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Commodities Briefing - Archive | June, 2016

What The ‘Brexit’ Means For Gold And Other Commodities

Posted on 30 June 2016 by VRS  |  Email |Print

The news out of the United Kingdom rocked global markets. In an historic referendum vote, citizens of the U.K. narrowly voted for a “Brexit” — a British exit from the European Union. Since joining the European Union in 1973, a fair number of Britons have been skeptical of the governing body.
British attitudes toward European unity have been… complicated, to say the least. Winston Churchill advocated for “a kind of United States of Europe” during a speech in Zurich in 1946, while simultaneously setting the precedent for an arm’s length relationship with the continent throughout his career. Now that the votes are cast, questions remain about what this will mean for trade, immigration, travel and a host of other issues……………………………………….Full Article: Source

Which Commodities Will Benefit From Brexit?

Posted on 30 June 2016 by VRS  |  Email |Print

Buy gold but be cautious around oil and copper, that’s the main takeaway from Deutsche Bank’s special commodities report entitled “commodities weathering the Brexit storm”.
Most commodity markets remain plagued by oversupply, but the gold market is set to see increased demand over the next 18 months. There are a number of political risk events set to unfold during this period, which are only set to add to the global economic uncertainty that’s been thrown up as a result of Brexit…………………………………………………………………………………Full Article: Source

The Oil Price Rebound Will Be Brief - Goldman Sachs

Posted on 30 June 2016 by VRS  |  Email |Print

Goldman Sachs has rejected analysts’ opinions that the global oil market is recovering, noting that while it expects a “modest” deficit in the coming months based on the slight rebound in oil prices, the market will again be in a state of surplus by early next year.
It may seem as if oil is recovering on the back of supply disruptions that have helped to chip away at the global glut and push prices close to $50, but Goldman says that in the best-case scenario this isn’t a rebound—it’s just the first signs of one……………………………………….Full Article: Source

Abu Dhabi Merger to Create Oil Producer Dwarfing OPEC’s Libya

Posted on 30 June 2016 by VRS  |  Email |Print

Abu Dhabi’s proposed merger of two of its largest sovereign investment funds would create a global energy business that produces more oil than OPEC member Libya and with bigger assets than ConocoPhillips.
The Persian Gulf emirate with about 6 percent of the world’s crude reserves will combine Mubadala Development Co. and International Petroleum Investment Co. to cut costs and boost efficiency, the state news agency WAM reported Wednesday. The deal would pool assets of about $135 billion, many of them non-energy-related, and debt of about $42 billion, according to Bloomberg calculations……………………………………….Full Article: Source

Iraq’s oil exports set to decline in June for second month

Posted on 30 June 2016 by VRS  |  Email |Print

Iraq’s oil exports are set to decline in June for a second month, according to loading data and an industry source, adding to signs that supply growth from OPEC’s second-largest producer is slowing this year.
Iraq in 2015 provided the biggest rise in supply from the Organization of the Petroleum Exporting Countries. But companies working in Iraq have warned the government that projects to boost output will be delayed if Baghdad cuts spending in response to low oil prices……………………………………….Full Article: Source

Gold could be set for a strong breakout

Posted on 30 June 2016 by VRS  |  Email |Print

The British voters’ decision to leave the EU has badly shaken markets– although the dollar remained relatively calm while investors rushed into the safety of gold. Gold prices reached the long-term resistance target projection level of $1,340 before retreating. This is a rally within the context of a longer-term uptrend breakout.
Technically, this breakout is strong and there is a strong probability gold will move above $1,340 and move towards resistance near $1,580. However, there are important changes in the structure of the gold market that make the move above $1,350 and towards $1,580 more hazardous and volatile……………………………………….Full Article: Source

Gold is about to drop, and this play will let me cash in big when it does

Posted on 30 June 2016 by VRS  |  Email |Print

Gold’s run is almost done, according to gold trader Andrew Keene of AlphaShark, and he has just the way to profit from an expected slide in the precious metal. The yellow metal has had an incredible year, and that has sent most gold-mining stocks soaring. But with market uncertainty appearing to settle amid the post-Brexit vote rebound, Keene thinks the metal is due for a turn lower.
Keene has picked one gold stock that he sees following an expected downtrend for the metal in the coming months. Barrick Gold (ABX), the world’s largest gold-mining company, has seen its shares on the rise since September of last year, following the gold rally……………………………………….Full Article: Source

Gold is back

Posted on 30 June 2016 by VRS  |  Email |Print

Significant downturn in economic growth and rising uncertainty over the political developments have helped gold become a new emerging bull market, with the price expected to rise to US$2,300 within the next 24 months, according to a Liechtenstein-basesd asset and wealth management firm.
Incrementum AG’s study, “In Gold we Trust”, said that the first step had already been taken and early this year gold celebrated an impressive comeback, exhibiting strong vital signs, and recording its strongest quarterly performance in 30 years, which was fuelled by fears over ‘the recovery of the post-Lehman economy’……………………………………….Full Article: Source

Faber Says Own Gold, Prepare for QE4 as Easing Follows Brexit

Posted on 30 June 2016 by VRS  |  Email |Print

Gold’s investment case has been strengthened by the U.K.’s vote to quit the European Union as the fallout may spur the world’s central banks to step up easing, hurting currencies and favoring bullion, according to Marc Faber, publisher of the Gloom, Boom & Doom Report.
The U.S. Federal Reserve may even embark on a fourth round of quantitative easing, or QE4, Faber said in an interview on Bloomberg Television on Wednesday, adding that he typically buys bullion every month. While he also likes gold shares, they need to correct first after recent gains, he said……………………………………….Full Article: Source

Cautiously optimistic about nickel price

Posted on 30 June 2016 by VRS  |  Email |Print

Base metals have enjoyed a solid 2016 so far with only lead (-3%) in negative territory for the year. While the likes of zinc (+28%) and tin (+16%) have rallied and steelmaking raw materials iron ore (+24%) and coking coal (+12%) have come back strongly, nickel remains stuck in the doldrums.
On the LME nickel jumped back above $9,000 on Wednesday, but hasn’t been in five-digit territory for nearly a year and is worth half of what it was early in 2014 when Indonesia’s ban on ore exports led many to believe the volatile metal is entering a bull market……………………………………….Full Article: Source

Copper hits eight-week peak as Brexit fears fade, dollar dips

Posted on 30 June 2016 by VRS  |  Email |Print

Copper and nickel climbed to the highest levels in nearly eight weeks on Wednesday, bolstered by a softer dollar and fading fears about Britain’s vote to exit the European Union. Zinc and lead touched three-week highs as the dollar gave up some of its gains made since the Brexit vote last week.
Three-month copper on the London Metal Exchange hit a peak of $4,847.50 a tonne, the highest since May 5, building on a 2.3 percent gain in the previous session. It failed to trade in closing open outcry activity and was bid at $4,838, up 0.4 percent……………………………………….Full Article: Source

2016 already best year ever for world’s largest gold ETF

Posted on 30 June 2016 by VRS  |  Email |Print

Once the largest fund of its kind in the world, top physical gold-backed exchange traded fund – SPDR Gold Shares (GLD) – is having a rip-roaring first half of 2016. After suffering through three years of a declining gold price and investors liquidating positions built up during the metal’s bull run, this year the fund’s assets under management have swelled by $18.5 billion year to date.
GLD dwarfs other physically-backed exchange traded gold products holding 48.8% of the global total as of today at 950 tonnes or 30.5m ounces worth $40.3 billion. GLD’s holdings have shot up by 308 tonnes this year to the highest since July 2013……………………………………….Full Article: Source

Biggest Gold ETF Tops Record as Angst Drives Inflows

Posted on 30 June 2016 by VRS  |  Email |Print

To see just how big the stampede into gold has been this year, look no further than exchange-traded funds. Investors have already poured $12.2 billion into SPDR Gold Shares, topping the inflow for all of 2009 that was the highest since the fund was created 12 years ago.
SPDR has lured the most money this year among more than 6,000 ETFs tracked by Bloomberg, as the U.K. Brexit vote roiled markets and amplified demand for havens……………………………………….Full Article: Source

Brexit Weighs on Big Oil ETFs

Posted on 30 June 2016 by VRS  |  Email |Print

The United States Oil Fund, which tracks West Texas Intermediate crude oil futures, and the United States Brent Oil Fund , which tracks Brent crude oil futures, are among the various commodities exchange traded products that have been stung by the Brexit result.
A stronger dollar coupled with downward revisions to U.K. economic growth forecast are among the factors pressuring crude in Brexit’s wake and there could be more near-term pain for oil because some market observers see Brexit also affecting Chinese economic growth……………………………………….Full Article: Source

Japan should not resort to currency depreciation

Posted on 30 June 2016 by VRS  |  Email |Print

In the midst of the fallout from the UK’s decision to leave the EU last week, Japan has become a haven for investors. Instead of providing reassurance to Japanese policymakers, this flight to safety is threatening domestic growth and monetary stability. How should the authorities respond?
Prime Minister Shinzo Abe launched “Abenomics”, shortly after his victory in late 2012. Thereafter, the yen depreciated significantly, providing helpful relief to an economy struggling with chronic deflation and the aftermath of the global financial crisis……………………………………….Full Article: Source

Currency wars pose ‘lose-lose’ threat after Brexit vote, warns ECB’s Mario Draghi

Posted on 30 June 2016 by VRS  |  Email |Print

The world is at risk of a currency war after the Brexit vote, as each economy seeks to devalue their own money in a bid to boost growth, Mario Draghi has warned.
The European Central Bank president urged colleagues across the globe to coordinate their efforts, in order to avoid competitive currency devaluations between economies, which could undermine attempts to boost world growth……………………………………….Full Article: Source

JP Morgan ‘expecting Scottish independence and new currency’

Posted on 30 June 2016 by VRS  |  Email |Print

JP Morgan has confirmed that it expects Scotland to vote Yes in a second independence referendum as well as introducing its own currency before the UK leaves the European Union in 2019.
Bank economist Malcolm Barr said in a note to clients: “Our base case is that Scotland will vote for independence and institute a new currency at that point (2019).” Mr Barr said that the ‘pressure to hold a new referendum’ would arise following the UK’s Brexit……………………………………….Full Article: Source

Brexit: 94 unanswered questions for climate and energy policy

Posted on 30 June 2016 by VRS  |  Email |Print

What does the UK’s shock vote to leave the European Union mean for energy and climate change? Amber Rudd, secretary of state for energy and climate change, and Andrea Leadsom, energy minister, both sought to offer reassurances that UK energy and climate commitments would continue.
Rudd said, in unscripted comments added to her planned speech: “We made a clear commitment to acting on climate change in our manifesto last year. That will continue.”……………………………………….Full Article: Source

Green lining? Five ways Brexit could be good for the environment

Posted on 30 June 2016 by VRS  |  Email |Print

Brexit may be bad in many ways, but here’s a very faint glimmer of a silver lining. If the UK leaves the European Union, it might not necessarily be a disaster for the environment.
Anyone in the country who feels strongly about air pollution or carbon emissions is likely to have voted to remain in the EU. The general consensus before the vote was that if the UK left, it would be bad news for the environment. And so it could be. But don’t despair just yet — there are five ways it might actually benefit the environment……………………………………….Full Article: Source

Understanding the Difference Between Hard and Soft Commodities

Posted on 30 June 2016 by VRS  |  Email |Print

There are two main types of commodities: hard and soft. Hard commodities consist of natural resources, such as oil or gold. While soft commodities are agricultural goods or livestock that must be grown and cared for in order to be produced. Both markets trade on supply and demand, and are heavily influenced by macroeconomic events.
Hard commodities are usually the ones that make headlines, or are referred to as a basis for economic health. Because the production and supply of these assets can be predicted fairly accurately, they are used to gauge global-economic health. Copper and oil, in particular, are often looked at to determine where the economy is headed by observing total-worldwide demand for these products……………………………………….Full Article: Source

China commodities rally on hopes of measures to counter Brexit

Posted on 29 June 2016 by VRS  |  Email |Print

Commodity futures in China from steel to soymeal rallied on Tuesday, as investors bet on countries bringing in measures to counter the shock to markets and economies from Britain’s vote to leave the European Union.
Chinese steel futures jumped for a second day, while the rally spread to other commodities. “I think there is a fresh wave of speculation,” said Yang Zhijiang, an analyst at China Merchant Futures. China’s commodities markets had recently calmed after a roller-coaster ride started in April, when soaring prices and volumes prompted exchanges to curb speculative activity………………………………………..Full Article: Source

Brexit fallout, global commodity markets may remain volatile

Posted on 29 June 2016 by VRS  |  Email |Print

“Brexit”, the word continued to keep global markets involved and horrified from the past few days and when reality happened it spooked the financial world in a massive way. Britain is the first state to leave the 28-nation European Union since its foundation.
Now, the billion dollar question is that are the markets overreacting. Will it continue to impact on the trade behaviour? If so,… how long? As per estimates, $2.08 trillion has been wiped off from the global equity markets after Britain voted to leave the European Union………………………………………..Full Article: Source

Oil Is Still Heading to $10 a Barrel

Posted on 29 June 2016 by VRS  |  Email |Print

Back in February 2015, the price of West Texas Intermediate stood at about $52 per barrel, half of its 2014 peak. I argued then that a renewed decline was coming that could drive it below $20, a scenario regarded by oil bulls as unthinkable.
But prices did fall further, dropping all the way to a low of $26 in February. Since then, crude rallied to spend several weeks flirting with $50 per barrel, a level not seen since last year. But it won’t last; I’m sticking to my call for prices to decline anew to $10 to $20 per barrel………………………………………..Full Article: Source

Oil prices rebound in post-Brexit bargain hunting

Posted on 29 June 2016 by VRS  |  Email |Print

Oil prices rose above $48 a barrel on Tuesday as investors took advantage of a two-day slide in crude following Britain’s vote to leave the European Union to lock in lower prices.
The vote result sent global stocks and currencies spiralling down, though oil price losses were relatively limited due to expectations of strong summer demand in Asia and the United States, as well as tightening supplies after a two-year rout. A looming strike at several Norwegian oil and gas fields threatened to cut output in western Europe’s biggest producer, also helped support prices on Tuesday………………………………………..Full Article: Source

‘Going long on fear’: Analysts hike gold price forecasts after Brexit

Posted on 29 June 2016 by VRS  |  Email |Print

Gold prices ran up after Britain’s decision to quit the European Union, climbing sharply last Friday and yesterday as the referendum results rippled through global markets, pummelling stocks and some currencies.
Gold has pulled back from its Friday high, and dipped about 1 per cent amid today’s stock market rally. “We are revising our gold price assumptions as we believe that the fundamental macro backdrop for gold prices provides significant runway for gold price appreciation from current levels despite an appreciation of 25 per cent [year to date],” Clarus Securities said this week………………………………………..Full Article: Source

Gold price could rise on another big post-Brexit shock, Stifel says

Posted on 29 June 2016 by VRS  |  Email |Print

There may be some more upside for safe-haven gold after the Brexit shock, but the upside is likely to be limited, said experts. “To buy gold at these levels, you’d have to be betting that a lot more goes wrong and I’m really not sure that’s going to be the case,” Hans Olsen, Stifel’s global head of investment strategy, said.
Olsen said his firm made a “fair amount of money” from gold’s recent rally but the “big disruptions” were already over………………………………………..Full Article: Source

Gold Veteran Says Brexit May Be Start of ‘Major Bull Market’

Posted on 29 June 2016 by VRS  |  Email |Print

Gold may stand at the start of a major bull market should the U.K.’s Brexit vote prove to be a forerunner of greater political and financial instability around the world, according to Evolution Mining Ltd.’s Jake Klein, a veteran of more than 20 years in the industry.
With the rise in uncertainty, investors are coming back to the market, the executive chairman of Australia’s second-biggest producer said in an interview with Bloomberg Television. “It is an alternate currency, it’s performed that role” as a haven for over 2,000 years, he said………………………………………..Full Article: Source

Gold Retreats, Copper Climbs as Post-Brexit Markets Stabilize

Posted on 29 June 2016 by VRS  |  Email |Print

Gold fell back and copper soared as global markets stabilized on speculation that policy makers will do more to curb the post-Brexit fallout. Bullion fell after its biggest two-day surge in seven years as European and U.S. equities and the pound climbed for the first time since the U.K. voted to leave the European Union.
Concern that an exit will disrupt the global economic recovery had caused market turmoil and boosted gold by 5.4 percent in just two days as investors sought a haven………………………………………..Full Article: Source

Hedge Funds Push Gold Bullish Bets To Record Level

Posted on 29 June 2016 by VRS  |  Email |Print

Hedge funds and money managers were buying gold as prices were dropping, ahead of the British referendum on the future of its EU membership, according to the latest trade data from the Commodity Futures Trading Commission. Friday’s report showed that gold’s speculative net length reached historic highs last week.
The disaggregated Commitments of Trader report (COT), for the week ending June 21, showed money managers increased their speculative gross long positions in Comex gold futures by 17,436,contracts to 274,936. At the same time, short bets fell by 3,732 contracts to 24,528. The latest data shows the gold market is net long by 250,408 contracts………………………………………..Full Article: Source

Copper touches 2-month peak as dollar eases

Posted on 29 June 2016 by VRS  |  Email |Print

Copper hit its highest level in almost two months on Tuesday as the US dollar weakened and hedge funds and speculators slashed their bets on lower prices. Data from the London Metal Exchange showed money managers had reduced their short position in copper to just over 86,600 lots on Friday, down from 107,600 lots a week before.
The report came in the wake of figures published late on Friday that showed a reduction in the record short copper position on Comex, the US futures exchange………………………………………..Full Article: Source

What makes ETFs good investments for retirement

Posted on 29 June 2016 by VRS  |  Email |Print

The popularity of exchange-traded funds has never been higher. The industry just passed the $100-billion mark in assets in Canada, and a recent poll conducted by the Journal of Financial Planning and the Financial Planning Association Research and Practice Institute indicated that ETFs were the most popular retirement product among advisers.
Eighty-three per cent of 283 advisers said they currently use or recommend ETFs to clients, while 80 per cent of advisers said the same about mutual funds. Moreover, 46 per cent said they plan to recommend ETFs more frequently over the next 12 months, compared to stocks and mutual funds, which came in at 23 and 21 per cent, respectively……………………………………….Full Article: Source

High-Yield ETFs Miss The Boat, Again

Posted on 29 June 2016 by VRS  |  Email |Print

High-yield exchange-traded funds (ETFs) struggled last year, in part because energy bonds took a beating when oil prices fell. Does that make an ETF that avoids energy bonds a good idea? We don’t think so.
At least one asset manager recently launched an ETF that invests in every high-yield sector except energy. The idea is to limit the risk of losses and default associated with low oil prices, which can make it hard for oil and gas companies to service their debt………………………………………..Full Article: Source

Brexit and currency war

Posted on 29 June 2016 by VRS  |  Email |Print

In the aftermath of Britain’s vote to leave the European Union last week, fears are mounting that the world might plunge into a currency war. On Monday, China’s central bank cut the yuan’s fixed rate by almost 1 percent to 6.6375 to the dollar as the greenback surged after the Brexit vote. Monday’s fix was the lowest level since December 2010.
Japan is also ready to act as the yen, one of the haven assets bought in times of turmoil, hit a 32-month high of 99.02 per dollar Friday after the vote. Japanese Prime Minister Shinzo Abe said Japan would carefully watch foreign exchange and stock markets, but his remark was taken as indicating that the world’s third-largest economy could intervene in the currency market soon to put the brakes on the surging currency………………………………………..Full Article: Source

Currency volatility makes careful planning essential

Posted on 29 June 2016 by VRS  |  Email |Print

The instability of exchange rates against the US dollar has reduced the number of speculators in the market and instead made currency hedging a part of business strategy. Michael Judge, head of corporate clients at currency provider OFX, says the large movements of the US dollar against the Aussie in the past 18 months have made currency a business input rather than an opportunity to make profits or play the market.
He says in the month to May 25 the Aussie slipped from $US0.78¢ to 0.71.5¢, representing a slide that could eradicate most of an importer’s profit margin if they settled invoices at spot rates………………………………………..Full Article: Source

Currency market volatility may stay

Posted on 29 June 2016 by VRS  |  Email |Print

The recent referendum by the British against staying in the European Union, which resulted in Prime Minister David Cameron resigning from office, also caused severe volatility in the global financial markets with the currency markets being the worst hit.
The first impact was that the British sterling pound crashed 8% against the dollar over the previous trading session as soon as the verdict of British wanting to exit the European Union was out. The British currency touched the lowest levels in 30 years adding uncertainty to the future value of the pound. It also dipped sharply against the yen. Some have even predicted that the pound would crash more severely than global stocks over the next year. ……………………………………….Full Article: Source

N. Korea pushes clean energy development to earn currency

Posted on 29 June 2016 by VRS  |  Email |Print

North Korea is pushing to embrace renewable energy such as solar and wind to address the country’s power shortage issues and make profit by selling tradable carbon emissions credits, according to a think tank’s report published on June 28.
The country seeks to develop green energy and reduce greenhouse gases by ratifying laws related to environment protection and waste management, the study conducted by Hyundai Research Institute said………………………………………..Full Article: Source

Federal carbon tax a cash grab that could damage the economy

Posted on 29 June 2016 by VRS  |  Email |Print

Carbon taxes largely function as energy taxes to generate a new source of revenues for cash-hungry governments. According to a report in the Globe and Mail, Finance Canada is quietly promoting the idea of a federal carbon tax, or at least, a minimum carbon price, in order to reduce greenhouse gas emissions as Canada has pledged to do in last December’s Paris Agreement.
The problem is, Canada’s track record at implanting economically benign carbon pricing is not very good: three of the four Canadian Jurisdictions with carbon taxes or pricing are in complete violation of economic theory about benign carbon pricing………………………………………..Full Article: Source

How long Brexit uncertainty reigns is key for commodities, gold

Posted on 28 June 2016 by VRS  |  Email |Print

Amid the horror for many, the elation for others and the shock for virtually everybody of the British vote to exit the European Union, perhaps the most measured and predictable response was from commodity markets. As it became clear on Friday that the Leave camp was going to pull off an unexpected victory, commodities did what they normally do in a period of heightened risk, they declined.
The outlier of course was gold, which also did exactly what it was expected to do by rallying strongly as investors sought the protection of what is still viewed by many as the ultimate safe-haven in times of crisis and uncertainty………………………………………..Full Article: Source

Japan’s Komatsu Warns Brexit Vote Could Delay Commodity Rebound

Posted on 28 June 2016 by VRS  |  Email |Print

The U.K.’s vote to leave the European Union could delay a recovery in commodity prices, while the yen’s response to the Brexit decision, soaring to within sight of 99 to the dollar, was an overreaction, according to Komatsu Ltd.’s chief financial officer.
The Tokyo-based maker of construction equipment, the world’s largest after Caterpillar Inc. of the U.S., is particularly sensitive to commodity prices and the Japanese currency as more than three-quarters of its sales are made overseas, including the equipment used to dig up and transport metals, coal and other minerals………………………………………..Full Article: Source

Big Banks on Oil: Keep Bullish Despite Brexit

Posted on 28 June 2016 by VRS  |  Email |Print

Goldman Sachs Group, Morgan Stanley, and Citigroup joined Deutsche Bank in saying the worst may be nearly over for oil. Brexit has raised risks but ultimately does little to dent the trends of rising demand and falling supply that have been pushing oil on its strongest rally in years, the banks said.
Even if spillover effects from the vote slowed major economies around the world, it would likely reduce oil demand by just 130,000 barrels, or 0.1% of global demand, Goldman analysts said. Deutsche Bank had estimated an even smaller impact, just 100,000 fewer barrels, compared with outages in Nigeria that are taking 400,000 barrels a day off the market………………………………………..Full Article: Source

Goodbye to OPEC?

Posted on 28 June 2016 by VRS  |  Email |Print

Should the 169th OPEC meeting held earlier this month be its last? As former British Prime Minister Winston Churchill said, “To improve is to change; to be perfect is to change often.”
For Saudi Arabia and the remaining Gulf Cooperation Council (GCC) countries (Bahrain, Kuwait, Oman, Qatar and United Arab Emirates), which together account for around 40 percent of the world’s oil reserves and the lion’s share of OPEC’s collective output, their future oil strategy should be an exclusively GCC affair, away from the stress and dysfunction of OPEC………………………………………..Full Article: Source

OPEC’s Pain Is Only Getting Worse As Revenues Continue To Fall

Posted on 28 June 2016 by VRS  |  Email |Print

OPEC lost $349 billion in revenue last year because of low oil prices, cutting revenues almost in half from the year before. A report from the EIA in mid-June estimated 2015 revenues for OPEC countries at $404 billion, down 46 percent from the $753 billion the member countries earned in 2014. Revenues last year fell to their lowest level in eleven years.
Worse still for OPEC is the fact that revenues could fall even further this year, as low oil prices sank to new depths, particularly in the first quarter of 2016. The EIA projects OPEC revenues this year to drop to $341 billion. That will result in per capita oil export revenues in OPEC countries falling from $606 in 2015 to $503 this year………………………………………..Full Article: Source

Gold’s upside from here is limited, says Goldman’s Currie

Posted on 28 June 2016 by VRS  |  Email |Print

Investors are flocking to gold as a safe haven trade after the U.K.’s vote to leave the European Union, but the upside from here is rather limited, the global head of commodities research at Goldman Sachs said. “One of the key reasons for that is the market is incredibly long. We’ve also seen a sharp decline in interest rates, particularly U.S. Treasurys, which suggests that we probably are topping out here,” Jeffrey Currie said.
Goldman Sachs upped its gold price forecast to $1,300 on Friday after Thursday’s Brexit vote sent the price soaring. The precious metal was trading around $1,330 in afternoon trading Monday………………………………………..Full Article: Source

Gold still the star among commodities after Brexit

Posted on 28 June 2016 by VRS  |  Email |Print

As far as commodities go at the moment, there’s gold, and then there’s pretty much everything else. The yellow metal, which enjoys a reputation as a haven in times of volatility and crisis, is up 0.8 per cent this morning at a two-year high of $1,326.80 an ounce.
It has been one of the stars of the show, rallying 4.7 per cent on Friday as the UK voted in favour of leaving the EU and the plunging British pound sent financial markets into a tailspin. Gold should also benefit if central banks, particularly the Federal Reserve, refrain from tightening monetary policy………………………………………..Full Article: Source

10 reasons why gold price will go up in the future

Posted on 28 June 2016 by VRS  |  Email |Print

The price of gold in India has seen a highest single day jump in the last five years, with the previous one being in August 2011. Globally, too, following the UK votes favouring exit from EU, which is an unprecedented event, has seen nearly $100 per ounce jump in gold prices, which was not a usual phenomenon.
After closing at $1313 on Friday, today it is trading 1% higher in early trade around $1325 per ounce. There are several factors that suggest gold will be a preferred asset for all kind of investors — retail, institutional or even central banks………………………………………..Full Article: Source

Gold: Bears Are Trapped, Next Stop $1,400

Posted on 28 June 2016 by VRS  |  Email |Print

Gold posted a massive weekly gain Friday of over 4%, despite the largest one day advance for the U.S. Dollar in 2 years. Gold is up over 14% this year as we head into its strongest half of the year seasonally.
Brexit was a black swan event for gold bears, and most shorts were caught completely flat footed with commercial short positions in gold near all time highs………………………………………..Full Article: Source

What Brexit Means For Metal Prices

Posted on 28 June 2016 by VRS  |  Email |Print

One of them is the referendum, especially when it’s done in a period of instability. When people are unhappy, they look for what they think is a short-term solution to their problem, overlooking what’s really best for the country. The Brexit is a perfect example of this.
The British people are unhappy because their economy isn’t doing so well, blaming foreigners that cross its borders as part of the European Union and the regulations imposed on member states by Brussels. Referendums can also distill complex issues into a simplistic choice………………………………………..Full Article: Source

Investors Keep Piling Into Gold Funds

Posted on 28 June 2016 by VRS  |  Email |Print

As the price of gold has soared, funds that track the precious metal are also reaching new heights. The two largest gold funds, SPDR Gold Trust and iShares Gold Trust, now own more physical gold combined than all but seven nations, according to analysis from Convergex.
With about 1,037 metric tons altogether, the amount of gold in the two funds outpaces reserves of notable holders such as the European Central Bank and Saudi Arabia. Following Britain’s vote to exit the European Union, the third largest U.S. gold ETF, ETFS Physical Swiss Gold Shares, announced on Monday that its assets have surpassed $1 billion………………………………………..Full Article: Source

Gold ETFs See Brexit Bonus As Assets Fly To Safe Havens

Posted on 28 June 2016 by VRS  |  Email |Print

The post-Brexit carnage in global markets has left investors scrambling into any asset class that has shown at least some resistance to the rout. Amid the flight to safe havens, gold and gold-backed ETFs have grown even more popular, continuing their 2016 climb.
Gold prices climbed to $1,328 per ounce Monday, marking a 23% surge since January versus a 2.1% decline for the S&P 500. With Brexit-fueled uncertainty unlikely to clear up in the near future, analysts don’t expect the metal to lose its shine soon………………………………………..Full Article: Source

Platforms are quite costly when it comes to trading ETFs

Posted on 28 June 2016 by VRS  |  Email |Print

When Frank Spiteri was asked about setting up an exchange-traded fund (ETF) desk at Peel Hunt a few years ago, he had to admit to the then-chief executive, “I don’t even know what ETFs are”.
Now he is heading up UK and Europe distribution at ETF Securities, a sizeable provider of the products. Needless to say, for much of his career, Mr Spiteri has prioritised educating retail investors about these passive vehicles, having come to the realisation he was not alone in having little, if any, knowledge of the market despite its prominence in the US………………………………………..Full Article: Source

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June 2016
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