Agriculture
The U.S. has sanctioned some Chinese companies it says profit from exploited labor, and banned imports of cotton products and tomatoes from the region.Even so, governments are cautious. Over two decades ago Jay got his start at the Kansas City Board of Trade in the Wheat Futures pit.
Currencies
Dollar indexSince the dollar weakened, the dollar index declined yesterday and slipped below the support of 90.35, where the 50-day moving average coincides. Weak US dollar, strong Asian currencies and foreign portfolio investment (FPI) flows into the markets could lend support to the domestic currency, Reliance Securities said in a research note. This means a weak dollar and dollar depreciation can be positive for the rupee. It’s going to take a higher rate spread against other G10 currencies – particularly the dollar – and higher oil prices for EURNOK to continue down.
less The rupee appreciated 16 paise to 72.33 against the US dollar in opening trade on Tuesday tracking positive domestic equities and strong Asian currencies. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.01 per cent to 90.00. MARKET NEWS Gold climbed to a one-week high, bolstered by a weaker dollar and a retreat in U.S. Treasury yields, while concerns over rising inflation further boosted bullion’s appeal.
Last week, the steepening of the US yield curve gave rise to a stronger dollar, while EM and commodity currencies such as NOK lost ground. But it has opened on the strong foot and the dollar index hinting at a decline in the greenback. Gene comments on stock, bond, dollar, oil & gold markets, with a particular emphasis on monetary policy, technology issues and S&P intraday action.
less The rupee appreciated 16 paise to 72.33 against the US dollar in opening trade on Tuesday tracking positive domestic equities and strong Asian currencies. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.01 per cent to 90.00. MARKET NEWS Gold climbed to a one-week high, bolstered by a weaker dollar and a retreat in U.S. Treasury yields, while concerns over rising inflation further boosted bullion’s appeal.
Last week, the steepening of the US yield curve gave rise to a stronger dollar, while EM and commodity currencies such as NOK lost ground. But it has opened on the strong foot and the dollar index hinting at a decline in the greenback. Gene comments on stock, bond, dollar, oil & gold markets, with a particular emphasis on monetary policy, technology issues and S&P intraday action.
Metals
Impact on IndiaAs regards how the copper price spike will impact India, Kumar said India is not in the best place right now, in terms of the copper market. Sterlite Copper’s Kumar said if the “contributing factors continue in the current state”, copper could be ruling on the higher side in the coming months. India could spend 30-35 per cent more on importing copper as demand for the metal could increase due to higher spending on infrastructure development, he said.
Economic re-engagement in China is one of the key drivers behind the copper price rally; the country imports approximately 50% of global copper output. Rating agency Care said that strong demand, especially in China, is expected to hold copper prices on the higher prices. According to the International Copper Study Group, global copper output is expected to rise 4.5% year-over-year to approximately 21.80 million tonnes in fiscal 2021. More copper per EVThis will result in higher demand for copper.
Sterlite Copper’s Kumar said demand and supply factors will continue to affect the prices. Care said that copper production dropped 30 per cent during the October-December quarter last year as Hindalco Industries undertook maintenance shutdown. “On the one hand, you have increased demand boosted by economic recovery and, on the other, you have copper manufacturers struggling to meet the supply requirements,” he said.
Economic re-engagement in China is one of the key drivers behind the copper price rally; the country imports approximately 50% of global copper output. Rating agency Care said that strong demand, especially in China, is expected to hold copper prices on the higher prices. According to the International Copper Study Group, global copper output is expected to rise 4.5% year-over-year to approximately 21.80 million tonnes in fiscal 2021. More copper per EVThis will result in higher demand for copper.
Sterlite Copper’s Kumar said demand and supply factors will continue to affect the prices. Care said that copper production dropped 30 per cent during the October-December quarter last year as Hindalco Industries undertook maintenance shutdown. “On the one hand, you have increased demand boosted by economic recovery and, on the other, you have copper manufacturers struggling to meet the supply requirements,” he said.
Oil
Malaysian palm oil futures rose 2%, tracking a rally in crude oil and rival edible oils, though expectations for improving production capped gains. This is expected to push gasoline inventories down by 3.43 million bbl, while distillates are likely to have fallen by 3.91 million bbl. Brent crude futures, the global oil benchmark, advanced 1.59 per cent to $66.28 per barrel. less It’s going to take a higher rate spread against G10 currencies (USD) and higher oil prices for EURNOK to continue down.
Crude oil prices climbed 5.5 percent over the past 24 hours. But given the outlook for both rates and oil prices longer out, we believe there is a good chance the cross could come below 10.00 before the summer. According to a Reuters poll, US commercial crude stocks are likely to show a draw of 5.37 million bbl for the week ending the 19th of February. Markets will look forward to Powell’s testimony and API weekly crude stocks data for near-term trading opportunities in oil.
According to industrial sources, the restart of US oil production could take up to two weeks. The rally in oil has been nothing less than incredible these past three weeks, about 10 dollars higher.
Crude oil prices climbed 5.5 percent over the past 24 hours. But given the outlook for both rates and oil prices longer out, we believe there is a good chance the cross could come below 10.00 before the summer. According to a Reuters poll, US commercial crude stocks are likely to show a draw of 5.37 million bbl for the week ending the 19th of February. Markets will look forward to Powell’s testimony and API weekly crude stocks data for near-term trading opportunities in oil.
According to industrial sources, the restart of US oil production could take up to two weeks. The rally in oil has been nothing less than incredible these past three weeks, about 10 dollars higher.
United States
The Fed wants to keep asset prices high, and has shown no interest in intervening to pop the obvious froth appearing at the edge of the market. It is when bond yields have risen too much for the stock market that they will also have risen too much for the Fed. less Volatility has returned to Wall Street, and it appears that our absolutely epic stock market bubble may be in serious trouble. Even as the real economy has imploded all around us, there has been tremendous euphoria on Wall Street as stock prices have surged to dizzying heights.
The joke in the market is that sometimes “good news is bad news” if it means the Fed raises rates too fast. US stock futures are trading higher today, indicating a positive opening for Wall Street. The Fed pays banks on the reserves held above and beyond those required by central-bank regulatory policy as part of its effort to maintain liquidity in the financial system. Since leaving Wall Street I’ve dedicated my financial career towards studying this situation and helping people understand what’s actually happening.
The spread between IOER and the two-year yield has typically been above 0.05 percentage point since the Fed cut the rate to its lowest level ever in March. Contracts for the Nasdaq-100 retreated 0.6%, suggesting technology stocks will continue to lead the market lower.
The joke in the market is that sometimes “good news is bad news” if it means the Fed raises rates too fast. US stock futures are trading higher today, indicating a positive opening for Wall Street. The Fed pays banks on the reserves held above and beyond those required by central-bank regulatory policy as part of its effort to maintain liquidity in the financial system. Since leaving Wall Street I’ve dedicated my financial career towards studying this situation and helping people understand what’s actually happening.
The spread between IOER and the two-year yield has typically been above 0.05 percentage point since the Fed cut the rate to its lowest level ever in March. Contracts for the Nasdaq-100 retreated 0.6%, suggesting technology stocks will continue to lead the market lower.
China
The U.S. calls it genocide.Beijing insists Uighurs have just as many freedoms as anyone else in China. Foreign Minister Wang Yi says locals in Xinjiang lead safe and happy lives. In the meantime, Beijing continues to act as it sees fit on Xinjiang. Tensions over Xinjiang are bleeding into broader ties.
Europe
Banks use those yields as a reference when setting the price of their loans to households and firms, Lagarde said. She told the European parliament that the ECB was would maintain favorable financing conditions throughout the pandemic period. Accordingly, the ECB is closely monitoring the evolution of longer-term nominal bond yields. Yesterday, UK Prime Minister Boris Johnson announced in detail a four-step reopening plan.
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