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Commodities Briefing - Category | Investment more

Why Gold Investors Should Love Central Banks

Posted on 18 March 2016 by VRS  |  Email |Print

After the European Central Bank (ECB) announced new rounds of monetary stimulus last week, gold initially surged upward on the news. It did fall back down on Friday, but there is little question that gold prices were reacting to the news of European monetary policy.
The ECB cut its key interest rate to zero, while going further into negative territory on its bank deposit rate. The deposit rate now stands at -0.4%, meaning that banks will be charged this amount for their deposits held at the central bank. This policy is supposed to encourage banks to lend out deposits to businesses and individuals, instead of holding it as reserves with the central bank………………………………………..Full Article: Source

Investors’ take bullish bets on commodities to record highs

Posted on 16 March 2016 by VRS  |  Email |Print

After some relative calm seen in the price of oil, fund managers are putting some of their money back to work in commodities, new data on Tuesday showed. Global investors added to their allocation of commodities this month, according to a survey carried out by Bank of America Merrill Lynch, which said the jump in exposure to commodities in March was the largest ever on record.
This comes after investors hoarded money in cash at the start of the year amid one of the worst starts to the year on record for equities. While many managers are still technically “underweight” on the commodity benchmarks, bullishness on the sector has dramatically improved in the last month as oil prices have climbed closer to $40 per barrel and iron ore prices have soared………………………………………..Full Article: Source

As oil prices bottom out, investors are increasingly bullish on energy sector

Posted on 16 March 2016 by VRS  |  Email |Print

It was one of the darkest periods of the oil market slump. The global economy was showing fresh signs of slowing, and crude prices were collapsing so steeply that virtually every well in America was unprofitable.
But when Diamondback Energy went out to raise $226 million worth of new stock that week in the middle of January, the oil and gas company found more buyers than it could accommodate. It had to nearly double the amount of shares it sold, to 4 million………………………………………..Full Article: Source

Fund Managers Cut Cash, Buy Commodities and Emerging Markets

Posted on 16 March 2016 by VRS  |  Email |Print

Global fund managers have become more optimistic about financial markets, especially those that have been out of favor such as commodities, including energy, emerging markets and high-yield debt.
According to the Bank of America Merrill Lynch Fund Manager Survey for March, managers have cut cash levels to 5.1% from 5.6% in February — their highest level in more than 14 years — while increasing allocations to industrials, commodities, energy, materials, emerging markets and high yield. The survey records changes in allocations between mid-February and mid-March………………………………………..Full Article: Source

How far can the commodities rally go?

Posted on 09 March 2016 by VRS  |  Email |Print

As is the trend these days, where the miners go, the FTSE 100 is sure to follow. So, unsurprisingly, profit-taking in the commodities sector is the main reason why London’s blue-chip index is nursing losses Tuesday. With many miners having surged by 50% or more since mid-January, investors are rightly wondering how far the rally has to run.
The timing and breadth of the upturn certainly caught many investors off guard. Anglo American was the proverbial falling knife until January, since when its share price is up more than 160%. Glencore, once everyone’s favourite dog to kick, is up 126% in the past seven weeks………………………………………..Full Article: Source

Commodities Rebound Hinges on China’s Real Estate Market

Posted on 08 March 2016 by VRS  |  Email |Print

Iron ore prices soared the most ever Monday after China voiced willingness to stimulate the economy. The commodities rebound is being driven by speculation that investments in China’s housing market is recovering, Hao Hong, chief China strategist at Bocom International Holdings Co. in Hong Kong said in a report.
That means Chinese real-estate investments should also register a bounce when figures for January and February are released this month. Hong is not so sure: While housing inventories in bigger cities have fallen, it will “take years to clear” backlogs in smaller towns that account for 60 percent of China’s property investments, he said………………………………………..Full Article: Source

A rally in commodities may be a sign that Wall Street hit a bottom

Posted on 07 March 2016 by VRS  |  Email |Print

Have we hit a bottom yet? Wall Street appears to think that a march higher in the commodities sector may be signaling that the worst is over for the market — at least in the near term.
For many investors, plunging commodity prices have been a sign that all isn’t well in the world. Falling commodity prices, specifically crude-oil prices can serve as a sign that global growth is in a state of retrenchment. In the case of oil, many believe it is simply a matter of an unrelenting glut………………………………………..Full Article: Source

Gold returns to bull market on safe-haven demand

Posted on 04 March 2016 by VRS  |  Email |Print

Gold is back in a bull market for the first time since 2013, buoyed by investors snapping up the metal as they seek a haven from the turmoil rocking equity markets. Bullion for immediate delivery settled at $US1264.25 an ounce on Thursday. That marks a 20 per cent gain from the recent closing low in December, meeting the common definition of a bull market.
Gold rallied 19 per cent this year, beating gauges in Treasuries, currencies and equities amid concerns the slowdown in global growth will hurt the US economy. That’s also fuelling bets the Federal Reserve may delay interest rate increases this year, helping boost the investment appeal for bullion, which doesn’t pay yields or dividends………………………………………..Full Article: Source

Is Silver a Good Investment in 2016?

Posted on 03 March 2016 by VRS  |  Email |Print

After last month’s silver price volatility, investors are asking the same question – is silver a good investment this year? During the first two weeks of February, silver prices rocketed 10.8% to $15.81 – the highest close since Oct. 28. But futures for May delivery fell 5.6% to $14.92 from Feb. 11 to the end of the month.
The dizzying price fluctuations have investors worried that silver will remain risky and unpredictable throughout the year. But Money Morning Resource Investing Specialist Peter Krauth – a 20-year veteran of the metals and commodities market – says there’s a $940 million trend that makes silver a solid investment in 2016………………………………………..Full Article: Source

Gold still a buy, says Deutche Bank

Posted on 01 March 2016 by VRS  |  Email |Print

Gold remains a buy even though it has it has rallied over 16 per cent since the start of the year, according to a note from Deutsche Bank, with global central bank misfires making a strong case for bullion’s safe-haven status.
And in Australian dollars, gold has come within shooting distance of all-time highs, prompting Macquarie Bank to call Western Australia’s gold fields the “golden west”, whose operators were in a “purple patch”. However, while Macquarie predicts Australian dollar gold will break those record highs later this year, it is too late to be buying most gold shares, the bank warned………………………………………..Full Article: Source

Gold’s price rally has diehard fans excited – but for how long?

Posted on 01 March 2016 by VRS  |  Email |Print

China is wobbling, oil is plummeting, Britain is threatening to quit Europe. And the gold bugs couldn’t be happier. With a 15% gain in 2016, gold’s rally has its diehard fans excited. But for how long?
This is the metal’s best start since 1980, when gold prices rallied about 270% to then all-time highs of $850 an ounce on an oil-supply shock crisis and raging inflation. This year gold prices are higher on worries over economic weakness in China and Europe, and the Bank of Japan’s surprise move to negative interest rates………………………………………..Full Article: Source

Six Reasons To Buy Gold In 2016

Posted on 29 February 2016 by VRS  |  Email |Print

Gold bullion and gold mining stocks have rallied 18% and 51%, respectively, in recent months after a brutal bear market over the last five years. Given gold’s proven ability to hold its value in the face of rising inflation and reckless monetary policy, we believe it plays an important role in any diversified portfolio.
At Evergreen Gavekal, we believe it may be time to to start initiating or adding to additional gold holdings for six reasons. Technical trading patterns suggest gold may finally be breaking out into a bull market (we do caution, however, that it appears to be temporarily over-bought)………………………………………..Full Article: Source

Here’s how to play gold: Technician

Posted on 29 February 2016 by VRS  |  Email |Print

Maybe the goldbugs will finally strike gold. After enduring years and years of losses, bullion is tracking for its best month since January 2012, up 9 percent. And according to a highly regarded technician, the hot commodity is about to get even hotter.
“I think we can squeeze a little bit more out of this trade” said Ari Wald of Oppenheimer on CNBC’s Fast Money last week. According to Wald’s chart work, the recent price action in gold is strikingly similar to the activity in 1999 when the commodity reversed a multi-year downtrend and started to form a base………………………………………..Full Article: Source

Gold Industry: Considered as the safest bet for investment in devious times

Posted on 26 February 2016 by VRS  |  Email |Print

Gold is a precious metal and has high ductility as well as malleability, mainly used as jewellery and for investment purposes globally. Gold is currently oversold in a bearish market attributed to its escalating high prices. Gold is considered as the safest bet for investment in devious times of war and high inflation with currency fluctuations.
Recent rebellions and war events in the Middle Eastern countries of Tunisia, Libya, Egypt, Syria and now Ukraine has led to rise in investments in bullion. This has caused overselling of gold and thus rapid increase in prices worldwide. Rising prices are expected to be a major factor driving the global gold market as more and more consumers are purchasing gold as a mean of long terms investments……………………………………….Full Article: Source

Bullion investors buoyed gold demand in 2015

Posted on 26 February 2016 by VRS  |  Email |Print

Global gold demand in 2015 was virtually flat compared to 2014 at 4,212 tonnes, according to the World Gold Council’s latest Gold Demand Trends report. Despite a challenging start to the year, gold demand rebounded in the second half of 2015, as a result of sustained buying from central banks and a strong second half from China and India.
This was particularly evident in the retail investment sector, where bar and coin purchases were led by China and Europe, with support from the U.S., as investors took advantage of weaker prices amid a softening economic backdrop, financial turbulence and ongoing geopolitical tension………………………………………..Full Article: Source

3 Ways to Make Precious Metals Print Money

Posted on 26 February 2016 by VRS  |  Email |Print

From an investment standpoint, most investment managers will suggest you put 2% to 3% of your portfolio into precious metals for diversification purposes. The problem with that approach is that precious metals are highly cyclical and volatile, and they don’t have a long-term positive upward bias like equities.
That’s no good for buy-and-hold investors, and instead means that precious metals are much more suited to trading. Of course, the problem with trading precious metals is the very same cyclicality and volatility they exhibit………………………………………..Full Article: Source

Is Gold Still a Good Investment Today?

Posted on 25 February 2016 by VRS  |  Email |Print

In the last few months, China’s economy has been faltering, and it has been having an effect on world financial markets. Due to this recent development, gold prices have shot up compared to what it used to be before.
During the period of the introduction of the Gold Reserve Act back in 1934, the price of gold was set to be $35 an ounce. That is a record increase of more than 300% between then and now. Actually, gold is a volatile investment. When it comes to gold, prices can go down as well as up, and over the last few years they have done both. At the height of the recession, way back in 2011 for instance, gold hit a record high of $2,000 per ounce. But by the end of 2014, the price of gold had fallen to $1,200 per ounce………………………………………..Full Article: Source

Gold nearing a bull market for the first time since 2013

Posted on 24 February 2016 by VRS  |  Email |Print

Investors are falling back in love with gold thanks to the woman who came between them in the first place: Janet Yellen. A rally in prices this month has the precious metal nearing a bull market for the first time since 2013 amid mounting expectations that Federal Reserve Chair Yellen won’t follow through on her forecast for raising US interest rates further this year.
The prospect of lower-than-expected borrowing costs - along with weakening equity and currency markets - is reviving gold’s appeal as a store of value. Global gold holdings in exchange-traded funds (ETFs) also are climbing………………………………………..Full Article: Source

Gold investment demand in China to grow if price rally holds

Posted on 19 February 2016 by VRS  |  Email |Print

Gold investment demand in China has started 2016 quite strongly, outperforming interest in jewelry, but for the momentum to continue bullion would have to maintain its price rally, a World Gold Council (WGC) official said.
With a 14 percent gain, gold XAU= is the best performing asset so far this year after falling for three straight years to 2015. The metal hit a one-year high last week as turmoil in global stock markets triggered safe-haven demand………………………………………..Full Article: Source

Investment Keeps Eluding Australia as Commodities Rout Endures

Posted on 18 February 2016 by VRS  |  Email |Print

Australian policy makers have been scouring economic data every three months for signs of a pick up in investment outside the mining industry. Three years on, and with a 30 percent depreciation in the currency and record-low interest rates, it remains as elusive as ever.
“It has felt a lot like waiting for Godot,” said Gareth Aird, a senior economist at Commonwealth Bank of Australia, the nation’s largest lender by market value. “A lift in non-mining investment remains the missing ingredient in the Australian economic growth transition story.”……………………………………….Full Article: Source

Crude oil looks best bet among assets this year, should rebound towards $47 level

Posted on 16 February 2016 by VRS  |  Email |Print

Slow growth in the global economy, low demand, and comfortable supplies across the world with OPEC nations continuing to pump in more than 30 million barrels per day for most of 2015 was a significant factor in pulling down oil prices.
Besides, robust global inventories in the OECD nations which rose by a notional 1 billion barrels in 2014-15 with the fundamentals suggesting a further build of 285 million barrels over the course of 2016. Hence, the pain on the crude counter has been continuing so long and this is evident in the chart above, wherein crude oil has been consistently falling for three years in a row……………………………………….Full Article: Source

Gold no longer a safe haven asset

Posted on 15 February 2016 by VRS  |  Email |Print

Yet again panicky investors are rushing to buy gold at a time of global financial turmoil. It seems that most of the buying of gold is done by ordinary people who are not fully aware of what is actually happening in the global financial markets or the world economy. The rush to buy gold has pushed its price up sharply this year ignoring the rout in global commodity markets.
Just for a reminder that price of gold has been falling for the past six years. I believe that some of the rally in gold price has something to do with the Indian seasonal festivals and the Chinese New Year. There is this recent argument that has been pushed around by the gold bulls……………………………………….Full Article: Source

Metal Bulls Savor Longest Rally in 10 Months on Feeble Dollar

Posted on 08 February 2016 by VRS  |  Email |Print

Investors are jumping back into metals they were dumping as recently as a month ago. A global slowdown has increased speculation that U.S. growth will cool enough to force Federal Reserve policy makers to wait longer before raising interest rates again.
The prospect of delays sent the dollar lower and gave metals a boost as alternative investments. Speculators increased their bets on price gains for gold and silver and got less bearish on copper. Gold and copper prices have climbed for three straight weeks, the longest rally since at least mid-April………………………………………..Full Article: Source

Here’s What Oil and Gas’s Ugly 2015 Did to Business Investment

Posted on 04 February 2016 by VRS  |  Email |Print

In the final quarter of 2014, business investment related to oil, gas and other mining hit an all-time high. One year later, that’s dropped by more than half. It’s the second-biggest yearlong drop in inflation-adjusted investment seen by any of the major categories in more than 50 years. (Which is how long we’ve had comparable data.)
Even by standards set by previous swings in the relatively small, volatile mining and gas sector, this one’s a humdinger. Mining and petroleum is one of the smallest categories of business investment, especially after that brutal four-quarter stretch lopped off half its size, but it has still caused some of the biggest swings in the distribution of business investment in the modern era………………………………………..Full Article: Source

Chinese Seen Buying More Gold as Investors Seek Haven Assets

Posted on 04 February 2016 by VRS  |  Email |Print

China’s gold demand will keep expanding as investors seek safe assets and jewelry buying increases, the China Gold Association said. Consumption in the country that vies with India as the world’s biggest user climbed 3.7 percent to 985.9 metric tons in 2015 from a year earlier, according to group data released on Wednesday.
Demand rose as prices declined and investors allocated more wealth to the safety of bullion than to other financial assets, according to the association, which represents jewelers, refiners, banks, brokerages and miners………………………………………..Full Article: Source

Investors concerned about commodities, energy: Moody’s

Posted on 02 February 2016 by VRS  |  Email |Print

Major investors listed the credit quality of the commodities and energy sectors as their biggest worry this year, as oil oversupply combines with reduced demand from China to drive energy prices sharply lower, said ratings agency Moody’s Investors Service in a report.
The finding on the most exposed sectors to downside risks in 2016 — the result of polling the region’s largest investors, intermediaries and debt issuers based in Singapore and Hong Kong — was consistent with Moody’s view that rated Asian corporates with commodity exposure remain in a precarious position………………………………………..Full Article: Source

Investment funds hit all time high in 2015

Posted on 27 January 2016 by VRS  |  Email |Print

Investment funds under management hit a record high of £871 billion in 2015, up from £835 billion in 2014. The figures, published by The Investment Association – a body that represents UK investment managers – come despite the turmoil in markets in the latter half of the year as a Chinese slowdown and commodity rout dented investor sentiment.
UK Equity Income was once again the best-selling fund sector of the year. Meanwhile tracker funds, which aim to replicate performance of a particular stock market index such as the FTSE, had their best year ever………………………………………..Full Article: Source

Why Gold Is Not a Good Safe Haven Investment

Posted on 20 January 2016 by VRS  |  Email |Print

Gold is typically considered a safe haven while markets are volatile, and with the recent equity slide both in China and US, investors are thinking of gold as an alternative, safe haven investment. Indeed, since the start of the year gold prices have received a boost, hitting a 2-month high as global stock markets sold-off.
The global stock rout didn’t have any bullish effect on silver prices since the precious metal has an industrial metal status, too. That might help explain why gold fared better than silver in January………………………………………..Full Article: Source

Another Chance to Join Commodity Rally You Probably Missed

Posted on 19 January 2016 by VRS  |  Email |Print

Traders and investors have another chance to join a rare commodity rally that probably passed them by last year. European Union pollution permits, beaten only by London cocoa in 2015, may have further to roll.
Spurred by European Union lawmakers in Brussels, the contracts are poised to gain about 39 percent in 2016, after a poor start to the year, according to a survey of 13 traders and analysts by Bloomberg. That would be a record third year of gains after prices climbed 11 percent in 2015………………………………………..Full Article: Source

Commodity exposure in 2016 requires care

Posted on 11 January 2016 by VRS  |  Email |Print

Having serially disappointed investors for a while, commodities could well offer investors one of the most compelling investment opportunities in 2016. The sector’s attractiveness is likely to increase as the year proceeds, offering multiple entry points for potentially attractive medium-term return opportunities. Exploiting them will require emphasis on portfolio construction, with the design of the right investment vehicles as important as careful asset selection.
To say that 2015 was a difficult year for commodities would be an understatement. While oil grabbed most of the headlines with its volatile drop of one-third in price to seven-year lows, the damage was widespread with copper, corn, platinum and sugar also falling significantly………………………………………..Full Article: Source

Gold rebounds on safe-haven demand as stocks face headwinds

Posted on 11 January 2016 by VRS  |  Email |Print

Gold bounced back on Monday with the market inching towards last session’s nine-week high as pressure on Asian stock markets triggered safe-haven bids for the metal. Gold climbed to its highest since early November on Friday, adding more than 4 percent to its value this year, as concerns over the Chinese economy and tumbling stock markets boosted the safe-haven appeal of the precious metal.
Investment appetite for bullion showed signs of picking up last week. Holdings of the world’s largest gold-backed exchange-traded fund, New York-listed SPDR Gold Shares, rose 4.2 tonnes on Thursday, data from the fund showed………………………………………..Full Article: Source

Investors in the mood to cut hedge fund exposure

Posted on 11 January 2016 by VRS  |  Email |Print

Global investors are planning to cut their exposure to hedge funds in 2016 following a disappointing performance in the past year, according to a survey. The poll data, from research group Preqin, will be met with dismay by the hedge fund industry, which had hoped volatile stock markets would encourage investors to seek alternative sources of return. It is also likely to add extra pressure on hedge fund fees.
Preqin’s survey of institutional investors showed that more are planning to cut their hedge fund holdings this year than are planning to increase them, by 32 per cent to 25 per cent……………………………………….Full Article: Source

Moody’s: Oil, gas companies to cut investments by quarter

Posted on 07 January 2016 by VRS  |  Email |Print

World’s oil and gas companies will cut capital investments by 20-25 percent against the background of lower oil prices, the international ratings agency Moody’s forecasts. Oil and gas sector expects an increase in the number of defaults in 2016, the agency said in a report Jan. 6.
The excess supply of oil will continue to put pressure on the world oil market, according to analysts of the agency. Moody’s noted that the oil-producing countries, including the non-OPEC states, won’t limit the volume of production due to the struggle for market share………………………………………..Full Article: Source

The long view is the only view on commodity income

Posted on 06 January 2016 by VRS  |  Email |Print

We hear a lot of criticism these days of people focussing too much on the short term. Whether it be business people not looking beyond next quarter’s financial results, or politicians supposedly hostage to a 24 hour news cycle. Both claims, in my view and experience, are greatly overstated.
Where I do find worrying short-termism, however, is in Australia’s approach to commodity prices. The media will show a 2-3 year graph of, say, oil or iron ore prices dropping from over $100 a barrel or tonne to now be around $40………………………………………..Full Article: Source

Base metal investors may not be able to wake up from this nightmare

Posted on 06 January 2016 by VRS  |  Email |Print

You know it’s grim when a sector’s primary bull case involves bankruptcy. Unfortunately for those in the base metals space, “that’s the situation we find ourselves in,” said Edward Meir, senior commodity analyst with INTL FCStone. The just-concluded year of 2015 is one that base metals investors will desperately want to forget.
Amid a dour environment for commodities overall, these industrial metals were among the hardest hit. Aluminum slid 11 percent, copper was down 24 percent, nickel dropped 42 percent, and precious-metal-with-industrial-uses platinum fell 26 percent. With that in mind, observers warn not to expect much in the way of a reprieve………………………………………..Full Article: Source

Commodities a ‘compelling’ investment opportunity in 2016

Posted on 05 January 2016 by VRS  |  Email |Print

Having serially disappointed investors for a while, commodities could offer one of the most compelling investment opportunities in 2016. The sector’s attractiveness is likely to increase as the year proceeds, offering multiple entry points for potentially attractive medium-term return opportunities.
Exploiting them will require emphasis on portfolio construction, with the design of the right investment vehicles as important as careful asset selection. To say that 2015 was a difficult year for commodities would be an understatement. While oil grabbed most of the headlines with a drop of one-third in price to seven-year lows, the damage was widespread with copper, corn, platinum and sugar also falling significantly………………………………………..Full Article: Source

Commodity exposure in 2016 requires care

Posted on 05 January 2016 by VRS  |  Email |Print

Having serially disappointed investors for a while, commodities could well offer investors one of the most compelling investment opportunities in 2016.
The sector’s attractiveness is likely to increase as the year proceeds, offering multiple entry points for potentially attractive medium-term return opportunities. Exploiting them will require emphasis on portfolio construction, with the design of the right investment vehicles as important as careful asset selection………………………………………..Full Article: Source

Why Now Is the Time to Buy Gold

Posted on 05 January 2016 by VRS  |  Email |Print

Gold has a message for the market: You’re a nut if you trust the Fed. In the days since the arbiters of American monetary policy raised interest rates on December 16 — the first rate hike in nearly a decade — gold prices have pretty much gone nowhere. On December 15, the day before the Fed’s announcement, gold closed near $1,065.
As I write this, it’s at $1,070 … and it has seen a high of $1,084 and a low of $1,052. Like I said, it has gone nowhere. Which, if you believe the claptrap that passes for institutional knowledge and learned wisdom on the business news channels, defies preconceptions about the metal………………………………………..Full Article: Source

Investors Go for Gold as Market Tumbles

Posted on 05 January 2016 by VRS  |  Email |Print

Gold started 2016 on a bright note. Investors seeking safety from the tumbling stock market and rising tensions in the Mideast are buying beaten-up exchange-traded funds that track the price of gold and the miners that dig it out of the ground.
The nearly $22 billion SPDR Gold Trust , or GLD, and was up 1.2% while the S&P 500 fell 2.2%. Even gold producers, some of last year’s most troubled companies as gold prices fell for a third straight year, rose on Monday. The $4.3 billion Market Vectors Gold Miners ETF added 1.5% on the heels of five years of declines, 2015’s topping 25%………………………………………..Full Article: Source

Seven magnificent commodity bets for 2016

Posted on 04 January 2016 by VRS  |  Email |Print

It’s always tempting for commodity analysts to issue forecasts for the coming year, even though we intrinsically know that the future is inherently uncertain and even the most reasoned expectations can be easily confounded by events. With that in mind, and with a nod to my fellow Australians’ love of a punt, I’ve decided rather to do a list of bets I may be tempted take in commodity markets in 2016, assuming I was allowed to wager.
1. Crude oil will trade both below $30 a barrel and above $60 in 2016: Logic and momentum suggest the first part of this bet is a no-brainer, with both Brent and WTI crude already having tested below $35 (Dh128.45) a barrel. The second part relies on history repeating itself insofar as when the bottom is reached, the rebound tends to be rapid………………………………………..Full Article: Source

Big oil to cut investment again in 2016

Posted on 04 January 2016 by VRS  |  Email |Print

With crude prices at 11-year lows, the world’s biggest oil and gas producers are facing their longest period of investment cuts in decades, but are expected to borrow more to preserve the dividends demanded by investors.
At around $37 a barrel, crude prices are well below the $60 firms such as Total, Statoil and BP need to balance their books, a level that has already been sharply reduced over the past 18 months. International oil companies are once again being forced to cut spending, sell assets, shed jobs and delay projects as the oil slump shows no sign of recovery………………………………………..Full Article: Source

2016 to see global oil and gas investments at lowest level in six years

Posted on 04 January 2016 by VRS  |  Email |Print

News agency Reuters is reporting that the oil price slump witnessed in 2015 will loom large over 2016 as: “Global oil and gas investments are expected to fall to their lowest in six years in 2016 to $522 billion, following a 22 percent fall to $595 billion in 2015, according to the Oslo-based consultancy Rystad Energy.”
This news comes as little surprise as the appetite for expensive investment projects is likely to be low amongst management teams looking to batten down the hatches to ride out a crude oil price slump largely attributed to an oversupplied market………………………………………..Full Article: Source

Commodity funds hemorrhage cash as investors bail at record pace

Posted on 29 December 2015 by VRS  |  Email |Print

Investors can’t seem to get away from non-energy commodities fast enough. A record US$857 million was pulled this year from U.S. exchange-traded funds backed by broad baskets of everything from grains to metals, according to data compiled by Bloomberg through Dec. 23.
The value of the funds plunged 26 per cent as raw materials tumbled to a 16-year low. Hedge funds are expecting more losses, betting on price declines for gold, copper, corn and natural gas. While energy-linked funds were the only commodity group to see net inflows this year, oil and gas didn’t escape an almost across-the-board decline in prices………………………………………..Full Article: Source

Commodities’ cycle upsets investor returns

Posted on 29 December 2015 by VRS  |  Email |Print

If one of your new year’s resolutions in 2015 was to invest in a FTSE 100 tracker, you may be ruing the day you did so. With the end of the year upon us, the global resources rout has dragged the index down by more than 7 per cent since January (though an average dividend yield of 4 per cent provides some consolation).
The big question is whether the oil companies and mining stocks that have dug passive investors into a deep hole can climb out of it next year — but few are willing to predict a happy ending in the short term. The table of the FTSE 100’s biggest losers is dominated by the miners. Topped by Anglo American — down 75 per cent this year as the collapse in the iron ore price caused its dividend payments to cave in — Glencore, BHP Billiton and Antofagasta make up four of the worst five performing stocks, with Rio Tinto languishing at number seven………………………………………..Full Article: Source

Seven (possibly) magnificent commodity bets for 2016

Posted on 28 December 2015 by VRS  |  Email |Print

It’s always tempting for commodity analysts to issue forecasts for the coming year, even though we intrinsically know that the future is inherently uncertain and even the most reasoned expectations can be easily confounded by events.
With that in mind, and with a nod to my fellow Australians’ love of a punt, I’ve decided rather to do a list of bets I may be tempted take in commodity markets in 2016, assuming I was allowed to wager. 1. Crude oil will trade both below $30 a barrel and above $60 in 2016………………………………………..Full Article: Source

Patient Investors Will See Rewards When Commodities Rebound

Posted on 18 December 2015 by VRS  |  Email |Print

Commodities continue to slump. Prices for gold, silver, oil, natural gas and other commodities are languishing, in some cases, at levels not seen for years. ETF commodity funds have also struggled. But for individuals with a long-term perspective, this may be the perfect time to invest in commodities.
Prices will eventually rebound A number of major mining companies have also done an admirable job cutting costs and improving efficiency. They will be well prepared to address returning demand. That is likely to occur when the Chinese economy bounces back and other emerging and European markets hit smoother waters………………………………………..Full Article: Source

Weaker commodity prices unsettling investors

Posted on 16 December 2015 by VRS  |  Email |Print

The oil price established a new lower range last week, falling below $40 for the first time since 2008. We expect to see some improvement in the oil supply/demand balance as we move through 2016, but in the short term oversupply will persist.
Supply-pressures have been driven by both OPEC and US shale producers. Counter-intuitively, OPEC’s production has been on an increasing trend despite the sharp fall in the oil price since 2014 and capacity is expanding as sanctions are lifted on Iranian exports………………………………………..Full Article: Source

Gold Market Becoming `Dull’ as Investors Factor in Higher Rates

Posted on 10 December 2015 by VRS  |  Email |Print

Gold’s price swings are running out of steam as investors factor in the likelihood that the Federal Reserve will raise interest rates next week. After jumping the most since August on Dec. 4 and then sliding 0.8 percent on Monday, bullion futures gained 0.1 percent on Tuesday.
The metal touched a five-year low last week on expectations that the Fed will soon raise borrowing costs, curbing demand for assets that don’t pay interest. There’s an 78 percent chance that policy makers will raise rates at their Dec. 15-16 meeting, Fed-funds futures show and Fed Chair Janet Yellen has said the pace of increases will be gradual. Holdings in bullion-backed funds snapped the longest run of declines since March………………………………………..Full Article: Source

Investors brace for more losses as commodities crunched

Posted on 09 December 2015 by VRS  |  Email |Print

BHP shares have dropped below $17 each and South32 under $1 for the first time after commodities were crunched again overnight and mining giant Anglo American cancelled its dividend.
Brent oil dipped below $US40 a barrel for the first time since early 2009, before recovering, while iron ore continued its descent, with the Qingdao benchmark shedding another US41¢, or 1.1 per cent, to $US38.65 a tonne. On the London Stock Exchange, investors dumped Rio Tinto, driving the price of its shares down 8.4 per cent, while BHP Billiton dropped a further 5.5 per cent………………………………………..Full Article: Source

Commodities Slump Hammers Sector’s Junk Bonds

Posted on 07 December 2015 by VRS  |  Email |Print

Deep losses on bonds from junk-rated U.S. energy and mining firms are rattling even seasoned investors, underscoring the challenges facing these companies amid a prolonged slump in commodity prices. Many bond prices are down 60% or more this year. Oil prices are still low due to a global supply glut, and metals prices are declining as China’s economic growth slows.
The moves are prompting worries that defaults could increase in the coming months, potentially sparking a fresh bout of selling that could spread to other parts of the junk-bond market. Among this year’s worst performers: some Linn Energy LLC bonds have fallen nearly 80%, Penn Virginia Corp. bonds are down 75% and Chesapeake Energy Corp. bonds are down 60%, according to figures from MarketAxess Holdings Inc. All three firms produce oil and natural gas in the U.S………………………………………..Full Article: Source

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