Friday, May 18, 2018

Stock & Commodities Related News.

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.

Stock & Commodities Related News.

US STOCKS-Oil surge spurs Wall St turnaround, sends Russell 2000 to record - Reuters News

18-May-2018 12:08:22 AM

  • Energy stocks jump over 1 pct as oil tops $80
  • Cisco, Walmart drop after earnings reports
  • U.S. expects China to bring proposal to trade talks
  • Indexes up: Dow 0.12 pct, S&P 0.21 pct, Nasdaq 0.19 pct

Changes comment, adds details, updates prices

By Medha Singh

May 17 (Reuters) - Energy and industrial stocks led Wall Street higher on Thursday and the small-cap Russell 2000 hit a record, even as a rise in U.S. bond yields to fresh seven-year highs suggested more competition for equities and investors fretted over geopolitics.

The energy sector rose 1.41 percent, giving the benchmark S&P 500 the biggest boost, as Brent crude hit $80 per barrel for the first time since November 2014 as renewed U.S. sanctions threatened a fall in exports from Iran in an already tightening market.

Smaller companies continued this year's trend of outperforming their larger rivals with the Russell 2000 reaching a record high for the second session in a row.

Data showed the number of Americans on unemployment rolls last week fell to the lowest since 1973. Other data showed a pickup in factory activity in the mid-Atlantic region this month, with manufacturers saying they were asking for higher prices for their products.

The industrial sector was up 0.61 percent, the second-biggest gainer among the 11 major S&P sectors.

"You have kind of a mixed bag of earnings numbers ... the economic data generally speaking was pretty good and that's leading to a little bit of mild buying in the market," said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.

On the Russell 2000, Nolte said, "I think you're starting to see people come into that because it's the only index that has put in a new high and you've got some interest."

At 11:46 a.m. EDT, the Dow Jones Industrial Average was up 30.33 points, or 0.12 percent, at 24,799.26, the S&P 500 was up 5.79 points, or 0.21 percent, at 2,728.25 and the Nasdaq Composite was up 14.08 points, or 0.19 percent, at 7,412.37.

The three rate-sensitive sectors, real-estate, utilities and telecoms, were slightly lower.

The market had opened in the red, weighed by a drop in Cisco and on jitters as U.S. 10-year Treasury yields hovered at 7-year highs and the United States and China started trade talks to try to avert a damaging tariff war.

White House Chief Economic Adviser Larry Kudlow expects China to bring a proposal to the talks which would "extend the conversation and permit additional negotiations".

Keeping the gains in check were Cisco's 2.8 percent drop, the most on the Dow, after the company's forecast indicated its transition to a software-focused business was a work in progress.

Walmart slipped 1.1 percent, reversing premarket gains, after it said profit margins were under pressure, despite sales and earnings beating expectations.

J.C. Penney tumbled 10.7 percent after its same-store sales missed estimates and the company cut its full-year profit forecast.

Advancing issues outnumbered decliners for a 1.55-to-1 ratio on the NYSE and for a 2.05-to-1 ratio on the Nasdaq.

The S&P index recorded 22 new 52-week highs and four new lows, while the Nasdaq recorded 108 new highs and 20 new lows.


(Reporting by Medha Singh in Bengaluru; Editing by Anil D'Silva and Shounak Dasgupta)




UPDATE 8-Oil hits new multi-year high above $80/bbl on Iran concerns - Reuters News

17-May-2018 11:34:01 PM

  • Brent futures at highest since November 2014
  • Global inventories expected to fall further
  • OPEC cuts and looming U.S. sanctions on Iran lift Brent
  • Shell halts exports from major Nigerian pipeline

Updates throughout, changes dateline, previously LONDON

By Jessica Resnick-Ault

NEW YORK, May 17 (Reuters) - Oil prices climbed above $80 a barrel on Thursday for the first time since November 2014, hitting new multi-year highs on concerns that Iranian exports could fall because of renewed U.S. sanctions, reducing supply in an already tightening market.

The market continued to push higher as geopolitical concerns drove trading.

"We are going to have reduced supplies from Iran in six months and Venezuela hasn't shown that they can stop the drop in their supplies," said Gene McGillian, vice president of research at Tradition Energy."

Brent crude futures reached an intraday high of $80.33 a barrel before receding to $80.16 by 11:09 a.m. EDT [1509 GMT].

U.S. West Texas Intermediate (WTI) crude futures were up 41 cents at $71.90 after also hitting their highest since November 2014, at $72.30 a barrel.

U.S. President Donald Trump's decision this month to withdraw from an international nuclear deal with Iran and revive sanctions that could limit crude exports from OPEC's third-largest producer has boosted oil prices.

France's Total warned on Wednesday that it might abandon a multibillion-dollar gas project in Iran if it could not secure a waiver from U.S. sanctions, casting further doubt on European-led efforts to salvage the nuclear deal.



A rapid decline in Venezuela's crude production has further roiled markets in recent months.

"The geopolitical noise and escalation fears are here to stay," said Norbert Rücker, head of macro and commodity research at Swiss bank Julius Baer. "Supply concerns are top of mind after the United States left the Iran nuclear deal."

Global inventories of crude oil and refined products dropped sharply in recent months owing to robust demand and OPEC-led production cuts.

Oil stocks were expected to drop further as the peak summer driving season nears, offsetting increases in U.S. shale output, Bernstein analysts said.

Several banks have in recent days raised their oil price forecasts, citing tighter supplies and strong demand.

Further supporting prices, Royal Dutch Shell on Thursday said it was halting crude exports from a major Nigerian pipeline.


On the flip-side, however, high oil prices could hit consumption, the International Energy Agency warned on Wednesday as it lowered its global oil demand growth forecast for 2018 to 1.4 million barrels per day (bpd) from 1.5 million bpd.

The IEA said global oil demand would average 99.2 million bpd in 2018, although U.S. bank Goldman Sachs said consumption would cross 100 million bpd "this summer".

Leading production increases is the United States, where crude output has soared by 27 percent in the last two years to a record 10.72 million bpd, putting it within reach of top producer Russia's 11 million bpd.

The result has been a widening difference between U.S. crude and benchmark Brent. WTI traded at $8.20 a barrel below Brent on Thursday, the most since April 2015.

(Additional reporting by Henning Gloystein in Singapore and Ron Bousso in London; Editing by Dale Hudson and David Goodman)




PRECIOUS-Gold slides to 2018 low as dollar strengthens - Reuters News

17-May-2018 09:57:22 PM

  • U.S. 10-year Treasury yield touches seven-year high
  • Platinum slips to lowest since mid December

 (Update prices, adds comment)

By Jan Harvey

LONDON, May 17 (Reuters) - Gold slid to a fresh low for the year on Thursday as another rise in U.S. bond yields and concerns over political risk in Italy held the dollar index near its 2018 peak.

The precious metal has fallen more than 2 percent this week on gains in the U.S. currency and a rise in U.S. 10-year Treasury yields to seven-year highs. Higher yields increase the opportunity cost of holding non-yielding assets such as bullion.

Spot gold was down 0.1 percent at $1,289.34 an ounce by 1450 GMT, off an earlier 4-1/2 month low of $1,285.41. U.S. gold futures for June delivery were down $2.80 at $1,288.70.

The dollar has climbed nearly 4 percent this quarter on expectations that the Federal Reserve will lift U.S. interest rates further this year to curb inflation, at a time when other central banks are still keeping monetary policy loose.

"I expect further weakness in gold prices because I think the dollar can rise a bit further," ABN Amro analyst Georgette Boele said.

"Gold prices are mainly driven by the U.S. dollar and then U.S. yields ... our year-end 10-year U.S. Treasury forecast stands at 3.2 percent, with three more Fed rate hikes."

The euro remains under pressure, hovering near a five-month low on concerns that political developments in Italy could cause wider disruption in the common currency bloc.

Political uncertainty arising out of North Korea after Pyongyang threatened to pull out of a meeting with the United States was likely to limit downside for gold, analysts said. But that was not enough to offset other factors.

"The precious metal still remains vulnerable to the prevailing dollar and rate headwinds," INTL FCStone said in a note.

From a technical perspective, gold prices were looking vulnerable to further losses after breaking below key chart levels this week, according to analysts who study past price moves to determine the future direction of trade.

"Gold has eroded key support, namely the 200-day moving average, the $1,302.74 March low and the 50 percent retracement (of the December-to-January rally)," Commerzbank said in a note on technicals. "We have been forced to neutralise our outlook as the market is now on the defensive."

Among other precious metals, silver was up 0.6 percent at $16.45 an ounce, having touched its lowest in two weeks at $16.17 in the previous session.

Platinum was flat at $887.30, off an earlier five-month low of $879, while palladium rose by 0.5 percent to $985.20.

(Additional reporting by Apeksha Nair in Bengaluru Editing by David Goodman and Edmund Blair)




U.S. Cash Grains-Interior corn steady-firm on slow farmer sales - Reuters News

18-May-2018 12:31:39 AM

CHICAGO, May 17 (Reuters) - Spot corn basis bids were mostly steady to firm at processors and interior elevators around the U.S. Midwest on Thursday on slow farmer sales, while bids at river elevators were mixed, merchants said.

  • Spot soybean basis bids were narrowly mixed amid a slowdown in farmer sales. Wheat basis bids were flat.
  • Midwest farmers are racing to plant corn and soybeans and focusing little on selling crops. Cash prices are below many growers' sales price targets.
  • Corn export sales last week were near the high end of a range of trade estimates, but soybean sales were near the low end of expectations, according to U.S. Department of Agriculture data.
  • Chicago Board of Trade corn and soybean, futures were little changed on Thursday.




GRAINS-U.S. wheat futures rise on world weather woes, corn; soy flat - Reuters News

17-May-2018 11:37:46 PM

Recasts, updates with U.S. trading, adds new analyst quote, changes byline, dateline; pvs PARIS/SINGAPORE

By Mark Weinraub

- U.S. wheat futures rallied on Thursday, their third straight day of gains, on worries that adverse weather will lead to crop shortfalls in key growing areas around the world, traders said.

Corn and soybean futures were close to unchanged as traders assessed how forecasts for rain would affect planting in the U.S. Midwest in the coming week.

The grain markets also were monitoring the progress of trade talks between the United States and key export customers China and Mexico.

Chicago Board of Trade soft red winter wheat futures rallied through key technical resistance points after weakness in the overnight trading session brought out some short-covering and bargain buying.

"There's still plenty of concern over how this winter wheat crop will wind up, despite stronger-than-expected production estimates and rising ratings," Matt Zeller, director of market information at INTL FCStone said in a note to clients. "Dryness is creeping in to crops for major producers/exporters Australia and Russia, adding to at least a minor bullish story heading to 2018/19."

Australian farmers are planting wheat in some of the driest soils in years, following on from a severe drought that cut 2017/18 output in the world's fourth-largest exporter to the lowest in a decade.

At 10:27 a.m. CDT (1527 GMT), CBOT July soft red winter wheat was up 6-3/4 cents at $5.01 a bushel.

"There is some support for the wheat market at current levels because of a drought in the U.S. southern Plains. The USDA is showing some improvement in crop rating but there will be yield losses," said one India-based agricultural commodities analyst.

CBOT July soybean futures were up 1/2 cent $10.06-1/2 a bushel.

The soybean market is focused on the outcome of trade talks between the United States and China. Chinese demands for U.S. shipments have taken a hit since Beijing proposed import duties last month.

The United States and China launch a second round of trade talks on Thursday to try to avert a damaging tariff war, with the Trump administration demanding a $200 billion cut in China's U.S. trade surplus and greater protections for intellectual property.

CBOT July corn futures dipped 3/4 cent to $3.98-1/2 a bushel.

(Additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore
Editing by David Goodman and Tom Brown)




FOREX-Dollar rises to 4-month high vs yen on higher U.S. Treasury yields - Reuters News

17-May-2018 10:49:34 PM

  • Euro struggles near $1.18 mark
  • Dollar rise leaves Yen at weakest since January

Recasts, updates prices in text, adds comment, FX table, changes byline, dateline; previous LONDON

By Gertrude Chavez-Dreyfuss

NEW YORK, May 17 (Reuters) - The dollar climbed to a four-month peak against the yen on Thursday, bolstered by the rise in U.S. Treasury yields that suggests a more upbeat outlook for the world's largest economy.

U.S. benchmark 10-year yields hit a high of 3.122 percent, the highest in nearly seven years.

"The near-term picture remains positive for the dollar with Treasury yields showing few signs of topping, a move that makes the buck a more enticing bet to income-seekers," said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.

Rising yields reflect continued optimism about the U.S. economy, reinforcing expectations that the Federal Reserve would raise borrowing rates at least two more times this year.

The dollar rose to its strongest versus the Japanese yen since Jan. 23 at 110.80 yen. It was last at 110.71, up 0.3 percent on the day.

The dollar index rose 0.1 percent to 93.461, below its 2018 high of 93.632.

The euro, meanwhile, fell to near a five-month low against the dollar on Thursday on concerns about the demands of populist parties likely to form Italy's next government.

Italy's anti-establishment 5-Star Movement and the anti-immigrant League, which are working to draft a coalition program, may ask the European Central Bank to forgive 250 billion euros of debt.

But broader Italian markets held up better on Thursday as investors played down the broader impact on euro zone political stability and questioned whether the Italian parties would really follow through on such plans.

The euro slipped to $1.1799, just above the $1.1763 2018 low it hit on Wednesday.

The euro has slumped six cents from more than $1.24 in three weeks after a huge dollar rally. Investors are betting U.S. interest rates will need to rise further, while other central banks are postponing monetary tightening.

That has forced investors who took big positions against the dollar anticipating a fall in 2018 to unwind and cover their positions, pushing the greenback even higher.

"This sense of a market that is not particularly well prepared for a euro decline is supported by the benign valuations still evident in the pricing of six-month and 12-month implied volatility," BNY Mellon analysts said in a note, referring to prices of a measure of expected swings in the value of the euro.

Sterling gave up earlier gains after the UK government dismissed a media report that Britain wanted to stay in the European Union's customs union after Brexit.

 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Tommy Wilkes in London
Editing by Susan Thomas)