Close: London Session | Forex, Metals, Oil, Agriculture January 26, 2021



Wheat acreage has reached a new high of 34.5 million hectare (mha) in Madhya Pradesh which saw record procurement last season. The massive wheat crop is sure to pose challenges for policymakers in terms of procurement, storage and movement. The wheat production target indicated by the government is at 106.5 million tonnes (mt) for 2020-21. Over two decades ago Jay got his start at the Kansas City Board of Trade in the Wheat Futures pit. For example, wheat spot prices are already well below the MSP of ₹1,975/quintal in some mandis.


Yesterday’s rollercoaster ride in US stocks on a potential delay to the US stimulus package saw the dollar advance while bond yields dropped. Meanwhile the US Dollar is advancing versus major peers supported by its safe haven properties amid concerns over a delay for Biden’s $1.9 trillion stimulus. less To the surprise of many market participants, the Australian Dollar (AUD) was/still is one of the strongest currencies during the COVID-19 pandemic. On the other side of the pond, the safe-haven dollar is gaining ground amid concerns that President Joe Biden’s stimulus plan is delayed or watered down.
When the dollar was taken off the gold standard, it meant “there was no limit on the amount of currency that could be printed,” Barisheff explains. An upside surprise to the data could also benefit the Australian dollar amid improving economic prospects. The currencies of many of the U.S.’s largest trading partners gained strength, and the dollar lost a third of its purchasing power that decade.
The defensively-minded US Dollar and Japanese Yen rose while their sentiment-geared Australian and New Zealand Dollars fell alongside stocks and cyclical commodities including copper and crude oil. less Gold and silver on Friday posted moderate losses on the strengthened dollar. One of the biggest historical events was when U.S. President Nixon cut the dollar’s tie to gold in August 1971.


Gold did not lose much, as stocks fell, which made gold a safe haven for jittery investors. Friday’s US economic data was bearish for gold, but bullish for industrial metals and silver prices. In order to avoid draining its gold reserves, Nixon simply closed the gold window. Silver was also hurt after Germany reduced its GDP estimate for this year, which reduces expected industrial metals demand, such as silver. If you look at the return on gold since 2000, the average has been 10 per cent a year.
However, these gains and increased risk appetite among investors didn’t prevent the modest jump in gold prices in the aftermath of the inauguration. However, long gold positions are being liquidated, as long positions fell to 5¾ month low on December 22. Gold prices idled as the downbeat backdrop weighed on bond yields – which is typically supportive for non-interest-bearing bullion – even as the Greenback climbed. We look at rolling 5-year periods starting each month since December 1991 for four asset classes, namely, equity, bonds, commodities, and gold.
Lockdowns, however, are negative for economic growth and industrial demand, which hurts industrial metals, such as silver.


MARKETS TODAY OIL: Oil prices ticked up alongside rising European shares and amid reports of a blast in Saudi Arabia, trading near 11-month highs. Oil is still the world’s most important commodity, so I always try to lead off with a prediction on the direction of oil prices. I have worked in the areas of oil refining, natural gas production, synthetic fuels, ethanol production, butanol production, and various biomass to energy projects. There were no domestic shipments or fuel oil imports that were seen discharging in the Kingdom s red sea ports for last week.
Because we don’t know how long it’s going to take to get the pandemic really under control, there’s a lot of uncertainty around the direction of oil prices. I have over 20 years of international engineering experience in the chemicals, oil and gas, and renewable energy industries, and hold several patents related to my work. BEFORE THE BELL Futures for Canada s main stock index rose as oil prices gained amid reports of a blast in Saudi Arabia.
Oil prices rallied in the fourth quarter, and are now close to where they were a year ago.
I felt like oil prices would be strong all year. The Mina Abdullah refinery which usually supplies the fuel oil for domestic demand is still undergoing upgrades.

United States

Wall Street futures edged up following a series of quarterly earnings reports from Corporate America and ahead of Federal Reserve’s policy meeting. Worries that the Fed might signal unease with the recent rise in inflation expectations – capping scope for more monetary support – may hurt as well. less (Video length 00:05:03) Johnson & Johnson on Tuesday reported fourth-quarter earnings and revenue that beat Wall Street’s expectations. Encouraging data can also be found in yesterday’s December profile of economic activity via the Chicago Fed National Economic Activity.
Global Headlines Impeachment moves | Senators will be sworn in as jurors in Trump s impeachment trial today and issue a summons to the former president. The US January market to manufacturing PMI rose unexpectedly 2.02%, stronger than negative expectations and the fastest expansion since the data started being collected. The US 10-year yield, which the consensus expected to push above 1.20%, slipped below 1.03% yesterday, its lowest level in nearly three weeks.
This metric applies equally to well established Nasdaq names as well as the far more speculative stocks like Tesla. The US earnings season picks up today, with Microsoft, J&J, Texas Instruments, AMD, 3M, and GE, among others. The continent is lagging behind the UK and the US and far behind Israel, the world leader – which is beginning to see promising results from its immunization scheme.


PBOC advisor Ma Jun cited the risk of fomenting asset bubbles as the impetus behind the action. less The Chinese erstwhile dictator Xi Jinping asked the Davos gathering of the superrich, can’t we all just get along?


German officials were concerned that the vaccine may not receive approval from the EU’s medicines authority EMA for use in those over 65, Bild said in its online edition. Last week, Pfizer sparked an outcry when it reported an issue at a factory in Belgium that reduced vaccine deliveries to EU member countries. EU export curbs risk triggering a domino effect, said Simon Evenett, a professor at the University of St. Gallen in Switzerland. The U.K. s vaccine minister is warning the EU against engaging in vaccine nationalism.
Chancellor Angela Merkel told party colleagues that Germany s management of the pandemic has slipped out of control. U.K. Prime Minister Boris Johnson is expected to announce his plan today for quarantining travelers on arrival. Sweden now want the EU Commission and Pfizer to reach an agreement on how many doses there are contained in each vial. The virtual Davos meeting continues today with speakers including Merkel and French President Emmanuel Macron.
EU turns screws on bankers clinging to their London desks.