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Commodities Briefing 10.May 2013

Posted on 10 May 2013 by VRS |  Email |Print

Investors withdrew a record $9.3 billion from commodity exchange-traded products as gold sales pushed the metal into a bear market, BlackRock Inc (BLK) said. The outflow for commodities in April pushed the total for the first four months this year to $17.8 billion, compared with inflows of $6 billion for the same period last year, BlackRock said in a report dated April 30.
The previous record for commodity sales was $5.2 billion in February. Gold outflows were an all-time high of $8.7 billion last month as the metal slid to a two-year low in London on April 16, two sessions after falling into a bear market………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

Commodity-based exchange traded products (ETPs) suffered record outflows of $9.3 billion in April, data showed on Thursday, as institutional investors dumped gold holdings.
Leading wealth managers have been switching out of commodities since the start of the year in favour of equities and bonds as they look for yield, a trend which accelerated in April with a major sell-off across the commodities field, led by a collapse in the gold price. Global outflows from commodity ETPs tripled month-on-month, according to Blackrock Inc, the world’s largest asset manager, while redemptions from the precious metals segment quadrupled after gold’s largest spot-price decline in 30 years………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

When fund providers make the case for investing in commodities, one of the most frequently cited selling points is that they provide a source of non-correlated returns for traditional portfolios. Unfortunately, that claim doesn’t stand up to scrutiny.
Given that commodities actually have had an exceptionally high correlation with stocks — as well as a dismal risk-return profile — in recent years, investors might want to think twice before piling their money into commodities………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

Archer Daniels Midland is the first commodities trading house to be enmeshed in the US anti-bribery law. It may not be the last.
The American company last week disclosed it had set aside $25m to cover potential penalties for violations of the Foreign Corrupt Practices Act (FCPA), the law that the US Department of Justice and Securities and Exchange Commission have in recent years started aggressively enforcing………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

The average developing country lives off exporting commodities like oil, gas, copper, cocoa or soybeans. The sale of these resources brings both revenue to the government and foreign currency to import what is not produced at home — which, in these places, tends to be most things.
So whatever happens to the price of those commodities matters a great deal for development and, even more, for the war on poverty. The problem is that those prices are famously volatile. They can jump up and down seemingly at random, from year to year, month to month, even within a single minute………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

The Iraqi and Libyan governments said they would help Egypt cope with its economic crisis by offering up crude oil exports. The Egyptian government of President Mohamed Morsi is trying to right the economic ship more than two years after the country’s revolution.
Conflict in Libya and Iraq, meanwhile, has raised questions about their ability to make post-war oil gains. With OPEC members forced to make adjustments to U.S. oil production gains, it may be that retraction isn’t just an economic issue anymore…………………………………Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

The Organization of Petroleum Exporting Countries will increase crude exports this month as refiners boost processing ahead of the peak summer travel season, tanker tracker Oil Movements said.
The group that supplies about 40 percent of the world’s oil will ship 23.84 million barrels a day in the four weeks to May 25, up from 23.55 million barrels in the previous period, the researcher said in an e-mailed report. The figures exclude Angola and Ecuador…………………………………Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

Gold traders are divided on whether surging demand for jewelry and bullion coins will sustain the rally in prices as a slump in holdings through exchange-traded products extends to the longest in more than eight years.
Twelve analysts surveyed by Bloomberg expect prices to rise next week, with 10 bearish and five neutral. While rising coin sales and demand for physical gold in Asia drove prices up 11 percent since reaching a two-year low April 16, ETP investors sold about $9.9 billion of their metal in the 27 days through May 8, the longest retreat since September 2004………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

The results of Thomson Reuters GFMS’ Platinum & Palladium Survey 2013 are in, and the news looks good for palladium investors. According to the precious metals consultancy, palladium recorded its highest deficit in 11 years in 2012. Specifically, supply of the metal fell to 8.19 million ounces, a 4-percent decline, while usage grew 5 percent, hitting 9.32 million ounces. That created a 1.12-million ounce gap between supply and demand, a sizeable increase over 2011′s 279,000-ounce deficit.
Residual deficit for the year (calculated by taking Russian stockpile sales and ETF demand into account) came in at 1.16 million ounces, down from a residual surplus of 1.05 million ounces in 2011………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

Futures regulators are close to an agreement that would end a months-long standoff over a central plank of the 2010 Dodd-Frank law and finally bring more transparency to the trading of swaps, the complex financial contracts at the heart of the financial crisis.
The deal would represent a win for Wall Street’s biggest swaps dealers and a big compromise for Commodity Futures Trading Commission Chairman Gary Gensler, who has been at loggerheads with a fellow Democratic commissioner over one part of the rule………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

Emerging Asian currencies such as the Malaysian ringgit have come back with a vengeance, and their gains might not be done yet. The Malaysian ringgit has gained more than 2% against the dollar so far this month, after the country’s ruling coalition led by Prime Minister Najib Razak won recent national elections.
The South Korean won has advanced more than 1.5% so far this quarter, as geopolitical tensions with North Korea eased and investors jumped to buy the won at more-attractive levels………………………………….Full Article: Source

Posted on 10 May 2013 by VRS |  Email |Print

Carbon-market supporters from China to California will push for emissions trading even as they prepare for the end of the United Nations Kyoto Protocol in seven years, Europe’s top climate negotiator said.
Nations including China and New Zealand and some U.S. states have formed an informal group, “kind of the champions of the carbon market,” Artur Runge-Metzger said in a May 2 interview in Bonn, Germany. “It’s that club that’s going to set international standards” rather than UN talks, he said………………………………….Full Article: Source

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