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Commodities Briefing 01.Nov 2012

Posted on 01 November 2012 by VRS |  Email |Print

Slumping energy and metal prices sent commodities to their biggest monthly loss since May, lagging behind stocks, bonds and the dollar, as the global economy grew at the slowest pace since the 2009 recession.
The Standard & Poor’s GSCI Total Return Index of 24 raw materials fell 4.1 percent, erasing gains for the year. The MSCI All-Country World Index of stocks slid 0.6 percent, including dividends, while the U.S. Dollar Index slid 0.02 percent. While bonds of all types gave positive returns, prices dropped on average, according to Bank of America Merrill Lynch’s Global Broad Market Index. (MXAP)……………………………………….Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

The European Union needs new binding goals on renewable energy and on cutting carbon emissions to succeed green policy targets that expire in 2020, the EU’s energy chief said, omitting any mention of replacing the current energy savings target.
His comments added to a debate about whether the three existing green goals should be followed by another three, with some EU nations and industry opposing what they see as too much regulation………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

OPEC oil output has risen slightly in October as extra supplies from Iraq, Angola and Libya have offset disruptions in Nigeria and a further decline in Iran to its lowest in two decades, a Reuters survey found on Wednesday.
The survey indicates Iraq’s expansion in export capacity and continued high output from top exporter Saudi Arabia are helping to compensate for reduced supply from Iran, whose output has fallen sharply due to Western sanctions………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Does the rise of U.S. shale oil mean fuel buyers can look forward to a multi-year period of crude price decline? Or is oil destined for new record highs above $150 a barrel?
The question is dividing energy analysts who are split on whether or not shale and other predominantly North American “unconventional” supply like Canadian oil sands will be enough to comfortably meet an increase in global fuel demand led by emerging markets to 2020………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Iran announced Wednesday that it is restricting the outward flow of Gold Bullion, in response to “challenges in the field of foreign trade”, the country’s Mehr news agency reported.
The move, which will restrict the export of Gold Coins and other bullion, follows a report earlier in the week from the official INRA news agency that Tehran has banned the export of 50 industrial and petrochemical items as well as foodstuffs………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

After putting curbs on non-banking finance companies (NBFCs) lending against gold, the Reserve Bank of India on Tuesday banned banks from lending for purchase of gold by jewellers.
“No advances should be granted by banks against gold bullion to dealers or traders in gold if, in their assessment, such advances are likely to be utilised for purposes of financing gold purchase at auctions or speculative holding of stocks and bullion,” the RBI said in its half-year review of the monetary policy. The RBI has been concerned over banks’ exposure to gold finance companies and has taken steps to curb it………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Investor and newsletter writer Dennis Gartman suspects that a large number of sell stops in gold are likely building below $1,700 and 1,300 euros per ounce.
Stops are pre-placed orders to buy or sell when certain chart points are hit, often used by traders to exit trades that are going against them………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Endless easy money policies from central banks around the globe have undoubtedly created a long-term tailwind for gold and precious metals. In recent articles I have suggested that gold prices may also have tailwinds in the form of extensive inflationary pressures and have recommended picking up the gold miners as a potential way to play it, in addition to physical assets or one of the ETFs that tracks gold prices such as the SPDR Gold Trust (GLD).
I believe all precious metals will benefit from inflationary actions of by central banks worldwide in the next few years. In the present article I would like to highlight three ways to invest in silver, given that I have stated that it could outperform gold in the next year………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

If asked to name the top performing commodity of the past decade, not many would answer silver because of its notorious volatility. Yet, according to Lloyds TSB, silver prices have delivered the best gains since 2002.
Lloyds data shows that the shiny metal soared 572% over the past decade, beating gold’s rise of 428%, which was second best among commodities. Lloyds said silver beat gold because “[I]n addition to being perceived as a safe haven investment, high demand for industrial uses has also contributed to the strong rise in the price of silver.”……………………………………….Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Global diamond markets continue to soften with market sentiment dampening. Although October is traditionally a slower time for the diamond industry due to the Diwali Holidays, the current downturn in market activity is being driven by more concerning underlying fundamental factors.
With both rough and polished prices continuing to ease, the soft market conditions are expected to continue during November………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Metals and mineral prices are unlikely to recover in the next five years as new projects will add supply at a time of tepid demand, according to KPMG LLP’s global head of mining.
A decline in the growth rates of Asian economies as new projects begin production means the metals market is imbalanced, Wayne Jansen said. As a result, companies are deferring investments, he said………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

At a global level, assets invested in exchange-traded funds and exchange-traded products reached a new all-time high of over US$1.86 trillion at the end of Q3 2012, an increase of 21.7 per cent from $1.53 trillion.
Looking regionally, assets invested in European listed ETFs and ETPs also reached a new all-time high of over US$349.5bn at the end of Q3 2012 surpassing the prior record of $339.4bn set at the end of February 2012………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

As markets re-open their doors on Halloween, investors will be scrambling to make up for lost time. But while today’s trading will be in a frenzy, we wanted to take Halloween day to look back on some of the more frightening commodity performances over the past few years. We found three of the worst commodity ETFs in the trailing five years to give you your share of terror on this holiday.
Actually, we could have chosen from a wide variety of industrial metal-based funds, as these commodities have been nothing short of pathetic in recent years. The DJ-UBS Nickel Total Return Sub-Index ETN has surrendered just over 54% in the trailing five years, as a weak economy has made it impossible for industrial metals to keep their heads above water………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Wheat is arguably one of the most important crops in the world, and currently ranks as one of the three most consumed grains across the globe. Wheat is prized for being relatively easy to grow, as well as for being able to flourish in a vast array of environments.
The crop is also able to stay fresh for extended periods of time, allowing it to be stored for a long duration. These qualities have made wheat a dietary stable in both developed and emerging markets………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

For years, issuers and investors alike have been trying to find unique ways to slice and dice the commodity market to find the best returns. Some prefer to buy into depressed assets, while others have employed strategies that focus in on a specific segment of the broad space.
But for every methodology out there, the volatility of the commodity world will, at some point, throw a wrench into even the best laid plans. It is not unusual to see some of these assets move by 3% or 4% in a single trading session, a double-edged sword for traders………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Emerging-market currencies were mixed Wednesday, as many investors who had been sidelined during Hurricane Sandy returned to work without an appetite for risk. Early in the session, a weaker-than-expected U.S. manufacturing gauge tempered market sentiment. The Chicago Business Barometer came in at 49.9, missing the consensus forecast of 51.0.
Investors are becoming increasingly defensive in their positioning as the U.S. presidential election draws nearer, preferring to sell currencies that have profited so they can sit the fence………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

The Swiss National Bank has pulled off what was thought to be a near-impossible trick: unloading billions of euros without the wider market noticing.
Switzerland’s central bank said Wednesday that the proportion of its currency reserves held in euros fell to 48% at the end of September, down from 60% at the end of June, indicating that it aggressively sold euros for other currencies throughout that time, most notably in favor of sterling and dollars………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Carbon trading in Australia and provinces of Canada may lack needed liquidity unless they link with other markets, according to an adviser at the Center for European Policy Studies.
The countries should link their proposed markets to existing programs in Europe, the center’s Andrei Marcu said today at a conference in Bangkok. South Korea’s efforts to start a carbon market in 2015 should also tie up with Europe to boost trading liquidity, he said………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

Orbeo has said prices for United Nations emission credits may drop to almost zero this year, Bloomberg News reports. Orbeo, a carbon-trading company owned by Solvay Energy Services, also predicts a possible rebound after 2015.
Investors are dumping the UN greenhouse-gas credits known as Certified Emission Reductions, Orbeo senior manager Dorothy Denis tells the business publication………………………………………..Full Article: Source

Posted on 01 November 2012 by VRS |  Email |Print

China’s development has had a significant impact on emerging market growth, and not all economies have unambiguously benefitted. According to Analyst Daniel Martin at Capital Economics, “Even countries that have made the most of Chinese demand may find themselves ill-positioned for the next stage of China’s development as it moves away from its investment-heavy growth model.”
Commodity exporters have been among the biggest winners from China’s rise. Its investment boom has resulted in disproportionately high demand for natural resources. Outside of Asia, countries that are rich in natural resources are exporting most to China. “Demand from China has also led to an increase in global commodity prices, which has improved the terms-of-trade of commodity producers. Some economies have, understandably, become more reliant on commodities as a result.” Martin adds………………………………………..Full Article: Source

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