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Commodities Briefing 16.Mar 2011

Posted on 16 March 2011 by VRS |  Email |Print

From Dow Jones: Copper prices avoided the brunt of Tuesday’s commodity selloff, as traders looked beyond the imminent nuclear-reactor crisis to Japan’s reconstruction. “Copper is the first thing they’ll need to come back and rebuild,” said Charles Nedoss, senior market strategist at Olympus Futures.
May copper, which has the biggest number of contracts outstanding, ended 1.2% lower at $4.1370 a pound. Thinly traded March copper also fell by 1.2%, settling down 4.85 cents to $4.1250 a pound on the Comex division of the

Posted on 16 March 2011 by VRS |  Email |Print

From Thehindubusinessline.com: Japan’s deepening nuclear crisis, triggered by the March 11 earthquake and tsunami, sent shock waves across the commodities market on Tuesday with prices of crude oil, gold, silver, copper and coffee crashing. Other commodities such as rubber, crude palm oil also dropped, though some recouped their losses towards the end of the day.
A broad sell-off was seen across all commodities as investors and funds chose to cash in or book profits. A rising dollar contributed to the chaos in the market as commodities that are traded in the greenback began to lose value……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Bloomberg: Wheat plunged the most in seven months and agriculture prices tumbled on concern that the earthquake and nuclear crisis in Japan will slash raw-material demand. A gauge of commodities dropped the most in four months.
Corn, soybeans, cotton, cattle, rice, oats and soybean oil dropped the most allowed by exchanges in Chicago and New York. Crude oil had the largest decline in almost five months……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Bloomberg: Demand for commodities will remain intact after Japan’s biggest earthquake as rebuilding efforts will outweigh a decline in industrial production, Mark Mobius, chairman of Templeton Asset Management’s Emerging Markets Group, said.
“We don’t think there’s going to be a significant change in the longer-term trend,” Mobius said. “We haven’t moved to buy or sell. There is tremendous spending that has to be done, and that will boost the demand for steel, iron ore and the rest of it.”………………………………………Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Usatoday.com: When officials in charge of a badly damaged nuclear power plant consider trying to cool hot fuel rods by spraying them with water from a helicopter, the situation is either out of control or frighteningly close.
That’s where matters stood late Tuesday at Japan’s Fukushima Dai-ichi nuclear plant, as workers fought another fire and struggled to keep the plant’s reactors from releasing catastrophic amounts of radiation……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From AFP: The International Energy Agency warned Tuesday of a “marked slowdown” in the global economy unless oil prices fall from current high levels as post-recession demand picks up.
“If prices remain at current levels or rise further, by September 2011, if not before, the global economy may feature a marked slowdown,” the IEA said in its monthly oil report……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Moneycontrol.com: Global oil demand will be lower than previously forecast in 2011 as high oil prices begin to have a toll on the global economy, the International Energy Agency (IEA) said on Tuesday.
The IEA, which advises 28 industrialised countries on energy policy, also said OPEC’s production fell only slightly in February as the organisation’s members stepped in to compensate for the loss of Libyan output……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Nytimes.com: The price of oil fell below $100 a barrel on Tuesday for the first time in two weeks as investors dumped commodities for safer assets amid worries that the widening disaster in Japan could lead to a global economic slowdown.
But the slide in the price of energy may be short-lived. A variety of factors could increase fuel costs in the next few months, even as supplies remain tight because of the continuing unrest in the Middle East……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Mineweb.co.za: It has become a media tradition for moves in the gold price to be related to some political event or a civil war or a major tragedy such as the earthquake in Japan, when the events should actually have a negligible effect on those markets.
We find it unfortunate that this happens because it is misleading. For instance, we were informed by the media yesterday that the gold price had risen in the dollar, because of Japan’s earthquake and tsunami……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From MainStreet: Your bank savings are paying next to nothing, so maybe it’s time to look at an age-old alternative: gold. Gold has historically been the refuge in times of crisis, and the rippling effects of the earthquake and tsunami in Japan certainly count as a crisis that may damage the world economy and financial markets in ways we can’t foresee.
While gold has not always proven to be a good long-term holding, many investors like the fact that gold marches to a different drummer. When stocks and bonds are suffering, gold may flourish, and vice versa. Thus it can stabilize a portfolio, much like cash……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Mineweb.co.za: Analysts at RBC Capital Markets believe that the current sell-off in platinum stocks - about 10% over the past week alone - offers a “second bite at the cherry with two of the ‘juiciest’ cherries looking like Aquarius Platinum and North American Palladium at present”.
RBCCM says the issues driving the sell-off “are essentially related to a belief that world economic growth is again taking a beating with rising sovereign risk in Europe and ongoing political instability in the Middle East having an unnerving impact on the price of oil and just to top it off, a large earthquake in Japan”……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Resourceinvestor.com: It goes without saying that in the short term, the biggest challenge for Japan and its economy is to provide immediate humanitarian relief to the victims of the earthquake and tsunami. Cost will, of course, not be a factor in rescue and relief efforts.
However, in the long term the largest problem for the Japanese industrial economy will be the sudden onset of the need to redistribute (at best) and allocate and prioritize (at worst) the supply of electricity between civilian and industrial demand……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Business-standard.com: Most of the base metals continued its declining trend at the non-ferrous metal market here today on hectic stockists offering amidst bearish global cues.
The industrial metals fell further at the LME on Japanese concern over quake-stricken nuclear plant weakening the trading sentiment……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Reuters: Investors took a bullish stance in the iShares MSCI Japan Index on Tuesday, positioning for a rebound in Japanese equities after a torrid sell-off.
The exchange-traded fund tracks the performance of the Japanese equity market and ended down two cents to $10.03. At its lows, the fund has dropped nearly 14 percent since last Friday’s devastating earthquake and tsunami……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Istockanalyst.com: Here’s a look at six of Fidelity’s commodity and resource related funds that earn my buy recommendation. Today, commodities are in increasingly short supply as increasing global consumer demand, geopolitical disruptions, and even Mother Nature have taken their toll on the supply of goods and services.
I view commodities as a real world currency whose value typically increases in times of economic expansion and decreases in times of economic contraction……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Reuters: Global trading of futures and options contracts jumped 26 percent last year, with Asian exchanges dominating trade for the first time, the Futures Industry Association (FIA) said on Tuesday.
Contracts traded on Asian derivatives exchanges surged 43 percent to 8.86 billion contracts in 2010, the FIA, a Washington-based industry group, said in its annual report……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Risk.net: Derivatives exchanges report a spike in trade volume on the back of growth in Asia-Pacific and Latin America, and strength in the commodities sector.
Derivatives exchanges witnessed a 25.6% increase in trading volume in 2010 compared with the previous year, with 22.3 billion contracts changing hands, the US-based Futures Industry Association (FIA), a trade body, said on Tuesday……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Thehindubusinessline.com: The Bombay Stock Exchange has signed a licensing agreement with the US-based International Securities Exchange (ISE) to launch derivative products in India.
The agreement is part of the ongoing market development efforts between BSE and Deutsche Borse Group, which includes Eurex and ISE, the BSE said in a statement……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Reuters: Exchange operator CME Group ’s London unit will start clearing over-the-counter energy and commodity derivative products starting May 2011. CME Clearing Europe will start clearing more than 150 such contracts from May 6, it said on Tuesday.
Clearing members will include commodity and energy trading arms of BNP Paribas , Citigroup , Deutsche Bank and HSBC , among others……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Reuters: Daily traded volume on a Mauritius’ commodities and currency exchange have tripled since it started operations last October, the exchange said.
The Global Board of Trade (GBOT), as the exchange is known, said it crossed the $35 million mark on March 11, when it finished the day at $35.18 million……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Mg.co.za: The Johannesburg Stock Exchange (JSE) released its annual results for the 12 months ending December 2010 just as its current CEO, Russell Loubser, announced he will be stepping down at the end of this year.
Loubser will be replaced by current deputy chief executive Nicky Newton-King……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Dow Jones: Nervous traders jumped into perceived safe havens such as the yen and Swiss franc Tuesday as reports of further explosions at Japan’s Fukushima nuclear power plant sent currencies tied to global growth sharply lower across the board.
A full-blown nuclear disaster could put pressure on global energy supplies, stoke more oil-driven inflation and have a profound effect in slowing global growth……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Reuters: Japan’s nuclear crisis hit Latin American currencies on Tuesday, but a pledge of low interest rates by U.S. Federal Reserve promised to anchor the appeal of Latin American debt.
Investors piled into assets that they perceived to be a safehaven, like U.S. Treasury bonds, amid fears that radiation from earthquake-damaged nuclear plants could reach Tokyo……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Reuters: Japan’s largest brokerage, Nomura Holdings Inc plans to shut its global commodities and energy-trading desks, according to sources close to the company.
“Nomura is closing down the oil and commodities desk. Global,” an oil broker said……………………………………….Full Article: Source

Posted on 16 March 2011 by VRS |  Email |Print

From Bloomberg: European Union carbon permits surged to their highest price in almost two years after Germany said it will halt its seven oldest nuclear reactors, increasing demand for replacement power from fossil fuels.
EU permits for December jumped 3.7 percent to 17.21 euros ($24.08) a metric ton on the ICE Futures Europe exchange in London, the highest close since May 2009……………………………………….Full Article: Source

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