Tuesday, November 16, 2010

20101116 0858 Global Market News.

Oil falls below $85 on stronger U.S. dollar
SINGAPORE, Nov 16 (Reuters) - Oil prices eased below $85 weighed down by a stronger dollar and an expected rise in U.S. crude stockpiles.
"Oil had a strong rally recently and the market was really set up for a correction, with the value of the dollar having quite a lot to do with this," said Victor Shum, an analyst with energy consultancy Purvin & Gertz.

China rare earth dominance seen remaining -Van Eck
LONDON, Nov 15 (Reuters) - Countries outside of China are scrambling to invest in domestic supplies of rare earth metals, but new mines could take 10 years to come on stream, asset manager Van Eck Global said on Monday.
China accounts for 97 percent of world total production of rare earth, which was around 120,000 tonnes in 2008, mining experts say.

US corn underpinned by supply tightness
SYDNEY, Nov 16 (Reuters) - U.S. corn and wheat futures posted modest losses as the dollar firmed, but tightening global stocks after production setbacks in key grain regions continue to underpin the market.
"The broader factor around grains is the very tight supply situation going forward," said Wayne Gordon, a grains analyst at Rabobank in Sydney.

Argentina approves 5 mln T in corn exports-source
BUENOS AIRES, Nov 15 (Reuters) - Argentina's government has approved the shipment of 5 million tonnes of 2010/11 corn, its first approval of new corn season exports, a senior government source told Reuters on Monday.
Argentina is the world's No. 2 corn supplier and the country's farmers are currently sowing the 2010/11 crop, which is expected to reach a record 26 million tonnes, meaning more will be available for export.

OIL: Crude falls as firmer dollar weighs
TOKYO, Nov 16 (Reuters) - U.S. crude futures fell on Tuesday as the dollar extended recent gains, while the market awaited a weekly industry report on U.S. inventories due later in the day.
Crude is extending a 3-percent slide last week, when its recent rally to a 25-month high of $88.63 was reversed as a fall in Chinese stocks on rate hike worries on Friday sparked concerns about oil demand.

COMMODITY MARKETS: Corn leads rebound; dollar still weighs on oil
NEW YORK, Nov 15 (Reuters) - Corn prices rose 4 percent on Monday as most commodities rallied on stronger fundamentals and U.S. economic data, though gains in the dollar continued to weigh on oil.
"A weaker dollar does lead to higher commodity prices for a while, but the consequences of such a relationship are seldom highlighted, namely, that high commodity prices eventually lead to higher inflation and/or demand destruction, and thus sow the seeds of their own fall," said Edward Meir, energy and base metals analyst at MF Global in New York.

GLOBAL MARKETS: Dollar surges on euro debt woes; bonds down
NEW YORK, Nov 15 (Reuters) - The U.S. dollar climbed to a six-week high against major currencies on Monday as worries about Ireland's debt crisis persisted, hurting the euro, while rising U.S. bond yields increased the greenback's appeal.
"The euro fell below $1.36 and is set to remain under pressure in the near term as investors focused on fiscal troubles in Ireland and Portugal and await meetings of European finance ministers on Tuesday and Wednesday," said Greg Farinella, managing director and head of Treasury and trading at Espirito Santo Investment S.A. in New York.

IEA's Tanaka: oil market 'very well supplied'
TOKYO, Nov 15 (Reuters) - The oil market will have plenty of supply until at least the end of 2011 if OPEC keeps producing at current levels, International Energy Agency Executive Director Nobuo Tanaka said on Monday.
There have been concerns about supply after recent sharp falls in crude and other oil products in floating storage due to robust demand.

High metal prices prompt talk of stockpiling
LONDON, Nov 12 (Reuters) - Excess money market liquidity and worries about scarce resources are propelling commodity prices to record highs and prompting talk of stockpiling.
But any such moves by big industrial consumers may aggravate high prices and increase risks for companies, which should seek other ways to secure raw materials such as copper, iron ore and rare earths by moving up the supply chain.

China should shift monetary policy -c.bank researcher
BEIJING, Nov 15 (Reuters) - China should move to a more prudent monetary policy and guard against risks from loose money conditions used to counter the global financial crisis, a central bank researcher said in remarks published on Monday.
"China should return to a stable and healthy monetary policy as soon as possible in response to the actual situation," Zhang Jianhua, head of the research bureau of the People's Bank of China, told the official Financial News.

Japan says China vows action on rare earth exports
YOKOHAMA, Japan, Nov 13 (Reuters) - China expects the problem of slow rare earth exports to Japan to be resolved soon, Japan's Trade Minister Akihiro Ohata quoted a senior Chinese official as saying on Saturday.
Ohata said Zhang Ping, the head of China's National Development and Reform Commission, had told him he instructed officials to speed up customs inspections of rare earths.

PRECIOUS-Gold steady; European debt, inflation worry support
SINGAPORE, Nov 15 (Reuters) - Gold prices were steady on Monday, after the sharpest fall in four months in the previous session, as inflation concerns and sovereign debt issues in Europe offered support.
Spot gold  was little changed at $1,365.75 an ounce by 0702 GMT, after falling three percent on Friday as talks of an imminent interest rates hike in China triggered a broad sell-off across financial markets.

FOREX-Dollar boosted by higher Treasury yields
LONDON, Nov 15 (Reuters) - The dollar index hit a six-week high on Monday, boosted by higher U.S. Treasury yields, while the euro was stung as Ireland's deepening debt problems  shook confidence in the euro zone.
The 10-year Treasury yield hit a two-month high as the Wall Street Journal reported that a group of Republican-leaning economists is launching a campaign calling for the Federal Reserve to drop its plan to buy $600 billion of Treasuries.

Stocks fall, dollar rises on Irish debt woes
SYDNEY, Nov 15 (Reuters) - Stocks in Asia and Europe fell  on fears that Ireland may be forced to seek a financial rescue package, while a jump in U.S. Treasury yields helped drive the dollar higher.
"That looks to be the initial catalyst that sparked the selloff (in Treasuries), and then it ran into quite a few stops and became momentum and flow driven," said Sue Trinh, currency strategist at RBC in Hong Kong.

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