Oil Prices Zig-zag In Asia Reacting To Mixed Influences- 20 Feb 2018



Gold Prices Fall For Third Straight Session As U.S. Dollar Strengthens.  
Gold prices remained lower on Tuesday as the dollar rebounded from a three-year low, while investors await the minutes of the latest Federal Reserve meeting due tomorrow. The dollar was supported by the U.S. homebuilding data released on Friday that increased to more than a one-year high in January and that building permits soared to their highest level since 2007. A higher-than-expected consumer price growth last week was also cited as tailwind. The greenback has been weakening in recent months, as inflation concerns amid the ideas that U.S. Federal Reserve and other central banks might raise rates were cited as the main reason for the dollar's underperformance. The U.S. Treasury Secretary Steven Mnuchin suggested last month that a weaker dollar policy by the States could be good given the country’s trade deficit is reaching to a 10-year high. 

Copper dropped as a resurgent dollar dragged down prices, while the Lunar New Year holidays reduced liquidity. 
Copper on MCX settled down -0.91% at 457.30 while prices moved in the range as trading volumes were remain thin with U.S. markets were closed on Monday for Presidents' Day and also the Shanghai Futures Exchange is closed for the Lunar New Year, reopening on Thursday, Feb. 22. Also other metals were largely unchanged in extremely light trading volumes of less than 1,000 lots. The dollar steadied after pulling ahead from a three-year low against a currency basket the previous day, though it was dogged by growing concerns a ballooning fiscal deficit in the United States could disrupt the economy. Meanwhile Hedge funds and money managers cut their net long positions in COMEX copper contracts in the week to Feb. 13, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday. In the week ahead, investors will focus on minutes of the Fed’s latest policy meeting with hopes the central bank will give more hints on the pace of future rate hikes this year. Staying in the U.S., a report on existing home sales will be the highlight of the holiday-shortened week. 

Oil Prices Zig-zag In Asia Reacting To Mixed Influences.  
Oil prices fluctuated between gains and losses again Tuesday morning in Asia, following Saudi Arabia’s decision to cut oil production late last week even as the U.S. continues to increase production.Partly due to Saudi Arabia’s vow to cut oil production by 100,000 barrels per day (bpd) next month compared to the February level and to cut exports to below 7 million bpd in March, oil prices are stabilizing and inching back up from sharp drops at the beginning of the month. Further supporting prices are rising tensions in the Middle East, especially along the border of Syria and Israel where Iranian and Syrian forces are reportedly amassing with Israeli forces responding. Although neither Syria nor Israel plays much of a role in the oil market, prices tend to increase whenever there is a threat to oil anywhere in the Middle East. 

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Gold Prices Down In Asia In Holiday-Thinned Trade- 19 Feb 2018

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Gold Prices Down In Asia In Holiday-Thinned Trade. 
Gold prices eased in Asia on Monday despite some support from a weaker dollar as several key regional markets including China were shut for holidays. Markets in Hong Kong, Taiwan, Vietnam, China, the US and Canada are shut on Monday. In the week ahead, investors will focus on minutes of the Fed’s latest policy meeting with hopes the central bank will give more hints on the pace of future rate hikes this year.. Expectations for a faster rate of monetary tightening outside the U.S., which would lessen the divergence between the Federal Reserve and other central banks has eroded the dollar’s relative yield attraction for investors.

Copper prices ended with gains as support seen as the dollar continued to decline.
Copper on MCX settled up 0.75% at 461.5 as support seen as the dollar continued to decline. The dollar slipped to a three-year low against a basket of currencies, headed for its biggest weekly loss in two years, as bearish factors offset support the U.S. currency could take from rising Treasury yields. The U.S. currency has been weighed down by a variety of factors this year, including concerns that Washington might pursue a weak-dollar strategy and the perceived erosion of its yield advantage as other countries start to scale back their easier monetary policy. 

Zinc prices ended with gains tracking firmness in LME prices as support seen due to depleting stocks.
Zinc on MCX settled up 0.44% at 230.75 tracking firmness in LME prices as support seen due to depleting stocks. The dollar remained under pressure weighed down by a variety of factors this year, including concerns that Washington might pursue a weak-dollar strategy and the perceived erosion of its yield advantage as other countries start to scale back their easier monetary policy. Global zinc miners and smelters failed to reach any benchmark deal on 2018 processing terms at an annual industry gathering and any agreement is likely to be delayed by a month or more as participants haggle over prospects for growing supply in the second half. 

Oil hits highest in nearly two weeks on Asian equity recovery. 
Oil prices extended gains to hit their highest level in nearly two weeks on Monday, buoyed as Asian shares joined a global recovery in equity markets and by worries over tensions in the Middle East. Prime Minister Benjamin Netanyahu said on Sunday that Israel could act against Iran itself, not just its allies in the Middle East, after border incidents in Syria brought the Middle East foes closer to direct confrontation."The upside momentum since WTI hit last week's low of $58 has been continuing," said Tetsu Emori, CEO of Emori Capital Management in Tokyo. "Oil got mild support from gains in Asian equity markets, but has been getting pressure from the rise in U.S. rig count and a slight recovery in the dollar." Trading is expected to be slower than usual due market holidays in the United States as well as Greater China and India. 

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Zinc prices gained as stronger than expected inflation in the United States spurred buying- 15 Feb 2018

Gold Prices Fall In Asia As Chinese New Year Holidays Start - Gold dipped in Asia on Thursday as top buyer China started a market break through Feb. 21 to mark the Lunar New Year and physical trade dipped further with Hong Kong also shut and Singapore on holidays Friday and Monday. Overnight, gold prices rose sharply amid dollar weakness as data showing rising inflation and falling retail sales stoked stagflation fears as market participants questioned the underlying strength of inflation. Rising inflation and falling retail sales pointing to possible sluggishness in consumer spending, leading some market participants to slash their bullish expectations for first quarter economic growth as JPMorgan (NYSE:JPM) revised down its first quarter US GDP forecast to 2.5% from 3%.

Zinc prices gained as stronger than expected inflation in the United States spurred buying -  Zinc on MCX settled up 2.62% at 229.55 as stronger than expected inflation in the United States spurred buying. An environmental crackdown in China has hit supplies of metals and fuelled a price rally that shows no sign of losing steam any time soon. The Yangtze River delta region near Shanghai saw a key measure of smog concentrations rise by a fifth in January. Some regions of China could suffer heavy pollution because of fireworks and unfavorable weather conditions during Lunar New Year celebrations, despite a ban on firecrackers in more than 400 cities, the Ministry of Environmental Protection warned. 

Copper prices rose as traders took up new positions in the metal before the ShFE closes for a national holiday - Copper on MCX settled up 1.82% at 457.55 on fresh buying as support seen after Shanghai copper prices rose registering their biggest daily leap since October, as traders took up new positions in the metal before the Shanghai Futures Exchange closed for a national holiday. Market open interest on Shanghai copper hit 811,170 lots on Tuesday, the highest since January 2016, ahead of the Lunar New Year holiday in China beginning on Thursday. Traders were likely covering their short positions ahead of the week-long holiday, which could put them at some risk due to volatility in LME prices. 

Oil extends gains on Saudi commitment to cut, weak dollar - Oil prices on Thursday extended gains from the previous session, pushed up by a weak dollar and by comments from Saudi Arabia that it would rather see an undersupplied market than end a deal with OPEC and Russia to withhold production.Prices rose on the back of ongoing weakness in the U.S.-dollar against other leading currencies, further supported by rising stock markets, traders said. A weaker greenback potentially supports consumption of dollar-denominated commodities as it makes fuel and raw materials cheaper for countries using other currencies. "On commodity markets, everyone loves a lower U.S. dollar," said Greg McKenna, chief market strategist at futures brokerage AxiTrader.

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Aluminium inventory to climb further post-CNY- 14 Feb 2018

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Gold Prices Rise To Hit One-Week High; All Eyes on U.S. Inflation.  
Gold prices rose on Wednesday, but investors remain cautious ahead of today’s U.S. inflation data and clues on the pace of future interest rate hikes. The U.S. Dollar Index that tracks the dollar against a basket of currencies was down 0.11% to 89.60, but gold prices are likely to be range bound before the release of U.S. inflation data. Gold is sensitive to moves in both U.S. rates and the dollar. A weaker dollar makes gold less expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion. Asian equities were mixed in Wednesday, with Hang Seng and KOSPI gaining in the morning trading session but Nikkei, ASX, Shanghai Composite and Shenzhen Component traded in the red. Japan took centre stage in the region as the country’s 4Q GDP missed estimate and grew 0.5% vs the expected 1%. 

Aluminium inventory to climb further post-CNY
China’s aluminium inventory after Chinese New Year may continue to go up to 2.1 million mt and the price of the lightweight metal is set to trade in a wider range, SMM believes. Earlier this week, SMM data showed that the country’s aluminium inventory hit a record high at 1.81 million mt due to weak consumption ahead of the week-long holiday. We believe the increase has been seasonal, and this has contributed to the decline in SHFE aluminium prices since the start of the year.   

Flash : Zinc inventory to rise amid CNY
SMM expects zinc social inventory in Shanghai, Guangdong and Tianjin to hit 200,000 mt after Chinese New Year, up by at least 20,000-30,000 mt during the week-long holiday. Production at smelters and deliveries remain normal but trading was muted, SMM learned. 

Oil Prices Flat In Asia Morning As Traders Eye Mixed Cues.  
Oil prices were mostly flat Wednesday morning in Asia, with traders in the region reacting to mixed cues from data that suggests demand will increase this year but so will supply.A stronger U.S. dollar, faster-than-anticipated U.S. production and a surge in demand from China have supported oil prices over the last week but oil remains well off recent highs, likely due to lingering concerns of oversupply. Brent started February at $69.65 and WTI started at $65.80. On Tuesday, International Energy Agency (IEA) raised both its forecast for oil demand this year by 7.7% but also warned that production is rising, particularly in the U.S. and that could put downward pressure on oil. The IEA expects global demand to increase by 1.4 million barrels per day (bpd) through 2018. 

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Oil prices rise 1 percent as stocks markets steady- 12 Feb 2018

Gold Prices Gain In Asia With Chinese New Year Trade In Focus - Gold prices gained in Asia on Monday with financial markets in Japan will be closed for a holiday and demand eyed in greater China watched with the Lunar New Year holidays set to kick off this week. Investors this week are watching inflation readings from the U.S., UK and Germany. Last week, gold prices edged lower on Friday in what was a fifth day of declines in the last six sessions as the stronger dollar weighed on the precious metal, making it more expensive for holders of other currencies. The dollar was supported by increased safe haven demand from investors amid dramatic moves in the equities and bond markets. U.S. stocks ended higher on Friday, but still suffered their steepest weekly losses in more than two years. Market turbulence has been triggered by speculation that the Federal Reserve may raise interest rates at a faster rate than had been expected amid signs of a pickup in inflation. Expectations for higher interest rates are typically negative for gold as the precious metal struggles to compete with yield-bearing assets like Treasury’s when borrowing costs rise.

Oil prices rise 1 percent as stocks markets steady - Oil prices rose by 1 percent on Monday, recovering at least some of last week's steep losses as Asian stock markets found their footing after days of chaotic trading. Looming over oil markets, however, was rising production in the United States which is undermining efforts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia to tighten markets and prop up prices.The firmer prices came after crude registered its biggest loss in two years last week as stock markets slumped. But with U.S. stock markets rebounding on Friday and Asian markets seemingly steadying on Monday, analysts said crude was also supported. "The bounce in U.S. stocks means some catch-up is possible (for oil)," said Greg McKenna, chief market strategist at futures brokerage AxiTrader. McKenna said markets on Monday were quiet as "the incentive for traders in Australia or Asia to do anything without the lead of the U.S. is likely to be lacking," referring to recent U.S. stock market volatility.

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Gold Prices Up As China Central bank Pumps Up Liquidity, Prices Data Stable - 9 Feb 2018

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Gold Prices Up As China Central bank Pumps Up Liquidity, Prices Data Stable. 
Gold prices rose in Asia on Friday with the Chinese New Year next week expected to stoke some physical demand as the People's Bank of China released nearly CNY 2 trillion in extra liquidity on a day when prices data came in stable and other key gold buyer India witnessing a pickup on a lower tax rate for the yellow metal. Overnight, gold prices edged lower on Thursday, reaching their lowest level in around a month as the dollar firmed amid expectations of more U.S. interest rate hikes this year. Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced. A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.

Copper extended its downtrend after another big rise of inventories highlighted the market currently has healthy supplies.
Copper extended its downtrend after another big rise of inventories highlighted the market currently has healthy supplies. On-warrant copper inventories in warehouses certified by the London Metal Exchange - those not earmarked for delivery - jumped by 25,700 tonnes on Thursday and have surged by 75 percent over the past three weeks. That showed that a 12 percent rally in LME prices in December was not supported by the underlying fundamentals. China’s unwrought copper imports fell for a second straight month in January as winter restrictions on the construction sector and high domestic production rates continued to crimp demand for metal from overseas. Traders were likely to import more copper cathode to China given uncertainty over smelter feed supply as new restrictions on China’s scrap imports come into force. The December production jump defied curbs imposed on the operations of northern Chinese smelters.

Oil falls for sixth day as supply fears mount. 
Oil prices fell for a sixth day on Friday after Iran announced plans to boost production and U.S. crude output hit record highs, adding to concerns about a sharp rise in global supplies. The falls come amid a rout in global share markets as inflation fears grip investors.Both contracts have fallen more than 9 percent from this year's high point in late January. "Bets on further rising oil and metals prices, for example by hedge funds, have climbed to excessively bullish levels," said Carsten Menke, commodities research analyst at Swiss Bank Julius Baer.At that level, U.S. production would overtake current output in Saudi Arabia, the biggest producer in the Organization of the Petroleum Exporting Countries.OPEC and other producers, including Russia, have cut production since January 2017 to force down global inventories, but these cuts have been offset by rising U.S. oil production.

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Copper eased despite a recovery in stock markets after their recent steep slide - 8 Feb 2018

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Gold Prices Gain In Asia With China Trade Data Showing Surge In Imports
Gold prices gained in Asia on Thursday as investors noted January trade data on China showed a narrower than expected surplus even as imports soared. Overnight, gold prices fell to five-week lows as the dollar continued to advance amid a sharp uptick in Treasury yields. The United States 10-Year rose to four-year highs sparking a move higher in the dollar, pressuring gold to five-week lows following news that the Senate agreed a budget deal. Senate leaders reached a major budget agreement that would increase spending caps, Majority Leader Mitch McConnell said Wednesday. Dollar-denominated assets such as gold are sensitive to moves in the dollar – A rise in the dollar makes gold more expensive for holders of foreign currency and thus, reduces demand. Also weighing on the yellow metal was a tick lower in safe-haven demand amid easing geopolitical uncertainty following reports that German Chancellor Angela Merkel's Christian alliance and the Social Democrats (SPD) agreed a coalition deal, paving the way for a
new government.

Copper eased despite a recovery in stock markets after their recent steep slide.
Copper on MCX settled down -2.78% at 440.25 despite a recovery in stock markets after their recent steep slide. China’s foreign exchange reserves rose for a 12th straight month in January as further gains in the yuan currency and tighter regulations continued to discourage capital outflows. A pick-up in China’s economic growth and some progress in the government’s campaign to rein in financial risks have also helped bolster confidence in its currency, while new channels for foreign investors to invest money onshore have helped increase inflows. Reserves rose $21.5 billion in January to $3.161 trillion, compared with an increase of $20.2 billion in December, central bank data showed. It was the first time that China’s reserves have climbed for 12 months in a row since June 2014, and brought its stockpile -- the world’s largest -- to the highest since September 2016. Restrictions on industrial output this winter have affected some of China's biggest copper smelters.

Crude Oil Stays Weaker In Asia Despite Record Imports By China In January. 
Crude oil shrugged off record imports by top buyer China in January reported on Thursday and stayed with a negative trend overnight in the US where fresh levels of shale output continues to come to the market as a counterweight to OPEC-led curbs.China's China's crude oil imports in January jumped 20% to a record 40.64 million metric tons, equivalent to 9.57 million barrels per day (bpd), up from around 7.94 million bpd in December and the previous high of 9.17 million bpd in March of 2017. Overnight, crude oil prices settled sharply lower after data showed US domestic oil supplies rose for the second straight week while domestic production rose further above 10 million barrels per day. The sharp build in product inventories such as gasoline and distillate comes amid a slowdown in refinery activity as refiners enter a period of maintenance. Subdued refinery activity lessened demand for crude oil, contributing to the recent build in inventories.

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