Open: New York Session | Forex, Metals, Oil, Agriculture August 26, 2021

A member of the National Guard plays a trumpet during a flag rai

Agriculture

Over two decades ago Jay got his start at the Kansas City Board of Trade in the Wheat Futures pit.

Currencies

The Swiss franc and the British pound dropped 0.3% and 0.2% respectively against the U.S. dollar whereas the euro was flat against the dollar, with 1 euro buying $1.18. The Australian dollar (-0.14%) and the Canadian dollar (-0.21%) showed the steepest losses. The US Dollar Index, which measures the greenback’s value against the basket of six major currencies, slipped on Wednesday for the 3rd consecutive session. Gene comments on stock, bond, dollar, oil & gold markets, with a particular emphasis on monetary policy, technology issues and S&P intraday action.
The greenback is also strengthening, which makes it costlier for emerging-market bond issuers to service their dollar debt, according to Khoon Goh, head of Asia Research at ANZ. The blue line goes a step further and adjusts for inflation based on the Producer Price Index for All Commodities, chained in today’s dollar value. Furthermore, there was a slight recovery in the US dollar on Wednesday; though prices closed red, the greenback remained on the upside during most of the day.
At the interbank foreign exchange, the rupee opened at 74.22 against the dollar, then surged higher to 74.11, up 13 paise over its previous close. The Indian rupee appreciated 13 paise to 74.11 against the US dollar in opening trade on Thursday, tracking a positive trend in domestic equities. It’s considering digitizing the U.S. dollar, giving people money they can access on their phone and bypassing electronic payments that can be slow and costly for businesses.

Metals

Jordan also briefly discusses gold stocks and what he looks for in gold equity investment. ETFs that allow investors to trade gold bullion or a group of gold mining companies have become widely popular. After gold breaks through $2,100, Jordan thinks gold will have its biggest move since the late ’70s. Since the end of the 2007–2008 global financial crisis, gold has been at least $1,000 per ounce; it recently hit $2,000 an ounce. Gold prices for the latest contract on MCX are trading down by 0.1% at Rs 47,118 per 10 grams.
Gold prices are trading down 0.2% at Rs 47,102 per 10 grams. In global markets, gold rates were flat today as traders turned cautious ahead of US Federal Reserve’s Jackson Hole symposium later this week. Gold prices skidded in Indian markets today amid a weak global trend. GDX holds 55 of the largest gold miners in the world, with its top 10 holdings making up nearly 65% of the portfolio by weight. Although gold’s direct impact on currencies has diminished over the last century, precious metal is still a very important asset.

Oil

The ADTV of crude oil futures touched a high of ₹9,421 crore on MCX in 2012, and ₹9,963 crore (futures plus options) made a new high of ₹9,963 crore. Global oil benchmark Brent crude futures fell 0.48 per cent to USD 71.90 per barrel. Nifty Oil & Gas was up 0.50 per cent.Nifty Metal was down 1.29 per cent. Nifty Oil & Gas was up 0.82 per cent. For 2021, the crude oil ADTV is down to ₹5,280 crore. This implies negativity for commodity-linked currencies and oil, although it has temporarily faded into the background ahead of Fed Chair Powell’s speech scheduled for Friday.

United States

While various central bankers and key individuals will start the meeting today with official speeches and on-the-side interviews, Friday’s speech by Fed chair Jerome Powell is key. Even within large-cap tech, a ratio of the Nasdaq 100 to the Nasdaq 100 equal weighted index has been trending higher with higher lows throughout this year. It may be that the Fed will decide to wait to see next Friday’s Jobs Report (NFP) before announcing any tapering timetable at the September FOMC meeting.
Instead, he wants the Fed to target full employment and only raise rates once we see the sort of unemployment rates we had before the pandemic. For these reasons, progressive economists who have been pushing the Fed to pay more attention to full employment have been very happy with Powell’s reversal of past Fed policy. Fed Chair Powell is expected to signal asset purchases, but others expect announcing this to happen at the FOMC meeting next month. But apart from the question of how much Biden can shift the Fed’s regulatory orientation, there is also the question of its relative importance.
US stock futures are trading lower today, indicating a negative opening for Wall Street. The Nasdaq 100, which includes 100 of the largest domestic and international non-financial companies listed on the Nasdaq, also rose to a fresh high on Wednesday, tagging 15369. However, the Fed’s policy on regulation can likely be shifted by appointing new members who are committed to a stronger regulatory framework.

China

The Hong Kong-listed shares of Kuaishou tumbled 10% on Thursday, after the Beijing-based company reported a loss equivalent to $1.1 billion for the second quarter, which ended in June. Founded in 2014, EqualOcean is headquartered in Beijing and has offices in Shanghai, Shenzhen and New York.

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