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Are commodities signaling a Lehman-sized meltdown? Japan’s Abe thinks so

Posted on 27 May 2016 by VRS  |  Email |Print

Only hours after Brent oil prices shot past $50-a-barrel for the first time in months, Japanese Prime Minister Shinzo Abe warned that the past few difficult years for commodities in general could be a red flag for another global financial crisis. Abe made the comments while hosting a meeting of the Group of Seven leaders on Thursday in Ise-Shima, Japan, according to a report from Reuters.
Abe showed his fellow leaders data charting a 55% drop in global commodity prices between June 2014 and January 2016. He said that’s similar to how much prices fell between July 2008 to February 2009 after Lehman Bros. went bankrupt and triggered a global financial crisis………………………………………..Full Article: Source

Should you start hoarding gold? Some say China’s gold ambitions mean you should keep some stashed at home

Posted on 27 May 2016 by VRS  |  Email |Print

China’s decision to buy its second gold storage vault in London last week was another step towards total dominance of the market. The vault is in a secret location and was bought by Chinese state-owned bank ICBC Standard Bank from Barclays. It could store $90bn of gold at today’s prices, and follows the purchase of a lease on another vault in the capital earlier this year from Deutsche Bank.
London has been a hub for metals investment for hundreds of years, but times have changed and the big banks are pulling back from trading them. Now China is pushing into the gold market in a big way. The reasons why are unclear, and gold continues to spawn more conspiracy theories than the moon landing, but what is known is that China has been amassing the yellow metal at a rapid pace over the last decade………………………………………..Full Article: Source

Platinum and Palladium: Are They Following the Fall in Gold?

Posted on 27 May 2016 by VRS  |  Email |Print

Platinum and palladium are exclusively used in emission-curbing autocatalysts. Those demands impact the price direction for these metals. Platinum has increased approximately 13% year-to-date. Palladium, however, has erased its losses from 2015 and now has a year-to-date loss of 2.7%.
The last month has adversely impacted palladium, which fell about 9.8%. Platinum fell a marginal 0.14%. The beginning of the year remained slow for palladium. This is likely due to industrial metals rather than precious metals. The volatility in palladium is close to 31%, while platinum’s volatility is around 23%. Palladium is the most volatile among the four precious metals………………………………………..Full Article: Source

China Wants to Set Prices for the World’s Commodities

Posted on 26 May 2016 by VRS  |  Email |Print

China has put the world’s traditional financial centers on notice that it wants to develop its raw material markets as hubs for setting prices, seeking to marry the country’s commercial heft with a much greater say in determining how much commodities cost.
“We’re facing a chance of a lifetime to become a global pricing center for commodities,” Fang Xinghai, vice chairman of the China Securities Regulatory Commission, said at the Shanghai Futures Exchange’s annual conference in the city on Wednesday. “On the way to realize this goal, we’ll see very intense competition. We have the advantage of trading size and economic growth, but our legislation is still not sound and we lack enough talent.”……………………………………….Full Article: Source

Gold – Bullish combination could prevail

Posted on 25 May 2016 by VRS  |  Email |Print

Gold rallied 16 percent in the first three months of 2016 after falling about 10 percent in 2015. Factors in the rise included higher risk aversion, downward revisions to the Fed’s tightening cycle and brighter sentiment across commodities.
While we expect gold to strengthen further and range between $1,180 and $1,325 in the second quarter because these positive drivers may endure, we expect downward pressure to re-emerge later in 2016 stemming from a stronger dollar and rising US real interest rates………………………………………..Full Article: Source

Jim Rickards makes the case for gold at $10,000 US an ounce

Posted on 24 May 2016 by VRS  |  Email |Print

Gold is often seen as a safe investment in times of economic uncertainty, and prominent investors, such as George Soros, are placing big bets on the precious metal. Gold prices of have been surging lately and gold stocks are among the top performers in 2016.
In his new book The New Case for Gold, Wall Street veteran Jim Rickards explains why he expects the current world monetary regime to fail and why he sees bullion heading to $10,000 US an ounce. The current increase in the dollar price of gold reflects the decline of the U.S. dollar, Rickards said during a recent interview with Peter Armstrong, host of The Exchange on CBC News Network………………………………………..Full Article: Source

Avoid gold until Fed moves: Gartman

Posted on 24 May 2016 by VRS  |  Email |Print

Owning the metal in dollars will be for the brave until the US central bank pulls the interest rate trigger, the respected US investor says. Those trading gold should probably do it in something other than dollars while the theme of higher US rates plays out.
That’s the view of Dennis Gartman, US investment guru and publisher of The Gartman Letter. “If you have to trade gold, stay on the sidelines in terms of US dollars,” he says on Monday. While owning gold in non- dollar terms, particularly in yen and euros, he feels a rising dollar will continue to put a ceiling on gains………………………………………..Full Article: Source

When’s it safe to buy gold? After the Fed hikes, Gartman says

Posted on 23 May 2016 by VRS  |  Email |Print

Something strange is happening right now in the gold market, and it has commodities investor Dennis Gartman erring on the side of caution. Gold ended Friday with its biggest weekly drop in two months, and its third straight week of losses. Conversely, the dollar saw its third straight week of gains following comments from New York Federal Reserve President William Dudley.
The central banker indicated that markets were underestimating the likelihood of an interest rate increase in June or July. The backdrop suggests investors may be positioning themselves for higher rates—a possibility not lost on Gartman, who has taken note of some interesting movements in the yellow metal………………………………………..Full Article: Source

Will oil at $50/barrel worry India?

Posted on 20 May 2016 by VRS  |  Email |Print

While oil that plunged below $30 a few months ago helped India contain inflation and shrink its trade deficit, a rebound to $50 has other advantages for the world’s fastest-growing importer of crude. More cash for fuel exporters could boost global growth, lure commodity-dependent sovereign wealth funds back to emerging markets and increase demand for Indian-made goods, including petroleum products.
“The environment might be better rather than worse for India,” said Sonal Varma, an economist at Nomura Holdings in Mumbai. Oil at “$60, $65, $70 — that’s when the problem starts, but right now I think it’s fine.”……………………………………….Full Article: Source

Gold Prices: One Big Reason Why $2,000 Gold Could Be Possible

Posted on 19 May 2016 by VRS  |  Email |Print

Something just happened in the gold market that suggests gold prices are severely undervalued. Don’t expect to read this in the mainstream financial publications. Gold buyers are increasing in numbers.
You see, in 2013, when the precious metal’s prices were plummeting (for all the wrong reasons as I see it), the mainstream media told investors that buyers would be running from gold. Big investment companies said gold prices would fall further. They were all wrong………………………………………..Full Article: Source

Why Silver Prices Fluctuate

Posted on 19 May 2016 by VRS  |  Email |Print

Silver prices have been very bullish in 2016. They have risen a very healthy 20% year to date, despite short-term pullbacks in late April and early May. The five-year silver bear market of 2010-2015 appears to be over.
But run-ups and pullbacks both cause investor concern. How far up is up? Why are silver prices so strong? Are pullbacks harbingers of long-term declines? Why do the prices fluctuate, either up or down? We’ll answer these silver price questions for you today – let’s take a look………………………………………….Full Article: Source

There’s no reason to fear a currency war: Narayana Kocherlakota

Posted on 19 May 2016 by VRS  |  Email |Print

The U.S. government seems concerned about what will happen if other big nations push down the value of their currencies against the dollar. Actually, it could be good for the global economy.
Ahead of this week’s meeting of finance ministers from the Group of Seven developed nations, Treasury Secretary Jacob Lew has warned that the U.S.’s counterparts — the three largest euro-area nations plus Canada, Japan and the U.K. — might undermine global growth if they engage in policies that cause their currencies to depreciate against the dollar. In my view, his concerns are misplaced………………………………………..Full Article: Source

Commodity price slump creates opportunities for resource cooperation

Posted on 18 May 2016 by VRS  |  Email |Print

Weaker global commodity prices were creating opportunities for resource-rich nations to find shared solutions, Western Australia’s Mines and Energy Minister Sean L’Estrange said. L’Estrange noted that an agreement announced between iron-ore majors Fortescue Metals and Vale earlier this year, demonstrated how competitors could work together to find innovative solutions to common challenges.
Western Australia’s Fortescue and Brazil’s Vale in March inked a memorandum of understanding under which the two companies would form joint ventures to blend iron-ore products. The new blended product would be developed to suit the long-term needs of Chinese steel customers, and improve the efficiency of the supply chain to the steel industry………………………………………..Full Article: Source

Palladium left out of precious metals rally; investors shy away

Posted on 18 May 2016 by VRS  |  Email |Print

Investor appetite for palladium-backed exchange-traded funds is failing to pick up after a dismal 2015, pointing to another difficult year for the metal despite the prospect of a deepening supply deficit.
Market watchers are predicting the market shortfall for palladium will grow this year as mine output abates and demand from carmakers picks up. However, its prices have lagged the rest of the precious metals complex this year, rising 5 percent versus a 20 percent jump in gold and 17 percent climb in platinum………………………………………..Full Article: Source

The volatile gold play that’s nearly doubled this year

Posted on 17 May 2016 by VRS  |  Email |Print

Can you dig it? This year’s best-performing exchange-traded funds are all gold plays. Among ETFs with more than $500 million in market value, the top dog is triple-leveraged gold miners product (NUGT), with an insane 315 percent rally.
But nipping at its heels is unleveraged gold mining pick (GDXJ), which tracks smaller, or “junior” gold miners, which tend to be more volatile. That ETF is up 98 percent this year, outperforming its bigger brother (GDX), which is also a VanEck Vectors product. What’s incredible is that even after nearly doubling this year, the GDXJ is still down 73 percent over the past five………………………………………..Full Article: Source

In times of commodities turmoil, it pays to be agile

Posted on 16 May 2016 by VRS  |  Email |Print

As the prices of resources plunged, independent commodities trading houses thrived in 2015. The winners had two things in common: They were not focused on upstream concessions, and they showed a knack for adjusting their strategies to market movements.
Low oil prices contributed to a huge profit for Mercuria Energy Group, CEO Marco Dunand said at the FT Commodities Global Summit, hosted by the Financial Times in mid-April. Leaders of other major commodities traders made similar bullish remarks at the gathering in Lausanne, Switzerland……………………………………….Full Article: Source

Oil is not out of the woods yet: BNP Paribas commodities chief

Posted on 13 May 2016 by VRS  |  Email |Print

Recent downgrades to global economic growth forecasts suggest the crude market is not out of the danger zone, Harry Tchilinguirian, global head of commodity markets strategy BNP Paribas, said Thursday.
In its latest oil market report released Thursday, the International Energy Agency said a rebalancing of supply and demand is becoming evident. However, crude stockpiles remain “enormous” and would need time to fall, Neil Atkinson, head of oil industry and markets at the IEA, told CNBC Europe………………………………………..Full Article: Source

2016 gold price rally’s all about ETFs, hedge funds

Posted on 13 May 2016 by VRS  |  Email |Print

On Wednesday, gold snapped back some of its recent losses adding nearly $10 in New York in another day of brisk trading. At $1,275 an ounce, gold is up just over 20% since the start of the year. A new study shows the rally – the best start to the year in almost three decades – has been almost entirely driven by investors in physical gold-backed exchange traded funds and large-scale futures speculators like hedge funds.
According the the World Gold Council’s Gold Demand Trends study ETF investors who’ve been stocking up on the metal right out of the gate in 2016 were behind the best ever first quarter for the metal and the second largest quarter on record after Q1 2009………………………………………..Full Article: Source

Gold Bullion Is “Long Term Insurance Policy” – HSBC’s Steel

Posted on 12 May 2016 by VRS  |  Email |Print

Gold bullion is a “long term insurance policy” according to James Steel, chief commodities analyst at HSBC, who spoke with Tom Keene about what’s driving gold markets on “Bloomberg Surveillance” yesterday. In Bloomberg’s “Single Best Chart,” Keene displays inflation adjusted ‘London gold prices’ going back to 1950.
Steel is cautious on gold in the short term but positive in medium and long term and thinks gold will “churn higher.” When asked about whether he has a “message for gold bugs … people who have Krugerrands in their dressing room drawer”, Steel spoke of gold’s portfolio insurance benefits and “the diversification argument is the most powerful … it is an insurance policy”………………………………………..Full Article: Source

A Precious Metals Update: Why Platinum Is A Good Investment

Posted on 12 May 2016 by VRS  |  Email |Print

Tom Cloud provides a precious metal update that includes the distorted economic data as well as his take on the huge short positions against gold and silver. Tom also covers the platinum market and why he believes platinum is a good investment going forward.
I have now sponsored Precious Metals Expert Tom Cloud on the SRSrocco Report because of his extensive 40 years experience in the industry and his upfront honesty in discussing his rates which are some of the lowest in the industry………………………………………..Full Article: Source

Mitsubishi: Macroeconomic Backdrop ‘Positive’ For Precious Metals

Posted on 12 May 2016 by VRS  |  Email |Print

Mitsubishi is upbeat on gold despite the recent pullback, although at the same time wary of a possible correction in the near term. Pressure in the early part of the week was the result from a stronger U.S. dollar, despite Friday’s disappointing U.S. jobs report, plus a comeback in equities, the firm says.
“In our view, the dollar and yield environment should remain supportive of higher gold prices into the medium term and support the uptrend; however, the lack of strong physical demand in Asia right now and perhaps overly bullish investor positioning puts gold in danger of a short-term correction or at least a period of consolidation,” Mitsubishi says………………………………………..Full Article: Source

Should I Ever Invest in Gold?

Posted on 10 May 2016 by VRS  |  Email |Print

There are two schools of thought regarding gold: One camp advocates owning gold as a hedge against inflation, a weakening dollar, and stock market disaster. The other camp, which includes Warren Buffett, argues the yellow metal has no role in a modern portfolio.
“Gold is always an interesting topic to discuss with clients and other advisers,” says Joe Heider, founder of Cirrus Wealth Management in Cleveland. He shares Buffett’s view that your investment dollars are put to better use in other assets. “Gold has no intrinsic value other than for jewelry and some industrial use, and it produces no income,” says Heider………………………………………..Full Article: Source

Commodities recovery is ‘probably a little bit too fast’

Posted on 09 May 2016 by VRS  |  Email |Print

This year’s respite from the commodities rout is a “bit overdone” and investors should watch out for further retracement, the CEO of one of the world’s largest natural resources companies said.
Crude oil prices have largely rallied since mid-January, after a steep and lengthy rout from June 2014 onwards hit commodities across the board. Other commodities such as zinc, copper and iron ore have also pared some losses this year………………………………………..Full Article: Source

OPEC Leaves Us Exposed to Oil Shock

Posted on 09 May 2016 by VRS  |  Email |Print

OPEC’s strategy to lock down its share of the oil market comes with a worrying by-product: rising production means the world is less able to cope with a big supply disruption than at any time since the financial crisis.That may not seem a cause for fear when the world’s awash with oil. But it could become much more of a problem once the market re-balances and demand outstrips supply again.
Global spare capacity — defined by the IEA as the volume of oil that can be brought into production within 90 days and sustained for an extended period — stands at 3.44 million barrels per day, according to data compiled by Bloomberg. But much of that may not be available as quickly as you’d hope………………………………………..Full Article: Source

Do not over-allocate to gold

Posted on 09 May 2016 by VRS  |  Email |Print

The past five years have seen gold prices contract from the peaks seen in September 2011. However, in recent months, prices have increased. For the financial year 2016, domestic gold prices rallied about 11%, the bulk of which happened in the first three months of the year—it increased nearly 20% from January till April 2016.
While this recent trend could make you optimistic about the trajectory of gold prices, stop and analyse the objective of allocating funds to gold. Gold is not a productive investment—it does not earn interest, rent or dividends. All you have is the expectation that over a period of time the price of gold will increase………………………………………..Full Article: Source

Investors – and Donald Trump – are loving gold. How long will the rush last?

Posted on 06 May 2016 by VRS  |  Email |Print

The gold price has soared alongside the fortunes of Donald Trump, a big fan of the precious metal. How long can the new gold rush last? Two phenomena that pundits said would almost certainly never happen have taken place this week: Donald Trump clinched the Republican presidential nomination, and the price of gold capped a 15-month rally by soaring above $1,300 an ounce.
Coincidence? Logic would suggest so. But then, this is anything but a logical market environment or presidential electoral cycle. And there are, in fact, several ways in which gold is the ultimate Trumpian investment……………………………………….Full Article: Source

Is the bloom off the commodity rose already?

Posted on 05 May 2016 by VRS  |  Email |Print

With both the S&P/TSX Composite index and the S&P/TSX Venture composite index both down over one per cent in the last two sessions, investors are wondering if the bloom has somehow come off the commodity rose already. The corrective forces are the outcome of negative economic data triggering profit-taking in a market that has soared by nearly 30 per cent since the beginning of 2016, and is no cause for alarm.
This is just natural market movement. A lot of money has been flowing into mining lately. Yesterday alone saw a total of $145 million worth of bought deal and debenture financings flow into junior energy and mining deals………………………………………..Full Article: Source

Commodities - Will The Rally Continue?

Posted on 05 May 2016 by VRS  |  Email |Print

The recent rally in commodity prices has surprised many market participants and has greatly supported the stock market’s rebound. It has also made bulls out of a number of former stock market bears, as one of its side effects was to cause an improvement in market internals. But does the rally actually make sense?
As always, there are arguments both for and against the idea. We will take a look at several of them below. First of all, it is widely held that the “commodity super-cycle” as it used to be called (i.e., the secular bull market that started in 1998) is definitely over………………………………………..Full Article: Source

Gold Has Similar Pattern To 1999; Short-term Pressure Ahead Says Technician

Posted on 05 May 2016 by VRS  |  Email |Print

In 1999, the gold market rallied at the start of the year before settling into a range, so is history repeating itself for the metal? According to Ari Wald, head of technical analysis for Oppenheimer & Co., it just might be. ‘For the longer term trend, it is indeed reversing higher here, but the message is, tactically, now is not the time to be playing for that,’ said Wald in an interview with Kitco News.
‘Over the past few weeks, gold has rallied a lot in a short amount of time - in fact it is about 11% above the 200-day moving average along with being overbought and testing some resistance at the 2015 peak at $1,300,’ he explained. ‘It is due for a pause to refresh and with that pause, we can see downside risk, maybe to the March lows of $1,200.’……………………………………….Full Article: Source

Jim Rogers Says China Right to Cool Casino-Like Commodity Frenzy

Posted on 05 May 2016 by VRS  |  Email |Print

Veteran investor Jim Rogers says that authorities in China are right to tackle the frenzy of speculative investing that’s broken out in the nation’s commodity futures markets, warning that a failure to act would have stored up problems.
“China is doing their best to cool it off and calm it down,” Rogers, Singapore-based chairman of Rogers Holdings, said in an interview. “That’s good, because over-speculation in anything leads to problems, especially if people don’t know what they’re doing.”……………………………………….Full Article: Source

Springtime For Commodities

Posted on 04 May 2016 by VRS  |  Email |Print

April showers bring May flowers, but will a budding bull market in commodities bloom this May? Emerging green shoots in gold, silver and crude oil could be early signs that the deep freeze gripping commodities since Spring 2011 is finally thawing. Weather Will Determine Direction of Key Commodities in 2016.
While weather will continue to be a major factor for certain commodities, the dollar will determine the direction of the sector as a whole. Essential commodities like crude oil and agricultural products are priced in dollars………………………………………..Full Article: Source

Gartman says gold is in a true bull market—and on its way to $1,500

Posted on 04 May 2016 by VRS  |  Email |Print

Gold has enjoyed a spectacular beginning to 2016, and one widely followed commodities expert believes the metal could be on the verge of going much, much higher.
“I think it’s still a bull market,” said Dennis Gartman, editor of The Gartman Letter, Monday on CNBC’s “Fast Money.” He predicts gold could finish out the year 10 to 15 percent above current levels. With gold hitting a 15-month high Monday and breaching $1,300, that would represent a price as high as nearly $1,500………………………………………..Full Article: Source

What Makes the Price of Gold Move

Posted on 04 May 2016 by VRS  |  Email |Print

The present gold bull market has drawn more attention to investing in the yellow metal. Yet, many investors don’t know much about the factors that affect the price of gold. Unlike other investments, perceived value is a major factor in the gold price.
There is a bit more to it than that, however. Here are several of the top influencers on the price of gold. Money Morning Resource Investing Specialist Peter Krauth gives readers regular insight into the “types” of money that move the price of gold. One of these is called “dumb money.”……………………………………….Full Article: Source

Harvard Professor Urges EMs To Buy Gold

Posted on 04 May 2016 by VRS  |  Email |Print

Emerging market economies need to shy away from the U.S. dollar and U.S. treasuries, and instead invest more in gold, this according to one Harvard profession.
Tuesday, in a commentary for Project Syndicate, Kenneth Rogoff, professor of Economics at the Ivey League university and former chief economist at the International Monetary Fund, recommended that emerging economies boost their gold reserves to about 10%, which would still keep them below some developed country’s gold reserves………………………………………..Full Article: Source

Oil Price Rally Isn’t as Deep Rooted as It Looks at First Glance

Posted on 03 May 2016 by VRS  |  Email |Print

At first glance, oil prices have rallied - a lot. Look closer, however, and the market is still pricing the “lower-for-longer” mantra, much as it did at the beginning of the year. Front-month futures for West Texas Intermediate, the U.S. benchmark, have risen 21 percent this year, but the recovery looks very different if you focus on the longer term.
The five-year-forward WTI contract fell 2.6 percent over the same period, reflecting the view that shale oil production could rebound as prices recover, capping any rally. “The markets may be getting ahead of themselves,” Michael Wittner, oil analyst at Societe Generale SA in New York, said in a note to clients………………………………………..Full Article: Source

BP Says Oil Price Not Lower Forever

Posted on 03 May 2016 by VRS  |  Email |Print

Oil prices will eventually rebound, BP’s Upstream Chief Executive Bernard Looney told attendees during a presentation at the Offshore Technology Conference in Houston. “Is it lower for longer or lower forever? At BP we don’t think it’s lower forever,” Looney assured oil and gas industry delegates during the first day of the global conference.
“You hear people questioning the future of oil and gas … The world needs this industry; half the world still lives in poverty…these people deserve the same opportunities we take for granted and oil and gas has [the potential to deliver that],” he added………………………………………..Full Article: Source

Gold’s surge is making it feel a lot like late 2007

Posted on 03 May 2016 by VRS  |  Email |Print

Gold is enjoying an incredible year, surging 22 percent as the S&P 500 is barely positive. What’s rare is for the yellow metal to outperform the market so dramatically in a year when stocks are up.
In fact, going back to 1980, there has been only year in which gold has outperformed the S&P by 20 percent or more while the latter was positive on the year: 2007. Both gold and the fear-measuring CBOE Volatility Index surged in the second half of that year, even as stocks maintained their footing. The crash, of course, came in 2008………………………………………..Full Article: Source

Commodities recovery has sceptics, but a boon while it lasts

Posted on 02 May 2016 by VRS  |  Email |Print

The recovery in commodity markets has plenty of sceptics, including the major resource companies, but the benefits will soon start flowing through the rest of the economy. The lift in the iron ore price from its low of just under $US38 a tonne last December to a high of just under $US70 a tonne last month has paralleled a broader improvement in resource markets including oil, copper and nickel.
It may not be enough to spark fresh investment in new resource projects, but it will boost the profits of the resources sector, delivering more dividends, taxes and royalties and, at the margin, more employment. It should help lift Western Australia — at present the biggest drag on national economic performance — out of its slump………………………………………..Full Article: Source

Global commodity bust boosts India Inc’s profits

Posted on 02 May 2016 by VRS  |  Email |Print

The downward cycle in the global commodity market, which has severely impacted several economies, including the behemoth China, has come to the rescue of India Inc as the March quarter performance of companies that have declared results shows.
The aggregate operating profit of 156 companies (excluding banks and financials) that are listed on the Indian bourses and have announced results has grown by an impressive 17 per cent year-on-year.Even as the larger economy continues to grapple with a demand slowdown, as evident from the tepid 2.6 per cent rise in revenue, the weakness in global commodity prices has been the saving grace for the import-dependent economy………………………………………..Full Article: Source

Analysts Just Aren’t Buying the Oil Rally

Posted on 29 April 2016 by VRS  |  Email |Print

Questions remain about current high oil stockpiles and the potential for increased supply. Even as oil rallies, analysts have barely nudged up their price forecasts as they worry that crude’s recent gains might not be sustainable.
The price of oil has jumped 76% from the decade-low it hit earlier this year. That is mainly on hopes that dwindling U.S. oil production will help take crude out of an oversupplied market………………………………………..Full Article: Source

For commodities markets, the bad times are just beginning

Posted on 28 April 2016 by VRS  |  Email |Print

For the commodities market, the good times have come and gone, but the bad times are only just beginning. Each commodities supercycle, defined as a decadelong bull market, has always been followed by a downturn that lasted just as long, or longer.
With demand weak and oversupply rampant, it is unlikely that this time will be any different. For many countries and companies, this means the only options are adapt or die………………………………………..Full Article: Source

Speculators march into China commodities

Posted on 28 April 2016 by VRS  |  Email |Print

At the start of the year western commodity traders knew China, the world’s biggest consumer of raw materials, would play a decisive role in the direction of markets. What they did not know was that it would be Chinese investors as much the country’s economic prospects driving prices.
In the past month near mania has gripped China’s commodity futures markets with day traders and yield-hungry wealth managers pouring into a lightly regulated sector, often with astonishing results………………………………………..Full Article: Source

Silver bullion momentum building as supply trouble brewing

Posted on 28 April 2016 by VRS  |  Email |Print

Silver bullion prices are likely to rise further as there is “supply trouble brewing” as strong industrial and investment demand are confronted by declining supply.
“There are signs that this year could be a pivotal year for the silver market,” New York-based CPM Group said in its “Silver Yearbook 2016… Silver mine supply is forecast to decline for the first time in 2016, since 2011,” CPM said, noting scheduled closures and planned production cutbacks………………………………………..Full Article: Source

Silver Supply Trouble Shows Why Rally Momentum Is Building

Posted on 27 April 2016 by VRS  |  Email |Print

More good news for silver bulls: there’s supply trouble brewing. Output from mines will fall for the first time since 2011, while demand for the metal in uses including industrial products and jewelry is heading for a fourth straight gain, supporting prices, according to CPM Group.
The market is entering what is “likely to be a pivotal year,” the New York-based researcher said in its “Silver Yearbook 2016.” Production is declining just as signs of stabilization in China’s economy fuel optimism for stronger global demand, helping drive a 24 percent rally in silver this year through Monday that topped gold’s performance………………………………………..Full Article: Source

Commodities react like a canary in a coal mine

Posted on 26 April 2016 by VRS  |  Email |Print

Commodities are suffering from a negative sector sentiment, independent of supply and demand dynamics. This is largely because concerns about Europe and the US getting trapped into recession and Chinese President Xi Jinping’s ability to steer the country’s economy into soft landing refuse to go away.
No doubt commodities will be the first in the line of price collapse if recession hits the world. That is why Vedanta Resources chief executive officer Tom Albanese loves to describe the “commodities sector as a canary in a coal mine”. Albanese doesn’t think global recession will happen. But, the thought of demand could take a hit is leading people to cut their commodities exposure………………………………………..Full Article: Source

After Doha, what next for Opec?

Posted on 25 April 2016 by VRS  |  Email |Print

Opec has had some infamous meetings in its history. An ill-timed hike in quotas in Jakarta in November 1997 led to a crash in prices, while the June 2011 “worst ever” meeting in Vienna, as the Saudi oil minister termed it, failed to stop prices from rising. Doha last week was, perhaps, not in that league but still blended tedium, surprise and dysfunction, even more embarrassingly for including key non-Opec players.
Most Opec countries attended along with non-Opec leaders such as Russia and Oman. It seemed that the previously announced deal to freeze production at January levels was a formality, especially as most countries involved could not or would not increase output anyway………………………………………..Full Article: Source

Gold, already on its way up, may head even higher

Posted on 25 April 2016 by VRS  |  Email |Print

Gold bugs may have a firmer grip on the market than you think. Consolidation in the precious metal has become the driving force for positive near-term momentum in the space, said Zev Spiro, CEO and chief market technician at Orips Research. It comes as both gold and silver trade around their highs for the year.
“As long as prices hold above support in the $1,190-$1,205 area, then the composure remains positive,” Spiro told CNBC’s “Futures Now” in a recent interview. “Upward momentum is expected with a breakout above the $1,275-$1,280 area. So, that’s where I expect the new wave of buying would come in and could carry prices higher.”……………………………………….Full Article: Source

Should you run with the commodities herd?

Posted on 22 April 2016 by VRS  |  Email |Print

Another week of climbing commodities prices must be making true believers of professional investors, whether they like it or not. At some point, fund managers have to start looking nervously at their performance against a benchmark that is being turbocharged by the most hated sector of them all: resources.
Last year was tailor made for the average investor using the sharemarket index as a benchmark. All you needed to do was be underweight banks and resources and you could boast you were beating the market and earning your fees………………………………………..Full Article: Source

Fallen angels: Downgrades surge amid commodities rout

Posted on 22 April 2016 by VRS  |  Email |Print

More companies were tossed into the investment junkyard during the first three months of this year than in all of 2015, as weak commodity prices helped to undermine once-solid corporate balance sheets.
Moody’s Investors Service, one of the world’s largest credit raters, said in a report that it pushed 51 companies out of its investment-grade category during the first quarter of 2016, a reflection of their increasing risk of default. By comparison, Moody’s downgraded only 45 companies to below investment-grade status during all of last year………………………………………..Full Article: Source

Why $80 could be ‘new normal’ for oil: Advisor

Posted on 22 April 2016 by VRS  |  Email |Print

The “new normal” for U.S. oil prices could be as much as double the current $40 per barrel, but don’t expect $65 to $80 crude until around 2018, long-time industry advisor Tom Petrie said Wednesday.
“We overshot on the downside, when we penetrated $30 [per barrel],” Petrie said, referring to the Feb. 11 bottom of $26.05 per barrel. Since then, WTI has surged about 45 percent. “Some of that recovery, shock though it was, was getting back into a more normal adjusted price.”……………………………………….Full Article: Source

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