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Commodities Briefing 01.Oct 2012

Posted on 01 October 2012 by VRS |  Email |Print

Kevin NorrishInvestors bid up the price of commodities in recent months as expectations rose that the Federal Reserve would soon step in once again to stimulate the wobbly U.S. economy. But the rally has stalled since the package was unveiled in September, raising concerns about whether widespread gains will continue in months ahead, as they did after an earlier Fed initiative in 2010.
The Dow Jones-UBS Commodity Index has jumped 15% since June 6, when Fed officials indicated the central bank might need to take further action to promote growth. The index also leapt 15% in the three months after the Fed signaled its 2010 plans………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Commodities are on the upswing in early trade amid a broad-based advance in risk appetite as traders encouraged by yesterday’s release of an ambitious Spanish budget await a similar result from France. Sentiment-linked crude oil and copper prices are following shares higher while gold and silver are buoyed by ebbing haven demand for the US dollar.
Optimism may be fleeting however. Economists expect Paris will run a deficit equivalent to 4.6% percent of GDP this year, the highest among the core members of the euro zone. This means President Francois Hollande and company may be forced to press on with tax hikes and/or spending cuts, both of which would compound headwinds for already anemic growth………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Speculators cut wagers by the most in 16 weeks as commodities capped the first monthly loss since May on mounting concern that central bank stimulus measures won’t be enough to halt slowing economic growth.
Money managers reduced net-long positions across 18 U.S. futures and options by 5 percent to 1.24 million contracts in the week ended Sept. 25, the biggest slump since June 5, Commodity Futures Trading Commission data show………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Oil prices recorded their best quarterly performance of the year in the third quarter, but opinion is roughly split over whether the stimulus-led rally will continue in the final three months of 2012, according to CNBC’s latest oil survey.
Though many argue new stimulus measures introduced by major global central banks last quarter were a ‘game-changer,’ putting an effective floor in the oil price, others say the macro-economic environment remains soft and any post-stimulus material turnaround in the real economy – if and when it does come — will be limited………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Oil industry needs management that ‘has the guts to take risks and invest’. The global energy market is in flux: “We are experiencing a global race for the most important energy raw materials. A race in which former emerging countries such as China and India are now setting the pace,” said Rainer Seele, Chairman of the Board of Executive Directors of Wintershall, at an energy debate hosted by the German Council on Foreign Relations (DGAP) in Berlin.
Seele discussed the current economic and political developments on the raw materials markets for crude oil together with OPEC Secretary General Abdullah Salem El-Badri and Ulrich Benterbusch, Director of the Office of Global Energy Policy at the International Energy Agency (IEA)………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Iran’s OPEC governor Mohammad-Ali Khatibi has reiterated that the country’s crude oil exports have not seen any change despite tight Western embargoes on the Islamic Republic’s oil sector.
“The oil exports process is similar to previous months and the exports are carried out as done in the past,” Khatibi said……………………………………….Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Iraq will invest around $500 billion (309 billion pounds) in energy and linked industries with the help of the private sector by 2030, generating around $6 trillion in revenues, the Deputy Prime Minister for Energy said on Sunday.
Hussain al-Shahristani said the growth generated would create around 250,000 jobs for the war-torn country, which is trying to rebuild its economy after years of violence and economic sanctions………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Over the past few years, gold has been the darling of investors eyes. But what about the other so-called precious metals? You know about gold but what about silver, copper and platinum?
Investing in Silver: The silver market is much smaller than the gold market, which makes for higher volatility (fluctuations) in price. Therefore investing in silver can be risky for most investors. There are industrial uses for silver, such as jewelry, but the price is driven primarily by supply and demand and investor speculation………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

As a general rule, the most successful man in life is the man who has the best information. Gold no longer has a legal role in the world’s monetary system, but because of a collapse of faith in sovereign obligations - fiat currencies/paper money ? and a coming complete lack of trust in governments and financial institutions, gold is going to quickly become a core banking asset.
So why do I believe gold is going to become a core banking asset, what exactly does gold have going for it to make this possible?……………………………………….Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Gold prices in spot and futures are likely to gain on Monday in the domestic market, taking cues from global markets during the weekend. On Friday, the most-active December gold contract closed firm at $1,773.90 an ounce on the Comex.
A weakening dollar that is likely to lead to a firm trend in the rupee is likely to push gold prices in global and domestic markets………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Singapore has emerged as one of the world’s hubs for private banking for the wealthy, and now it is making a play to become the Fort Knox of Asia.
Starting Monday, the Southeast Asian city-state is scrapping a 7% tax on gold and silver in an effort to turn the city into a precious-metals trading hub to rival London and Zurich, where value-added taxes don’t apply to the investment-grade gold trade………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Just a few weeks ago, Mario Draghi, President of the European Central Bank (ECB), announced that he would do anything required to bailout the weakest members of the euro zone and in so doing prevent the euro currency from dissolution. Investors who may have been previously positioning themselves to withstand a euro crisis seem to be anxious to believe that such bold actions will prevent the worst.
Consequently, many unwound positions in US dollars and bought back euros. In the wake of the announcement, the euro rose from $1.22 to $1.30………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Gold and silver prices dipped Friday as the dollar strengthened against global currencies on safe-haven buying that followed disappointing U.S. consumer sentiment and purchasing managers data. An economist warns a recession could lead to a meltdown in precious metals despite all the bullishness from global stimulus programs.
Spot gold prices shed 0.23% to $1774 an ounce intraday. During the quarter, it reached its highest price of 2012 and came within six percentage points of its all-time nominal high from 12 months ago………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Silver Bullion was the best-performing commodity this quarter, up 25.3% thanks to the Fed’s decision to initiate QE3. Prices for both silver and gold are holding under formidable double-top resistance levels near $36 and $1800, respectively.
Investor flows into the two metals continued at a rapid pace, as Silver ETF holdings and Gold ETF holdings hit record levels at 600 million troy ounces and 82 million troy ounces, respectively………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Despite the slew of production losses, Barclays is forecasting the platinum market to remain in surplus for the remainder of 2012. They estimate supply disruptions would need to last another 4-6 weeks to balance the market assuming demand conditions do not deteriorate further.
“In addition to this, political uncertainty continues to plague PGM output in Zimbabwe with the government ordering Zimplats to pay levies spanning the past five years after the revised tax assessment.” the Bank said in a report………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

The strong bounce in precious metals yesterday following the midweek correction supports the current positive momentum with focus once again turning to whether upside resistance can be breached. Look out for silver in such a situation as it tends to show the way.
As we approach month and quarter end commodities showed no major change from their current trends. October gasoline which expires today moved into positive momentum following the dramatic spike in recent days. The next contract of November however does not yet show similar characteristics as the rally was driven by shortages around the New York Harbour area which is the delivery hub for RBOB gasoline………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Mining giant Xstrata is reportedly planning to recommend that its shareholders back a revised multibillion-pound merger with commodities trader Glencore. Mining giant Xstrata is reportedly planning to recommend that its shareholders back a revised multibillion-pound merger with commodities trader Glencore.
It is understood the decision comes after a weekend of talks and will be announced on Monday, coinciding with a deadline set by the City takeover panel. The merger has turned into a long-running saga since being proposed in February, amid shareholder discontent over the terms………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

The US dollar will unlikely to lose its status as the main reserve currency in the near future despite the current challenges facing the US economy, regional economists said. According to the International Monetary Fund data, the dollar’s share of known global reserves held by central banks slipped in the year’s second quarter.
The dollar’s share of the roughly 5.8 trillion of known reserves was 61.9 percent in the second quarter compared with 62.1 percent during the first three months of the year, Reuters reported………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

Asian currencies had the best quarter in two years after global policy makers announced plans to pump money into financial markets to support growth, spurring capital flows into higher-yielding assets.
The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s most-active currencies, rose 1.8 percent since June 30 as the Federal Reserve, the European Central Bank and the Bank of Japan expanded bond-purchases programs to lower borrowing costs………………………………………..Full Article: Source

Posted on 01 October 2012 by VRS |  Email |Print

The Iranian currency has fallen to a historic low despite all efforts by the Islamic Republic to control the market. Iranian media report that the dollar was traded at the record level of more than 30,000 rials on Sunday, while the price of the gold coin has reached 12 million rials and appears to be rising by the day.
The head of the Gold & Coin Union of Tehran said the rising price of gold and foreign currencies is due to low supply in the face of rising demand………………………………………..Full Article: Source

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