Open: New York Session | Forex, Metals, Oil, Agriculture November 20, 2020

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


We ve come down in an escalator, but we’re going to go back up the stairs,” Sunny Verghese of Olam International said at the World Cocoa Foundation (WCF) conference. Last week, U.S. soybean export sales for the 2020-21 marketing year hit an 18-week low. It also covers the commodities market daily focusing on in-depth technical developments in GOLD, CRUDE OIL, SILVER, CORN & WHEAT.


Dollar index The dollar index, which opened with a gap-up in the last session, weakened towards the end of the session, posting an intra-day loss. Also, the dollar index hints at a further decline, indicating that the dollar is likely to trade lower today. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.08 per cent higher at 92.36. The rupee appreciated by 11 paise to settle at 74.16 (provisional) against the US dollar on Friday, supported by positive domestic equities and sustained foreign fund inflows.
At the interbank forex market, the domestic unit opened at 74.15 against the US dollar and touched an intra-day high of 74.09 and a low of 74.21. During the last session, the rupee (INR) settled lower by 8 paise against the dollar (USD), closing the session at 74.27 after making an intraday low of 74.33. However, beyond that, the RBI would step in to curtail its move, while dollar index may also rebound given the uncertain growth outlook in the US.
Stocks included in the MSCI EM Asia index are up 17.5% in dollar terms this year, while the MSCI EM ex-Asia index is down 19.9%. The US dollar ranks highest in international popularity, credibility, and convenience amongst major global currencies. W&T’s second-lien bonds are currently trading at 63 cents on the dollar, indicating a fair amount of concern that they will be repaid.


Among the companies awarded concessions were Australia’s Centamin, Canadian companies B2Gold, Barrick Gold, Lotus Gold, Red Sea resources and Britain’s AKH Gold. In global markets, gold prices edged lower today amid uncertainty over more US stimulus measures. Tracking weak global cues, gold prices continued to struggle in Indian markets for the fifth day in a row. But a project like this, with minimal capital expenditures needed is “worth its weight in gold” when commodity prices literally “fall through the floor”.
In the previous session, gold prices had fallen 0.7% or Rs 350 per 10 grams. Gold prices are trading up by 0.3% at Rs 50,125 per 10 grams. On MCX, gold edged up 0.1% to Rs 50,029 per 10 grams after suffering losses in the previous four sessions. Gold may find a bit of support as well if the chipper mood weighs on haven-seeking USD demand. Switzerland’s exports of gold to China remained at rock bottom, however, suggesting that demand in Asia is far from a full recovery.
S&P 500 futures pointed to little change at the open, the 10-year Treasury yield was at 0.842%, oil traded above $42 a barrel and gold was broadly unchanged.


Brent crude futures, the global oil benchmark, rose 0.38 per cent to USD 44.37 per barrel. At that production level and current strip prices (including $43 West Texas Intermediate oil), W&T may be able to generate $412 million in revenue after hedges. W&T Offshore is a Gulf of Mexico oil and gas producer that gets around 60% of its production from federal waters and 40% of its production from state waters. W&T may end up averaging around 43,000 BOEPD in production (36% oil, 48% liquids) during 2021 if it continues to go with a quite limited capex budget.
less Crude oil prices tracked lower alongside stocks as risk appetite soured in Wall Street trade. That may brighten investors’ mood market-wide, echoing as supportive for sentiment-sensitive crude oil prices. Malaysian palm oil futures reversed early gains, set to post losses of 1% for the week, as exports slumped during the first half of November. Crude oil prices are marking time at range resistance in the 42.40-43.88 area.
W&T’s results were depressed in 2020 by a combination of low oil and natural gas prices and an exceptional amount of Gulf of Mexico storms.
While the developments are wonderful for the world, we think deployment will take some time and oil demand recovery will also lag.

United States

Mnuchin said in a letter after markets closed that he would allow the programs to expire, arguing that credit markets have now been brought back to sufficient strength. Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell found themselves in disagreement over several emergency lending programs that were started to support businesses during the Covid-19 pandemic. The latest knock comes from the public spat between the US Treasury and Federal Reserve over emergency lending facilities the Treasury is pulling the plug on.
— Emily Barrett, Asia FX/Rates Editor.That SpatThe Fed chief says it s too soon put away its emergency tools to help markets and the economy. Unlike many sectors, banks did not rally back to new highs when the Fed and Congress stepped up with stimulus programs to support the economy. However, as I recently blogged, the Fed would continue to be a key force on the bond market landscape, and as a result, it’s ‘pedal to the metal’.
Mnuchin wrote to the Fed demanding the return of money the government provides the central bank for lending to certain markets. Markets mixedWhile the disagreement between Mnuchin and Powell rattled U.S. futures, investors are holding on to optimism over vaccine progress. US stock futures are trading lower today, indicating a negative opening for Wall Street indices. Meanwhile, COVID cases continue to rise markedly with the US reporting its highest daily reading ever at 185,000 cases and nearly 2,000 deaths.


CCB Securities is owned by China Construction Bank (Asia) (CCB), which is headquartered in Beijing but has offices worldwide.


Thousands of people gathered in Berlin over the last few days, protesting the Merkel government passing a new lockdown law. Grayscale Europe s Best-Laid Plans…And to bring us full circle on negative rates, and government spending discord there s notably less harmony in the European Union. The veto means that the spending agreed by EU leaders in July won t be up and running in the beginning of the year as planned. Looking ahead, a gathering of the leaders of European Union member states for a virtual summit may capture the spotlight.
On the news The Brexit negotiations came to a temporary hold thursday, as an aide on the EU negotiation team had fallen sick from Corona Virus. In Britain, former Prime Minister Theresa May once derided opponents of Brexit as citizens of the world, with the implication that this was a bad thing. Last week’s exit of two hardline Brexiteers from UK Prime Minister Boris Johnson’s cabinet have raised hopes for an accord.
The spending will be over the next four years, Prime Minister Boris Johnson told the House of Commons on Thursday. For that reason, the possibility of a hard Brexit still exists and that is certainly not priced into the pair at the moment. Becuase of this, EU Chief negotiatior Michael Barnier has gone into quarantine, thus suspending talks with his UK counterpart.