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Tuesday, February 02, 2010
Bullion metals add glaze
Prices rise after few consecutive days of slipping
Precious metal prices ended considerably higher on Monday, 01 February 2010. Prices rose due to better than expected economic reports and weak dollar.
Prices were slipping since last couple of days due to impending worries from China front where tightening monetary policies are bothering investors due to shaky demand of metals in coming months.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.
On Monday, gold for April delivery ended at $1,105 an ounce, higher by $21.2 (1.9%) an ounce on the New York Mercantile Exchange. Last week, gold lost 0.6%. For January 2010, gold lost 1.2%. Year to date, gold has gained 0.7%.
Last year, after hitting a low at $807.30 per ounce on 15 January 2009, gold futures rallied almost 51% to hit an all-time high at $1217.40 per ounce during early December of 2009 but fell from those levels at the end.
On Monday, March Comex silver futures ended higher by 47 cents (2.9%) at $16.66 an ounce. Last week, silver ended lower by 4.3%. In January 2010, silver shed 3.9%. Year to date in FY 2010, silver has dropped by almost 1%.
Silver futures had hit a low at $10.42 on 15 January 2009 and hit a high at $19.30 per ounce on 2 December 2009. Like gold, silver also ended lower than its all time high level.
Among economic data expected for the day, The Institute for Supply Management in US reported on Monday, 01 February 2010, that its index rose to 58.4 in January 2010 from 54.9 in December 2009. A figure of 56 was expected by market. It is the highest reading since August 2004.
Readings over 50% in the ISM diffusion index indicate that more firms are growing than contracting. The report indicated that nation's manufacturing firms were growing at a very strong pace in January 2010.
But enthusiasm over the report was a bit tempered by a steeper-than-expected 1.2% drop in construction spending during December. Separately, personal income during December was up 0.4% in a slightly sharper increase than had been expected, but spending during December increased at a softer-than-expected pace of 0.2%. Core personal consumption expenditures increased just 0.1% month-over-month, but that was in-line with expectations.
In the currency market on Monday, the dollar index, which weighs the strength of dollar against the basket of six other currencies fell by almost 0.2%.
Gold had ended FY 2009 higher by 24%. Silver futures had ended 2009 up 50%. The dollar index had lost 4.2% against its counterparts last year.
At the MCX, gold prices for April delivery closed higher by Rs 303 (1.85%) at Rs 16,620 per ten grams. Prices rose to a high of Rs 16,661 per 10 grams and fell to a low of Rs 16,291 per 10 grams during the day's trading.
At the MCX, silver prices for March delivery closed Rs 568 (2.22%) higher at Rs 26,068/Kg. Prices opened at Rs 25,560/kg and rose to a high of Rs 26,117/Kg during the day's trading.
Crude climbs up
Strong economic data and weak dollar lift crude prices
Crude oil prices ended higher on Monday, 1 February 2010. Prices rose due to better than expected economic reports and as cold temperature once again gripped parts of US.
Strong economic reports generally tend to push crude prices higher on anticipation of higher demand in coming months. The weak dollar further aided crude's climb today.
On Monday, crude-oil futures for light sweet crude for March delivery closed at $74.6/barrel (higher by $1.6 or 2%). Earlier, the contract had fallen to an intraday low of $72.49 a barrel. Last week, crude ended lower by 2.4%. In January 2010, crude ended lower by 8.3%.
Among economic data expected for the day, The Institute for Supply Management in US reported on Monday, 01 February 2010, that its index rose to 58.4 in January 2010 from 54.9 in December 2009. A figure of 56 was expected by market. It's the highest reading since August 2004.
Readings over 50% in the ISM diffusion index indicate that more firms are growing than contracting. The report indicated that nation's manufacturing firms were growing at a very strong pace in January 2010.
But enthusiasm over the report was a bit tempered by a steeper-than-expected 1.2% drop in construction spending during December. Separately, personal income during December was up 0.4% in a slightly sharper increase than had been expected, but spending during December increased at a softer-than-expected pace of 0.2%. Core personal consumption expenditures increased just 0.1% month-over-month, but that was in-line with expectations.
In the currency market on Monday, the dollar index, which weighs the strength of dollar against the basket of six other currencies fell by almost 0.2%.
Among other energy products on Monday, heating oil for the March rose 1.9% to $1.96 a gallon.
Also on Monday, natural gas for March delivery gained nearly 6% to $5.43 per million British thermal units.
Crude ended FY 2009 higher by 78%, the highest yearly gain since 1999. It reached a high of $82 earlier in October 2009 and hit a low of $33.98 on 12 February 2009. Oil prices had reached a high of $147 on 11 July, 2008 but have dropped almost 53.5% since then. Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.
At the MCX, crude oil for February delivery closed Rs 57 (1.7%) higher at Rs 3,435/barrel. Natural gas for February delivery closed higher by Rs 11 (4.6%) at Rs 250.6/mmbtu.
Monday, February 01, 2010
Nifty February 2010 futures above 4,900
Turnover declines
Nifty February 2010 futures were at 4,901, at a premium of 1.30 points as compared to the spot closing of 4,899.70. Turnover in NSE's futures & options (F&O) segment was Rs 60,383.27 crore, sharply lower than Rs 92,503.91 crore on Friday, 29 January 2010.
Jindal Steel & Power February 2010 futures were at premium at 656 compared to the spot closing of 653.85.
Unitech February 2010 futures were near spot price at 76.50 compared to the spot closing of 76.20.
Tata Motors February 2010 futures were at discount at 714.50 compared to the spot closing of 717.45.
In the cash market, the S&P CNX Nifty rose 17.65 points or 0.36% at 4899.70.
Asian markets starts February with little optimism
Shanghai, Sydney edge lower while Hang Seng, Nikkei finish higher
Stock markets in Asian region closed mixed on Monday, 1 February 2010, with Friday's negative close on Wall Street amid renewed concerns about the quality of economic recovery hurting sentiment to a significant extent. Though some of the markets edged up a bit in early trades, lack of support at higher levels has pushed them down notably into negative territory.
On Wall Street, stocks registered drop for the third consecutive week. It was mainly due to a sell off during the last two days of the week that stocks suffered losses for the week. Earning reports dominated the week but the positive ones also failed to cheer investors. The Dow Jones Industrial Average ended lower by 53.13 points at 10,067.33. Nasdaq ended lower by 31.65 points at 2147.35. S&P 500 ended lower by 10.66 points at 1073.87.
In the commodity market, crude oil was little changed after falling for four days, as speculation mounted that China will rein in record lending growth, crimping demand from the world’s second- biggest energy consumer.
Crude oil for March delivery was at $73.12 a barrel in electronic trading on the New York Mercantile Exchange, up 23 cents, at 9:51 a.m. London time. The contract earlier fell as much as 40 cents, or 0.6%. On 29 January 2010, it fell 1% to $72.89, the lowest settlement since 21 December 2009.
Brent crude oil for March settlement was at $71.75 a barrel on the London-based ICE Futures Europe exchange, up 29 cents, at 9:51 a.m. local time. The contract earlier fell as much as 33 cents, or 0.5%. On 29 January 2010, it slipped 0.9% to $71.46, the lowest settlement since 12 October 2009.
Gold, little changed in London today, may rise for the first time in a week as a pause in the dollar’s rally spurs demand for the metal as an alternative investment. Gold for immediate delivery added $2.10, or 0.2%, to $1,082.95 an ounce at 9:46 a.m. London time. Bullion for April delivery was 30 cents lower at $1,083.50 on the New York Mercantile Exchange’s Comex unit.
In the currency market, the US dollar and yen strengthen as the week starts on risk aversion as Asian stocks were broadly lower following Friday's late sell off in US equities. There were also some concerns on more tightening from China after release of PMI manufacturing data.
The Japanese yen strengthened against major counterparts on Monday on persisting concerns about financial stability in Europe increasing demand for Japan’s currency as a refuge. Japan’s currency yen was quoted at 90.02 against the greenback.
The Hong Kong dollar was trading at HK$ 7.7688 against the dollar. Actually the Hong Kong dollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85 to the U.S. dollar.
In Sydney trades, the Australian dollar fell against a firmer US dollar as investors unwound yen-funded carry trades, in part on general risk aversion and talk regulators might eventually take aim at the carry trade business. At the local close, the dollar was trading at $US0.8832, down from $US0.8893 on Friday. The dollar had shed a cent in overseas trade on Friday to a five-week low of $US0.8775 when the US dollar got a lift from upbeat US economic data.
In Wellington trades, the New Zealand dollar tested the US70c level at the start and the end of a mixed session today. The NZ dollar was at US 70.02 cents at 5 pm from US 70.19 cents at 8 am and US 70.43 cents at 5pm on Friday.
The South Korean won closed at 1169.50 won to the greenback, down from Friday 1161.80 won.
The Taiwan dollar weakened against the greenback. The Taiwan dollar was trading higher against the US dollar at NT$ 32.1010, 0.1010 down from Friday’s close of NT$31.9900.
In equities, Asian markets ended mixed Monday as losses on Wall Street and worries about monetary tightening in the region weighed on sentiment.
In Japan, the share market finished the choppy trade in mixed terrain, as players picked up heavily battered shares and the companies that reported bullish earning. Trading was sluggish as weaker Asian bourses and disappointed earning forecast from Toshiba Corporation and on weaker commodities prices renew risk aversion mood. At the closing bell, the Nikkei 225 Stock Average index was at 10,205.02, rose 6.98 points or 0.07%, while the broader Topix of all First Section issues on the Tokyo Stock Exchange fell 2.51 points, or 0.28%, to 898.61.
On the economic front, the Japan Automobile Dealers Association said that Japan's vehicle sales, excluding mini vehicles, surged 36.8% year-on-year to 238,362 in January.
In Mainland China, the stock market continued last week decline, with key Shanghai index plummeted on Monday, the lowest since October, on heavy selling across the sectors triggered by mounting concerns over more tightening from the government to prevent the economy from overheating after the two separate survey data showed the country’s economy sustained its manufacturing expansion in January as export orders jumped and inflation pressures grew. The falls was also fueled on fears that the stronger US dollar might trigger a capital exodus from emerging markets.
At the closing bell, the Shanghai Composite Index, measuring A shares and B shares on the Shanghai Stock Exchange, retreated 47.93 points, or 1.6%, to 2,941.36, while the Shenzhen Component Index on the smaller Shenzhen Stock Exchange dropped 148.10 points, or 1.22%, to 11,989.11. The CSI 300 Index, measuring exchanges in Shanghai and Shenzhen, succumbed 1.61%, to 3,152.71.
On the economic front, the HSBC Purchasing Managers' Index of China's manufacturing sector stood at 55.8% in January, down 0.8 percentage points from the previous month, the China Federation of Logistics and Purchasing said on Monday. Despite a moderate slowdown, the figure has been above 50 percent, the threshold indicating expansion for 11 consecutive months.
In Australia, the share market fell on Monday after treading water in morning, burdened by risk aversion on lingering worries over financial stability in Europe and other external uncertainties ranging from US banking reform to monetary tightening in emerging economies. Selling was intensified in afternoon after weaker than expected jobs data rattled investor confidence in the sustainability of economic growth. At the closing bell, the benchmark S&P/ASX200 index slipped 45.50 points, or 1%, to 4,524.10, meanwhile the broader All Ordinaries slid 52.10 points, or 1.13%, to 4,544.80.
On the economic front, the PMI, a measure of manufacturing, rose 2.5 points to 51 in January. The 50-point mark is the barrier between expansion and contraction. The growth was driven by a rise among construction materials and coal mining stocks the report concluded.
The Australian Bureau of Statistics said Monday an index measuring the weighted average of prices for established houses in the eight capital cities climbed 5.2%
The ANZ Job Advertisements Series released today showed the total number of jobs advertised in major metropolitan newspapers and on the internet fell by seasonally adjusted 8.1% in January to an average of 134,106 per week after growing 4.6% in December and 5.2% in November, according to ANZ Banking Group's monthly survey.
In New Zealand, equities started the day slightly easier to commence the month of February in the negative region. The benchmark index slipped deeper into the red region towards the end of the day. At the closing today, the NZX 50 lost 0.43% or 13.69 points to 3150.97. Meanwhile, the NZX 15 declined by 0.55% or 30.96 points to close at 5678.54.
On the economic front, the price of commodities that New Zealand exports lifted a little in January, even though dairy prices recorded the first fall in seven months. The ANZ Commodity Price Index, which is weighted based on contributions to merchandise exports, lifted 0.4 percent in January. The index has risen for 11 consecutive months and is up 36.5 percent from a year ago.
In South Korea, stocks closed higher on market expectations that a massive recall of vehicles by Toyota Motor Company will benefit Korean automakers. After range-bound trading, the benchmark Korea Composite Stock Price Index (KOSPI) gained 4.01 points to 1,606.44.
In Singapore, the share market finished choppy trading session edge lower as investors discouraged by weaker Asian market and pullback in commodities prices. Players were cautious on increasing uncertainty about the stability of the global economy; although losses were limited amid some of buying interest emerged as 5.3% pullback in January make stocks valuation attractive. At the end of today’s trade, the blue chip Straits Times Index was at 2,736.17, fell 9.18 points or 0.33%.
In Philippines, the stock market closed lower as investors mimicked global markets, which in turn spurred a massive selling of key heavy weight stocks. Moreover, investors took cues from the Wall Street's disappointing performance last Friday. Investors also continued to fret over US government plans to reduce risk taking among banks. At the final bell, he benchmark index PSEi declined 2.36% or 69.98 points to 2,883.21, while the All Shares index fell 1.96% or 37.10 points to 1,848.39.
In India, the key benchmark indices provisionally closed with small to decent gains after a strong intraday rebound triggered by upbeat economic data. The latest data showed the manufacturing sector grew at its fastest pace in almost 1-1/2 years in January 2010. The BSE 30-share Sensex inched lower by 1.93 points or 0.01% to 16,356.03. The S&P CNX Nifty was up 17.65 points or 0.36% to 4899.70.
On the economic front, India's exports rose an annual 9.3% in December to $14.6 billion, the second consecutive rise after 13 straight months of decline, the government said today. Imports rose 27.2% from a year earlier to $24.75 billion. Exports for April-December, the first nine months of the 2009/10 fiscal year, were down 20.3% at $117.59 billion from the same period in the previous year.
India's manufacturing sector grew at its fastest pace in almost 1-1/2 years in January 2010, boosted by a sharp rise in new export orders that underpin a recovery in the industrial sector, a survey showed. The HSBC Markit Purchasing Managers' Index (PMI), based on a survey of 500 Indian companies, rose to 57.7 in January 2010, its strongest reading since August 2008 and up from 55.6 in December 2009. A reading above 50 means activity is expanding. The new orders index rose to 62.9 from December's 60.1.
Elsewhere, Malaysia’s Kula Lumpur Composite index finished slightly lower at 1259.79 while stock markets in Indonesia’s Jakarta Composite index fell by 23.25 points ending the day lower at 2587.55.
In other regional equities, European shares started February in the red, extending year-to-date weakness, with losses from media firm Vivendi adding pressure on Monday. It was a more mixed picture on the regional level, with the U.K. FTSE 100 index up 0.2% or 10.39 points at 5,199 and the German DAX index up 0.1% at 5,614.02, while the French CAC-40 index declined 0.31% or 9.61 points to 3,730
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