AI
Tuesday, September 18, 2012 3:30:35 AM
Commodities: forecast more gains
http://www.bloomberg.com/news/2012-09-16/bullish-wagers-at-16-month-high-as-citi-sees-gains-commodities.html
Fed Chairman Ben S. Bernanke is trying to bring down an unemployment rate stuck above 8 percent since February 2009. The central bank said it will make open-ended purchases of $40 billion of mortgage debt a month and hold the benchmark interest rate near zero at least through mid-2015. European Central Bank President Mario Draghi said Sept. 6 that policy makers agreed to an unlimited bond-purchase program, the same week in which China approved a $158 billion subways-to-roads construction plan.
More than $1.4 trillion was added to the value of global equities last week after the Fed announced a third round of bond buying on Sept. 13 to revive growth. Inflation expectations measured by the break-even rate for five-year Treasury Inflation Protected Securities surged to the highest since May 2011.
Bull Market
The S&P GSCI has jumped 25 percent since reaching this year’s low on June 22, driving the gauge into a bull market in the fastest turnaround since the depths of the financial crisis four years ago. The measure surged 92 percent from the end of 2008 through June 2011 as the Fed bought $2.3 trillion of debt in the first two rounds of quantitative easing and held borrowing costs at a record low.
Copper investors were the most bullish since early April, the CFTC data showed. Prices reached a four-month high on Sept. 14 in New York as the stimulus plans boosted demand prospects. Refined production of the metal fell short of consumption by 241,000 metric tons last year, the International Copper Study Group said last week. Supplies will also trail demand this year and next, Barclays Plc said in a report Sept. 12.
Gold bets jumped 14 percent to 165,724 contracts. Prices in New York, which climbed to a six-month high of $1,780.20 an ounce on Sept. 14, closed at $1,770.60 on the Comex today. Crude-oil holdings rose for a fourth straight week to 203,324 contracts, the longest increase since February. Futures rose above $100 a barrel last week for the first time since May.
Platinum wagers climbed 11 percent to 24,205 contracts, the highest since May 2011. Futures rose for 10 straight sessions in New York before falling today. South African workers at a Lonmin Plc (LMI) mine and nearby operations of Anglo American Platinum Ltd. (AMS), the biggest producer, are holding protests over pay.
“The Fed statement does change things,” said Jack Ablin, who helps oversee about $60 billion of assets as chief investment officer of BMO Private Bank in Chicago. “It really shows the Fed’s unwavering desire to inflate asset prices, and commodities will certainly be part of that.”
http://www.bloomberg.com/news/2012-09-16/bullish-wagers-at-16-month-high-as-citi-sees-gains-commodities.html
Fed Chairman Ben S. Bernanke is trying to bring down an unemployment rate stuck above 8 percent since February 2009. The central bank said it will make open-ended purchases of $40 billion of mortgage debt a month and hold the benchmark interest rate near zero at least through mid-2015. European Central Bank President Mario Draghi said Sept. 6 that policy makers agreed to an unlimited bond-purchase program, the same week in which China approved a $158 billion subways-to-roads construction plan.
More than $1.4 trillion was added to the value of global equities last week after the Fed announced a third round of bond buying on Sept. 13 to revive growth. Inflation expectations measured by the break-even rate for five-year Treasury Inflation Protected Securities surged to the highest since May 2011.
Bull Market
The S&P GSCI has jumped 25 percent since reaching this year’s low on June 22, driving the gauge into a bull market in the fastest turnaround since the depths of the financial crisis four years ago. The measure surged 92 percent from the end of 2008 through June 2011 as the Fed bought $2.3 trillion of debt in the first two rounds of quantitative easing and held borrowing costs at a record low.
Copper investors were the most bullish since early April, the CFTC data showed. Prices reached a four-month high on Sept. 14 in New York as the stimulus plans boosted demand prospects. Refined production of the metal fell short of consumption by 241,000 metric tons last year, the International Copper Study Group said last week. Supplies will also trail demand this year and next, Barclays Plc said in a report Sept. 12.
Gold bets jumped 14 percent to 165,724 contracts. Prices in New York, which climbed to a six-month high of $1,780.20 an ounce on Sept. 14, closed at $1,770.60 on the Comex today. Crude-oil holdings rose for a fourth straight week to 203,324 contracts, the longest increase since February. Futures rose above $100 a barrel last week for the first time since May.
Platinum wagers climbed 11 percent to 24,205 contracts, the highest since May 2011. Futures rose for 10 straight sessions in New York before falling today. South African workers at a Lonmin Plc (LMI) mine and nearby operations of Anglo American Platinum Ltd. (AMS), the biggest producer, are holding protests over pay.
“The Fed statement does change things,” said Jack Ablin, who helps oversee about $60 billion of assets as chief investment officer of BMO Private Bank in Chicago. “It really shows the Fed’s unwavering desire to inflate asset prices, and commodities will certainly be part of that.”
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