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PRECIOUS-Gold eases, but remains near 7-month high
Fri Feb 20, 2009 6:48am GMT Print | Single Page[-] Text [+] * Gold eases but remains in sight of seven-month peak * SPDR Gold Trust holdings up 0.5 pct, marks new record * Bullion seen headed towards $1,000
(Updates price) By Miho Yoshikawa TOKYO, Feb 20 (Reuters) - Gold was a touch softer on Friday
but continued to trade near a seven-month high over $985 marked
this week as it consolidated gains before tackling new peaks. The precious metal, which gained about 5 percent during the
week, fell a touch on Thursday on profit-taking, sparked by
worries that its recent rally had been overdone. But the bleak economic outlook is expected to keep
safe-haven buying intact. Spot gold <XAU=> was trading at $971.70 an ounce by 0602
GMT, down about 0.2 percent from New York's notional close on
Thursday. This compares with its all-time high of $1,030.80
marked in March. Gold touched $985.95 an ounce on Thursday, marking its
highest level since July 15, and was likely to try to
consolidate around $960 before heading higher, dealers said. "I would say (the market) should be able to consolidate a
little bit, it should come down a little bit, maybe around the
region of $960," said Beh Hsia Wah, a dealer at United Overseas
Bank in Singapore. "Everybody is looking for $1,000," she said. A Hong Kong dealer said gold was showing its strength in
its traditional role as an inflation hedge in the current
economic climate as more money was printed to fight the
recession. "People read the newspaper ... and people are flocking to
gold for the time being," he said. There was little buying for jewelry demand. "We're only seeing investment buying, that's all," he said. Gold's popularity as an investment was also evident in the
rise in gold exchange-traded funds. The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust GLD, said holdings hit a record 1,028.98
tonnes on Thursday, up 4.89 tonnes or 0.5 percent from the
previous day. [GOL/SPDR] Investment in silver ETFs has also been strong, with
holdings of the world's largest, the iShares Silver Trust
SLV.P, jumping nearly 3 percent to a record 7,873.75 tonnes
on Wednesday. Its holdings have risen more than 1,000 tonnes, or 16
percent, since the start of the year. [ID:nLJ806511] In supply news, the world's second-largest gold producer,
Newmont Mining (NEM.N: Quote), sees equity gold sales at 5.2 million
to 5.5 million ounces in 2009, and reported adjusted earnings
per share of 26 cents in the fourth quarter. [ID:nN19398975] If a bleakening outlook in other markets from equities to
foreign exchange is any indication, gold is unlikely to lose
its shine for investors soon. The latest deteriorating economic signs included Thursday's
close of the U.S. Dow industrials index at its lowest in more
than six years and a fall in crude oil futures below $39 a
barrel. [O/R] [.N] The yen edged up slightly on Friday, but stayed in sight of
a six-week low against the dollar and a one-month trough
against the euro. [USD/]
Precious metals prices at 0604 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 971.50 -2.05 -0.21 10.38
Spot Silver 14.02 0.01 +0.07 23.85
Spot Platinum 1061.50 -5.00 -0.47 13.89
Spot Palladium 213.00 -0.50 -0.23 15.45
TOCOM Gold 2948.00 15.00 +0.51 14.57
29967
TOCOM Platinum 3211.00 -18.00 -0.56 21.08
6327
TOCOM Silver 420.60 -2.40 -0.57 31.73
315
TOCOM Palladium 657.00 6.00 +0.92 19.45
1000
Euro/Dollar 1.2591
Dollar/Yen 94.07
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Chikako Mogi; Editing by Clarence
Fernandez)
rise and shine GAS peeps!
Bank of America's Lewis subpoenaed over Merrill deal: WSJ
By Simon Kennedy
Last update: 3:38 a.m. EST Feb. 20, 2009Comments: 7
LONDON (MarketWatch) -- Bank of America Corp. (BAC:bank of america corporation com
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Last: 3.91-0.66-14.44%
4:00pm 02/19/2009
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BAC 3.91, -0.66, -14.4%) Chairman and CEO Kenneth Lewis has been subpoenaed by New York State Attorney General Andrew Cuomo, who is investigating whether the bank withheld information from investors, according to a report in The Wall Street Journal citing people familiar with the matter. Cuomo is investigating the bank's purchase of Merrill Lynch & Co. to determine whether investors were misled about the depth of Merrill's losses in late 2008 and whether details of the bonuses to Merrill employees should have been disclosed, the report said. Investigators also took testimony from John Thain, the former CEO of Merrill, on Thursday, the Journal reported. Thain was quizzed on why the September agreement contained a nonpublic attachment that detailed the maximum Merrill could pay in bonuses, the report added.
Futures point to more Wall Street losses
By Barbara Kollmeyer, MarketWatch
Last update: 6:10 a.m. EST Feb. 20, 2009Comments: 4MADRID (MarketWatch) -- U.S. futures were indicating a rough session to finish the week for Wall Street on Friday, after the Dow industrials closed below the key 7,500 level in the previous session and with plenty of gloomy news to keep buyers at bay ahead of the weekend.
Dow industrial futures (DIA:Dow Diamonds ETF
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Last: 75.03-0.73-0.96%
4:00pm 02/19/2009
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DIA 75.03, -0.73, -1.0%) were off 120 points. S&P 500 futures (SPY:SPDR S&P 500 ETF
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Last: 78.18-0.85-1.07%
4:00pm 02/19/2009
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SPY 78.18, -0.85, -1.1%) dropped 12.90 points to 766.50 and Nasdaq 100 futures (QQQQ:PowerShares QQQ
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Last: 28.79-0.45-1.54%
4:00pm 02/19/2009
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QQQQ 28.79, -0.45, -1.5%) lost 18.75 points to 1,151.70.
The Dow Jones Industrial Average closed Thursday at 7,465.95, down 89.68 points to end at the weakest level since Oct. 9, 2002. Financials led the decline as big names like Citigroup and Bank of America tumbled on continued fears the government's efforts to rescue the financial system may fall short.
"It is difficult to know whether the latest falls are another move to a new bear phase or just a clear out of weakly held speculative longs built up over the last few months," said Simon Denham, managing director of Capital Spreads, in a note to investors.
"It has been reasonably simple for traders to deal the price ranges for the recent weeks and months, and this latest move might just be a lesson to these speculators that making money is not (and never will be) this easy. "
The dollar was firmer across the board on Friday, while March crude futures were down $1.68 to $37.80 a barrel on the last day as the lead contract and April crude was also down by more than $1 a barrel.
April gold was up $6.50 to $983 an ounce.
More unsettling financial news awaits traders on Friday.
Shares of Bank of America (BAC:bank of america corporation com
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Last: 3.91-0.66-14.44%
4:00pm 02/19/2009
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BAC 3.91, -0.66, -14.4%) were down 4% in Frankfurt on a report in the Wall Street Journal that Chairman and Chief Executive Officer Kenneth Lewis has been subpoenaed by the New York State Attorney General Andrew Cuomo, who is investigating whether the bank misled investors over its purchase of Merrill Lynch & Co. Bank of America shares were down 4% in Frankfurt.
And the auto sector had its share of gloom after the Saab automobile division of General Motors (GM:General Motors Corporation
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Last: 2.00-0.06-2.91%
4:00pm 02/19/2009
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GM 2.00, -0.06, -2.9%) filed for creditor protection. GM had warned of such a move earlier this week in a filing to the U.S. Congress.
Shares of mining giant Anglo American (AAUK:anglo amern plc adr new
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Last: 8.75-0.01-0.11%
4:00pm 02/19/2009
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AAUK 8.75, -0.01, -0.1%) (UK:AAL: news , chart , profile ) plunged in Europe after it reported a 29% fall in profits, halted payouts to investors and said it would slash 19,000 jobs to cope with the global economic slowdown.
European markets were weaker across the board, led by banking issues with the pan-European Dow Jones Stoxx 600 down over 2%. Asia was also sharply weaker, with Japan's Topix index closing at the weakest level in over 20 years.
U.S. economic data on tap includes consumer prices for January, while the earnings calendar is on the thin side, highlighted by J.C. Penney (JCP:Penney (J.C.) Company, Inc
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Last: 14.92+0.06+0.40%
4:00pm 02/19/2009
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JCP 14.92, +0.06, +0.4%) and Lowe's (LOW:Lowe's Companies, Inc
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Last: 16.98+0.09+0.53%
4:00pm 02/19/2009
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LOW 16.98, +0.09, +0.5%) . Both results will come before the bell.
Upbeat results late Thursday from tax preparation software provider Intuit (INTU:Intuit Inc
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Last: 21.27-0.61-2.79%
4:00pm 02/19/2009
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INTU 21.27, -0.61, -2.8%) and drug maker Mylan (MYL:Mylan Laboratories Inc
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Last: 11.57+0.10+0.87%
4:00pm 02/19/2009
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MYL 11.57, +0.10, +0.9%) could boost those shares, which climbed in after hours action.
The New York Times Co. (NYT:New York Times Company
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Last: 3.51-0.20-5.39%
4:03pm 02/19/2009
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NYT 3.51, -0.20, -5.4%) could see pressure after its board suspended the quarterly dividend on the company's Class A and Class B common stock late Thursday.
Barbara Kollmeyer is an editor for MarketWatch in Madrid.
morning breakout! TGIF!
TGIF breakout board!
coolness, what hot on your side today?
IGTP moving and grooving up by 92 %
IGTP rocking today
IGTP on the move today check out the level 2
rise and shine FBS! whats hot on your side? IMGR and SUMM are on top of my lists!
not bad for IMGR yesterday closed at .008, watch out for MGLG had a nice run yesterday looking forward to see some great moves today!
morning stocksurgeon! SUMM looks like its ready to run! IMGR news came out yesterday, MGLG up and moving!
eyes on MGLG IMGR IGTP
morning breakout! whats up today?
nice moves for MGLG, still on my radar for today! as well as IMGR!
MGLG on fire today up by 100%
MGLG l2
interesting!
good day doog! nice moves on SUMM yesterday, IMGR rocking today, news out too
thats lovely! time to load up!
all smiles with all the profits.. go for $$$$$$$$$$$$
oh yeah ready for a bounce, load up before it gets too hot!
morning FBS! whats hot today? SUMM and IMGR for me! add little bit of BBDA and EESO
"Live, laugh, learn, and play stocks! Life is short!" --- live life to the fullest.. common lets go shopping!
thanks sid! IMGR news out today!
so true! especially those who are so scared of their dentist. lol!
gonna be an interesting day for IMGR for sure!
finally some news on imgr... whats more to expect?
Coffee Risks Squeezing Starbucks, Funds on Supply (Update2)
Email | Print | A A A
By Shruti Date Singh
Feb. 17 (Bloomberg) -- An unexpected coffee rally sparked by dwindling supplies risks squeezing Starbucks Corp., Kraft Foods Inc. and hedge funds betting on a decline.
Demand may exceed output by 8 million 60-kilogram bags in the coming year -- almost what Germany consumes -- and exporter stockpiles are the lowest since 1965, the International Coffee Organization said. Arabica coffee futures may jump 25 percent this year after falling for the first time since 2001 as output drops in Brazil and Colombia, the Western Hemisphere’s top two growers, Goldman Sachs Group Inc. said Feb. 9.
“We see coffee prices increasing in 2009,” Sandra Bachofer, who helps manage $1.2 billion for Zug, Switzerland- based Tiberius Group, said yesterday in a telephone interview. “We expect coffee to be one of the most promising commodities in 2009.”
Expectations for a rebound show what happens when speculator-driven futures markets collide with real-world supply and demand. The rally would drive up costs for Seattle-based Starbucks and Kraft Foods’s Maxwell House, while enriching growers and increasing export revenue in countries such as Vietnam and Brazil.
While Fortis Bank says the recession may stall demand and keep prices in check, coffee is up 0.9 percent this year at $1.1305 a pound on ICE Futures U.S. Contracts for December delivery indicate the rally will continue.
Price Forecasts
Judith Ganes-Chase, a former Merrill Lynch & Co. analyst who runs a consulting firm in Katonah, New York, said coffee may rise as much as 52 percent to $1.70 by June 30. Morgan Stanley forecast an average of $1.41 in the year starting Oct. 1, and Goldman Sachs predicted $1.40 in the next 12 months.
Starbucks, the world’s largest coffee chain, said Jan. 28 it expects “unfavorable” coffee costs in the year ending Sept. 30 to erode the benefit of lower dairy prices. The company said its cost of first-quarter sales rose 2.9 percentage points from a year earlier, partly because of higher coffee expenses.
“We are confident that we have the coffee we need and that increased premiums in specific countries will have little or no effect on our existing or future contracts,” Stacey Krum, a Starbucks spokeswoman, said in an e-mail.
The company usually has supply commitments for a year to 18 months into the future, so the impact of changing coffee costs may take that long to show up in financial results, said Jeffrey Farmer, an analyst with Jefferies & Co. in Boston, who rates the shares a “hold.”
Maxwell House
Northfield, Illinois-based Kraft, the world’s second-largest food company, raised Maxwell House coffee prices twice in early 2008 as bean costs jumped, followed by three reductions. No price changes were made this year, spokeswoman Bridget MacConnell said.
Higher prices may hurt hedge funds and other large speculators who sold 19,379 futures contracts valued at more than $864 million as of Feb. 10, based on the May delivery contract, in a bet that prices would fall, data from the Commodity Futures Trading Commission show.
Coffee fell 14 percent in the fourth quarter on the ICE exchange even as the premium for Colombian beans over the most- active New York futures jumped 54 percent, reflecting demand at a time when investors fled commodity markets. Open interest, or the number of outstanding contracts, fell almost 10 percent.
“Coffee fell victim to massive fund liquidation” last year, said Roland Veit, chairman of importer Paragon Coffee Trading Co. in White Plains, New York. “The coffee market was driven too low for non-fundamental reasons.” Buyers in the physical market “started to ignore” futures that didn’t reflect supply and demand, he said.
Commodity Rally
Investors stocked up on commodity futures early last year, hoping to profit from rising demand for food, feed and fuel. A weakening dollar made raw materials priced in the currency more appealing for overseas buyers and as an inflation hedge.
The number of outstanding coffee futures in New York reached a record 204,360 contracts on Feb. 15, 2008. At 37,500 pounds per contract, that’s equal to almost half of all the coffee consumed globally last year. The surge in speculator holdings helped push the price to a 10-year high of $1.719 a pound on Feb. 29, 2008.
Then the credit crisis and the recession erased optimism about commodity demand and sparked a rush by investors to sell assets. From October through December, hedge funds and other large speculators were betting coffee prices would drop as the Standard & Poor’s 500 Index posted the biggest quarterly decline since 1987. The Reuters/Jefferies CRB Index of 19 commodities, after reaching a record high July 3, plunged 36 percent last year, the most in more than five decades.
Colombia Premium
By December, coffee reached a two-year low and open interest had fallen 39 percent from its record.
Tighter supplies are pushing up the cost of coffee from Colombia, where a growers group on Jan. 26 reported 2008 production dropped 9 percent to 11.5 million bags. The decline means export shipments “may arrive late” to some buyers, said Jorge Lozano, head of the Association of Colombian Exporters.
Colombian beans, embodied by the image of sombrero-clad Juan Valdez and his mule, cost 27.42 cents more than the price of most-active New York futures on Feb. 13. The premium reached 28.85 cents on Feb. 4, the highest since at least 2001.
Similar premiums were reported for Costa Rican and Guatemalan beans, according to a Feb. 6 report from analyst F.O. Licht of Ratzeburg, Germany.
Stockpiles in warehouses monitored by ICE Futures U.S. on Feb. 12 reached the lowest since July 2007. Stockpiles held by shippers fell 32 percent from a year earlier to 17.26 million bags on Oct. 1, partly because consumption in coffee-exporting countries jumped 37 percent in the past decade, ICO data show.
Production Deficit
The financial crisis also may contribute to reduced output, according to Tiberius Group’s Bachofer.
“Coffee is very labor intensive and requires lots of fertilizer,” she said. “Financial credit is not as available as before. This may lead to lower inputs in these two areas. The reduced fertilizer input will mainly have an impact on the marketing year 2010-2011.”
Global demand may reach 130 million bags, exceeding supply by 6 million to 8 million bags in the year that starts Oct. 1, said Nestor Osorio, the ICO’s executive director. Brazil estimates its harvest will drop as much as 20 percent to 36.9 million bags this year as trees enter the smaller phase of a two- year crop cycle.
“It’s a very tight market,” Osorio said in a telephone interview from London. “The supply will be in deficit. There are no reasons to believe prices could come down.”
To contact the reporter on this story: Shruti Date Singh in Chicago at ssingh28@bloomberg.net.
Last Updated: February 17, 2009 15:55 EST
morning doog! whats up today?
good day stock surgeon! still on my radar... add SUMM and EESO as well as MODC
hi merci! nice to hear from you. havent heard from you for such a long time. whats up and whats new?
hi sidney... nice new board! nice to see all familiar people here.....
nice one, at you can have it anytime you want....
PNP picks for wednesday: SUMM THRA MODC BBDA, IMGR ready to run!
PNP picks for today: SUMM THRA BBDA MODC
good morning day traders! eyes on SUMM THRA BBDA MODC
PRECIOUS-Gold inches up to 7-month high, ETF tops 1,000 T
Wed Feb 18, 2009 2:27am EST Email | Print | Share| Reprints | Single Page[-] Text [+]
Market News
World shares fall as growth worries nag
U.S. oil falls towards $34, eyes crude stock build
Nikkei hits 4-month closing low on bank, economy worries
More Business & Investing News... * Gold inches up to fresh seven-month peak
* SPDR Gold Trust holdings hit record-high 1,008.80 tonnes
* Bullion may test $1,000 in near term
By Chikako Mogi
TOKYO, Feb 18 (Reuters) - Gold prices inched up to hit a fresh seven-month high on Wednesday, as growing concern over the global economy redoubled investors' fervour for safe-haven assets.
Global markets were roiled by a slew of grim reports showing a slumping Japanese economy and contracting U.S. economic activity as well as fears that Eastern Europe's battered economies would drag down Western banks. [ID:nLH575804] [ID:nNYS004827]
The market was largely steady, however, as many players took a break from the recent rally, traders said.
Spot gold <XAU=> was trading at $970.10 an ounce, up $1.75 from the notional New York close, after rising as high as $973.50 an ounce to a fresh seven-month high. Gold rose as high as $973.20 an ounce on Tuesday.
Gold futures for April delivery GCJ9 on COMEX rose $5.5 to $973.0 an ounce, after touching a new seven-month high of $975.4.
"It's holding up quite well, considering the move it had. Macroeconomic pessimism that was evident in the New York equities market is providing quite a strong support for gold, for its safe-haven quality," said Toby Hassall, a research analyst at Commodity Warrants Australia.
Reflecting the keen interest in gold, holdings at the world's largest gold-backed exchange-traded fund, the SPDR Gold Trust GLD, struck a record 1,008.80 tonnes on Tuesday, up 2.3 percent from Friday. [GOL/SPDR]
For graphics on SPDR Gold holdings, click on: here
Global gold demand rose 4 percent to 3,569 tonnes in 2008 as increased investor demand outstripped jewellery and industrial demand, which traditionally make up about two-thirds of consumption, the World Gold Council said in a report on Wednesday. [ID:nN17391802]
Investors, expecting years of inflation and global economic instability, are pouring money into securities backed by gold bullion, helping to turn a simple safe haven into a mainstream asset class.
Some traders said that physical flows may be caught between waning demand for jewelry as recession takes a toll on purchases of luxury items and healthy appetite from investors eyeing gold jewelry as a way for cashing in when necessary.
In a research report, investment bank Goldman Sachs said investors seeing the bottom of the collapse in commodities prices drawing near should hang fire and remain focused on equities, although it remained bullish on their long-term outlook. [nSP422801]
morning breakout traders!