Open: New York Session | Forex, Metals, Oil, Agriculture September 03, 2020



MARKET NEWS Chicago soybeans rose with the market on track for a ninth straight session of gains, underpinned by strong demand from China, the world’s largest importer. The volume is down due to a decline in corn sales to 603,000 tonnes from 1.85 million tonnes by the same date last season. Raw sugar and arabica coffee futures on ICE closed lower on Wednesday, weighed partly by a stronger dollar, while New York cocoa prices hit a six-month peak. Whilst this provided a short-term sugar hit, it only exacerbated the previous issue of their dividend payments choking their cash flow, which is arguably just as severe a problem.
Sugar prices ruled mix on Thursday on ease supply, demand and volumes. On Bombay Sugar Merchants Association’s spot rates (Rs/Quintal): S-grade Rs.


Some of the currencies under review are the Aussie, the New Zealand Dollar and the US Dollar. FOREX: The dollar’s bounce extended as investors trimmed bets against the greenback and sold the euro on concerns that the European Central Bank was worried about its rise. The US dollar is firm against the Canadian dollar. European shares jumped and the euro pared losses after France introduced new stimulus measures and final PMI releases in Germany and the euro area beat flash readings.
The dollar may continue to catch a bid, especially if the ECB is intent on focusing on the euro. Europe There are three main talking points in Europe today: France’s new 100 bln euro initiative, the PMI, and the Financial Times story about the ECB and the euro. The US dollar is continuing to recover after hitting new lows earlier in the week. While EUR/USD’s slide early in the week can be partially attributed to a data-based dollar, recovery, the most recent prominent American indicator fell short of estimates.
That’s a strong bullish signal for gold that the dollar will continue to weaken over the long term. So while the combined bank should have higher charge-offs (in dollar terms) during an economic downfall, this basically unchanged credit profile (in percentage terms) is a remarkable feat.


Gold 7 days Gold 14 days Gold 1 month Gold 3 months Gold 6 months Gold 1 year The price of turmeric were stable on Thursday. The inferred resources contain further 2.76 million toz gold, 189.73 million lb copper, and 3.91 million toz silver, or 3.15 million toz of gold equivalent. With an after-tax NPV (5%) over $1 billion, the Troilus Gold project looks good at the current gold prices. At the current share price of $1.16, the market capitalization of Troilus Gold equals approximately $133 million and the enterprise value is slightly above $100 million.
(Source: Skeena Resources) At the moment, Eskay Creek holds just over three million ounces of gold and 60 million ounces of silver in the indicated and inferred categories. According to the PEA, the cash costs should average $919/toz gold and the AISC should average $1,051/toz gold. Over the last 8 years, the average annual production should be lower, only around 100,000 toz gold per year. If the two zones are connected, the resources will grow by several million toz gold in this one area alone.
It is a reasonable price tag for a long-life mine with annual production volumes over 200,000 toz gold. I think De Grey might have one of the best undeveloped gold projects in the world and it’s possible that Mallina grows beyond 10 million ounces in the future.


Nigerian state oil company issues tender for annual crude oil contracts – document Nigerian state oil company NNPC on Wednesday issued a tender for its annual crude oil contracts. Malaysian palm oil futures rose for a sixth consecutive session to a near seven-month high, tracking sharp gains in soyoil and Dalian palm oil and concerns over production. Crude Monthly August imports eased to 24 mln bpd amid weak demand August crude arrivals to Asia eased to 102 million mt (24.13 million bpd) amid weakening demand.
For the region’s big oil producers—already reeling after a flood of excess oil pushed some prices below zero in April—a few aging assets likely in line for a makeover.
Oil exploration names dominated the bottom of the S&P 500 yesterday, with Diamondback Energy (FANG), Marathon Oil (MRO) and Apache (APA) the worst three performers. US gasoline implied demand fell last week to 8.78 million bpd from 9.16 million bpd a week earlier according to the Energy Information Administration (EIA). Scotiabank raises target price to C$53 from C$51, following the company s strong first-quarter results that were above estimates and better margins due to crude oil’s volatility.
Shut-ins from Hurricanes Laura and Marco have removed 13.8 million barrels of oil from the market since Aug. 22, according to a Reuters tally of government data. The contracts will determine which companies can sell and trade crude cargoes directly from in Africa’s largest oil exporter. As seen below, the WTI crude oil price has recovered to a healthier $40.75 per barrel.

United States

Fed Chair Jerome Powell told us last week they will let inflation run higher than “normal” to make up for stubbornly “below average” inflation for some time. The leading performances for the growth and momentum buckets in the US stock market continue to pull ahead, based on a set of exchange-traded funds. These are exceptional growth rates for a non-tech company, and they place the company on the top 150 growth list among the US stocks I follow. Traders look set to pare the robust gains seen on Wall Street this week after a rally that lifted the DJIA above 29,000 for the first time since February.
U.S. President Donald Trump spoke of the risk last month while urging campuses to reopen, saying that sending students home after an outbreak could put relatives at risk. Financial market participants have taken a wait-and-see attitude before the US labor market report for August, which will be published tomorrow. The US Federal Reserve has adjusted its official inflation target to be even more flexible and inflationary.
A roll-out announcement may boost Mr Trump but any move is likely to be highly politicized which may impact its early success.” The Trump administration is set to make public its decisions on the scope and effective date of its bans on TikTok and WeChat later this month. Therefore, a little more inflation to increase employment in the short term is easier to justify with the Fed’s mandate than with that of the ECB.


It follows multiple rounds of high-level military talks with Beijing that failed to end the recent standoff over the two nations’ disputed border. The five-year plan is focused on supporting third-generation chips as Beijing becomes increasingly concerned by U.S. moves which could threaten supply of the crucial components. The strain risks hamstringing Beijing’s efforts to prop up the economy, raising pressure on the central bank to follow up with deeper stimulus.
Worsening relations between Beijing and Washington have made it increasingly difficult for Chinese companies to source components and technologies from overseas. Beijing plans to bolster its own semiconductor sector over the next five years, people familiar said. But the question is, can it stay that way much longer if Beijing keeps finding Aussie exports to punish. Speaker Milos Vystrcil is under fire both from Beijing and politicians at home for traveling to Taiwan, which China sees as a renegade province.
That same month Beijing placed crippling tariffs on the grain.


Macron’s new initiative has long been touted and marks a shift from the pandemic focus to broader economic goals to boost investment and jobs. The key question is how ECB President Lagarde addresses the situation either in her prepared comments after next week’s meeting or in answer to questions from the press. The main risk to this view is if the ECB decides to unveil new monetary easing measures already next week. Merkel has defended NordStream as a necessity to secure adequate fossil fuel supplies, even as Germany and its European allies work toward a ‘fossil fuel-free’ future.
Curiously, the ECB considers price stability to be given if price inflation is below, but close to, 2 percent. David Merkel is an investment professional, and like every investment professional, he makes mistakes. Approaching the final year of her chancellorship, Merkel is finally pushing Germany to overcome its postwar reticence and play a bigger role on the international stage.
But during almost 15 years in office, Merkel has acted as Putin s bridge to the west, consistently encouraging dialogue with Russia over its isolation. Since June, he s lost one minister to a drunk-driving scandal and another quit along with Ireland s EU Commissioner after breaching Covid-19 restrictions. David J. Merkel, CFA — 2010-present, I run my own equity asset management shop, called Aleph Investments.