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



The Wall Street firm upgraded shares of Starbucks to outperform from market perform, sending shares of the world’s largest coffee chain up 1.5% in premarket trading on Wednesday. It has a number of notable brands, including Green Mountain Coffee, Dr Pepper, A&W Root Beer, Schweppes Ginger Ale, and Snapple brands.


Dollar The sell-off was simultaneous with a dollar index that shot up to 94.20. most of the markets we do nicely in are the gold market, silver market, crude oil market, bond market and the dollar. Gold and silver prices paused gains after a three-day rally, as the US Dollar climbed after the first US presidential election debate. The dollar then became a fiat currency, like all the others, and the government could print as many dollars as it wanted when it wanted.
In the near term, the outlook of gold largely depends on the direction of the US Dollar, due to their negative correlation and a lack of geopolitical events lately. Gold slipped as the dollar benefited from caution that crept into financial markets. Gold slipped as the U.S. dollar benefited from caution that crept into financial markets. The biggest mistake the US made was when Nixon removed the dollar from the gold standard. Amid all this, the U.S. Dollar Index has risen about 1.6% this week, leaving gold exposed to further losses should the currency strengthen.
The US Dollar, a perceived safe-haven, advanced 0.18% post-debate, sending gold and silver prices down by 0.38% and 1.2% respectively.


In other words, by historical standards, the gold price is still very high relative to the cost of energy, meaning that gold mining profit margins remain elevated. Also consider the general low valuation of gold stocks with today’s gold price (see near bottom of this article). With gold stocks as measured by the Gold Bugs Index, the 300 area is important because it was a resistance level and also the 2016 high in the index. The Gold Analyst offers quality technical and fundamental analysis of the price of gold to help educate readers in their investment decisions.
When gold was at $2,089, everyone was saying to buy gold. Base case indicates a mine life of 16 years, producing 367,000 ounces gold annually with life of mine average all-in sustaining costs of $694 per ounce. In 1980, the U.S. bull run saw gold prices reach $850/oz and silver prices leap to $50/oz. For two reasons, the high probability that the gold/oil ratio peaked on a long-term basis 5-6 months ago is not bearish for gold mining stocks.
Gold prices has mostly been trending in the lower Bollinger Band since its trend reversed in early August, suggesting that bearish side might be taking control. This was despite temporary Covid-19-related closures at their Westwood and Rosebel mines and reflects an average realized gold price of $1,724 per ounce sold.


Yet the market is worried about how they will absorb oil from a return of Libya’s oil production. On Wednesday, oil continues to slump, extending losses from Tuesday, following new worries that rising global coronavirus cases could result in lower demand for crude products. Libya’s Sarir oilfield has restarted production at the Sarir oil field, producing more than 300,000 barrels per day (bpd) last year before the shutdown. The surprise draws in crude, if confirmed, should lend credence to the threat for Saudi Arabia that the global oil market is much tighter than people think.
The oil price action hurt the company’s upstream operations versus a year ago, contributing to the overall revenue decline. Oil major Royal Dutch Shell Plc said it will cut as many as 9,000 jobs as it struggles with low demand and tries to restructure towards low-carbon energy. Naturally, the price of oil and gas is what pretty much drives revenue for the company, in addition to changes in volumes.
BEFORE THE BELL Canada s main stock index futures fell, as oil prices dipped on concerns over fuel demand.
As you are likely aware, oil and gas prices were pretty strong in 2018 and receded quite a bit in 2019, then collapsed in 2020 with COVID. While volumes matter, as do movements in balance sheet line items, there is no denying the clear correlation with oil prices and revenues for the company.

United States

BEFORE THE BELL Wall Street futures, European and Japanese shares fell, after a chaotic first U.S. presidential debate and rising COVID-19 cases turned investors cautious. Wall Street futures, European and Japanese shares fell, after a chaotic first U.S. presidential debate and rising COVID-19 cases turned investors cautious. less While Tuesday’s chaotic “shitshow” of a presidential debate between Trump and Biden revealed absolutely anything about either candidate’s core policies for the 2020-2024 period, .
Even so, it discounted the damage that the pandemic was going to cause because the market reversed right away as the Fed announced record stimulus. The global equity rebound that found momentum toward the end of September fizzled yesterday, ahead of the US presidential debate. The reason: the Fed’s explicit backstop of the corporate bond market since March, when Powell announced the Fed would purchase corporate bonds and ETFs. “At the current low rates, even if the Fed were to set all Treasury rates to 0bp, how many new borrowers and spenders would emerge?
Some link the selling to the US presidential debate, which did not showcase the rhetorical acumen of the candidates, and unlikely swayed many voters. Every also addressed the last question of the evening on the legitimacy of the upcoming election process, where Trump said “This will not end well,” .” This week the New York Times published an extensive analysis of Mr. Trump’s taxes after obtaining many years of his tax returns.


In other words, Beijing is turning up the pressure on an American tech giant and creating a bargaining chip out of thin air. Now, Beijing is lashing out at an American tech giant – Google parent Alphabet – by taking a page out of EU antitrust head Margrethe Vestager’s playbook. As Beijing turns inward, trade partners have reason to fear the model will stick. So it’s unclear what, exactly, is being targeted by Beijing.


Most recently, the European Commission laid out plans to increase the EU’s 2030 renewable energy target from the current 32 percent up to 38–40 percent. At any rate, with the election for Merkel’s successor coming next year, The opposition Greens are doing everything they can to push the issue. The ECB will likely ease in October instead of waiting until December, but it may use the October meeting to warm-up the markets and just send a dovish signal. The ECB is seen as easing in December, not in October, as many would think after this week’s German, French and Italian inflation data.
Interestingly enough, it may just be a step towards negative rates – a move likely to come only in the event of a hard Brexit. The ECB is worried about weak consumer prices after preliminary German Consumer Price Index figures showed ongoing softness.Will the Frankfurt-based institution add to its stimulus? The centrists and doves at the ECB see the inflation undershoot as part of the argument to extend its bond-buying operations.
The latest ECB staff projections foresee annual real GDP growth at -8.0% in 2020, 5.0% in 2021 and 3.2% in 2022. The EU reportedly has rebuffed the UK’s latest move to redraw its state-aid plans. ECB to consider allowing inflation to overshoot, Lagarde says.