US STOCKS-Wall St set to open lower, trade talks in focus - Reuters News
18-May-2018 09:11:30 PM
- China denies offering to cut $200 bln in U.S. trade surplus
- Brent crude eyes sixth straight week of gains
- 10-yr Treasury yield holds above 3 pct mark for fourth day
- Applied Materials falls after results
- Futures down: Dow 0.02 pct, S&P 0.17 pct, Nasdaq 0.42 pct
Adds comment, adds details, updates prices
By Medha Singh
May 18 (Reuters) - U.S. stock index futures were lower on Friday as technology shares slipped, while investors waited for the outcome of Sino-U.S. trade talks.
China denied it had offered to cut its trade surplus with the United States by up to $200 billion, hours after it dropped an anti-dumping probe into U.S. sorghum imports, but added that talks were constructive.
The world's two biggest economies are seeking to bridge a divide on trade issues during the two-day talks in Washington that began on Thursday.
"The focus today will be on trade talks as China denied any major reductions in surplus and the NAFTA talks progression" said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
Among technology stocks, Alphabet fell 1.3 percent in premarket trading and is expected to weigh on the major indexes.
Applied Materials dropped 6.2 percent after the chip gear maker's disappointing forecast renewed concerns over slowing smartphone demand.
Campbell Soup declined 8.8 percent after the company cut its full-year earnings forecast and said Chief Executive Officer Denise Morrison would step down.
At 8:55 a.m. ET, Dow e-minis were down 5 points, or 0.02 percent. S&P 500 e-minis were down 4.75 points, or 0.17 percent and Nasdaq 100 e-minis were down 29 points, or 0.42 percent.
"We're looking at a mixed session today. We still have the dollar creeping up again, rates pretty much doing nothing."
Investors have been fretting about rising interest rates, with the 10-year Treasury yield, the benchmark for global borrowing costs, holding above the key 3 percent level for the fourth day.
Tractor maker Deere reported a rise in quarterly sales, but profits were dragged down by higher freight and material costs. Its shares were up 0.4 percent.
The company's results reflect concerns of big U.S. manufacturers, which have warned of higher raw material costs amid a surge in commodity prices and rising interest rates.
Oil prices continued their surge, with Brent crude on track for the sixth straight week of gains, boosted by strong demand, looming sanctions on Iran, plummeting Venezuelan production and Nigerian disruptions.
Nordstrom declined 8.1 percent after the upscale department store operator reported same-store sales that missed analysts' estimates.
(Reporting by Medha Singh in Bengaluru; Editing by Anil D'Silva)
UPDATE 5-Oil prices set for sixth week of gains, India sounds alarm - Reuters News
18-May-2018 08:25:02 PM
- Brent rose above $80 on Thursday
- Saudi Arabia makes assurances on supplies
- Force majeure on Nigeria's Bonny loadings
- BP sees oil prices falling to $50-$65 a barrel - Dudley
Updates prices, adds BP price forecast
By Ahmad Ghaddar
LONDON, May 18 (Reuters) - Brent oil prices rose on Friday and were set for a sixth straight week of gains, boosted by strong demand, looming sanctions on Iran, plummeting Venezuelan production and Nigerian disruptions, as Saudi Arabia moved to assuage supply concerns.
Brent crude futures rose by 51 cents to $79.81 a barrel at 1209 GMT. The benchmark broke through $80 for the first time since November 2014 on Thursday.
U.S. West Texas Intermediate crude futures were at $71.61 a barrel, up 12 cents and set for a third straight week of increase.
British bank Barclays said it expected average prices of $70 per barrel for Brent this year and $65 a barrel for 2019, up from estimates of $63 and $60 previously.
"Since last month, Venezuela's production decline, Trump's Iran sanctions decision, a new disruption in Nigeria, and anecdotal evidence from a new round of producer earnings require a price forecast revision," the bank said.
Rising prices have already raised the alarm among big oil-consuming countries.
OPEC kingpin Saudi Arabia said on Thursday it would make sure the world is adequately supplied with oil just as major consumer India expressed frustration with rising prices.
Saudi Energy Minister Khalid al-Falih called India's Petroleum Minister Dharmendra Pradhan to assure him that supporting global economic growth was "one of the kingdom's key goals", the Saudi Energy Ministry said.
Crude prices have received broad support from voluntary supply cuts led by the Organization of the Petroleum Exporting Countries.
The International Energy Agency said oil inventories in the developed world had already dipped below the five-year average, a measure targeted by OPEC and its allies.
Beyond OPEC's cuts, strong demand, falling output from Venezuela and a U.S. announcement this month that it would renew sanctions against OPEC member Iran have helped push up Brent by 20 percent since the start of the year.
U.S. investment bank Jefferies said sanctions against Iran could remove more than 1 million barrels per day (bpd) from the market.
Barclays said output from Venezuela could fall below 1 million bpd. The country, also an OPEC member, produced around 1.5 million bpd in April.
In Nigeria, Shell declared force majeure on Thursday on loadings of Bonny Light crude. Exports of the grade were expected to run at nearly 200,000 bpd in June. Nigeria's Forcados stream was also experiencing delays due to a pipeline leak.
BP, however, sees the rally cooling off. The oil major's Chief Executive Bob Dudley told Reuters he sees oil falling to between $50 and $65 a barrel due to surging shale output and OPEC's capacity to boost production.
(Additional reporting by Henning Gloystein; Editing by Dale Hudson and Susan Fenton)
PRECIOUS-Gold prices fall as dollar hits fresh peak; rebound seen - Reuters News
18-May-2018 08:35:38 PM
- Spot gold down over 2 pct for the week
- Dollar index hits fresh five-month high
- Benchmark U.S. yields near 7-year peak
(Adds more analyst comment, updates prices)
By Eric Onstad
LONDON, May 18 (Reuters) - Gold prices dipped on Friday, weighed down by a firmer dollar, but some traders said signs pointed to a rebound.
Spot gold was down 0.2 percent at $1,287.71 per ounce at 1225 GMT, after hitting its lowest since Dec. 27 in the previous session at $1,285.41.
The metal was heading for its biggest weekly decline since early December.
U.S. gold futures for June delivery fell 0.2 percent to $1,287.30 per ounce.
"There are many drivers that are pointing to an upside in the precious metals, so we're buying into this weakness," said Gianclaudio Torlizzi, partner at consultancy T-Commodity in Milan.
The sentiment index in gold was indicating it was strongly oversold while the dollar was heavily overbought, while U.S. inflation measures were rising, he added.
Data on Thursday showed a tightening U.S. labour market and factory activity in the mid-Atlantic region picking up, bolstering expectations the Federal Reserve will raise interest rates next month.
"We think there is room for a strong rally into the summer and we have a gold target of $1,430 by August," Torlizzi said.
The dollar index rose to a fresh five-month peak on Friday as the benchmark U.S. Treasury yield hit the highest in nearly seven years.
"The 10-year U.S. yields put the dollar on a firm foot and put pressure on metals and gold," said a Hong Kong-based trader, adding that some "risk-on" sentiment in markets today was also adding pressure.
A stronger greenback makes dollar-denominated gold more expensive for users of other currencies, while higher U.S. yields dampen the appeal of non-yielding bullion.
The demands of populist parties likely to form Italy's next government, which promised on Friday to ramp up spending, could also support gold.
"A debt crisis in Italy would have a far bigger impact than one in Greece. Gold would profit as a result," Commerzbank analysts said in a note.
Spot gold is still targeting $1,302 per ounce as it has stabilised around a support at $1,287, Reuters technical analyst Wang Tao said.
In other metals, silver shed 0.1 percent to $16.41 an ounce.
Palladium rose 0.2 percent to $979.50, while platinum dropped 0.3 percent to $883.30 per ounce after hitting a five-month low at $879 on Thursday.
All three metals were heading for weekly losses.
(Additional reporting by Apeksha Nair in Bengaluru; Editing by Adrian Croft and Elaine Hardcastle)
METALS-Copper falls for first week in three while nickel rises - Reuters News
18-May-2018 08:27:50 PM
Updates with official prices
By Jan Harvey
LONDON, May 18 (Reuters) - Copper fell on Friday, heading for its first weekly loss in three as uncertainties over the outlook for global growth and this week's burst of dollar strength weighed on prices.
Aluminium steadied after two days of losses, however, and nickel jumped more than 1 percent on expectations that rising numbers of electric vehicles would boost the metal's demand profile.
"Right now we are in a bit of a vacuum, trying to figure out the direction of global growth," said Danske Bank analyst Jens Pedersen.
"We have seen some softening of (manufacturing data) of late, so the question is whether it was just a soft first quarter or whether we are heading for a more mature cyclical downturn."
While he was confident that manufacturing growth would pick up, Pedersen said that uncertainties remain over the China-U.S. trade dispute, the geopolitical situation and the dollar outlook.
"If the dollar continues to rise, which we don't expect, it would usually take its toll on commodity prices," he said.
* COPPER: LME copper was down 0.9 percent in official midday trading at $6,817 a tonne, on track to end the week down 1.7 percent.
* SPREADS: The spread between copper for immediate delivery and the three-month contract pulled back to its narrowest since October at $23 a tonne, down from $39 a tonne earlier this week, suggesting some tightening in the market.
* ALUMINIUM SPREADS: In aluminium, the spread between the same contracts held in backwardation - a forward curve structure indicative of market tightness, into which it flipped at the start of the week - to the tune of $10 a tonne. Particular tightness in the curve was seen in the July to August spread, which was last trading in a $24 backwardation.
* ALUMINIUM PRICES: Three-month aluminium on the London Metal Exchange was untraded in official rings and was last bid at $2,293 a tonne, unchanged from Thursday's close.
* ALUMINIUM STOCKS: Data on Friday showed on-warrant aluminium stocks in warehouses certified by the London Metal Exchange - those not earmarked for delivery, and thus available to the market - fell 28,725 tonnes after surging by 153,075 tonnes earlier in the week.
* FINANCIAL MARKETS: The dollar hit a five-month high against a basket of currencies, buoyed by a further rise in U.S. Treasury yields that suggests an upbeat outlook for the world's largest economy.
* NICKEL PRICES: LME nickel, also untraded in official rings, was last bid up 1.4 percent at $14,800 a tonne. "Discussions out of LME Week Asia have ... been positive, with the focus on the rising impact of the electric vehicle market boosting sentiment," ANZ said in a note.
OTHER METALS: LME zinc was down 0.4 percent in official trading at $3,083.50 a tonne. Lead and tin were both untraded in rings but were last bid 1 percent lower at $2,350 a tonne and 0.4 percent lower at $20,575 a tonne respectively.
(Additional reporting by Manolo Serapio Jr. in Manila
Editing by David Goodman)
CBOT Trends-Wheat up 6 to 7 cents, corn up 3-4, soybeans up 3-5 - Reuters News
18-May-2018 09:27:40 PM
CHICAGO, May 18 (Reuters) - Following are U.S. trade expectations for the resumption of grain and soy complex trading at the Chicago Board of Trade at 8:30 a.m. CDT (1330 GMT) on Friday.
WHEAT - Up 6 to 7 cents per bushel
- Wheat moving higher for a fourth straight session on technical buying and worries about dry conditions in parts of North America and Australia, along with spillover strength from corn and soybeans. CBOT July wheat reached $5.07-3/4 in early moves, its highest since May 10.
- Iraq's state grains board bought about 100,000 tonnes of hard wheat in a tender which closed this week, including some 50,000 tonnes from the United States and 50,000 from Australia, European traders said.
- CBOT July soft red winter wheat last up 6-1/2 cents at $5.04 per bushel. K.C. July hard red winter wheat last traded up 6 cents at $5.25 and MGEX July spring wheat was up 7-1/4 cents at $6.22 a bushel.
CORN - Up 3 to 4 cents per bushel
- Corn higher after China dropped its anti-dumping probe into imports of U.S. sorghum, raising expectations of increased demand for U.S. feed grains. However, the CBOT July contract stayed inside of Thursday's trading range in early moves. Support noted at the contract's 50-day moving average near $3.95.
- China's purchases of U.S. corn have slowed due to worries the grain might be drawn into the trade spat between the world's two largest economies, and as Chinese customs keeps the brakes on clearances for cargoes, traders told Reuters.
- CBOT July corn last up 4 cents at $3.99-1/4 a bushel.
SOYBEANS - Up 3 to 5 cents per bushel
- Soybeans higher on optimism for progress in U.S. trade negotiations with China, the world's biggest soybean buyer, after Beijing dropped its anti-dumping probe into imports of U.S. sorghum. Upward momentum capped by news of cancellations of U.S. soybean sales.
- The USDA said private exporters reported cancellations of 949,000 tonnes of U.S. soybeans for delivery to unknown destinations, including 829,000 tonnes for 2017/18 delivery and another 120,000 tonnes for 2018/19.
- The USDA also said private exporters reported sales of 168,000 tonnes of U.S. soybeans to unknown destinations, including 56,000 tonnes for 2017/18 and 112,000 tonnes for 2018/19.
- CBOT July soybeans last up 4-1/2 cents at $9.99-1/2 per bushel.
(Reporting by Julie Ingwersen)
VEGOILS-Palm climbs to 5-week high on stronger soy, crude oil - Reuters News
18-May-2018 07:45:39 PM
- Weaker ringgit also supportive of market - trader
- Palm may rise to 2,510 ringgit/tonne - technicals
- Palm charts 2nd straight weekly gain, up 2.9 pct
Updates with closing prices
By Emily Chow
KUALA LUMPUR, May 18 (Reuters) - Malaysian palm oil futures rose as much as 1 percent on Friday to their highest in more than five weeks, tracking gains in related edible oils and crude oil, while a weaker ringgit also lent support.
The benchmark palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange, however, pared some gains to end the day up 0.7 percent at 2,450 ringgit ($617.13) a tonne.
Earlier in the session, it rose as much as 1.2 percent to 2,462 ringgit, its highest since April 10.
Palm has added 2.9 percent this week in its second straight weekly gain.
Trading volume stood at 38,919 lots of 25 tonnes each on Friday evening.
"The palm market is up on soyoil's upward move last night and a strong Dalian this morning," said a Kuala Lumpur-based trader, adding that West Texas Intermediate (WTI) futures briefly going above $72 and Brent crude futures above $80 also brought about some buying.
Palm oil prices are impacted by movements in crude oil, as the edible oil is used as feedstock to make biodiesel.
Crude oil prices held firm on Friday on strong demand, supply cuts led by the Organization of the Petroleum Exporting Countries, and looming U.S. sanctions against oil exporter Iran.
A weaker ringgit could have supported palm, said another trader, as weakness in the Malaysian currency makes the vegetable oil cheaper for foreign buyers.
The ringgit, palm's currency of trade, weakened for a fourth straight session and was down 0.1 percent at 3.9700 per dollar.
In other related oils, the Chicago July soybean oil contract was up 0.7 percent following a 1.1 percent gain on Thursday.
The September soybean oil on China's Dalian Commodity Exchange was up 1.4 percent and the Dalian September palm oil contract rose 1.5 percent.
Palm oil is also impacted by movements in rival edible oils as they compete for a share in the global vegetable oils market.
Palm oil may break a resistance at 2,459 ringgit per tonne and rise to the April 6 high of 2,510 ringgit, according to Reuters market analyst for commodities and energy technicals Wang Tao.
