Message: egypt/gold/short
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Market Nuggets: MF Global Cautions About Short Commodity Positions Due To Egyptian Concerns 10 February 2011, 09:02 a.m. |
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(Kitco News) -- Base metals and Nymex energy prices are lower, and commodity markets may be sideways for the rest of the week since a period of consolidation is “long overdue,” says MF Global. However, “things may heat up once again” in Egypt this weekend, thus “we would not want to get too short here.” MF Global cites talk that protesters are planning a move onto the state radio and television building Friday, while a variety of strikes and labor protests are also underway. Public transport workers at five of the city's 17 garages vowed to bring bus operations to a halt this week. Strikes occurred for a second day in Suez on Wednesday, as some 5,000 workers at various state companies held separate walkouts at their factories. “Traffic at the Suez Canal was not affected, but clearly, the energy markets are worried…,” MF Global says. By Allen Sykora of Kitco News; asykora@kitco.com
Market Nuggets: Standard: Precious Metals Ease With Physical Demand On Sidelines, Dollar Rising 10 February 2011, 08:42 a.m. (Kitco News) -- At the moment, risk appetite appears to waning but is not prompting fresh investment demand for precious metals, says Standard Bank. “Physical demand too, especially in Asia, remains on the sidelines,” the bank says. “With little buying to counter it, a resurgence in the dollar is pulling the complex down, exacerbated by some light profit-taking.” The bank listed support levels for spot gold at $1,357 and $1,352, with resistance at $1,367 and $1,372. Silver support was listed at $29.93 and $29.77, with resistance at $30.40 and $30.70. By Allen Sykora of Kitco News; asykora@kitco.com
Market Nuggets: Barclays Capital Looks For Commodity Gains Despite Chinese Tightening 10 February 2011, 08:38 a.m. (Kitco News) -- Analysts with Barclays Capital do not anticipate Chinese monetary tightening ending strength in commodities any time soon. In fact, “given the history of commodities appreciating during periods of Chinese rate hikes and falls during periods of Chinese rate cuts, it would appear that the smart money should be looking to buy dips for the long haul,” Barclays says. Analysts say “markets do not move in straight lines, but we still believe the underlying trend for commodities is bullish.” The bank looks for crude oil to gain “firm footing” over $100 a barrel and is targeting $11,250 a metric ton for copper. By Allen Sykora of Kitco News; asykora@kitco.com
Market Nuggets: Barclays: Rising Commodity Prices To Contribute To Inflation 10 February 2011, 08:27 a.m. (Kitco News) -- Rising commodity prices will lead to inflation and increase the challenges facing central banks when setting monetary policy, says a report from Barclays Capital. In the past, technological advances in commodity production helped generation disinflationary pressures. “However, the impressive growth of China and India is increasing demand for commodities at a rapid pace, making it difficult for technological advances to allow production to catch up with demand,” Barclays says. “This is creating inflationary pressures on commodity prices, making them more vulnerable to shocks and, hence, more volatile.” Higher commodity prices will spill over into other goods. “The result will be imported inflation for most countries that rely on commodities either as inputs (such as oil and metals) or as consumption goods (such as food),” Barclays says. Furthermore, with excess supply always thin, commodity prices would be subject to large fluctuations due to any “shocks” such as weather, political instability in resource-rich nations, natural disasters, technical problems or other disruptions to output. “In sum, commodity demand may increase faster than supply can catch up, with negative consequence for inflation, growth and volatility,” Barclays says. By Allen Sykora of Kitco News; asykora@kitco.com
Market Nuggets: Copper Eases; Risk Of Short-Term Correction In Global Assets High - R.J. O’Brien 10 February 2011, 07:54 a.m. (Kitco News) -- Most overseas stock bourses fell overnight and U.S. stock-index futures are softer in electronic trading. Against this backdrop, copper has retreated. The red metal “looks set to test lower as fresh investment waits for more positive news,” says Janet Mirasola, managing director with R.J. O’Brien & Associates. A Chinese rate hike earlier this week “will keep caution at the forefront of traders’ minds and any move to lower levels will no doubt gain momentum, especially when fueled by negative comments from the likes of the Fed Chairman.” Ben Bernanke, chairman of the Federal Reserve, suggested Wednesday that unemployment will remain high for some time. “Continue to watch headline news for help with short-term direction, but bear in mind that global assets have run pretty far ahead of fundamentals and the risk of short term correction remains high but will ultimately bring fresh investment opportunity,” Mirasola says. By Allen Sykora of Kitco News; asykora@kitco.com
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