| Oil price hits record $US100 a barrel
THE price of oil in New York has spiked to a record $US100.10 a barrel in the wake of supply concerns. The price for a barrel of light, sweet crude, eclipsed the record set in January of $US100.09 a barrel. The market rallied amid speculation that OPEC, which supplies about 40 per cent of the world's oil, would cut output at its March 5 meeting in Vienna, analysts said. Another factor was the ongoing row between Venezuela and ExxonMobil over nationalised assets of the US giant. "Oil futures surged higher amid technical buying underpinned by the ongoing saga between Venezuela and Exxon and on speculation surrounding OPEC's next move when they meet in March," said Sucden analyst Nimit Khamar. "There is clear evidence that speculators are coming back in to the oil market." Iran has declined to rule out that OPEC would cut production next month.
Markets Unlikely to Recover as Recession Fears Outweigh Optimism Over ...
The major U.S. index futures are pointing to a substantially lower opening on Tuesday, as the markets open after a days break on account of a public holiday on Monday. The futures have not responded significantly to an inter-meeting cut announced by the Federal Reserve.
The global averages are down for a second straight day, and the course of these markets question the decoupling theory propounded by economists. The recoiling by the global markets is an indication that a setback to the U.S. economy will hurt the other global economies as well. Most nations, especially the East Asian and European countries derive the bulk of their export earnings from the U.S.
Fed Accelerates Rescue Efforts
The global credit crisis that became public in July last year seems to have more legs to play out.
Hedge funds scent a market turnaround amid turbulence
London: If hedge funds are, as is often claimed, the investment vanguard, their latest moves appear to be telling financial markets it is time to take a break from the trading patterns that have dominated since mid-2007. Investment banks have been poring over the latest data on hedge fund positioning from the Commodities Futures Trading Commission (CFTC) and concluded that a number of speculative bets have been changed. Societe Generale, for example, says long positions on 10-year government bonds have been closed. That is to say, hedge funds are not expecting demand for such bonds to increase and drive yields lower. .
What Now?
It's an easy short against the dollar. You can also short sterling against the euro or the Swiss franc. Over the longer term, when the interest-rate differential between the U.S. and the U.K. in real terms has been less than 1% to the advantage of sterling, sterling always has weakened against the euro. Now it is at 70 basis points in real terms. [A basis point is one one-hundredth of a percentage point.] You can sell sterling short against the dollar in the futures market. Faber: It may be easier to short a British-pound ETF, CurrencyShares British Pound Sterling Trust [FXB]. Zulauf: On the long side, Fred already talked about gold [in last week's Roundtable installment]. I have recommended it several times over the years. Now it's $850 per ounce. The most important thing driving the price of gold is low real interest rates.
Thomson Financial Europe AM at a glance share guide: Shares mixed, oil ...
Oil futures ended an erratic session higher Tuesday as investors focused on expectations that the Federal Reserve will cut interest rates and OPEC will hold production steady, and shrugged off estimates that domestic crude inventories rose last week. METALS: Gold prices fell as the dollar was mixed against major European currencies. EVENTS: FOMC meeting (interest rate decision due 1915 GMT) US weekly API, Department of Energy oil inventory data (0330 GMT) Jan ADP national employment report (1315 GMT) Q4 GDP (advance) (1330 GMT) Kraft Foods Inc Q4 results. EPS forecast 44 cents vs 51 (before market opens) Merck & Co Inc Q4 results. EPS forecast 73 cents vs 50 (before market opens) Allergan Inc Q4 results. EPS forecast 58 cents vs 51 (1700 GMT) Amazon Com Inc Q4 results. EPS forecast 48 cents vs 23 (1700 GMT) Boeing Co Q4 results.
Australian stock market climbs higher at noon
THE Australian stock market was 1.1 per cent stronger at noon as solid earnings results from Telstra and Qantas lifted investor spirits and Wall Street provided a good lead on speculation of another US interest rate cut. At 12.01pm AEDT, the benchmark S&P/ASX200 index was up 62 points, or 1.13 per cent, at 5558.5 while the broader All Ordinaries index had risen 62 points to 5639.3. On the Sydney Futures Exchange, the March share price index futures contract was 86 points higher at 5538 on a volume of 16,577 contracts. Macquarie Equities associate director Lucinda Chan said a strong lead from the US and some better than expected local earnings results were supporting the market. ''The market has not been supported since we started the results (season), but today looks a bit more positive with Telstra's good result and Qantas wasn't too bad either,'' Ms Chan said.
Traders Bracing For Slump Drive Up Platinum, Wheat, Coffee And Cocoa
Platinum and spring wheat hit record highs Thursday and arabica coffee and cocoa set new trading peaks as well, as investors in commodities pursued markets deemed less vulnerable to the slowing U.S. economy. Copper, an economically sensitive base metal, overcame jitters over U.S. growth by reacting to Wednesday's cut in interest rates. Traders said copper was also inspired by Thursday's rebound in Wall Street stocks and lingering production issues in China. But broad commodity futures indexes closed mixed, with the Reuters-Jefferies CRB and Dow Jones-AIG up and the S&P GSCI down. U.S. crude oil also fell, closing 58 cents lower at $91.75 a barrel on fears of slowing growth in the world's largest economy and the leading energy-consuming nation. Investors in energy were also sidelined ahead of an OPEC meeting on production quotas set for Friday.
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