Close: London Session | Forex, Metals, Oil, Agriculture October 30, 2020



Feeding demand | The recent strength in grain and soybean exports could continue into 2021,adding to dry-bulk prospects next year, Bloomberg Intelligence says. The coffee chain forecast 2021 earnings largely above estimates on Thursday, helped by strong online orders and a recovery in demand following the initial hit from the COVID-19 pandemic. While millions of residents in the Gulf have been suffering, these storms helped break the wheat market (WEAT) with temporary “drought easing rains” from Texas to southern Kansas.
Chicken trouble | Bumper corn crops typically signal cheap feed and fat margins for chicken producers in Brazil. For an interesting article I wrote a couple of weeks ago about La Nina and markets such as sugar (CANE), please read here. Overall, coffee needs are mostly price locked for fiscal 2021.


The dollar is trading in the green against the Australian dollar, the Canadian dollar, the pound and the New Zealand dollar. So far this Friday’s trading, gold is attempting a tepid bounce, as the US dollar bulls take a breather after the solid upsurge. The dollar index was little changed ahead of the U.S. election next week. The dollar index was slightly lower ahead of the U.S. election next week. In global markets, gold prices edged higher today due to weakness in the US dollar.
This is the latest multi-billion dollar loss by an oil major via a Marcellus asset round-trip, following Shell’s (RDS.A) divestiture to National Fuel Gas Company (NFG) in May. Negotiations on the longstanding row resumed on Oct. 27, days after U.S. President Trump suggested Egypt could blow up the multi-billion dollar structure. The US dollar of course is crucial to the directionality of precious metals, as it does tend to have a short-term negative correlation.
However, That being said, you have to pay attention to the US dollar. The fast-food giant was hit on Thursday with a potentially multi-billion-dollar lawsuit by Black franchise owners who accused the company of racial discrimination for steering them to underperforming stores.


(The HUI to gold ratio remains at very low levels, indicating that gold miners might be undervalued compared to physical gold. Below, I’m compared Agnico Eagle Mines to a few of its most similar peers: Yamana Gold (AUY), Kirkland Lake Gold (KL), and Kinross Gold (KGC). Yet, Agnico’s stock was down sharply today like many other gold miners given the drop in gold prices, which fell by more than 1%. Not surprisingly, the gold miner reported a stellar quarter, mainly due to the rise in gold prices to over $1,900/oz.
Agnico is a senior gold miner that has guided for between 1.68 and 1.73 million ounces of gold production at all-in sustaining costs between $1,025and $1,075/oz. I believe the recent drop in gold and gold mining stocks has left investors with plenty of good value buys to choose from. Since the March meltdown in the stock market that triggered an initial move lower on gold too, stocks corrected, and so did gold. Agnico operates several gold mines in North America, including its 50%-owned Canadian Malartic mine in Quebec which has produced 179,016 ounces of gold year to date.
Bitcoin followed gold closely and rose above $10k on gold surging above $2k. Source: Company data, Author’s spreadsheet for the third quarter increased 35% YoY to $884 million, driven by high prices for gold and silver, as well as increased sales.


Total trimmed its oil and gas output forecast for the year to under 2.9 million barrels of oil equivalent per day, from a previous 2.9-2.95 mboepd estimate. Chevron posts profit on deep cost cuts, improved oil prices Chevron reported an adjusted third-quarter profit as oil prices recovered from spring lows and spending cuts benefited operating results. Amid declining oil prices Chevron said it implemented aggressive cost-cutting measures.The oil giant lost $207 million during the quarter.
The oil producer reported an adjusted third-quarter profit as oil prices recovered from spring lows and spending cuts benefited operating results.
Furthermore, the Eagle Ford oil production often enjoys a premium to the posted price, whereas the past Permian issues have forced considerable discounts to the price of oil. Including unfunded lending commitments, ZION’s total exposure to the oil and gas sector was $4,329 million at the end of the last quarter, as mentioned in the earnings release. De-facto OPEC leader Saudi Arabia and non-OPEC Russia are in favour of extending existing oil production cuts of around 7.7 million barrels per day (bpd) into next year.
The French oil and gas producer trimmed its 2020 investment target after a sharp drop in third-quarter net profit, though the company maintained its dividend. Gasoline stocks dipped last week by 101,000 mt to 1.17 million mt, while fuel oil inventories were off by 106,000 mt to 1.37 million mt. Between March and July, Iran cut oil production from 3.1 million barrels per day to 1.9 million, its lowest rate since 1981.

United States

The social media company on Thursday added fewer users than Wall Street had expected and said a rise in expenses would accelerate in the fourth quarter. The greenback continued to draw bids and reached monthly highs above 94.00 vs, its main competitors, underpinned by the US fiscal stimulus impasse, election anxiety and dovish ECB. Harrison doubts whether Fed intervention will be enough, and said he doesn’t think risk assets will bounce back so well this time.
less (Nasdaq: SBUX) fourth-quarter earnings and revenue took a hit due to the pandemic but the company still beat consensus. China s state support for companies that Trump pledged to confront meanwhile remains intact.Campaign 2020There are four days until the election. US stock futures are trading lower today, indicating a negative opening for Wall Street indices. Thursday’s Key Earnings Activision Blizzard (NASDAQ:ATVI) -1.3% AH seeing significantly lower cash flow.Alphabet (NASDAQ:GOOG) +6.7% as ad sales bounced back sharply.
Nasdaq Futures are trading down by 270 points (down 2.4%), while Dow Futures are trading down by 521 points (down 2%). Nasdaq Futures are trading down by 162 points (down 1.4%), while Dow Futures are trading down by 261 points (down 1%). Apple Inc.’s shares are down more than 4% in pre-market trading after the company surprised Wall Street with lower-than-expected iPhone sales and a slump in China revenue.


French President Emmanuel Maron said that the current surge is worse than the first one, while German Chancellor Angela Merkel said the EU should have acted earlier. Exports in November could track much lower as a second wave of coronavirus grips much of the EU and US therefore limiting fuel demand. President Emmanuel Macron, who has been widely criticized by Muslim leaders for comments interpreted as hostile, said France was being attacked for its values.
EU Nation Wants Virus Tests for All After Victory Slovakia beat first wave; wants to do one better and test entire population. The ECB will clearly need to act to return inflation to target, as it seems to have realised at the meeting yesterday. The GDP recovery in the summer was much faster than the ECB or we had projected. Inflation – which Lagarde says will likely remain negative until early 2021 – is forecast to hover around 0% in October. EU and UK negotiators are in Brussels, trying to find more common ground after reportedly making progress on the thorny topic of state aid.
At yesterday’s press conference, Lagarde held out the possibility of further monetary policy easing in December.
By now, I have built up excellent skills and experience in analyzing macroeconomic and political developments in Europe, the Eurozone and Germany, including ECB watching.