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Commodities Briefing - Category | Price Watch more

Oil bulls’ hope for quick price dip dimmed by 2020 crude under $70

Posted on 10 August 2015 by VRS  |  Email |Print

Oil prices have continued their gloomy spell as the market is flooded with extra supply from the OEPC and US shale producers. As oil prices entered a second steep slide a few weeks ago, bullish traders and analysts had hoped for a repeat of the sharp but short dip that occurred early in the year – a speculative slide below $50 a barrel followed by a quick recovery.
Some are now reconsidering that view, as long-term oil prices take the lead in the market’s latest dive, swaying sentiment toward a lengthier slump that would mean prolonged pain for big producers, from Exxon Mobil Corp to Saudi Arabia………………………………………..Full Article: Source

Venezuela: ‘Terrorised by oil price drop’

Posted on 10 August 2015 by VRS  |  Email |Print

When a frustrated mother threw a mango at Nicolás Maduro in April, hitting him on the head, she could never have guessed the outcome: the Venezuelan president promised his homeless attacker a new apartment.
Others are not so lucky. Lolimar Gelis and her family lost their home in 2010 when a mudslide destroyed their shanty town, forcing them to take shelter at a military garrison in the west of the capital, Caracas. Despite appeals to the country’s leaders, the family is still waiting to be rehoused via a scheme launched by Mr Maduro’s predecessor, Hugo Chávez………………………………………..Full Article: Source

U.S. gas prices fall alongside crude oil -Lundberg survey

Posted on 10 August 2015 by VRS  |  Email |Print

The average price of a gallon of gasoline in the United States fell 11 cents in the past two weeks, pulled down by the ongoing slump in crude oil prices, according to the Lundberg survey released on Sunday. Regular grade gasoline fell to an average price of $2.71 per gallon, according to the biweekly survey dated Aug. 7, down 11 cents from the previous survey on July 24.
Gasoline is down 81 cents a gallon from the same year-ago period, according to the survey. “This is a continuation of dynamics that have been building in the past several weeks, as both U.S. and global benchmarks are down steeply again,” said survey publisher Trilby Lundberg in Camarillo, California………………………………………..Full Article: Source

Why oil prices could stay lower for longer

Posted on 07 August 2015 by VRS  |  Email |Print

The oil market is setting up for a prolonged period of low prices, unless there’s a dramatic shift in strategy by producers. Those producers range from Saudi Arabia and Iraq, to the upstart shale drillers of Texas and North Dakota whose surprising success initially set off a market share battle with the world’s largest oil exporters.
“What you’re seeing now is the price crisis some had expected last winter. Just a few weeks ago, confidence was coming back and people were saying, ‘$70 was the new $100.’ Reality intruded,” said Daniel Yergin, vice chairman of IHS………………………………………..Full Article: Source

Dollar gold price could break below $1,000/oz early 2016: BoA/Merrill Lynch

Posted on 07 August 2015 by VRS  |  Email |Print

There was more negative research published for gold Thursday, as Bank of America/Merrill Lynch predicted that the metal could break below $1,000/oz heading into 2016. Analyst at the bank Michael Widmer noted that gold prices have shown a persistent lack of strength in recent months “driven by a confluence of factors. Most notably perhaps, physical off-take in India and China.”
Combined the two countries represent roughly 50% of global physical gold demand. China takes the top spot for both gold consumption and production. “India still feels the aftermath of a range of measures aimed at dampening imports to reduce the nation’s current account deficit,” said the analyst………………………………………..Full Article: Source

Barrick comments on planning for $900 gold price

Posted on 07 August 2015 by VRS  |  Email |Print

In its second quarter results announcement Barrick Gold Corporation, the world’s largest gold miner in terms of output, cut its dividend by 60% and said it will embark on a program to sell more mines and make deeper cost cuts. Shares in the Toronto-based company was up sharply on Thursday amid a generally positive day for gold miners, but its market value is still down 45% over just the last three months. The company is worth some $8 billion in New York.
Barrick is forecast to produce between 6.1m – 6.4m ounces this year and while it’s had some problems of its own making it is obviously highly exposed to a fall in the gold price. It’s market cap today compares to $64 billion when gold peaked at $1,900 in 2011……………………………………….Full Article: Source

Oil settles at $45.15 a barrel, hits fresh 5-month low

Posted on 06 August 2015 by VRS  |  Email |Print

Oil prices fell to a fresh March low on Wednesday after a surge in U.S. gasoline stockpiles as the summer season, the country’s biggest demand period for motor fuels, nears its end. U.S. crude for September delivery closed down 59 cents, at $45.15 a barrel—its lowest since March 19. September Brent crude futures were flat at $49.50 a barrel after hitting a fresh six-month low earlier in the session.
U.S. crude stocks fell last week, while gasoline and distillate inventories rose, data from the Energy Information Administration showed Wednesday. Crude inventories fell by 4.4 million barrels in the last week, compared with analysts’ expectations for a decrease of 1.5 million barrels………………………………………..Full Article: Source

Gold price continues downtrend on sluggish demand, silver up

Posted on 06 August 2015 by VRS  |  Email |Print

Gold prices remained under selling pressure for the third straight session on the domestic bullion market due to lack of buying support from stockists and retailers in the face of global uncertainty.
In contrasts, silver regained marginally after a sharp overnight plunge on the back of stray industrial demand. Standard gold (99.5 purity) dropped by Rs 75 to end at Rs 24,605 per 10 gm from Wednesday’s closing level of Rs 24,680………………………………………..Full Article: Source

Barrick making plans for $900 an ounce gold price

Posted on 06 August 2015 by VRS  |  Email |Print

Barrick Gold Corporation cuts its gold production forecast to between 6.1m – 6.4m ounces as it disposes of assets including 50% of its Zaldivar copper mine in Chile for $1 billion, the Cowal mine in Australia for $550 million in cash and $298 million for its Porgera mine to tackle its crippling debt-load of more than $13 billion.
The company announced additional disposals on Wednesday announcing that in the next few weeks, it will start a process to sell its Bald Mountain, Round Mountain, Spring Valley, Ruby Hill, Hilltop and Golden Sunlight assets in Nevada and Montana. Other notable features of the quarter and outlook include further cost and capex cuts and plans to weather a $900 an ounce gold price:……………………………………….Full Article: Source

As oil falls below $50, analysts eye ‘mid-price’ era

Posted on 05 August 2015 by VRS  |  Email |Print

A slump in oil below $50 a barrel—a level it has held above for most of the past decade—has raised the prospect of a new era of lower prices, although a return to super-cheap oil seems unlikely. Prices below $50 for the two crude oil benchmarks, North Sea Brent and U.S. West Texas Intermediate, were the norm prior to 2005. Brent averaged just $18.37 a barrel in the 1990s, WTI $19.70 a barrel, and both only broke above $50 for the first time in late 2004.
China’s explosive economic growth over the past decade, coupled with flatlining global output, saw Brent soar above $140 in 2008 and it has spent more than 90 percent of the past decade above the $50 mark………………………………………..Full Article: Source

Oil price unlikely to recover as Saudi refining hits market

Posted on 05 August 2015 by VRS  |  Email |Print

Oil prices are unlikely to recover soon as Saudi Arabia’s drive to boost its refining activities is expected to force refineries elsewhere to slow down their operations, thus creating an even bigger glut of unwanted crude oil.
Two big new refineries in Saudi Arabia are adding to growing supplies of diesel and jet fuel, which could mean other refiners will use less crude as they respond to the oversupply of oil products. ……………………………………….Full Article: Source

In the oil market, $30 is the new $50

Posted on 05 August 2015 by VRS  |  Email |Print

Even as oil bounces back, analysts say market fundamentals are very bearish, and it would not be surprising to see crude take a temporary dive into the $30s per barrel in the next several months.
“There’s no reason why oil won’t go down to the $30s. That’s the level that will really shut in current production and have a bigger edge than current capex (cuts) will have on the oversupply,” said Edward Morse, global head of commodities research at Citigroup………………………………………..Full Article: Source

It would be very difficult for oil prices to stabilize in 2016

Posted on 05 August 2015 by VRS  |  Email |Print

It would be very difficult for oil prices to stabilize in 2016, Jamie Webster, senior director of IHS Energy Downstream Research told Trend. “Oil is still very oversupplied, indicating it would be difficult to maintain stable pricing,” he said. “I disagree that prices are stable,” he said. “They were fairly flat from about May to early July but since then have broken sharply downward, with Brent down nearly $15 per barrel.”
Webster said OPEC is not able to control prices at all, and its current stance of not curtailing production will further ensure it has no effect on price setting. The greatest chance is if there is a substantial price drop from the US in the next few months, he added………………………………………..Full Article: Source

Brent Crude Falls Below $50 a Barrel

Posted on 04 August 2015 by VRS  |  Email |Print

Record U.S. production has led to international competition to produce more, cut prices, fight for customers. The world’s benchmark oil price fell to less than $50 a barrel Monday for the first time in six months as a sluggish global economy and rampant oil boom keep crude markets falling.
Monday’s selloff widens losses from July that plunged oil into a bear market. Record production in the U.S. has led to an international competition to produce even more, cut prices and fight for customers around the world. The past week brought signs that production is still going strong, dashing hopes that low prices may force producers to slow down………………………………………..Full Article: Source

Oil price: Majors braced as $50 barrel looms

Posted on 04 August 2015 by VRS  |  Email |Print

A recent renewed decline in the price of oil is gathering pace, with international benchmark Brent crude hurtling towards the $50-a-barrel threshold it last breached in January at the nadir of its year-long slump. In London the price per barrel was hovering a little above $51 on Monday morning, after it shed close to 2.3 per cent following a similar fall in New York.
It is now more than 25 per cent below the peak of its spring recovery in May and is firmly entrenched in bear market territory, with many predicting a continued slide. The Wall Street Journal said the latest selloff followed another round of data showing a persistent supply glut, with US producers continuing to increase output and, crucially, a significant decline in manufacturing activity in China………………………………………..Full Article: Source

Gold Declines as Goldman Sachs Says Prices May Drop Below $1,000

Posted on 04 August 2015 by VRS  |  Email |Print

Gold fell, trading near a five-year low, as Goldman Sachs Group Inc. said rising U.S. interest rates may lead to deeper losses. A government report Monday showed American households kept spending in June, capping a stronger quarter for the biggest part of the economy, as incomes rose. The Federal Reserve signaled last week that it will probably raise rates this year as the labor market improves.
Goldman in a report Monday reiterated that gold may fall below $1,000 an ounce, or more than 8 percent below Monday’s closing futures price. Gold tumbled to a five-year low in July as Fed Chair Janet Yellen said the central bank is on track for raising rates for the first time since 2006, curbing the appeal of gold because it doesn’t pay interest like assets such as equities………………………………………..Full Article: Source

Copper, Aluminum Prices Fall to Six-Year Lows

Posted on 04 August 2015 by VRS  |  Email |Print

As copper and aluminum prices sank to six-year lows on the London Metal Exchange, some investors said industrial metals were just starting to catch up with the selloff that has sent other commodities prices sharply lower.
Crude oil prices have fallen by more than half over the last 12 months. Copper is down 27% and aluminum is down 19%. That leaves plenty of room for more falls. “If you look at what’s happened to other commodity prices over the last two or three years, they have dropped down…Who’s to say that won’t happen in copper?” said James Sutton, a London-based portfolio manager on the global natural resources equities team at J.P. Morgan Asset Management………………………………………..Full Article: Source

Commodity prices fall hits capital expenditure

Posted on 03 August 2015 by VRS  |  Email |Print

A fall in commodity prices is shrinking global corporate spending, with capital expenditure predicted to fall this year and next, research to be published on Monday shows. The energy, chemicals and mining sector accounted for well over a third of global capital expenditure last year but rating agency Standard & Poor’s predicts that spending will fall more than 10 per cent this year and decline further in 2016.
Concerns over weaker Chinese growth and rising commodity supply has led to a sell-off in oil and a broader decline in copper, gold and other raw materials, pushing the Bloomberg commodities index to a six-year low………………………………………..Full Article: Source

Oil prices could be as low as $50 by 2020: Goldman

Posted on 03 August 2015 by VRS  |  Email |Print

The price of oil could be stuck firmly at around $50 a barrel by 2020, a Goldman Sachs analyst told CNBC, raising new fears about the energy companies that have already started to cut costs, projects and jobs to cope with falling revenues.
Several big oil and gas companies announced this week they intend to make cutbacks to stay afloat in this sinking environment. Royal Dutch Shell expects to cut 6,500 jobs, 6,000 for Centrica, and at Chevron, a 2 percent slash to its global workforce………………………………………..Full Article: Source

ABN Amro keeps 2015 oil price forecasts, cuts 2016 view

Posted on 31 July 2015 by VRS  |  Email |Print

ABN Amro kept its 2015 oil price forecasts, but reduced its 2016 prices significantly, citing a worsening oil oversupply situation. The bank maintained its 2015 Brent and West Texas Intermediate (WTI) forecasts of $60 and $55 per barrel, respectively. But it cut 2016 Brent and WTI price forecasts by $10 to $65 and $60 per barrel, respectively.
ABN Amro said it expects a recovery with the market returning to balance with lower oversupply, mainly due to marginally higher demand and a weaker dollar during the course of 2016. “However, the oversupply will remain larger than previously expected as the OPEC produces above its quota, and also the US crude production will remain elevated,” Hans van Cleef, senior energy economist at the bank said in a note Tuesday………………………………………..Full Article: Source

Oil prices sinking - even without Iran

Posted on 31 July 2015 by VRS  |  Email |Print

Oil prices worldwide have been falling for the past year. And the return of oil from Iran - following its landmark nuclear deal - is expected to put further pressure on the prices. DW examines the global oil market.
“A year ago, the price of a barrel of Brent North Sea crude stood at around $110. It is currently hovering at about half that price - around $55,” recalled Alexander von Gersdorff of the Berlin-based Association of the German Petroleum Industry (MWV). The price of West Texas Intermediate (WTI) crude has even dipped to below $50 a barrel recently. This slump in prices came even before Iran scaling up its oil exports………………………………………..Full Article: Source

Prepare for gold prices to plunge…as low as $350

Posted on 31 July 2015 by VRS  |  Email |Print

A prominent gold forecaster predicts the yellow metal will drop to a mere $350 an ounce, a level unseen since 2003. It’s dramatically lower than what most experts are currently calling for. But Claude Erb’s prediction might have merit. Back in 2012, Erb, a former commodities trader at TCW Group, co-authored a landmark research paper with Duke University professor Campbell Harvey that was early to predict gold’s downfall.
At the time, gold was fetching north of $1,600 an ounce. Now it’s trading below $1,100. The paper used historical analysis to show that if gold is an inflation hedge — as many people believe — then it’s extremely expensive at current levels………………………………………..Full Article: Source

Gold has potential to plummet to $700: Strategist

Posted on 31 July 2015 by VRS  |  Email |Print

Gold got little respite from all the bad news surrounding it Thursday, with the price of the precious metal crunching to near a five-and-a-half-year low and two separate analysts telling CNBC that there was little reason to add it to an investment portfolio.
Shaun Port, the chief investment officer at the online investment management company Nutmeg, highlighted that central banks were no longer thirsty for bullion and predicted a hefty fall in price. “I think there’s much further downside for gold from here, potentially through the $1,000 (level) and back to the pre-crisis levels of the sort of $700 or $800 (level),” he told CNBC Thursday………………………………………..Full Article: Source

Study predicts gold could plunge to $350 an ounce

Posted on 31 July 2015 by VRS  |  Email |Print

Gold bugs, who have just begun to digest bullion’s more than $100 drop over the past month, need to prepare for the possibility of an even bigger decline. That, at least, is the forecast of Claude Erb, a former commodities manager at fund manager TCW Group, and co-author (with Campbell Harvey, a Duke University finance professor) of a mid-2012 study that forecast a plunging gold price.
They deserve to be listened to, therefore, since — unlike many latter-day converts to the bearish thesis — they forecast a long-term gold bear market when it was only just beginning. You might think that, with gold now trading more than $500 lower than when the study was released, Erb would declare victory and leave well enough alone. But Erb is doing nothing of the sort. Earlier this week, he told me that the gold community now needs to consider the distinct possibility that gold will trade for as low as $350 an ounce………………………………………..Full Article: Source

Gold could sink to $800: Yamada

Posted on 31 July 2015 by VRS  |  Email |Print

Gold just can’t get a bid. The precious metal fell near 5½-year lows on Thursday after the second-quarter GDP number showed the U.S. economy is growing at a steady rate and comments from Fed Chair Janet Yellen on Wednesday pointed to the notion of a September rate hike.
Gold is now down 13 out of the past 15 trading sessions, and according to one highly regarded technician, it’s about to get even worse. “I think we have to recognize that gold is in a structural bear market,” Louise Yamada, managing director of Louise Yamada Technical Advisors, said Thursday on CNBC’s “Futures Now.”……………………………………….Full Article: Source

The Real Reason Gold Prices Are Falling

Posted on 31 July 2015 by VRS  |  Email |Print

Gold is in the news for all the wrong reasons at the moment. The price of the metal tumbled this month, maintaining its downward trend for the year. In fact, bullion had its worst month in over two years in July. At US$1,092, an ounce of gold is now worth what it was back in 2010.
Its future prospects, if analysts are to be believed, are worse still. A recent Bloomberg survey suggested that prices could drop to US$984 an ounce by January. That would represent a 10% decline from its present price point. A separate Bloomberg survey highlighted that over half of respondents believe gold is heading for its third consecutive annual loss in 2015………………………………………..Full Article: Source

Forget whether $100 silver is possible, how about $1000?

Posted on 31 July 2015 by VRS  |  Email |Print

I don’t know of many charts out there that a bullish investor since 2011 would look at with more disgust than the silver chart. It has been an exceptionally painful experience for those bullishly inclined since 2011. In fact, silver has dropped 70% from its 2011 heights to its recent lows, and it is still not done. But this story certainly has a “silver lining” for those who are willing to be a bit more patient.
On Aug. 30, 2011, I wrote my first public column about silver, which called for a market top in silver with a shorting target of 42.90, and that it must remain below 44.30 for the downside to ensue. Within the same column, I provided a downside target of 26.80 in the futures………………………………………..Full Article: Source

Oil Price Fluctuations at $50-$65 per Barrel ‘Normal’

Posted on 30 July 2015 by VRS  |  Email |Print

Oil price fluctuations between $50 and $65 per barrel are normal because the situation on the world market depends on the level of supply and demand, Russian Energy Minister Alexander Novak said Wednesday.
“I think that the diapason of fluctuations, of which we spoke about before, from $50 to $65 [per barrel] is a normal and expected process and there are no supra-fluctuations that we see. The global situation on the markets depends on supply and demand and in today’s case, this is how it’s unfolding,” Novak said………………………………………..Full Article: Source

Demand not enough to boost oil price

Posted on 30 July 2015 by VRS  |  Email |Print

Strong global demand for oil is insufficient to offset a robust supply outlook that has driven prices back below US$50 per barrel, and Saudi Arabia no longer appears to have the necessary market clout to change prices.
“This remains a supply-driven market,” said Michael Tran, a New York-based commodity strategist at RBC Capital Markets. “Supply drove us into this low price environment and supply will have to be what ultimately digs us out.” Tran thinks oil could retest the lows from earlier in 2015, but he thinks WTI prices will ultimately average somewhere in the low US$50s for the remainder of the year………………………………………..Full Article: Source

Here’s what the rout in gold prices means for the market

Posted on 30 July 2015 by VRS  |  Email |Print

Lots have been said about the recent decline in gold prices. Most of it deals with the fundamentals of gold itself, such as mine closures, supply and demand, and the like. The rest involves the technical side, such as long-term trends and moving averages. But there are other sides to this story.
For example, gold is usually sought when inflation starts to heat up. When the economy first emerged from the Great Recession, gold rose in price, figuring that inflation would eventually rise — not just from the greater demand for metals and other commodities that usually accompanies a stronger economy, but from all the liquidity that the Federal Reserve had to create in order to push the economy forward………………………………………..Full Article: Source

Deutsche: Gold price has another 30% to fall – and soon

Posted on 30 July 2015 by VRS  |  Email |Print

On Tuesday gold stabilized but hovered near five-and-half year lows struck last week after a closely watched report showed global gold demand at the lowest in six years , followed by a prediction of a 30% fall from today’s levels.
Futures contracts in New York with August delivery dates were exchanging hands for $1,095.10 an ounce in after hours trade on Tuesday and flat compared to yesterday’s close in another day of light trading as anxious investors look for fresh direction for the metal………………………………………..Full Article: Source

HSBC downgrades 2015 gold price forecast

Posted on 30 July 2015 by VRS  |  Email |Print

HSBC has significantly downgraded its 2015 average gold price forecast, following the brutal sell-off seen in the market one week ago. HSBC now predicts that gold will average $1,160 per ounce in 2015 from $1,234 previously. The bank has also lowered its 2016 forecast by five percent from $1,275 per ounce to $1,205.
Nonetheless, the bank still believes that in the end, gold will recover from current levels, it said. Gold recently slumped to levels not seen since March 2009 at $1,077 per ounce, following a bear-raid on the market during early trading hours in Asia and what was the most illiquid period of business in the week………………………………………..Full Article: Source

Why Gold Will Fall to $1,020

Posted on 30 July 2015 by VRS  |  Email |Print

After a relatively uneventful few months for the gold market, prices broke out of their six-month range in dramatic fashion last week. Gold’s fall below the crucial USD1,130/oz level has seen the metal trade to a fresh five-year low of USD1,078/oz in recent days. While the market has since gained some composure, we expect further downside to ensue given the significant shift in market positioning.
Market positioning is reflecting a renewed negativity towards gold. While our short-term forecast of USD1,100/oz was met recently, we were surprised at the manner in which it occurred, having previously expected a gradual grind lower………………………………………..Full Article: Source

Iron ore price surges 6%

Posted on 30 July 2015 by VRS  |  Email |Print

While other metals markets continue to be mired in negativity, the price of iron ore surged on Wednesday as the market for the steelmaking raw material in top consumer China show signs of a bottom. The benchmark 62% Fe import price including freight and insurance at the Chinese port of Tianjin raced ahead $3.10 or 5.9% to $53.30 a tonne, capping three days of gains according to data provided by The SteelIndex.
The advance in the Metal Bulletin’s benchmark 62%-index at the ports of Qingdao-Rizhao-Lianyungang in China was $2.44 or 4.6% to $55.89 for an 8.7% gain since Friday to a four-week high. The latest move higher was inspired by a bounce back in Chinese steel prices with the most-traded rebar contract on the Shanghai Futures Exchange touching $340 on Wednesday. That’s up from record low of $305 at the start of the month………………………………………..Full Article: Source

Oil prices have plunged nearly 20% this month

Posted on 29 July 2015 by VRS  |  Email |Print

China’s crashing stock market and the meltdown in the metals market may be getting all the attention lately, but crude oil is quietly crumbling once again. Oil has plunged nearly 20% this month alone and it briefly dipped below $47 a barrel on Tuesday. That leaves it flirting with the March lows, which was the weakest price since 2009.
The latest selling has been fueled by the same dynamics that caused oil to tumble from $100 last summer. The American energy revolution has created a massive supply glut and the tepid global economy is depressing demand growth………………………………………..Full Article: Source

Oil market is in the dreaded ‘double dip’ so brace for more losses to come, warns Bank of America

Posted on 29 July 2015 by VRS  |  Email |Print

Oil prices are experiencing a “double dip” and could extend losses as the supply glut persists for another 18 months, according to Bank of America Corp. Risks to growth in China, the prospect of increased Iranian exports after this month’s nuclear deal and a strengthening dollar “could continue to press oil lower,” the bank said in a note dated July 24. Bank of America cut its third-quarter estimate for Brent to US$50 a barrel from US$54, while West Texas Intermediate was lowered to US$45 from US$50.
Brent and WTI returned to bear markets in the past week after falling 20 per cent from peaks reached in June, as a plunge in China’s stock market sparked concern that oil demand in the world’s second-largest economy will falter. Brent traded close to US$53 a barrel on Tuesday and WTI near US$47………………………………………..Full Article: Source

10 Reasons to Love the Oil Price Drop

Posted on 29 July 2015 by VRS  |  Email |Print

Don’t let tumbling oil prices darken your outlook on stocks or the economy. Yes, U.S. crude prices have dropped into an official bear market, down around 20% since the beginning of June, which will undoubtedly hurt the oil industry and companies like Exxon Mobil (XOM) and BP (BP).
But there are a number of benefits from the decline. Here are 10 of them: Stocks Tend to Rally After Oil Price Drops. When the price of oil goes down, stocks tend to surge. That’s the conclusion of a study published in The Journal of Financial Economics in 2008 by professors Gerben Driesprong, Ben Jacobsen, and Benjamin Maat. They found that when oil prices moved down one standard deviation (that’s a price movement of about 11%) then stocks would rally by 1% the next month………………………………………..Full Article: Source

Gold price to average $1135/oz in Q3 – GFMS

Posted on 29 July 2015 by VRS  |  Email |Print

The gold price will average $1,135 per ounce in the third quarter of this year, GFMS said in its latest Gold Survey report, and $1,175 in the fourth quarter. This compares to a second quarter average of $1,192 per ounce and current spot gold price of $1,095.
The third quarter is widely expected to see the first increase to US interest rates since 2008. Higher interest rates in theory would push many gold investors into more yield-bearing assets such as bonds. GFMS on the other hand believes that much of the action has already been priced into gold, and that the first increase will in actual fact push the metal’s price higher………………………………………..Full Article: Source

Gold Demand Lowest Since 2009

Posted on 29 July 2015 by VRS  |  Email |Print

Demand for gold fell to its weakest level since 2009 in the second quarter, as Chinese buyers shunned purchases, the metals consultant GFMS said. “Almost all major physical gold markets suffered in the second quarter,” the London-based research firm, a unit of Thomson Reuters, said Tuesday in commentary published with its latest GFMS Gold Survey.
Physical gold demand fell 14% from a year ago, with demand for bars and coins falling 12%, and demand for jewelry declining 9%, it said. The decline in consumption came despite a 7.5% fall in average U.S. dollar gold prices. A cheaper dollar makes it more affordable for people with other currencies to buy gold………………………………………..Full Article: Source

HSBC downgrades 2015 gold price forecast by six percent

Posted on 29 July 2015 by VRS  |  Email |Print

HSBC has significantly downgraded its 2015 average gold price forecast, following the brutal sell-off seen in the market one week ago. HSBC now predicts that gold will average $1,160 per ounce in 2015 from $1,234 previously. The bank has also lowered its 2016 forecast by five percent from $1,275 per ounce to $1,205.
Nonetheless, the bank still believes that in the end, gold will recover from current levels, it said. Gold recently slumped to levels not seen since March 2009 at $1,077 per ounce, following a bear-raid on the market during early trading hours in Asia and what was the most illiquid period of business in the week. ……………………………………….Full Article: Source

Copper Prices Rebound From Six-Year Low on Zambia Supply Threat

Posted on 29 July 2015 by VRS  |  Email |Print

Copper futures gained the most in two weeks on concern that power restrictions in Zambia will cut supplies there and have ripple effects at global mines. First Quantum Minerals Ltd. said on Monday that Zambia’s state-run power company declared force majeure for supply of electricity to its Kansanshi operation.
The power cut could lower copper output in the second half of the year, and also threatens the company’s progress at its Cobre Panama project in Latin America because of a potential liquidity squeeze, Greg Barnes, a Toronto-based analyst at TD Securities Inc., said in a report on Tuesday. Copper is rebounding after touching a six-year low on Monday as slowing demand in China increased concerns over a glut………………………………………..Full Article: Source

Oil Prices Fall to Four-Month Low Amid Chinese Stocks Rout

Posted on 28 July 2015 by VRS  |  Email |Print

Oil prices fell to a four-month low Monday on concerns about a selloff in Chinese stock markets and increased oil drilling in the U.S. U.S. oil prices have slumped 20% this month as the global glut of oil shows no signs of abating.
Production remains near multidecade highs in the U.S., Saudi Arabia and elsewhere, and analysts say demand could decline in the second half of the year after the busy summer-driving season ends. Light, sweet crude for September delivery settled down 75 cents, or 1.6%, at $47.39 a barrel on the New York Mercantile Exchange, the lowest settlement since March 20………………………………………..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

Which is more likely, $33 or $75 oil?

Posted on 28 July 2015 by VRS  |  Email |Print

At a time when stocks are hitting highs, oil prices have been cut in half. Relative to past prices, it is tempting to call oil “cheap” and buy it. Indeed, there are many bullish calls by analysts to do just that. I receive a very large number of emails, and investors are showing a high interest in buying oil ETFs here for the long-term. Let us first try to answer a very simple question, “Will oil go to $33 to $75?”
Based on oil’s current trading pattern, from a medium- to long-term perspective, traditional technical indicators in the categories of momentum, trend, volatility and volume are not only useless, but they are also likely to mislead investors into making wrong decisions………………………………………..Full Article: Source

Gold price recovers from five-year lows

Posted on 28 July 2015 by VRS  |  Email |Print

The price of gold is hovering around the $1,100 mark after hitting five-and-a-half year lows last week. Gold mining stocks bounced back on Monday morning after gold prices recovered from five-and-a-half year lows. On Friday, gold prices plunged to an intra-day low of $1,077 as investors offloaded the metal amid expectations that the US Federal Reserve will soon raise interest rates, thus making it a less attractive investment.
But after five consecutive weeks in negative territory, the gold spot price crept back towards the $1,100 mark on Monday morning as the weaker dollar helped it recover. However, investors and analysts indicated they were not convinced by the improving gold price………………………………………..Full Article: Source

HSBC cuts 2015, 2016 gold price forecasts

Posted on 28 July 2015 by VRS  |  Email |Print

HSBC strategists on Monday lowered their average annual gold price forecasts for this year and next, warning that gold prices are likely to remain under pressure in the short term and may “move within striking distance of $1,000″ an ounce before recovering. HSBC lowered its 2015 average annual price forecast to $1,160 from $1,234 and for 2016 to $1,205 from $1,275.
Among the reasons for gold’s recent selloff is the “drift towards Fed tightening and the associated USD strength, low global inflationary pressure, weak gold demand from India and China and market positioning and momentum,” HSBC strategists said………………………………………..Full Article: Source

Deutsche Bank says gold’s fair value is $US750 an ounce

Posted on 28 July 2015 by VRS  |  Email |Print

Gold prices may need to fall another 30 per cent to reach fair value, according to Deutsche Bank, with cheap oil the only potential lifeline for the battered precious metal. Gold is currently trading around $US1096, just above last week’s fresh five-year low of $US1072.30.
But Deutsche’s paper Estimating fair value for gold argues the price of the precious metal needs to drop substantially to bring valuation levels back towards historical averages. “Gold would need to fall towards $US750 per ounce to bring prices in real terms back towards long-run historical averages,” said Deutsche………………………………………..Full Article: Source

Silver Prices to Hit $50.00?

Posted on 28 July 2015 by VRS  |  Email |Print

Despite the massive outflow of capital from commodities, a leading indicator suggests that silver prices are about to skyrocket. The last time silver priced approached $50.00 per ounce, it was preceded by a corresponding rise in this key metric.
The grey metal has depreciated by over 30% in the last 12 months. It’s a steep fall for silver, especially in light of the NASDAQ gaining nearly 15%. The pattern seems to indicate a clear direction for capital; out of commodities and into stocks. However, following the trend is the exact opposite of what investors should be doing………………………………………..Full Article: Source

Copper Drops to Lowest in Six Years Amid Chinese Slowdown

Posted on 28 July 2015 by VRS  |  Email |Print

Copper slid to the lowest level in six years as the biggest selloff in Chinese equities since 2007 added to concern that the economy will worsen. The Shanghai Composite Index plunged 8.5 percent. China’s industrial profits fell in June, and data on Friday showed a private gauge of manufacturing unexpectedly declined in July to the lowest level in 15 months, boosting speculation that demand is slowing in the country.
China accounts for about 40 percent of the world’s copper consumption. “A rout resumption in Chinese equities prompts more scattered selling in most metals seen this morning,” Michael Turek, the head of base metals at BGC Partners Inc. in New York, said in an e-mail. “They just can’t catch a break or a breath, that is despite all the efforts to stabilize the Chinese markets up until now.”……………………………………….Full Article: Source

Chinese spot alumina prices hold steady despite smelter cuts

Posted on 28 July 2015 by VRS  |  Email |Print

Chinese spot alumina prices held steady Monday despite smelter cuts over the past week, industry sources said. However, with further cutbacks expected in the near term prices may be pressured lower, sources said.
There has been increasing talk of planned smelter in the past month on the back of prevailing weak domestic metal prices, with an estimated 600,000-700,000 mt/year of capacity expected to be reduced in the near term. But to date, only one smelter, Beijing Xinheng Group, has confirmed cutting capacity………………………………………..Full Article: Source

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