Monday, July 9, 2007
MCX world's 3rd largest bullion exchange
KOLKATA (INDIA) : The Multi-Commodity Exchange of India Ltd has become world's third largest bullion exchange after NYMEX and TOCOM. "MCX is now third largest bullion exchange after New York Metal Exchange and Tokyo Commodity Exchange. Total average daily bullion trading in the Indian commodity exchange is between Rs 5,000 and Rs 5,500 crore," MCX VP (product knowledge management) Sameer Patil said on Sunday on the sidelines of a seminar on bullion trading. Daily average gold trading was around Rs 3,000 crore, while trading size for silver was between Rs 2000 and Rs 2500 crore. In terms of trading volume, the MCX turnover was just 10 per cent of NYMEX and around 25 per cent of TOCOM, Patil said. Bullion contributed over 50 per cent of the total turnover of MCX. However, due to softening of the dollar the trading volume in bullion had stagnated. "Due to stagnation of business turnover in bullion we are conduction roadshows to bring more retail investors in bullion futures trading," Patil said. There was no immediate plan for spot market for gold and silver, he added.
Gold, Silver Futures Rise on Speculation Dollar to Weaken
July 9 (Bloomberg) -- Gold and silver rose in New York on speculation a decline in the value of the dollar will boost demand for precious metals as alternative investments.
Gold generally moves in the opposite direction of the U.S. dollar, which has fallen 1.7 percent in the past three weeks against a basket of six major currencies. Gold is up 3.8 percent this year while the dollar index has fallen 2.6 percent.
``The dollar is trending down and that's why gold is looking good,'' said Walter Otstott, senior broker at Dallas Commodity Co. in Dallas.
Gold futures for August delivery rose $7.70, or 1.2 percent, to $662.50 an ounce on the Comex division of the New York Mercantile Exchange. The metal rose 0.6 percent last week, the first gain in three.
Silver futures for September delivery rose 6.3 cents, or 0.5 percent, to $12.82 an ounce on the Comex. The metal is still down 0.9 percent this year.
Speculation the U.S. Federal Reserve will keep rates unchanged this year while other countries raise their overnight lending rates helped to weaken the dollar's prospects and make gold more attractive, analysts said.
Buying Trigger
``If the Fed is expected to keep interest rates unchanged, that could trigger some new buying for gold,'' said Nick Ruggiero, a trader at Eagle Futures Inc. in New York.
The Fed has kept its benchmark rate unchanged at 5.25 percent since June 2006. The Bank of England last week raised its key lending rate to 5.75 percent, the third increase this year. The European Central Bank raised its benchmark rate in June to 4 percent, the second increase this year.
Five of the past bear markets for the U.S. dollar have resulted in a higher gold price. The euro reached a record $1.3681 on April 27, a week after gold rose to this year's high of $698. The euro traded as high as $1.3638 today.
Gold generally moves in the opposite direction of the U.S. dollar, which has fallen 1.7 percent in the past three weeks against a basket of six major currencies. Gold is up 3.8 percent this year while the dollar index has fallen 2.6 percent.
``The dollar is trending down and that's why gold is looking good,'' said Walter Otstott, senior broker at Dallas Commodity Co. in Dallas.
Gold futures for August delivery rose $7.70, or 1.2 percent, to $662.50 an ounce on the Comex division of the New York Mercantile Exchange. The metal rose 0.6 percent last week, the first gain in three.
Silver futures for September delivery rose 6.3 cents, or 0.5 percent, to $12.82 an ounce on the Comex. The metal is still down 0.9 percent this year.
Speculation the U.S. Federal Reserve will keep rates unchanged this year while other countries raise their overnight lending rates helped to weaken the dollar's prospects and make gold more attractive, analysts said.
Buying Trigger
``If the Fed is expected to keep interest rates unchanged, that could trigger some new buying for gold,'' said Nick Ruggiero, a trader at Eagle Futures Inc. in New York.
The Fed has kept its benchmark rate unchanged at 5.25 percent since June 2006. The Bank of England last week raised its key lending rate to 5.75 percent, the third increase this year. The European Central Bank raised its benchmark rate in June to 4 percent, the second increase this year.
Five of the past bear markets for the U.S. dollar have resulted in a higher gold price. The euro reached a record $1.3681 on April 27, a week after gold rose to this year's high of $698. The euro traded as high as $1.3638 today.
Gold ends up, lifted by oil surge, dollar drift
NEW YORK (Reuters) - U.S. gold futures held onto strong gains into the close on Monday, after being lifted to a one-month high as fund and speculative buyers reacted to a drifting dollar and surging oil prices, traders said.
"The market was very quiet and very thin. But metals were up across the board. The dollar was weak and oil was up quite a bit and that supported it right from the get-go, but it was on light volume," said one New York gold dealer.
Most-active gold for August delivery on the COMEX division of the New York Mercantile Exchange settled with $7.70 gains at $662.50 an ounce. It set a higher range from $657.80 and $666.0 an ounce, a level last seen on June 7.
At its session top, August gold reached higher than in three prior attempts to break resistance at $666.0 an ounce. But some traders noted that its retreat from that level in a thin market may leave in doubt its resilience at that level.
A languishing dollar, however, offered gold bulls a reason to buy, especially in the face of surging oil prices.
The dollar traded mostly flat on Monday in a quiet session. Sentiment for the dollar has been dampened by expectations that the Federal Reserve will keep interest rates unchanged this year even as other central banks tighten monetary policy.
Analysts said even Friday's surprisingly robust U.S. jobs report was not enough to reverse the recent trend of narrowing interest rate differentials between the dollar and major European currencies, eroding demand for the greenback.
A weaker dollar often helps dollar-denominated assets like gold that trade in overseas markets.
"The market was very quiet and very thin. But metals were up across the board. The dollar was weak and oil was up quite a bit and that supported it right from the get-go, but it was on light volume," said one New York gold dealer.
Most-active gold for August delivery on the COMEX division of the New York Mercantile Exchange settled with $7.70 gains at $662.50 an ounce. It set a higher range from $657.80 and $666.0 an ounce, a level last seen on June 7.
At its session top, August gold reached higher than in three prior attempts to break resistance at $666.0 an ounce. But some traders noted that its retreat from that level in a thin market may leave in doubt its resilience at that level.
A languishing dollar, however, offered gold bulls a reason to buy, especially in the face of surging oil prices.
The dollar traded mostly flat on Monday in a quiet session. Sentiment for the dollar has been dampened by expectations that the Federal Reserve will keep interest rates unchanged this year even as other central banks tighten monetary policy.
Analysts said even Friday's surprisingly robust U.S. jobs report was not enough to reverse the recent trend of narrowing interest rate differentials between the dollar and major European currencies, eroding demand for the greenback.
A weaker dollar often helps dollar-denominated assets like gold that trade in overseas markets.
JP Morgan raises metal forecasts but says prices have passed peaks
LONDON (Thomson Financial) - JP Morgan lifted its price forecasts for all base metals through to 2010, but maintained that prices have already peaked in the current cycle. It sees copper prices averaging 7,056 usd a tonne this year, although by 2010, the bank sees copper at just 3,880 usd. Its previous estimates were 6,519 usd a tonne and 3,000 usd, respectively.For nickel, the bank sees an average price of 39,577 usd a tonne this year, falling to just 14,218 usd by 2010. Its previous estimates were 35,328 usd and 11,000 usd, respectively. "The average decline in base metal prices that we expect from cycle peak out to lower levels in 2010 is a considerable 60 pct," said the bank but added that it now expects a more moderate price declines.The price falls through to 2010 are based on expectations that despite positive demand growth, the supply side is catching up and should start exceeding demand growth from the middle of this year onwards. "The world currently has too much carbon steel production, too much stainless steel production, too much alumina production, too much aluminium production and will very soon have too much nickel production," it said."The same cannot yet be said of some other metals such as copper, lead and zinc, although there is every reason to believe that ... one by one, these other metals will follow suit," it added.The bank sees aluminium prices averaging 2,691 usd a tonne this year compared to just 2,050 usd in 2010. Its previous forecasts stood at 2,574 usd and 1,950 usd, respectively.For lead, an average price of 2,032 usd a tonne is forecast for this year compared to only 841 usd by 2010, while for zinc the forecasts stand at 3,552 usd a tonne and 1,682 usd, respectively.
Gold futures close up nearly $8
NEW YORK (MarketWatch) -- Gold futures closed sharply higher Monday, extending their prior-session gains, boosted by softness in the dollar and general strength in the metals market.
Gold for August delivery closed up $7.70 at $662.50 an ounce on the New York Mercantile Exchange. Other metals prices also gained ground.
"Today's movements seem to be a buy into the metals and commodities in general," said Zachary Oxman, senior trader at Wisdom Financial.
A supply shortage and strike issues in base metals, such as London copper, are pushing the complex higher, he said.
"Gold is coming off of an oversold situation where most of the longs from early 2007 were liquidated, which is leading to a market that can be driven quickly either way as the trade re-approaches the market," Oxman said.
Crude-oil futures declined Monday, but traded above $72 a barrel, as traders locked in profits from recent gains.
Gold for August delivery closed up $7.70 at $662.50 an ounce on the New York Mercantile Exchange. Other metals prices also gained ground.
"Today's movements seem to be a buy into the metals and commodities in general," said Zachary Oxman, senior trader at Wisdom Financial.
A supply shortage and strike issues in base metals, such as London copper, are pushing the complex higher, he said.
"Gold is coming off of an oversold situation where most of the longs from early 2007 were liquidated, which is leading to a market that can be driven quickly either way as the trade re-approaches the market," Oxman said.
Crude-oil futures declined Monday, but traded above $72 a barrel, as traders locked in profits from recent gains.
OIL - IEA sees supply crunch looming
London: World oil demand will rise faster than expected to 2012 while production lags, leading to a supply crunch, the International Energy Agency said yesterday.
In its Medium-Term Oil Market Report, the adviser to 26 industrialised countries said demand will rise by an average 2.2 per cent a year between 2007 and 2012, up from a previous medium-term forecast of 2 per cent.
The outlook, which updates an IEA forecast last issued in February, coincides with a jump in oil prices to more than $75 a barrel, closing in on a record high near $79, on concerns of a tightening market.
"Despite four years of high oil prices, this report sees increasing market tightness beyond 2010," the IEA said.
"It is possible that the supply crunch could be deferred - but not by much."
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The IEA's previous Medium-Term report called for world demand growth of two per cent a year between 2006 and 2011.
It now expects global demand to reach 95.8 million barrels per day (bpd) from 86.1 million bpd in 2007. The forecast assumes average global GDP growth of 4.5 per cent annually.
In its Medium-Term Oil Market Report, the adviser to 26 industrialised countries said demand will rise by an average 2.2 per cent a year between 2007 and 2012, up from a previous medium-term forecast of 2 per cent.
The outlook, which updates an IEA forecast last issued in February, coincides with a jump in oil prices to more than $75 a barrel, closing in on a record high near $79, on concerns of a tightening market.
"Despite four years of high oil prices, this report sees increasing market tightness beyond 2010," the IEA said.
"It is possible that the supply crunch could be deferred - but not by much."
');
The IEA's previous Medium-Term report called for world demand growth of two per cent a year between 2006 and 2011.
It now expects global demand to reach 95.8 million barrels per day (bpd) from 86.1 million bpd in 2007. The forecast assumes average global GDP growth of 4.5 per cent annually.
Brent rises above $76 to 11-month high
London: Oil prices rose to an 11-month high above $76 a barrel yesterday as rising global oil demand and North Sea field maintenance exacerbated supply worries.
London Brent crude, currently seen as a better indicator of the global market, climbed to an intraday high of $76.34 a barrel, the highest level since August 2006.
The all-time record high for Brent is $78.65, reached on August 8, 2006.
"The oil price is at very high levels for good reasons and there's every possibility we could see further strength in coming months," said David Dugdale, an analyst at MFC Global Investment Management.
"With Opec continuing to withhold oil from the market the general picture remains one of tightness, with kidnappings in Nigeria, the upcoming hurricane season and ongoing geopolitical concerns all adding to uncertainty over the summer."
London Brent crude, currently seen as a better indicator of the global market, climbed to an intraday high of $76.34 a barrel, the highest level since August 2006.
The all-time record high for Brent is $78.65, reached on August 8, 2006.
"The oil price is at very high levels for good reasons and there's every possibility we could see further strength in coming months," said David Dugdale, an analyst at MFC Global Investment Management.
"With Opec continuing to withhold oil from the market the general picture remains one of tightness, with kidnappings in Nigeria, the upcoming hurricane season and ongoing geopolitical concerns all adding to uncertainty over the summer."
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