US STOCKS-Wall St set to recover after selloff driven by Italy turmoil - Reuters News
30-May-2018 09:17:16 PM
- Italy renews attempt to form a government
- U.S. private employers added less-than-expected jobs in May
- First qtr GDP growth revised to 2.2 pct from prior 2.3 pct
- HP Inc, Salesforce.com gain on strong results
- Futures up: Dow 0.51 pct, S&P 0.37 pct, Nasdaq 0.21 pct
Adds comment, adds details, changes prices
By Medha Singh
May 8 (Reuters) - U.S. stocks were set to open higher on Wednesday, indicating a rebound from the steep selloff driven by a political crisis in Italy that had pushed the S&P 500 and the Dow Industrials to their worst day in a month.
A renewed attempt to form a coalition government in Rome by the two anti-establishment parties, the 5-Star Movement and League, raised hopes that Europe's third largest economy could avoid a new election.
A surprise breakthrough to form a hung government would ease uncertainty, but still usher in a coalition planning to ramp up spending in the heavily indebted nation and push for changes to European Union and euro-zone fiscal rules.
Equity index futures pared some gains after the second revision to first-quarter GDP data showed U.S. economic growth slowed slightly more than initially thought.
GDP grew at a 2.2 percent annual rate, the Commerce Department said, instead of the previously reported 2.3 percent pace.
"It's a rebound from yesterday on hopes that there may be some agreement on forming a government. But these kind of perceptions are going to bounce back and forth," said Scott Brown, chief economist at Raymond James in St. Petersburg.
"Markets are a little bit fragile because it's a holiday week. That could lead to some sharp moves either way."
On Tuesday, the S&P 500 and the Dow posted their first 1 percent drop in May as investors scurried for safety assets such as U.S. bonds on fears of political instability in Italy.
At 8:58 a.m. ET, Dow e-minis were up 125 points, or 0.51 percent. S&P 500 e-minis were up 10 points, or 0.37 percent and Nasdaq 100 e-minis were up 14.75 points, or 0.21 percent.
ADP National Employment report showed U.S. private employers added 178,000 private sector jobs in May, below Reuters consensus view of 190,000.
Investors also kept a wary eye on the developments around tariffs and trade. In an unexpected change in tone, the United States said late on Tuesday it could still impose tariffs on $50 billion of imports from China unless it addressed the issue of theft of American intellectual property.
China said on Wednesday it was ready to fight back if Washington was looking for a trade war, days ahead of a planned visit by U.S. Commerce Secretary Wilbur Ross.
Shares of big U.S. banks rose about 1 percent in premarket trading. The Federal Reserve is set to consider a proposal to modify the "Volcker Rule" at 3:00 p.m. ET.
The proposal, which marks another step by Trump administration regulators to ease banking rules, is aimed at preventing lenders from making market bets while accepting taxpayer-insured deposits.
Among stocks, cloud-based business software maker Salesforce.com rose 4.9 percent, while computer and printer maker HP Inc jumped 4.2 percent after raising full-year profit forecasts.
Michael Kors slipped 5.0 percent after a disappointing yearly earnings forecast.
(Reporting by Medha Singh in Bengaluru; Editing by Arun Koyyur)
UPDATE 5-Oil rises to $76 as tight current supply in focus - Reuters News
30-May-2018 09:22:41 PM
- Saudi, UAE, Kuwait ministers to meet this weekend-source
- OPEC-led output curbs have pushed down inventories
- U.S. crude stocks expected to show fall in weekly reports
- OPEC meets on June 22
Updates prices
By Alex Lawler
LONDON, May 30 (Reuters) - Oil climbed to $76 a barrel on Wednesday, supported by tight supplies despite expectations OPEC and its allies will pump more in the second half of 2018 and helped by forecasts U.S. inventories fell.
Global benchmark Brent crude has dropped more than $4 from a 3 1/2-year high of $80.50 a barrel on May 17, after reports that OPEC and Russia may increase supply at a June meeting, reversing policy after 17 months of supply curbs.
Brent rose 83 cents to $76.22 a barrel by 1315 GMT, after trading as low as $74.81 earlier. U.S. crude was up 40 cents at $67.13.
"Fundamentally, not much has changed. Oil remains well supported, although the sweetspot has entered a mature phase," said Konstantinos Venetis, senior economist at TS Lombard.
"Some air is fizzling out of the market and position-squaring raises the likelihood of an overshooting to the downside in the run-up to OPEC's June meeting."
Political turmoil in Italy has sent the euro to a 10-month low against the dollar on concern a snap election would lead to a eurosceptic government in Rome. A stronger dollar makes dollar-denominated oil more expensive for holders of other currencies.
"A dearth of bullish catalysts will make hard work of any recovery," said Stephen Brennock of oil broker PVM.
The Organization of the Petroleum Exporting Countries and non-OPEC producers led by Russia have had a pact to curb output by about 1.8 million barrels per day since January 2017, driving down inventories and pushing up oil prices.
Amid concerns the price rally has gone too far, Saudi Arabia and Russia are discussing raising OPEC and non-OPEC oil output by around 1 million bpd, sources told Reuters on May 25. OPEC meets in Vienna on June 22.
Still, some analysts remain cautious as the details have yet to be worked out. Ministers from Saudi Arabia, Kuwait and the United Arab Emirates meet this weekend, a source said.
"Clarity will likely take some time to emerge," said JBC Energy.
Lending some support to prices were expectations that U.S. crude inventories probably fell by 1.8 million barrels last week according to a Reuters poll.
Industry group American Petroleum Institute (API) releases its weekly supply report at 2030 GMT on Wednesday, followed by the official government data on Thursday.
(Additional reporting by Roslan Khasawneh and Rania El Gamal
Editing by Edmund Blair and Alexandra Hudson)
PRECIOUS-Gold holds steady in face of robust dollar due to Italy crisis - Reuters News
30-May-2018 07:27:21 PM
- Dollar near 6-1/2 month peak
- Italy crisis sparks stock sell-off
- China ready to fight back if U.S. ignites trade war
By Zandi Shabalala
LONDON, May 30 (Reuters) - Gold prices were steady on Wednesday as concerns about political turmoil in Italy and over a trade conflict between China and the United States outweighed strength in the dollar.
Italy kept the dollar at 10-month highs versus the euro amid concerns that repeat elections may become a de-facto referendum on Italian membership of the currency bloc.
The turbulence underpinned gold due to its appeal as a store of value during political and financial uncertainty.
The dollar index, which measures the greenback against a basket of six major currencies, hovered near its 6-1/2 month peak from the previous session. A stronger dollar makes assets such as gold more expensive for holders of other currencies, curbing demand.
"There has been a little bit of support from what has been happening in Italy and the potential implications for the Eurozone from the Italian crisis," Capital Economics commodities economist Simona Gambarini said.
"But it doesn't seem like the worries are big enough to warrant an increase in prices," she said, adding that price support was slightly eroded by the potential for an interest rate increase in June by the U.S. Federal Reserve.
U.S. benchmark 10-year Treasury yields on Tuesday registered their largest one-day drop since Brexit nearly two years ago. Higher rates could dent demand for non-interest-paying gold.
Spot gold was barely changed at $1,297 per ounce by 1120 GMT, while U.S. gold futures for June delivery fell 0.2 percent to $1,297 per ounce.
China on Wednesday lashed out at Washington's unexpected statement that it still holds the threat of imposing tariffs on $50 billion of Chinese goods, saying Beijing was ready to fight back in any trade war.
But Capital Economics' Gambarini said the potential trade war between China and the United States was mostly priced into gold, which would need an escalation or resolution to become a catalyst to prices again.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.35 percent to 851.45 tonnes on Tuesday.
In other precious metals, spot silver was steady at $16.40 an ounce.
Platinum fell 0.3 percent to $901.24 an ounce, while palladium was 0.2-percent higher at $981.
(Additional reporting by Karen Rodrigues in Bengaluru Editing by Alexander Smith/David Evans)
METALS-Copper slips as Italy crisis, U.S.-China trade row feed risk aversion - Reuters News
30-May-2018 08:11:17 PM
Updates with official prices
By Jan Harvey
LONDON, May 30 (Reuters) - Copper fell to a three-week low on Wednesday as a retreat in stock markets on worries over political turmoil in Italy kept up pressure on cyclical assets, offsetting a weaker dollar.
Concerns over the prospect of a U.S.-China trade war also simmered, weighing on appetite for stocks and industrial metals.
China warned on Wednesday that it was ready to fight back if Washington was looking for a trade war. That came after the United States, in a change of tone, said it still held the threat of imposing tariffs on $50 billion of imports from China.
Given those pressures, copper is sliding towards the bottom of its recent range, Saxo Bank's head of commodity strategy Ole Hansen said.
"The U.S.-China trade spat seems to be hotting up again after yesterday's announcement from the White House," he said. "The global growth and demand outlook does not need a new political/financial crisis in Europe and a potential trade war between the world's two biggest economies."
* COPPER PRICES: Three-month copper on the London Metal Exchange was down 0.6 percent at $6,815 a tonne in official trading, having earlier touched $6,727, its weakest since May 8.
* FINANCIAL MARKETS: Italy's political crisis and renewed trade war fears sent world stocks lower for the sixth day in a row on Wednesday.
* COPPER INVENTORIES: On-warrant copper stocks in London Metal Exchange warehouses - representing metal not earmarked for delivery - eased to 191,200 tonnes, data showed on Wednesday. That was the lowest level since January.
* INDIA SMELTER: Vedanta Resources is working on a legal challenge to an Indian state's closure of one of its copper smelters but will not proceed until tensions have eased over the deaths of 13 people during protests last week.
* TARIFFS: European Union Trade Commissioner Cecilia Malmstrom said she would seek a full exemption from new U.S. steel and aluminium tariffs when she meets her U.S. counterparts on Wednesday.
* ALUMINIUM: LME aluminium was 0.1 percent lower at $2,272 a tonne in official trading.
* ZINC STOCKS: On-warrant zinc stocks in LME warehouses eased to 195,225 tonnes, their lowest in a month. The proportion of cancelled warrants - metal earmarked for delivery and therefore not available to the market - rose to nearly 15 percent from 6 percent last week.
* ZINC SPREADS: Cash zinc held in a 25 cent premium over the three-month contract, versus a discount of $6.50 a tonne a week ago, indicating near-term market tightness.
* ZINC PRICES: LME zinc was untraded in official rings, but was last bid up 0.7 percent at $3,110 a tonne.
* OTHER METALS: LME lead was 0.5 percent lower in official trading at $2,433 a tonne, while tin was down 0.1 percent at $20,405. Nickel, also untraded in official rings, was last bid at $14,910, little changed from Tuesday's close.
(Additional reporting by Manolo Serapio Jr. in Manila
Editing by David Goodman and Susan Fenton)
VEGOILS-Palm rebounds from three-week low, tracking related oils - Reuters News
30-May-2018 07:15:47 PM
- Palm edged lower for a third straight session
- Weak demand, overnight commodity markets hit sentiment - trader
Updates quote, closing prices
By Fransiska Nangoy
JAKARTA, May 30 (Reuters) - Malaysian palm oil futures closed higher on Wednesday, rebounding from their weakest levels in over three weeks, as they tracked related oil prices in the Chinese market.
The palm oil contract for August delivery on the Bursa Malaysia Derivatives Exchange rose 0.9 percent to 2,440 ringgit ($611.99) per tonne by the end of the session.
Earlier in the day, it hit 2,395 ringgit, its lowest since May 8. The benchmark fell nearly 3 percent in the previous two sessions to Monday. The Malaysian market was closed on Tuesday for a public holiday.
Trade volume stood at 32,864 lots of 25 tonnes each on Wednesday.
"Market was tracking Dalian closely in the afternoon, even when we are hearing that exports may be underperforming," said a palm trader in Kuala Lumpur.
September soybean oil on China's Dalian Commodity Exchange jumped as much as 3 percent, while the Dalian September palm oil contract closed 0.6 percent higher.
Palm oil is affected by movements in rival edible oils as they compete for a share in the global vegetable oils market.
Meanwhile, shipping surveyors are due to release May export data on Thursday.
Palm prices may be "adjusted accordingly" in Thursday's session if the data came in below expectations, the trader said.
Palm, soy and crude oil prices, as of 1105 GMT
(Reporting by Fransiska Nangoy, Editing by Adrian Croft)
CBOT Trends-Wheat down 8-10 cents, corn down 2-3, soybeans down 4-6 - Reuters News
30-May-2018 09:29:22 PM
CHICAGO, May 30 (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 Wednesday.
WHEAT - Down 8 to 10 cents per bushel
- Wheat lower on technical selling after Tuesday's technical reversal to the downside, improving U.S. winter wheat crop ratings and beneficial rains expected in the northern U.S. Plains and Canada.
- The U.S. Department of Agriculture late Tuesday rated 38 percent of the U.S. winter wheat crop in good to excellent condition, up from 36 percent the previous week. Analysts on average had expected no change.
- The USDA also said the U.S. spring wheat crop was 91 percent planted, ahead of the five-year average of 89 percent.
- CBOT July soft red winter wheat last down 8 cents at $5.28-1/2 per bushel. K.C. July hard red winter wheat last traded down 8-3/4 cents at $5.47-3/4 and MGEX July spring wheat was down 4 cents at $6.24 a bushel.
CORN - Down 2 to 3 cents per bushel
- Corn lower on better-than-expected initial U.S. crop condition ratings, favorable U.S. weather forecasts and follow-through selling after Tuesday's technical reversal to the downside.
- The USDA late Tuesday rated 79 percent of the U.S. corn crop as good to excellent, above a range of trade expectations.
- The USDA also said the crop was 92 percent planted, ahead of the five-year average of 90 percent.
- CBOT July corn last traded down 2-3/4 cents at $3.97-1/4 a bushel.
SOYBEANS - Down 4 to 6 cents per bushel
- Soybeans lower on increasing tension over U.S. trade relations with China, the world's biggest soy importer, and technical selling.
- Market underpinned by soy logistics problems in Brazil due to a truckers' strike.
- The USDA late Tuesday said the U.S. soybean crop was 77 percent planted, above an average of trade expectations for 73 percent and the five-year average of 62 percent.
- CBOT July soybeans last down 5-3/4 cents at $10.24-3/4 per bushel.
(Reporting by Julie Ingwersen)
