Open: London Session | Forex, Metals, Oil, Agriculture September 02, 2020



He said there’s room to run on commodities; every dollar that’s going to be invested in commodities and commodity stocks this year is not in the markets yet. less Extending the rally, the rupee gained about 1 per cent on Tuesday ending the session at 72.87 versus the dollar (USD). Five Things You Need to Know The euro’s rally stalled after the ECB’s Philip Lane said the currency’s value “does matter,” a remark signaling concern, analysts said. While the ECB had warned that inflation would weaken, the negative reading will still sound the alarm for policy makers and a surging euro could further exacerbate deflationary pressure.
There is a danger that the U.K. could turn into one of the biggest global losers from a weaker dollar. The euro-dollar rate does matter, the European Central Bank’s Philip Lane said last night, causing the single currency to pare its gain. less The rupee fell 23 paise to 73.10 against the US dollar in early trade. But now the risks of no-deal Brexit, a weak dollar, and the need to raise tax are all putting the U.K. under pressure.
The euro’s gain eased, Australia fell into recession and it’s re-shuffle time for stock indexes. Federal Reserve stimulus has weighed on the greenback while the European Union’s rescue fund calmed any lingering fears of a euro breakup.


Before the recent upswing in gold prices, the gold industry went through a harsh downturn that has reset the playing field for gold producers. Although gold prices reached historic highs this summer, we still see some potential drivers that could move prices even higher. These ETFs have attracted large new pools of capital that previously wouldn’t have invested in gold and helped to create greater efficiency in the gold price discovery mechanism. However, much of the world’s gold, and most of the gold produced each year, is still held as jewelry or small-investor coins and bars.
In times of stable economic growth, traditional equity and debt investments could offer greater appreciation potential and the prices of gold and other precious metals may be adversely affected. 2 Source: World Gold Council, “Gold Demand Trends Q1 2020,” April 30, 2020. In our view, gold may benefit from bouts of elevated market volatility and mounting concerns over the coronavirus’s economic impact as investors seek perceived safe haven assets.
In our view, the recent rally in gold prices should provide a significant lift in cash flow across the industry. The industry now has an opportunity to use rising gold prices as a stepping stone toward building stronger and more sustainable businesses. Mining costs tend to be relatively fixed, so higher gold prices can flow straight to the bottom line.


At HFI Research Natural Gas, we give you guidance on natural gas fundamentals, weather, and set-ups to help you navigate the dangerous natural gas market. For readers investing or trading natural gas or natural gas equities, don’t be blinded by the incoming moves. The combined result is that cash price would further weaken into this weekend with more pullback expected for natural gas. Back in June when the market worried about a potentially full natural gas storage by November, prices dropped to $1.5/MMBtu.
For readers, we see more downward pressure for natural gas prices in the near-term.

United States

As noted last week, implied volatility on the Nasdaq is rising alongside stocks, suggestive of increased demand for call options. The basic premise of the interest rate/valuation argument has its roots in the “Fed Model” as promoted by Alan Greenspan during his tenure as Federal Reserve Chairman. Asset holders are benefiting from asset price inflation – and that is exactly what the Fed intended, he said. Steven Mnuchin said the U.S. urgently needs additional fiscal stimulus, and initiated a call with Nancy Pelosi.
At the moment the calls are holding sway, but it will be interesting to see what happens to the Nasdaq when the options activity dies down.
Greer said that the Fed’s memo is a pivotal time point in this rally, and it seems to have ignited another leg. (And let’s not forget the Fed also uses the U.S. Government’s grossly understated inflation statistics.) While this company has better growth prospects a comparable U.S competitor trades at 27x. Tuesday’s strong Wall Street finish has also set a positive tone. Both the Nasdaq and S&P 500 hit records to start September on a high note on Tuesday.


Beijing should soon be able to put atomic bombs on planes along with its ability to deploy the weapons via land and sea joining the U.S. and Russia. During a press briefing, Wang was pressured over the city, Xinjiang and the government’s response to the pandemic. This dilutes Beijing s goal of providing much-needed capital to startups.


OECD Hopeful | Sweden nominated Cecilia Malmstrom to be secretary general of the OECD, a job in which the former EU trade chief could find previous experiences useful. As this situation would be bad for the EU but much worse for the U.K., the British are now in a very difficult negotiating position. I mention this tempest in a British tea-cup because markets are putting Brexit, and the U.K. s post-imperial destiny, back into a harsh light. It was the “first real pushback from the ECB on the exchange rate’s appreciation,” said Scotiabank’s Shaun Osborne.
We also publish the Brexit Bulletin, a daily briefing on the latest on the U.K. s departure from the EU. This is the date at which a new free-trade agreement with the EU must be agreed to replace the arrangements that existed when Britain was a member. The FTSE-100 sold off badly Tuesday, and is now back below its level on June 24, 2016, the day of the Brexit referendum. But if Sunak doesn t do something about this, it will be hard to keep rates as low as they are now.Then there is the small matter of Brexit.