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Commodities Briefing 17.Feb 2014

Posted on 17 February 2014 by VRS |  Email |Print

After watching commodities take a beating over the past three years, investors may want to consider carefully treading back into the sector, financial advisers say. The average U.S. commodity-focused mutual fund and exchange-traded fund has gained 2.2% in 2014 through Thursday, according to Chicago-based investment-research firm Morningstar. Meanwhile, blue-chip stocks, as represented by shares of the SPDR S&P 500 ETF Trust, are down 0.91% over that period.
“Commodities still need to be approached with caution,” says Stephen Jury, global head of currencies and commodities at J.P. Morgan Private Bank in New York, which oversees $977 billion. “They’re not ready for another bull run.”……………………………………….Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Commodity markets in India have shown tremendous growth in a pretty short span of time. As far as a commodity exchange is concerned, its main objective is to provide a platform for risk hedging and fair price discovery. Though many steps have been taken by the exchanges and FMC, the regulator, to make the commodity market more transparent and efficient; but to take it to the next level a lot of things need to be done.
In order to initiate active participation by farmers in the commodity future markets, integration of both spot market and commodity futures market should be done. There are certain key priorities to build an efficient commodity market in India…………………………………………Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

The Organisation of Petroleum Exporting Countries (Opec) has long recognised the importance of dialogue and cooperation with other producers and stakeholders in the industry and is always “ready to talk” in this regard to ensure market stability and order.
That was the view put forward by Opec Secretary General, Abdullah Salem Al Badri, in a question and answer interview with the Caspian Energy Journal. Al Badri observed that, in 2013, prices had generally moved within the $100 110/b, a range that was acceptable to producers and consumers alike………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Outside the Organization of Petroleum Exporting Countries helped with the increase in oil output since last year, the IEA said Thursday from Paris.The International Energy Agency said in its monthly market report oil supplies since last January are up because of “steep growth” from non-OPEC members.
The IEA, however, said global oil supplies in January declined by 290,000 barrels per day to 92.1 million bpd because of lower non-OPEC output………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Hedge funds became the most bullish on U.S. crude oil in more than five months as a new pipeline from Oklahoma to Gulf Coast refineries eased a supply bottleneck, driving prices above $100 a barrel.
Money managers increased net-long positions, or wagers on rising prices, for benchmark West Texas Intermediate crude by 11 percent in the week ended Feb. 11, U.S. Commodity Futures Trading Commission data show………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Unless the Chinese government takes steps to cut oil consumption, China’s oil consumption may increase by 60% by 2030. Even worse, over 75% of its oil consumption will have to come from imports.
That comes from a new study out by China’s Development Research Center, which highlights China’s alarming trajectory – oil demand will continue to rise and meeting that demand will have to come increasingly from foreign sources. Li Wei, the Director of the Development Research Center, said that China must transform itself to avoid the security and environmental challenges this would bring………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Uncertainty is growing over China’s ability to sustain the rapid rates of economic growth it has seen over the past decade. China’s “unfolding credit crunch” is having an unforeseen and dramatic impact on gold prices as investors urgently stock up on the precious metal as a form of financial protection against a sharp correction in the world’s second largest economy.
This is the main reason why gold prices have unexpectedly shot up more than 10pc to breach $1,300 (£776) an ounce for the first time since November against the prevailing forecasts for weaker demand made by many industry experts at the beginning of the year, according to Adrian Ash, head of research at gold trading platform BullionVault.com………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

The gold price jumped to a three-and-a-half-month high above $1,320 an ounce on Friday, capping one of its best weeks in years. Gold’s rise this year – it is up 9.8% so far – has been ascribed to a number of factors.
Some key technical levels have been breached, including the 200-day moving average on Friday which supposes further upward momentum. Safe haven buying on turmoil in emerging markets boosted gold in January and continued strong physical demand from Asia has also provided a solid floor to the price………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Hedge funds raised bullish gold wagers to a three-month high as signs of slowing U.S. economic growth spurred demand for haven assets. Billionaire John Paulson maintained his bullion holdings last quarter.
The net-long position climbed 17 percent to 69,291 futures and options in the week ended Feb. 11, U.S. Commodity Futures Trading Commission data show. Long wagers rose 8.8 percent, the most since March. Net-bullish holdings across 18 U.S.-traded commodities rose 18 percent to 1.07 million contracts, the highest since October 2012, led by silver and coffee………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Gold’s move above $1,300 this week completely surprised some Wall Street analysts who were predicting further decline, according to award-winning precious metals and rare coin author Michael Fuljenz, President of Universal Coin & Bullion in Beaumont, Texas.
He points out many investors have continued to purchase physical gold, such as American Eagle and Canadian Maple Leaf gold bullion coins, and some mints around the world are scrambling to keep with the demand. “Why did financial experts miss gold’s big, sudden move in the new year?,” he asks………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Gold stocks just surged to a major technical breakout, a very bullish omen. Investors are actually starting to redeploy capital in this battered sector, catapulting gold stocks into the early lead as 2014’s best performers!
This year is shaping up to be the polar opposite of last year’s epic carnage, with gold stocks mean reverting back up to fundamentally-reasonable levels. The vast majority of the buying is still yet to come. Exiting last year, gold stocks were inarguably the most hated sector in all the stock markets………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Despite bearish analyst forecasts in late 2013 for the year ahead, the price of gold has held its ground or risen so far in 2014. Since January the precious metal has pushed up 7.6% to US$1,318 per ounce. This has been put down to everything from weak jobs in the US, strong growth in China and even, bizarrely, the weather.
Regardless, if the price of gold continues its recovery there could be some big money to be made on gold mining companies which still have a long way to go to recover themselves. The following three companies could be in prime positions to profit:……………………………………….Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Copper rose to a two-week high in New York after European economic growth topped analysts’ estimates, bolstering optimism that demand may rise. Tin headed for the biggest gain in almost four months.
Gross domestic product (GDP) in the euro zone expanded 0.3 per cent last quarter, European Union data showed on Saturday, more than the 0.2 per cent median forecast of analysts surveyed by Bloomberg. The dollar fell to the lowest this year against a 10-currency basket that includes the euro, boosting the appeal of copper as an alternative investment………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Defined-maturity exchange-traded funds aim to make the traditional strategy of laddering bonds of different maturities easier and more accessible. But should investors be laddering at all? For retirees hoping to sleep at night, “laddering” bonds ensures that each year a batch of individual bonds will mature, providing the income needed for that year.
There’s another option: defined-maturity bond ETFs, which resemble individual bonds right up to their distributions and maturity dates. But laddering with either ETFs or individual bonds brings its own set of trade-offs………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

2014 Update: 2013 saw a host of changes to tax rates for individuals in the highest tax brackets. This year, our guide has been fully updated with information related to the taxation of MLPs, buy-writes, wash-sale rules on collectibles, new ETF structures, regulated investment company rules and the taxation of distributions detailed by asset class and structure.
Note: This ETF Taxation Guide will be available in PDF format in the coming weeks, along with a PDF cheat sheet, which will be housed in our “White Papers” link under the “Sections” tab on our ETF.com site………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Commodity markets regulator FMC has allowed national level bourses to impose differential transaction fees for delivery and non-delivery based commodities contracts. Since 2009, the exchanges have been restrained from levying differential transaction charges based on commodities or timing.
“In suppression of the earlier directions, the Commission has now decided that the exchanges can levy differential transaction charges for different commodities,” Forward Markets Commission said in a directive issued to six national level commodity bourses………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Douglas Hodge says that while some economies had “sold their future” by shunning prudence and running big deficits, emerging market economies as a whole were now more resilent than they were two decades ago.
The currency crisis that has engulfed some emerging market economies is not dangerous enough to “infect the system”, according to the world’s largest bond fund………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Comments by the European Commission president about an independent Scotland are “pretty preposterous”, according to Scotland’s finance minister. Earlier, Jose Manuel Barroso told the BBC’s Andrew Marr it would be “extremely difficult, if not impossible” for an independent Scotland to join the European Union.
Mr Barroso cited the example of Spain opposing the recognition of Kosovo. However, John Swinney has dismissed the comparison. He told Andrew Neil on the Sunday Politics that “absolutely no member state of the European Union has indicated they would veto Scottish membership.”……………………………………….Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

Iran plans to set up a carbon trading market to reduce industrial emissions of climate-warming gas, an official from Iran’s Fuel Conservation Organization (IFCO) told oil ministry news service Shana. Iran has some of the world’s largest gas reserves and is major crude oil exporter. But rapidly rising domestic demand has created a gas supply and vehicle pollution crisis in some cities.
Although Iran has some large hydro-power plants, heavy subsidisation of fossil fuels means there is little incentive for private investments in wind or solar power projects………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

European rules to curb the record glut of carbon permits are raising the prospects of a shortage for manufacturers from Dow Chemical Co. to HeidelbergCement AG. Companies in Europe, which need allowances to match their emissions output, will be short of as many as 100 million permits a year through 2016, according to Goldman Sachs Group Inc.
The gap, worth 647 million euros ($884 million) at yesterday’s prices, compares with a surplus of 2.1 billion euros in 2012, EU data show. Carbon futures may more than double by next year to 15 euros a metric ton amid the curb, said UBS AG………………………………………..Full Article: Source

Posted on 17 February 2014 by VRS |  Email |Print

The South Korean government’s unwillingness to amend estimates of future greenhouse gas emissions could push its carbon price up to $93 per metric ton of CO2 , nearly 10 times higher than in Europe, when its cap and trade scheme launches in 2015, according to a report by Thomson Reuters Point Carbon.
Emissions from sectors covered by South Korea’s emissions trading scheme such as power generation and manufacturing could be about one-third higher than the government’s estimates, according to the Point Carbon report………………………………………..Full Article: Source

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