according to the outlook of the World Bank, next year prices are expected to moderate descent, especially as regards the commodity energentiche and oil in particular. An important element, since the raw materials are energentiche those weighing more generic benchmarks. (Translated)……………………………………….Full Article: Source

Index Funds And ETFs: 5 Ways To Shop Smart

Posted on 18 November 2014 by VRS  |  Email |Print

From 2007 through 2013, domestic equity index mutual funds and ETFs received $795 billion in cumulative net new cash and reinvested dividends, as many investors were drawn to passive investment strategies.
A big part of the allure of passive investments is their relatively low cost. Rather than attempting to beat the market through active stock picking, these passive strategies try to match the performance of the market or a part of it, based on an index, for instance the S&P. These investments may not offer the potential of outperformance, but they typically offer lower costs…………………………………Full Article: Source

Commodities slide continues in October: RBA

Posted on 04 November 2014 by VRS  |  Email |Print

After another fall in October, commodity prices would now have to rise by 61 per cent to get back to their mid-2011 peak. The RBA’s index of export commodity prices, measured against a basket of foreign currencies, fell by 1.4 per cent in October.
Falls in the prices of iron ore and oil lay behind the latest fall, the RBA said, although the data released by the central bank on Monday showed base metals prices also headed down, losing 1.8 per cent in the month………………………………………..Full Article: Source

Pain looms for commodity index investors as oil contango nears

Posted on 28 October 2014 by VRS  |  Email |Print

After a months-long battering from tumbling crude prices, commodity index investors may soon have another reason to consider leaving the oil market: contango.
For the first time since January, the U.S. West Texas Intermediate (WTI) crude oil futures market is poised to flip into contango, a structure in which prompt prices are below longer-dated contracts, typically signaling a weaker market. Outright oil prices have already tumbled about 25 percent since summer………………………………………..Full Article: Source

Scotiabank’s commodity index falls sharply in August

Posted on 30 September 2014 by VRS  |  Email |Print

Scotiabank’s monthly commodity price index lost ground in August, dropping 5.4 per cent from July in a broad-based decline. Four of Scotiabank’s commodity subindexes fell, with the biggest declines in the oil and gas sector as well as in agriculture.
Forestry was the only subindex to show an increase between July and August while mining and metals was down slightly. Scotiabank says international oil prices have been pulling back since June because of less concern about the risks to oil supplies from Iraq and Libya………………………………………..Full Article: Source

Panic as commodity index plunges

Posted on 23 September 2014 by VRS  |  Email |Print

“An unbiased, major barometer of commodity prices,” is how Thomson Reuters describes its CRB Continuous Commodity Index. And that’s why it’s so important. But the equally-weighted index is falling fast and last week plunged through major support levels.
Just weeks before, the 57 year-old index confirmed what is referred to by technical analysts as a “death cross” - it’s when the 50-day moving average crosses under the 200-day moving average, and is often taken to indicate a bear market………………………………………..Full Article: Source

Commodities index tumbles to five-year low

Posted on 15 September 2014 by VRS  |  Email |Print

One of the world’s leading indices for commodities has dropped to its lowest level in five years, casting doubt over renewed investor interest in the sector. After a record year of net withdrawals in 2013, sentiment towards commodities has started to improve this year helped by strong returns and declining correlations with other assets classes.
The Bloomberg Commodity Index, which reflects the prices of 20 commodities and is tracked by billions of dollars of investor assets, delivered total returns of 7.1 per cent in the six months to June, outpacing US equities and high yield corporate bonds………………………………………..Full Article: Source

Commodities Fall to 5-Year Low With Plenty of Supplies

Posted on 12 September 2014 by VRS  |  Email |Print

Commodities fell to a five-year low on speculation abundant supplies and slowing economic growth outside of the U.S. will curb demand for raw materials. The Bloomberg Commodity Index declined to the lowest since July 2009. Brent oil traded at the cheapest since 2012, wheat, corn and soybeans retreated to four-year lows, and gold slumped to a seven-month low.
Weak economic growth in Europe and Japan is leading to lower energy prices and interest rates in the U.S. at a time when the U.S. corn crop is a record high and U.S. oil production is poised to be the most in 45 years………………………………………..Full Article: Source

Commodity prices slip on waning global appetite

Posted on 12 September 2014 by VRS  |  Email |Print

Commodity prices are falling, the second time around in 2014. In the current quarter, till date, the Thomson Reuters CRB Commodity Index, a broad indicator, has declined by 7.7%. A similar indicator, the S&P GSCI Index, has fallen by 10.4%. What has contributed to this fall? Food prices are a reason. On Thursday, the UN’s Food and Agriculture Organization said its food price index fell to 196.6 points in August, a level last seen in September 2010.
The index fell by 3.6% over July. Surplus conditions in commodities such as cereals (except rice), dairy products, sugar and oils have contributed to this decline. Crude prices have seen a sharp decline in recent months, with Brent crude prices down by 12.7% in a three-month period. The Dow Jones Commodity Index–Energy has declined by 12.3% in this period. Coal prices also continue to decline, though the degree is lower as they have been falling for a much longer period………………………………………..Full Article: Source

Commodities Drop to Lowest Since January as Dollar Climbs

Posted on 10 September 2014 by VRS  |  Email |Print

Commodities declined to the lowest in almost eight months as the dollar advanced on speculation that the Federal Reserve will increase interest rates next year, curbing demand for raw materials. The Bloomberg Commodity Index (BCOM) that tracks 22 futures lost as much as 0.7% to 123.4334, the lowest since Jan. 10 and settled at 123.4755 in New York. Nickel tumbled the most since May, corn traded at a four-year low and Brent crude dropped to the lowest in 17 months.
The dollar, as measured by the Bloomberg spot index that tracks the greenback against 10 peers, climbed to a 14-month high before U.S. data this week forecast to show jobless claims fell and retail sales improved. Fed policy makers will meet on Sept. 16-17. Advances in the greenback make dollar-priced commodities more expensive in terms of other currencies………………………………………..Full Article: Source

Commodity Prices Inch Down in July: Scotiabank

Posted on 28 August 2014 by VRS  |  Email |Print

Scotiabank’s Commodity Price Index edged down by 0.3% month-over-month (m/m) in July, as oil prices lost momentum, partly due to an easing of concern over geopolitical supply risks in Libya and Iraq. “On a more positive note, a cyclical recovery in base metal prices is getting underway, with dramatically higher zinc and nickel prices expected in 2015,” said Patricia Mohr, Scotiabank’s Vice President of Economics and Commodity Market Specialist.
“Zinc led a strong rally in base metals in July, climbing from US$0.96 per pound to almost US$1.05 — an increase of 17% since late 2013. Commodity funds and investors have bid up zinc prices, anticipating tightening supplies over the next three to four years — with mine supplies not keeping pace with demand growth. In our view, zinc prices will climb to US$1.25 in 2015 and a very lucrative US$1.60-1.70 in 2016………………………………………..Full Article: Source

Commodities Rally Is Half-Baked

Posted on 26 August 2014 by VRS  |  Email |Print

It all started so well: a surprise drop in Treasury yields, expectations of accelerating economic recovery, and more than a dash of geopolitical turmoil. Yes, 2014 was shaping up to be a good year for commodities. And indeed, the first half was more than acceptable. At 7.1%, the recently renamed Bloomberg Commodity Index (formerly the Dow Jones- UBS index) had its best six-month period since the latter half of 2010 and its best first half since that of 2008, when the supercycle’s ascent seemed unstoppable.
Fast forward all of eight weeks and the good times are over. Commodities as a whole are now in negative territory for the year. Their lead over the S&P 500 has flipped to an 8.5 percentage point disadvantage. And while August may traditionally be a month of thin trading, there is good reason to think summer will set the tone for the rest of the year………………………………………..Full Article: Source

Commodity Index Turns Negative On The Year As S&P 500 Breaks 2,000

Posted on 26 August 2014 by VRS  |  Email |Print

One of the main commodity indexes, the Bloomberg Commodity Index is in the red for the first time year-to-date as equity markets post record highs, analysts said.
The Bloomberg Commodity index, formerly known as the DJ-UBS commodity index, is down only about 0.25% year-to-date, but this comes “after commodities outperformed all other global asset markets during the first half of 2014 for their strongest start to a calendar year since 2008,” said analysts at Citi Research………………………………………..Full Article: Source

Commodities: Time To Catch A Falling Knife?

Posted on 19 August 2014 by VRS  |  Email |Print

The PowerShares DB Commodity Index has been a little soft over the past seven weeks, losing around 7% in price (-2% YTD) while the S&P 500 has been flat. The top chart is the TR Continuous Index, which finds itself testing dual support — one of which is a 14-year rising support line.
This index has been soft for the past four years while the stock market has continued to rally. In the big picture, what happens here could be very important for commodities’ overall direction in the months to come………………………………………..Full Article: Source

NZ commodity prices fall for fifth straight month, led by milk powder

Posted on 04 August 2014 by VRS  |  Email |Print

New Zealand commodity prices fell for a fifth straight month in July, led by whole milk powder, reflecting a build-up of inventory in China and a strong milk production season for dairy farmers. The ANZ Commodity Price Index declined 2.4 last month and is now 9.8 percent below its February peak, while milk powder tumbled 12 percent and dairy product prices fell more broadly.
The slide in global dairy prices this year prompted Fonterra Cooperative Group to slash its forecast farmgate milk payout for 2015 to $6 a kilogram of milk solids, from an initial estimate of $7/kgMS. It also attributed the decline in dairy prices to a build-up of inventory in China but expressed some confidence that prices would recover at some stage. Westland Milk Products cut its forecast payout two days later………………………………………..Full Article: Source

Commodities Cap Biggest Monthly Decline Since May 2012

Posted on 01 August 2014 by VRS  |  Email |Print

Commodities had the worst monthly performance in more than two years, led by losses for crops including soybeans and wheat on signs of bigger supplies. The Bloomberg Commodity Index of 22 raw materials fell 5 percent in July to 127.91, the biggest loss since May 2012. Corn had the largest drop since 2011, and cotton posted for the longest losing streak in three years.
The U.S. Department of Agriculture raised its estimates on global stockpiles for cotton, corn, soybeans last month, signaling a growing glut. Bigger crops are helping to keep world food inflation in check, with the United Nations reporting a third monthly drop for prices in June………………………………………..Full Article: Source

Commodity Prices Edge Down in June: Scotiabank

Posted on 30 July 2014 by VRS  |  Email |Print

Scotiabank’s Commodity Price Index inched down by 0.7% month-over-month (m/m) in June, but has climbed 8.9% from last December’s low — led by stronger oil and gas prices. “The Metal and Mineral sub-Index retreated in June, but will rally sharply in July amid a spurt in base metal prices and steadier gold prices,” said Patricia Mohr, Scotiabank’s Vice President of Economics and Commodity Market Specialist.
“Exuberance over a moderate pick-up in China’s economy in the second quarter partly accounts for the recent surge in investor interest in base metals, as does a second year of record global auto production, with strength in China (+9.7% YTD), North America (+4.3%) as well as Germany and Spain (+7.9% — the two biggest auto manufacturers in Western Europe).” (Press Release)

S&P Dow Jones goes equal weight on commodity index

Posted on 08 July 2014 by VRS  |  Email |Print

S&PDJI moves DJ-UBS commodity index to equal weighting; Nasdaq partners with ETRE Financial for Reit indexes; Six launches new sustainability index; Stoxx licenses minimum variance to Japan’s Resona Bank.
S&P Dow Jones Indices has launched a broad-based commodity index, the Dow Jones Commodity Index (DJCI), hot on the heels of the expiration of its licensing agreement for the DJ-UBS Commodity Index (DJ-UBS). The DJCI includes 23 of the commodities included in the world production-weighted S&P GSCI, but it weights each of the three major sectors - energy, metals, agriculture and livestock - equally. Individual commodities are weighted by relative liquidity based on the five-year average total dollar value traded……………………………………..Full Article: Source

RBA commodity price index at 4 year low

Posted on 02 July 2014 by VRS  |  Email |Print

The prices of Australia’s export commodities headed lower in June for the sixth month in a row. That left the RBA’s commodity price index, in foreign currency terms, at its lowest level since March 2010, and 32 per cent below its July 2011 peak.
The biggest contributor to the 1.8 per cent fall in June, a repeat of the decline in May, was a drop in the price of iron ore, the RBA said. Rural commodity prices also fell, but the price of base metals rose………………………………………..Full Article: Source

RBA commodity price index at 4 year low

Posted on 01 July 2014 by VRS  |  Email |Print

The prices of Australia’s export commodities headed lower in June for the sixth month in a row. That left the RBA’s commodity price index, in foreign currency terms, at its lowest level since March 2010, and 32 per cent below its July 2011 peak.
The biggest contributor to the 1.8 per cent fall in June, a repeat of the decline in May, was a drop in the price of iron ore, the RBA said. Rural commodity prices also fell, but the price of base metals rose. The RBA’s price index is based on preliminary estimates of prices received for bulk commodities in recent months………………………………………..Full Article: Source

Expansion into the commodities world: Bloomberg

Posted on 25 June 2014 by VRS  |  Email |Print

From lean hogs to gold, the world of commodities is as vast as the world around us. On July 1, Bloomberg will take control of UBS’s leading commodity index, a diversified index that provides investors with exposure to the most widely followed commodities in the world. The index will be renamed from the “Dow Jones-UBS Commodity Index” to the “Bloomberg Commodity Index”.
With Bloomberg assuming management of the index, investors can now have broad commodity exposure with an index that is governed, calculated, distributed and licensed by the world’s leading provider of financial data………………………………………..Full Article: Source

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