Daily Close | Forex, Metals, Oil, Agriculture November 26, 2020



Source: CQG Corn prices are rising and were trading at above $4.20 per bushel this week. Wheat has already hit a six-year high, with the price of the grain above the $6 per bushel level. Soybean meal, a soybean product, and corn are feed staples. China has been purchasing soybeans hand over fist over the past months, contributing to the oilseed futures’ bullish price action. As the Chinese rebuild their pig population, the demand for soybean meal is rising.
Source: CQG Soybean prices have risen to the highest level since June 2016.


If you disobey and are busted having more than two households together at a time, you could face misdemeanor charges, thousand dollar fines, or even imprisonment. This relationship is also demonstrated by gold’s negative correlation with the U.S. Dollar Index shown below. The BEA uses the average dollar value in 2012 for inflation adjustment.


As shown in Exhibits 1 and 2, gold has four main factor exposures (all positive) that drive ~50% of gold’s risk: Interest Rates, Commodities, Foreign Currency, and Local Inflation. First, gold’s exposure to Interest Rates reflects the fact that gold is positively correlated with nominal government bonds globally. Thus, demand for gold increases, which then drives up gold prices in USD. Sometimes gold may even be viewed as a more attractive portfolio diversifier than Treasuries when yields drop (and bond prices rise).
The exposure to Commodities is somewhat obvious and expected, so we will spend some time digging into gold’s three other factor exposures. Hence, holding inflation hedges such as gold, Bitcoin, real estate or inflation-link bonds will be crucial. In other words, the monetary injections to support the restrictive economies will tend to levitate assets with limited supply such as gold and Bitcoin. The bank thinks gold prices could hit $2,300.00 per ounce in 2021.
This is expected as we mentioned in bonds and gold are both perceived as safe haven assets. Even the big banks say the bull run in gold isn’t done yet. (NYSE: CM) is also bullish on gold, expecting the price of the precious metal to be above $2,000 until 2024. Gold investments have done really well so far. (NYSE: GS), is bullish on gold.


The rise in oil prices and the increase in refining volumes led to a significant improvement in financial results quarter-over-quarter. Depending on how oil prices will perform in 2021, Gazprom Neft may lose around 5-10% of 2021 EBITDA. (source) With all the mistrust already brewing in our nation, this will be like throwing gasoline onto the fire.

United States

Flanked by crowds of people wearing Trump 2020 hats and carrying anti-lockdown signs, the infuriated restaurant owner eventually managed to gain access to the building and start serving meat. A calming trade environment between the US and China in 2021 will increase the demand for US agricultural products, and the costs of raising animals for meat will rise. Equally, initial Biden policy proposals being floated will appeal to his base but not Trump’s: amnesty for 11m illegal aliens; cancelling student loan-debt; and taxing ownership of guns.
The Trump administration’s tariffs and tensions could disappear early in 2021, creating more trade between the US and China. In 2018, Adobe Analytics data shows $6.22 bn was spent online in the US, representing a 23.6% increase on the previous year. Perhaps the Brits could try to synchronise with the US Supreme Court for maximum market attention(?) Yes, a Trump legal reversal is still a long shot; but his defeat is going to be polarizing rather than uniting.
The trade actual deficit will be lower as the US maintains a surplus in services. Prices at butcher counters across the US rose while availabilities fell. Today, Wall Street continues to use Zacks research including the Zacks Rank and Zacks Equity Research, which combines the best of quantitative and qualitative analysis. The second wave of the coronavirus is now sweeping across the US and Europe. Unheard of in the days when all Wall Street could say was “Buy”.
In the US, the confirmed case tally is nearing 12.8 million, while the death toll is at 262,446.
Several of Viatris’ non-branded drugs will have to be divested for anti-trust reasons for Viatris to be able to operate in the US according to the FTC.


Which might explain why Beijing offered an olive branch yesterday via its press and its official congratulations to Biden.


The current budget and coronavirus relief proposal before the EU would block funds to member countries seen as not adhering to “democratic standards”. The internal European Union rift has widened and is threatening to turn into full diplomatic war as Poland and Hungary have remained resolute in blocking the new EU budget. Prime Minister Boris Johnson confirmed England’s national lockdown will end next week, to be replaced by a tougher three-tier system of regional restrictions (Source: Bloomberg).
We can’t help but wonder why Merkel’s center-right government is taking such extreme steps to safeguard Wirecard. The French are now accusing the British of foot-dragging, and the EU and UK sides remain “extremely far apart”, apparently. Hungary’s PM Orban has told German Chancellor Merkel that what she’s asking for is political ‘suicide’, and Orban and Polish leader Morawiecki will meet today. The coming days will be “decisive”, says the EU’s von der Leyen.
The EU has targeted both countries as part of an .