October 30th, 2013

U.S. stocks fell, following a third straight record for the Standard & Poor’s 500 Index, after the Federal Reserve said it sees improvement in economic activity even as it maintained unprecedented stimulus.

The S&P 500 fell 0.8 percent to 1,758.67 at 2:25 p.m. in New York, extending a 0.3 percent decline prior to the Fed statement. The index advanced in 13 of the past 15 sessions through yesterday and has jumped 24 percent this year, on track for its best annual gain since 2003. The Fed stimulus helped propel the benchmark gauge higher by more than 160 percent from a 12-year low in 2009.

“Taking into account the extent of federal fiscal retrenchment over the past year, the committee sees the improvement in economic activity and labor market condition since it began its asset purchase program as consistent with growing underlying strength in the broader economy,” the Federal Open Market Committee said.

Continue reading »

October 29th, 2013

Corn futures reached a three-year low in Chicago as harvesting of the grain accelerated in the U.S., the world’s biggest producer, and crop conditions improved.

Farmers gathered 59 percent of crops in the main growing areas as of Oct. 27, compared with 39 percent a week earlier, the U.S. Department of Agriculture said yesterday. Sixty-two percent of crops were in good or excellent condition, up from 60 percent a week earlier that received the top ratings. The U.S. may produce a record 13.8 billion bushels this season, the USDA said in September. Its next forecast is due Nov. 8.

Continue reading »

October 18th, 2013

Commodity Futures – Russia may lose 4 million metric tons of wheat from its potential harvest after rains restricted planting of winter crops, the Institute for Agricultural Market Studies said.

Winter-crop sowing in the Central Federal District will fall 25 percent short of the original target, and farmers in the Volgograd and Rostov regions in the south will also plant less grain than planned, Dmitry Rylko, director of the Moscow-based researcher, also known as IKAR, said in a phone interview yesterday. The area planted with winter crops by Russian farmers was 20 percent smaller than last year as of yesterday, Agriculture Ministry data show.

Continue reading »

October 17th, 2013

Gold futures will drop in each of the next four quarters and reach a four-year low as reduced U.S. stimulus in response to faster economic growth curbs demand for bullion as a haven, the most accurate forecasters said.

The metal will decline to an average of $1,175 an ounce in the third quarter next year, or 10 percent less than now, according to the median of estimates from the 10 most-accurate precious metals analysts tracked by Bloomberg over the past two years. Prices were last at that level in 2010.

The forecasts underscore how some investors lost faith in gold as a store of value, driving prices to their first annual loss in 13 years. More than $63 billion was erased from the value of gold-backed funds this year, spurring losses for billionaire hedge-fund manager John Paulson, and mining companies announced at least $26 billion of writedowns. Bullion jumped today after Dagong Global Credit Rating Co. cut its U.S. credit rating and on speculation the Federal Reserve will postpone slowing stimulus.

Continue reading »

natural gas options

natural gas futures

October 15th, 2013

Natural gas futures fluctuated in New York amid predictions for colder-than-normal weather that would spur heating-fuel consumption.

Gas moved between gains and losses as MDA Weather Services in Gaithersburg, Maryland, said temperatures may be below average in the central U.S. from Oct. 20 through Oct. 29. The low in Chicago on Oct. 24 may be 32 degrees Fahrenheit (0 Celsius), 11 less than usual, according to AccuWeather Inc. in State College, Pennsylvania.

“Even if we have a cold front, we’ll have plenty of supply,” said Phil Flynn, a senior market analyst at Price Futures Group in Chicago. “The market is a little bit overextended and traders have been overplaying the cold weather.”

Continue reading »

October 14th, 2013

Reneging on its debt obligations would make the U.S. the first major Western government to default since Nazi Germany 80 years ago.

Germany unilaterally ceased payments on long-term borrowings on May 6, 1933, three months after Adolf Hitler was installed as Chancellor. The default helped cement Hitler’s power base following years of political instability as the Weimar Republic struggled with its crushing debts.

“These are generally catastrophic economic events,” said Professor Eugene N. White, an economics historian at Rutgers University in New Brunswick, New Jersey. “There is no happy ending.”

The debt reparations piled onto Germany, which in 1913 was the world’s third-biggest economy, sparked the hyperinflation, borrowings and political deadlock that brought the Nazis to power, and the default. It shows how excessive debt has capricious results, such as the civil war and despotism that ravaged Florence after England’s Edward III refused to pay his obligations from the city-state’s banks in 1339, and the Revolution of 1789 that followed the French Crown’s defaults in 1770 and 1788.

Continue reading »

Gold Options

Gold Futures

October 10th, 2013

Gold futures will extend losses into 2014 amid expectations the Federal Reserve will pare stimulus as the U.S. recovers, according to Morgan Stanley, adding to bearish calls from Goldman Sachs Group Inc. and Credit Suisse Group AG.

“We recommend staying away from gold at this point in the cycle,” Melbourne-based analyst Joel Crane said in a video report received today. Bullion will average $1,313 an ounce in 2014, down from the $1,420 forecast for this year, Morgan Stanley said in its quarterly metals report on Oct. 7.

Continue reading »

cocoa options

cocoa futures

October 8th, 2013

Cocoa futures reached a 23-month high as ample rains threaten to slow already shrinking supplies from West Africa, the world’s biggest growing region. Orange juice also advanced, while coffee, cotton and sugar slid.

In the year started Oct. 1, cocoa output will trail demand by 173,000 metric tons, followed by a shortage of 113,000 tons the next season, Macquarie Group Ltd. estimates. Growing areas in top producers Ivory Coast and Ghana may get as much as 150 percent of normal rain in October’s second half, slowing the harvest, World Weather Inc. in Overland Park, Kansas, predicts.

Continue reading »

commodity brokers

Commodity Futures

October 7th, 2013

Ben S. Bernanke, the world’s most-powerful central banker, says he doesn’t understand gold prices. If his peers had paid attention, they might have stopped expanding reserves that lost $545 billion in value since bullion peaked in 2011.

Bernanke, who holds economics degrees from Harvard College and the Massachusetts Institute of Technology and led the Federal Reserve through the biggest financial disaster since the Great Depression, told the Senate Banking Committee in July that “nobody really understands gold prices and I don’t pretend to really understand them either.”

Continue reading »

October 4th, 2013

Crude oil futures rose as Tropical Storm Karen pushed through the Gulf of Mexico to the U.S. coast, threatening crude production in the region.

Crude oil prices gained 0.5 percent. Karen will make landfall early Oct. 6 on the southeastern tip of Louisiana, according to the National Hurricane Center. BP Plc (BP/) is shutting in all its oil and natural gas output in the Gulf, and LOOP LLC will suspend tanker operations at noon. The U.S. government shutdown entered a fourth day as House Speaker John Boehner said that he won’t allow the U.S. to default on its debt.

Continue reading »

Tagged with: