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Commodities Briefing - Category | Investment more

Is Natural Gas the New Gold?

Posted on 28 August 2015 by VRS  |  Email |Print

When the market is shaky, seek safety in … natural gas. Wait – what? Citigroup Inc. is touting natural gas – a commodity so notorious for volatility that its most renown bet is called the “widow maker” – as a possible haven for investors weary of the market’s wild swings.
A sluggish global economy, a staggering China and plummeting oil prices have sent commodity, currency and stock markets spiraling this summer. But they mean very little for U.S. gas futures, which have been stable for more than two months and even briefly entered a bull market in the late spring………………………………………..Full Article: Source

Is gold back to being a safe haven?

Posted on 28 August 2015 by VRS  |  Email |Print

Gold prices have increased in August, recovering from a lacklustre performance over the last few years, after market volatility ramped up. While gold hasn’t been rising in tough periods as many investors would expect, it does appear that investors have been buying into the commodity this month, following a positive 3.35 per cent return from the S&P GSCI Gold Spot index.
The obvious guess as to why this is the case is the global volatility we have experienced in recent months. This came to a head on Monday, when the FTSE 100 had £74bn wiped off its value, the Dow Jones ended the day down 558 points and the Shanghai Composite dropped by 8.5 per cent………………………………………..Full Article: Source

Alternative investments: Helping investors weather the current market storm

Posted on 28 August 2015 by VRS  |  Email |Print

The recent sharp sell-off in global equity markets has focused investors on the importance of holding diversifying investments that can help mitigate volatility and potentially cushion their portfolios during times of market stress. Given their unique nature, alternative investments are proving to be useful tools to help investors weather the current market storm.
As the chart1 below illustrates, a basket of alternatives — based on Invesco’s alternatives framework as explained in my previous blog post How to approach the alternative investments puzzle — has historically delivered equity-like returns with low levels of volatility (as measured by standard deviation) and lower maximum……………………………………….Full Article: Source

Why gold was the best buy in 2008-9 crash and will be this time too

Posted on 27 August 2015 by VRS  |  Email |Print

What was the best asset class to buy for the recovery that followed the 2008-9 crash in global financial markets? Step forward gold whose rise was only exceeded by silver. Precious metals not only delivered the fastest recovery from that huge sell-off but offered increases way above the pre-crash levels.
Gold tripled from its low in the crash, while silver went on to record an eight-fold increase, still just shy of its 1980 all-time high. It is not hard to see history repeating itself all over again. Just look at the Chinese central bank this week cutting interest rates, just like the Fed had to do in 2008-9………………………………………..Full Article: Source

Gold Outlook – Not a Safe Haven Anymore?

Posted on 26 August 2015 by VRS  |  Email |Print

Gold rallied from the July lows of $1077 to test the $1167 level. Gold is believed to be a safe haven where investors put their money during periods of economic uncertainty. During the last economic recession, gold price rallied to over $1920. Unfortunately, this level has been the highest price since 2011.
The introduction of Quantitative Easing by the FED in order to stimulate the economy has eventually put gold in a bear market. The market is anticipating a rate hike from the FED as early as September. This is bad news for gold bulls because it will have a negative impact on the price of gold. This means that gold prices are more likely to go lower than we saw in July………………………………………..Full Article: Source

Commodity Hedge Funds Lose Most in Three Years as Rout Deepens

Posted on 25 August 2015 by VRS  |  Email |Print

Hedge funds betting on commodities lost the most in almost three years in July as the price-rout deepened. Funds lost money for a third month, according to the Newedge Commodity Trading Index, which was released to investors Friday and tracks the performance of raw-material trading strategies including equities and physical products.
The 1.3 percent decline was the most since October 2012 and the index is down 2.4 percent this year. A slide in everything from oil to metals pushed commodity prices down the most since 2011 in July. Managers are losing money and commodity funds at Cargill Inc. to Armajaro Asset Management LLP closed this year as China’s slowing economy adds to the global glut in most raw materials. Glencore Plc shares are at a record low, and oil and copper prices dropped to the lowest in six years………………………………………..Full Article: Source

What risks does the commodities slump pose for income investors?

Posted on 21 August 2015 by VRS  |  Email |Print

Eric Moore, manager of the Miton Income fund, looks at how major resources companies are responding to price falls. Some of the biggest changes in global markets over the last 12 months have come in commodity markets. Compared to a year ago, gold is down 15%, copper is down over 25%, sugar is down by a third, iron ore is down over 45% and the oil price has halved. These are massive moves, which have equally massive implications for equity investors.
For starters, ‘Dr Copper’ and his fellows are suggesting all is not well with aggregate demand, which does not chime with an equity market that remains keen to anticipate a sustained recovery………………………………………..Full Article: Source

Climate philanthropist George Soros invests millions in coal

Posted on 20 August 2015 by VRS  |  Email |Print

Billionaire has previously funded renewable energy and low-carbon initiatives and has called coal a ‘lethal bullet’ for climate change. Billionaire climate philanthropist George Soros invested more than $2m (£1.3m) in struggling coal giants Peabody Energy and Arch Coal in recent months, despite having once called the fuel “lethal” to the climate.
Filings with the Securities and Exchange commission show that between April and June this year Soros Fund Management (SFM) bought more than 1m shares in Peabody ($2.25m), the world’s largest private coal company, and 500,000 shares in Arch ($188,000)………………………………………..Full Article: Source

Commodities investors adapt, but don’t add allocations - Pimco

Posted on 19 August 2015 by VRS  |  Email |Print

Commodities investors are altering their exposure to the asset class following the recent price declines, but aren’t boosting allocations and don’t look likely to for now, a senior executive at Pimco told Metal Bulletin. Nicholas Johnson, an executive vp and portfolio manager focusing on commodities and multi-asset portfolios, said that investors were trying to change their exposure “at the margins.” “Some investors are saying they are exposed to too much volatility and would prefer a lower volatility.
“We see some interest from investors to mix their commodity beta – so investment in the S&P Goldman Sachs Commodity Index, and a commodity hedge fund,” he said. “The idea of this is that the investor will have some commodity beta but they also have some absolute return, so together they lower volatility and they probably have a little better return expectation. We do see some people who were all beta before now going to a mix of beta and hedge funds,” he noted………………………………………..Full Article: Source

China Devaluation Sparks Gold Buying Everywhere - Except China

Posted on 19 August 2015 by VRS  |  Email |Print

After last week’s surprise yuan devaluation investors everywhere were eager to buy gold as a haven. Everywhere, that is, except in China. Huaan Yifu Gold ETF, the bullion exchange-traded product with the biggest volume in China over the past month, posted a third straight weekly outflow as of Aug. 14. The withdrawal came even as global ETPs posted the first increase of assets since late June. Holdings in the Chinese fund are heading for the first monthly loss since April.
Gold prices in New York have climbed about 1 percent since Aug. 10, the day before China carried out its first major devaluation of the yuan since 1994 in a bid to promote domestic economic growth. While the currency move spurred some investors to seek shelter from volatility across equity and commodity markets, it also shored up confidence among Chinese buyers, dimming the haven appeal of precious metals in the nation………………………………………..Full Article: Source

Investors need positive commodities news to lure them back

Posted on 14 August 2015 by VRS  |  Email |Print

Investors will need to see some positive news in the commodity markets before they return to the asset class, the ceo of Tiberius Asset Management AG said. According to Christoph Eibl, who founded the company in 2005, about 90% of its investors have reduced their commodities exposure or left the space altogether in the past few years since 2011.
“When a client has to report its eighth quarter in a row of a decline in commodities prices at its quarterly investment meetings, there is eventually a question as to why it is invested in that asset class. There are certain points when you don’t want to hear that question any more, and you sell,” he said………………………………………..Full Article: Source

Best time to save and invest as gold price drops

Posted on 14 August 2015 by VRS  |  Email |Print

The price of gold dropped in the past week in what is considered the sharpest drop in the past 16 years. Financial analysts consider this development as a result of the crisis in the European Union. However, this is also considered a great period for personal savings and investments, as well as increased competition among gold shops. Media reports confirm that gold prices are not expected to drop bellow $1,000 an ounce.
Abdullah Al-Ammari, the CEO of Salim Hassan Al-Amari and his brother’s company, said that the local market has witnessed an increase in demand for 50 and 200 grams gold bullions. He noted that the drop in prices is a great opportunity to make savings as an investment………………………………………..Full Article: Source

Investors Should Hold Onto Gold Despite Expected Fed Rate Hike

Posted on 14 August 2015 by VRS  |  Email |Print

Gold seems to be falling out of favor with investors amid a looming rise in return on US debt as the US Federal Reserve is expected to announce an increase in its federal funds rate; however, the Head of Commodity Research at Germany’s Commerzbank has advised investors to hold on to the precious metal rather than sell it.
Gold seems to have fallen out of favor with investors as US Federal Reserve Chair Janet Yellen is expected to raise rates at its next policy meeting in September on the back of an improving American economy, boosting the dollar………………………………………..Full Article: Source

Commodities Investors Get Relief After July’s Drubbing

Posted on 11 August 2015 by VRS  |  Email |Print

Commodity bulls are finally getting some relief after suffering through the worst price plunge in almost four years. The Bloomberg Commodity Index that tracks 22 raw materials had its biggest gain since February on Monday amid increased Chinese crude-oil imports, supply disruptions at copper mines and worsening crop conditions for corn.
The gauge last month had its worst performance since September 2011 amid a stronger U.S. dollar, expanding gluts in many raw materials and signs of a slowing economy in China. Money managers cut their net-long positions in commodities by 67 percent in the past year, according to U.S. government data released Friday………………………………………..Full Article: Source

Falling commodity prices draw speculators and speculation

Posted on 11 August 2015 by VRS  |  Email |Print

The beauty of falling commodity prices is in the eye of the beholder as investors wrestle with whether to invest into the slide or invest in some kind of defensive strategy. Even with crude oil now hovering around $45 a barrel, there is debate over whether it is time to buy or steer clear of the global commodity.
One thing that is certain: Commodity, energy and precious metals have been among the worst-performing categories this year. Commodity broad basket mutual funds, as tracked by Morningstar Inc., are down 13.7% this year; natural resource funds are down 11.6%; equity limited partnership funds are down 15.5%; and equity precious metals funds are down 23.5%………………………………………..Full Article: Source

Barron’s: Time to Buy Commodities, Market Is Oversold

Posted on 11 August 2015 by VRS  |  Email |Print

With commodities indices hitting 13-year lows last week, now must be time to exit the asset class with both feet running, right? Quite the contrary, says Barron’s columnist Andrew Bary. “It’s time to consider commodities,” he writes.
“While the Standard & Poor’s 500, Nasdaq Composite, and other key equity indexes are near record levels, commodity stocks, including energy shares, are way below their peaks. Commodities are probably the most out-of-favor industry group in the stock market.”……………………………………….Full Article: Source

Oil speculators move in, but price slide continues

Posted on 11 August 2015 by VRS  |  Email |Print

Speculators increased bullish bets for the first time in seven weeks, a move that came too early in a market that continues to slide. Money managers’ net-long position in crude climbed 13 percent in the week ended Aug. 4, U.S. Commodity Futures Trading Commission data show. That’s a rebound from last week’s figure, which was the lowest level since 2010.
Major oil companies are preparing for a longer downturn and banks including Societe Generale SA are reducing their price forecasts as crude approaches a six-year low. The plunge has gathered strength as U.S. producers return drilling rigs to service and Iran seeks to increase exports after last month’s nuclear agreement with world powers………………………………………..Full Article: Source

Gold isn’t a safe haven any more

Posted on 10 August 2015 by VRS  |  Email |Print

Something strange is happening within the gold market. It used to be the first place investors rushed to in a crisis, but that’s changing. An analyst note from Barclays shows investors pulled money from financial derivatives based on the gold price, even as the Greek debt crisis reached its peak in June.
Barclays said $480 million (£310 million) was pulled from the market that month, putting total outflows in the past two months at over $1 billion (£640 million). “There are limited signs of safe-haven demand for gold,” said Barclays. “Since September 2014, gold has underperformed other haven assets such as bunds and US Treasuries.”……………………………………….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

6 Investments Suffering in Commodities Rout

Posted on 07 August 2015 by VRS  |  Email |Print

Factors have been conspiring to take the commodities market on a stiff ride—downwards. Nervous investors have watched everything from oil and natural gas to sugar, industrial metals and even precious metals plunge, with some items hitting price levels not seen in more than a decade.
Oil, of course, has been in the headlines for months as its price has moved downward, but there’s plenty of other turmoil bedeviling investors. Some of the downward pressure has come from the possibility—or threat—of the Fed raising interest rates at long last, which would boost the dollar against gold. But there are other forces at work, too. A slowing economy in China has lessened demand for raw materials, but it’s not just China—and it’s not just the slowing economy………………………………………..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

Poor commodities: An asset without a central bank backer

Posted on 05 August 2015 by VRS  |  Email |Print

Commodity investors stung by the four-year bear market made one simple mistake: investing in an asset class not backed by a central bank. Whereas equities and bonds have benefited from very meaningful support, direct and indirect, from central bank asset-purchase programs, commodities have not.
That may or may not be good policy; certainly you can argue that the current downdraft in commodities prices reflects a singular lack of inflation risk in the global economy. That might argue for more quantitative easing, but given that what we’ve had so far has neither generated much inflation or kindled demand for raw materials, it would be hard to be too sure that more central bank buying of financial assets would help commodities prices………………………………………..Full Article: Source

How to invest in resources while commodities crash

Posted on 04 August 2015 by VRS  |  Email |Print

There is quite a dichotomy in the markets these days as the S&P 500 has been flirting with its all-time high while commodities prices have reached near-decade lows by falling back to 2008 financial crisis levels. And the spread between the two is getting worse.
U.S. equity markets have benefited from investor interest in tech giants such as Google Inc., Apple Inc., Amazon.com Inc. and Facebook Inc., with some of these names rocketing more than 20 per cent in the past month alone due to better-than-expected quarterly results. By comparison, the S&P GSCI index, which measures a basket of 24 commodities, lost 13 per cent of its value in July………………………………………..Full Article: Source

Oil-and-Gas Debt Deals Sting Investors

Posted on 04 August 2015 by VRS  |  Email |Print

Funds face paper losses on substantial investments this year in exploration-and-production companies. It is shaping up as a cruel summer for debt investors wagering on a rebound in the oil-and-gas business.
Funds managed by Franklin Resources Inc., Blackstone Group LP and Oaktree Capital Group LLC, among others, are facing paper losses on substantial investments this year in exploration-and-production companies. The sector is coming under further pressure as oil prices have turned downward again, dropping below $46 a barrel in New York to a four-month low………………………………………..Full Article: Source

Why gold has lost its shine for investors

Posted on 04 August 2015 by VRS  |  Email |Print

The observation that gold has been a disappointing investment of late should come as no surprise to anyone in the investment world. The fact that this has occurred in the context of developments that would normally push gold prices higher is notable. But the most consequential hypothesis of all is that gold may be losing its traditional role in a diversified investment portfolio.
To say that gold has underwhelmed investors the past couple of years is an understatement. It did not participate in the surge upwards in nearly all financial asset prices; and it has not provided protection in the more recent downturn in risk markets………………………………………..Full Article: Source

Don’t enter commodities market for quick bucks: Sebi to investors

Posted on 03 August 2015 by VRS  |  Email |Print

Ready to regulate commodity trading, Sebi has cautioned small investors against entering this market for quick gains through speculation, which is “risky” and requires a lot of technical expertise. “People will come and tell you that with a small margin, you can make a lot of money. Do not fall into the trap,” Sebi Chairman U K Sinha said.
He asserted that the capital markets watchdog was fully prepared to begin regulating commodities trading and all necessary safeguards would be put in place to keep scamsters and manipulators at bay. Sebi, which expects the merger of commodities market regulator FMC with it to be completed by next month, will soon put in place a new set of regulations for this segment and the restrictions, including for trading lot sizes, would also be implemented to ensure safety of small investors………………………………………..Full Article: Source

Investors Are Far From Sold on Gold

Posted on 03 August 2015 by VRS  |  Email |Print

To understand the stock market, check out the gold market. The two tell a lot about each other. People buy gold when they are afraid of the future. They buy stocks at the opposite time, when they are hopeful. Today, despite worries about China, Greece, a likely Federal Reserve interest-rate increase and an uncertain corporate-earnings outlook, the gold market is giving a clear signal: Investors, on the whole, aren’t very frightened.
The last time gold hit a record, after controlling for inflation, was 1980. It has never been back in inflation-adjusted terms and, at Friday’s close, was 57% below its 1980 peak. The Dow Jones Industrial Average, also adjusted for inflation, last hit a record on May 19. At Friday’s close it was 3.7% off that level………………………………………..Full Article: Source

No need to rush to buy gold or silver just yet

Posted on 03 August 2015 by VRS  |  Email |Print

Gold prices are at a five-year low. However, experts feel investors should wait and watch as prices could slide further. Analysts feel this is not the time to go bottom fishing. Global gold pric es touched a 5-year low of $1,090 per troy ounce (31.1 gram) on July 22, down more than 42% from the all-time peak of $1,900 in September 2011.
Though prices bounced back a bit the next day , experts feel more pain is in store. The metal is trading very close to the support level of $1,080. If it falls below $1,080, prices could recede by another 4-8% in the international market. “If the $1,080 support is broken, the next major supports are $1,040 and $990,” says C.P. Krishnan, Whole Time Director, Geojit Comtrade………………………………………..Full Article: Source

Is it Time to Buy Commodities?

Posted on 31 July 2015 by VRS  |  Email |Print

A quick glance at recent headlines would lead a reasonable person to assume that this year’s big losers are Greek and Chinese stocks . Yet, despite all the furor in the news , the Athens Stock Exchange is down less than 5 percent year-to-date, while the Shanghai Composite remains up more than 10 percent, according to Bloomberg data.
The real damage has been in the commodity complex. Through late July, year-to-date crude oil prices were down around 10 percent, platinum prices were off nearly 20 percent and coffee prices were down almost 30 percent, Bloomberg data shows. Based on the Bloomberg Commodity Index of 22 commodities, the overall complex is now trading at a 13-year low. Several factors account for the sell-off………………………………………..Full Article: Source

Is Now the Time to Invest in Agriculture?

Posted on 31 July 2015 by VRS  |  Email |Print

Do today’s agricultural equity opportunities offer a parallel to the bull market of 2010? During the last significant El Niño cycle in 2010, Chicago corn futures rallied 78%.
We are currently living in an exciting time for the agricultural equity market that has yet to be widely recognised by investors. In particular, we do not believe the market has adequately discounted the potential impact of El Niño – a band of warm air that comes off the ocean, which can cause tropical storms – on agricultural commodity prices and what it could mean for upstream producers………………………………………..Full Article: Source

Get ready to cash in on the bottom for commodities

Posted on 30 July 2015 by VRS  |  Email |Print

A five-day rout was put to rest yesterday, with a 1% gain for the S&P 500 and other indexes. Dead-cat bounce? The Federal Reserve may chart out the fortunes for this market, depending on what’s in its statement later. Investors will comb through the Fed’s words for clues to a September hike, though they may get fewer hints than they’re hoping for.
But they may stay away from Internet stocks, after Twitter’s earnings call got messy and Yelp disappointed. Can Facebook rally the sector with results later? The pressure is on, as those shares have run up 15% in the last three months. At least the social-media group now has a what-not-to-say-at-your-conference-call blueprint to work off. Here’s what to expect from Facebook………………………………………..Full Article: Source

Investors fret over falling commodities

Posted on 29 July 2015 by VRS  |  Email |Print

Investors’ expectations are for more falls in commodity prices amid worries about the Chinese economy and interest rates. Speculators have confirmed what everyone else has been thinking: expect more falls in commodities, as worries about China and higher interest rates combine with waning sentiment to suggest markets are heading further south.
But while more losses are certain, their scope could be limited because many speculators have already made bets that prices will fall. Commodities from iron ore, to oil, grains and gold have shed value as the current extended price boom or “super-cycle” wanes………………………………………..Full Article: Source

Speculators show global commodities rout still not over

Posted on 28 July 2015 by VRS  |  Email |Print

Speculators have confirmed what everyone else has been thinking: expect more falls in commodities, as worries about China and higher interest rates combine with waning sentiment to suggest markets are heading further south. But while more losses are certain, their scope could be limited because a large number of speculators have already made bets that prices will fall.
Commodities from iron ore, to oil, grains and gold have shed value as the current extended price boom, or “super-cycle”, wanes. Losses are not new, with oil and gold having peaked in July 2008 and September 2011 respectively, while iron ore has been on a downtrend since January 2011 and has shed more than 70 percent since that time………………………………………..Full Article: Source

As Oil Prices Slide Investors Prepare To Buy

Posted on 28 July 2015 by VRS  |  Email |Print

Unless you’ve been living in a cave for the past year, you know that the price of crude oil has plummeted. At under $50 per barrel (WTI Crude), gas prices are lower, it’s cheaper to transport goods, and there are a host of other benefits. However, lower oil has also created a few problems. In this article, we’ll explore some of each and discuss a great investment opportunity emerging as a result.
Oil, fossil fuel, crude, whatever moniker you prefer, is highly ingrained in the fabric of our society. Until such time as a less expensive, more efficient, and abundant energy source is identified, oil should continue its dominance………………………………………..Full Article: Source

Oil Bulls Flee at Fastest Pace in Three Years as Glut Expands

Posted on 27 July 2015 by VRS  |  Email |Print

Speculators’ conviction that oil will rally weakened at the fastest pace in three years, just before futures tumbled into a bear market. The net-long position in West Texas Intermediate contracted 28 percent in the seven days ended July 21, U.S. Commodity Futures Trading Commission data show. Long positions dropped to a two-year low while short holdings climbed 25 percent.
Oil traded in New York fell more than 20 percent from its June high, meeting the common definition of a bear market. U.S. output has held near a four-decade high while the largest OPEC members pump at record rates, keeping the market oversupplied. The drop was part of a broader retreat in commodity prices to a 13-year low, driven by concern that slower economic growth in China and a stronger dollar will hurt demand………………………………………..Full Article: Source

Investors dump commodities for the second half

Posted on 24 July 2015 by VRS  |  Email |Print

Oil and metal prices have faced a beating this year, with fresh data showing investors have been offloading commodities in the last quarter on fears that interest rate hikes later in the year will toss up even more market volatility.
Data from UBS shows investors dumped holdings in global energy Exchange Traded Funds (ETFs) by some 50 percent in the last three months, as the market prepares for a U.S. Federal Reserve rate rise later in the year………………………………………..Full Article: Source

Investors pulling back as gold prices plunge

Posted on 24 July 2015 by VRS  |  Email |Print

With gold prices tumbling to a five-year low, investors aren’t just getting out of gold, they’re betting against it. Speculators in July amassed record short holdings in the metal, meaning they’re wagering that the price has further to fall. Also telling, the number of hedge funds that are hoping to profit from declines is near a record high.
Altegris Investments’ $513 million Futures Evolution Strategy Fund has increased its bets that gold will fall. “The only place to be right now is short,” said Lara Magnusen, a La Jolla, California-based portfolio strategist at Altegris. “We’ve been in persistently downward price action for gold, but it’s been exacerbated, certainly, this year by a host of fundamental reasons.”……………………………………….Full Article: Source

An investor’s guide to navigating a commodities roller coaster

Posted on 23 July 2015 by VRS  |  Email |Print

It has been a rough ride for commodities traders so far this year. Prices for many commodities are suffering from sizable losses, but there are ways to help make the road smoother.
Frank Holmes, chief executive officer and chief investment officer at U.S. Global Investors, spoke with MarketWatch recently to offer a few hints on the best ways to navigate the commodity landscape. Holmes, a well-known fund manager, and natural-resources and emerging-markets expert, was in town for the San Francisco Money Show………………………………………..Full Article: Source

Palladium under siege but strong fundamentals may end carnage

Posted on 23 July 2015 by VRS  |  Email |Print

Palladium investors are keeping record bets on a further slump in the market as broad-based weakness plagues the precious metals complex, but some analysts say the metal’s slide to 3 1/2-year lows is overwrought and a supply deficit will help the metal reclaim lost territory.
Spot prices of palladium, mainly used in emissions control systems for cars, trucks and other vehicles, have dropped more than 22 percent this year – the most among precious metals. Gold has fallen 7.6 percent, silver is down 6.1 percent and platinum has tumbled 20 percent. The commodity backlash has been fuelled by the prospect of higher U.S. interest rates, a stronger dollar and weaker Chinese demand. Short positions in palladium futures on the New York Mercantile Exchange have hit all-time highs since June………………………………………..Full Article: Source

Commodities are “in a mess” – pity the investor tied to yo-yo prices

Posted on 22 July 2015 by VRS  |  Email |Print

Worldwide, commodities investors in the primary sector – still struggling after the banking crisis of 2008 and the eurozone quaking that began in 2012 – were faced with the worst performance in precious metals and agricultural products this week. The falls were prompted by a stronger dollar as fears that the Greek debt impasse were irrelevant, and queries over a growth slowdown in China.
The gold price is at its lowest in two years, and this fact and allied falls in other commodities has driven linked equities and hedge funds south – some after years of buoyancy. The Bloomberg Commodities Index dropped to a 13-year low Monday, weaker than after the banking meltdown of 2008 and the euro-zone crisis of 2012. From oil to copper to sugar, little has escaped the rout in the year’s worst-performing asset class………………………………………..Full Article: Source

Investors Flee Commodities

Posted on 21 July 2015 by VRS  |  Email |Print

Prices of raw materials tumble, underscoring an aversion to commodity investments as the Fed prepares to raise rates. The prices of raw materials from oil and gold to copper, cotton and sugar tumbled, underscoring an increasing aversion to commodity investments as the Federal Reserve prepares to raise interest rates for the first time in nearly a decade.
U.S. oil prices dipped below $50 a barrel on Monday during intraday trading for the first time since April, while gold slid 2.2% to its lowest level in five years. The drops extend a retreat from the commodity sector that has picked up speed in recent months. Hedge funds and other investors are holding more bearish than bullish wagers on gold for the first time on record going back to 2006, according to data released Friday by the Commodity Futures Trading Commission. Investors cut their bullish bets on oil to the lowest level since March………………………………………..Full Article: Source

Commodities are crashing to 13-year lows as investors dump gold ahead of Fed rate hike

Posted on 21 July 2015 by VRS  |  Email |Print

The rout in commodities deepened with prices heading for the lowest close since 2002 as the prospect of higher U.S. interest rates sent gold tumbling. Raw materials are losing favour with investors as the dollar gains amid signals from Federal Reserve Chair Janet Yellen that the central bank may raise rates this year on the back of an improving U.S. economy.
Higher borrowing costs curb the attractiveness of commodities such as gold, which doesn’t pay interest or give returns like assets including bonds and equities. The Bloomberg Commodity Index dropped as much as 1.1 per cent, falling for a fifth day in the longest stretch of declines since March………………………………………..Full Article: Source

Gold Leads Commodities ‘Mess’ That Has Many Investors Smarting

Posted on 21 July 2015 by VRS  |  Email |Print

Pity the commodity investor. The Bloomberg Commodities Index dropped to a 13-year low Monday, weaker than after the banking meltdown of 2008 and the euro-zone crisis of 2012. From oil to copper to sugar, little has escaped the rout in the year’s worst-performing asset class.
“Commodities are a mess,” said Walter “Bucky” Hellwig, who helps manage $17 billion at BB&T Wealth Management in Birmingham, Alabama, in a telephone interview. “We are not looking to add to positions.” Gold, the most heavily-weighted commodity in the index, is the latest to get hit hard, socked by a stronger dollar and concern about a slowdown in China………………………………………..Full Article: Source

Rebounding rhodium bests nearly any other investment

Posted on 17 July 2015 by VRS  |  Email |Print

The best asset over the past week is a metal you’ve probably never heard of: rhodium. Rhodium, one of the rarest precious metals, soared 29 per cent in five days, beating every single stock in the MSCI World Index, all currencies and major commodities. While the market for rhodium is tiny and doesn’t trade on an exchange, a fund that holds the physical metal is up 23 per cent since July 9, and shares of producers are climbing.
Low prices are attracting companies that use rhodium for catalytic converters in cars, according to Jonathan Butler, a precious-metals strategist at Mitsubishi Corp. in London. The metal plunged to an 11-year low earlier this month on forecasts that South Africa, the biggest producer, is increasing production at the fastest pace in two decades………………………………………..Full Article: Source

Gold up in Asia as investors eye Greece talks, news on banking sector

Posted on 13 July 2015 by VRS  |  Email |Print

Gold prices gained on Monday in Asia as investors awaited concrete announcements on the status of Greece’s banks and a third bailout program as talks in Europe dragged on through the weekend after some earlier hopes a deal was near.
Gold futures for August delivery on the Comex division of the New York Mercantile Exchange rose 0.34% to $1,161.80 a troy ounce. Also on the Comex, silver futures for September delivery gained 0.47% to $15.608 a troy ounce. Elsewhere in metals trading, copper for September dropped 0.73% at $2.524 a pound………………………………………..Full Article: Source

Miners’ focus shifts from investor returns to survival

Posted on 13 July 2015 by VRS  |  Email |Print

Hit hard by the accelerated downturn in metal prices in recent months, global mining companies preparing to report results are likely to announce another round of austerity measures to cut costs and convince investors to remain committed to the sector. With investors looking for evidence of continued capital discipline while credit ratings and dividends are pressured by a rout in prices for anything from iron ore to platinum, reductions in capital expenditure, operational costs and jobs could all be on the cards.
It comes as little surprise, therefore, that miners have been among the worst performers on London’s FTSE 100 index of blue-chip companies so far this year. The FTSE 350 mining index has fallen by about 15 percent since the start of the year………………………………………..Full Article: Source

Copper Bears Rewarded as Economic Threats Spur Metal Rout

Posted on 13 July 2015 by VRS  |  Email |Print

Investors are hastening their retreat from copper, unnerved by the threats to global economic growth. The metal slumped to a six-year low last week as Greece’s efforts to reach a deal with creditors stumbled and Chinese equities plunged. Europe and China consume about two-thirds of the world’s copper. Goldman Sachs Group Inc. and Societe Generale SA see little prospects of a rebound anytime soon.
Speculators are holding their biggest bearish bet on copper in almost 16 months, with Barclays Plc forecasting that supply will flip from shortages to surpluses from this year. The International Monetary Fund cut its global economic-growth forecast and the Federal Reserve released minutes that showed policy makers saw risks to the economy from the turmoil in Europe and China………………………………………..Full Article: Source

What happened to gold’s safe-haven status?

Posted on 09 July 2015 by VRS  |  Email |Print

Conspicuous by its absence in the commodity market turmoil of the last week has been the reaction in the gold price, say analysts who believe the metal has currently lost its safe-haven status. “One of the interesting developments despite the Greece crisis and China uncertainty has been the failure of any rally in gold prices. In fact, gold prices yesterday (July 7) flirted with their year lows,” said Goldman Sachs in a morning note to clients.
“This is an indication that even in a risk-off environment investors are not seeing gold as a safe-haven and rather prefer parking their money in US and German bonds and the US dollar,” the bank said………………………………………..Full Article: Source

How To Invest When El Niño Comes Around

Posted on 07 July 2015 by VRS  |  Email |Print

This year, El Niño is forecast to upend weather patterns across the world and wreak havoc farmers, especially in regions where access to irrigation is limited. The weather phenomenon is expected to cut down on rainfall in Australian and Southern Asia and create unusually wet weather in parts of South America.
The extreme weather conditions have pushed investors to take a closer look into agriculture investments as the difficult growing conditions could lead to price spikes. Prices of wheat have seen a bump over the past two weeks after worries that El Niño would dry out wheat-producing regions. In Australia, where 14 percent of the world’s wheat exports are grown, dryer than expected weather is forecast to significantly cut down on crop yields………………………………………..Full Article: Source

Metals investors look for miners to cut supplies to lift prices

Posted on 06 July 2015 by VRS  |  Email |Print

Investors in industrial metals will keep a close watch on miners’ results in coming weeks for possible announcements of production cutbacks that could bolster weak prices. “What will be very important over the next few weeks is whether we start to see some supply responses emerging during the corporate results period,” said Nicholas Snowdon, metals analyst at Standard Chartered in London.
Iron ore, aluminium and zinc will get the most attention after a slide in prices that is pressuring the bottom line of some mining groups. “Over the past six months Vale, BHP and Rio have independently suggested either cuts to existing production, holding back sales and/or the slower ramp up of growth volumes,” Citi analyst Heath Jansen said in a note………………………………………..Full Article: Source

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