Gold edges up as Middle East tensions support
SINGAPORE, Feb 17 (Reuters) - Spot gold was a tad stronger , on course for a fourth straight day of gains, as escalating tensions in the Middle East buoyed sentiment, though physical demand remained lackluster.
"There's not much activity on the physical market, as prices have gone up quite a bit from before the Lunar New Year," said a Hong Kong-based dealer."In Asia, buyers are a bit reluctant to get in now, because they think prices are too high."
Asian stocks gain on U.S. hopes, oil rises
HONG KONG, Feb 17 (Reuters) - Asian stock markets rose, buoyed by strong corporate earnings and as the Federal Reserve expressed cautious optimism about the strength of the U.S. economic recovery.
"The mood in global equity markets is extremely positive and if external circumstances don't change much, the current rally can carry on until the Nikkei reaches 11,000," said Kazuhiro Takahashi, general manager at Daiwa Securities Capital Markets.
OIL: Crude climbs on Middle East tension, stock data
SEOUL, Feb 17 (Reuters) - U.S. crude futures extended gains in early Asian trades on Thursday, helped by a less-than-expected rise in U.S. crude inventory and fresh tension between Israel and Iran that fuelled concern about Middle East unrest.
The Energy Information Administration's weekly stock report showed crude oil stockpiles rose only 860,000 barrels last week, against a forecast for stocks to be up 2.2 million barrels.
COMMODITIES: Oil, gold up as Israel, Iran add to Mideast tension
NEW YORK, Feb 16 (Reuters) - Crude oil prices ended higher on Wednesday after spiking to $104 a barrel in London, and gold edged up as well, as tension between Israel and Iran accentuated the widening unrest in the oil-rich Middle East.
"Troubles in the Middle East are back on the agenda," said Rob Montefusco, an oil trader at Sucden Financial.
GLOBAL: Asian stocks gain on U.S. hopes, oil rises
Feb 17 (Reuters) - HONG KONG, Feb 17 (Reuters) - Asian stock markets rose on on Thursday, buoyed by strong corporate earnings and as the Federal Reserve expressed cautious optimism about the strength of the U.S. economic recovery.
"The mood in global equity markets is extremely positive and if external circumstances don't change much, the current rally can carry on until the Nikkei reaches 11,000," said Kazuhiro Takahashi, general manager at Daiwa Securities Capital Markets.
Argentina Wheat Output To Rise; Corn, Soybean May Fall (Source: CME)
Argentina's production of corn and soybeans will likely fall this year but the crop prospects have improved significantly in the last few weeks and wheat production is sharply higher than a year earlier, a senior industry executive said. "The situation for corn and soybeans is no longer as bad as it was a few weeks earlier because of recent rains and lower temperature," Freddy Pranteda, Director of grain trading company Cosur SA, said on the sidelines of a grains conference organized by Centre for Management Technology. He said less evaporation and continuous rains have saved several million metric tons of Argentina's standing crop of corn and soybeans. Corn output is likely to fall to 19.5 million tons this year from 22 million tons last year, Pranteda said. He said Argentina's output of soybeans may fall to 48 million-49 million tons from 55 million tons.
Earlier, market participants were concerned that Argentina's corn output could fall to 14 million tons and output of soybeans to below 44 million tons because of dry weather. However, lower output will drag down exports of corn to 11 million tons-12 million tons from 16 million tons last year and that of soybeans to 9 million-10 million tons from 12 million tons, he said. Argentina has already sold 6.5 million tons of new crop soybeans to China for the April-July period, he noted. Pranteda said wheat output is estimated to jump to 15 million tons from 8.5 million tons because of exceptionally high yields in some regions. Wheat is harvested in October and November, while corn and soybeans are harvested in March and April. Dry weather just ahead of the harvest late last year gave a boost to wheat yields, said Pranteda.
He said in some regions the wheat yields almost doubled to 7 tons a hectare from 3.5-4.0 tons. Last year the wheat crop was affected by drought in some areas, he noted. However, the protein content in wheat is lower this year by 1.0-1.5 percentage points at 11.0%-11.5%. Argentina's wheat exports are likely to almost double to around 9 million-10 million tons this year and some of the low-protein grades may be shipped to Asian countries such as Bangladesh, Pranteda said.
China PBOC: To Support Grain Output, Price Stability (Source: CME)
China's central bank said that it will use monetary policy tools to promote grain production, the latest sign of concern from top Chinese policy makers over food price pressures. The move comes after a rose of more than 10% in food costs helped keep January inflation close to two-year highs, despite a slew of cooling measures by Beijing. The People's Bank of China said in a statement that it will pay close attention to trends in domestic and international grain prices, and use various monetary policy tools in order to stabilize prices. The PBOC will use refinancing and rediscount loans, among other tools, to expand support for drought relief efforts and will direct financial institutions to provide financing for irrigation projects as well as purchases of seeds, fertilizers and pesticides, it said.
Outstanding loans to the agricultural sector and rural areas at the end of last year totaled CNY11.76 trillion, up CNY2.6 trillion from a year earlier, it said. China's food prices, which make up about 30% of the consumer price index basket, jumped 10.3% on year in January, quicker than a 9.6% rise in December, the National Bureau of Statistics said Tuesday. Overall prices gained 4.9%.
Divisions threaten hope for G20 policy deal
PARIS, Feb 15 (Reuters) - Wide differences between rich and poor countries may frustrate France's hope of taking a bold step towards stabilising the global economy at a Group of 20 finance ministers meeting this week.
The two-day talks in Paris will launch debate on French President Nicolas Sarkozy's ambitious agenda for his country's year-long presidency of the G20. The agenda includes grand proposals to curb the volatility of food and fuel prices and to reduce gradually the world's reliance on the U.S. dollar.
PRECIOUS-Gold rises to 4-week high as dollar retreats
LONDON, Feb 16 (Reuters) - Gold prices rose to four-week highs above $1,375 an ounce in Europe on Wednesday as a retreat in the dollar and concerns over the medium-term inflation outlook helped support the precious metal.
Spot gold hit a peak of $1,377.65 an ounce and was bid at $1,376.14 an ounce at 1013 GMT, against $1,372.95 late in New York on Tuesday. U.S. gold futures for April delivery rose $2.30 an ounce to $1,376.40.
FOREX-Euro up on Asian buying, sterling hit by BOE report
LONDON, Feb 16 (Reuters) - The euro rose on Wednesday, helped by buying by Asian central banks, while sterling fell after the Bank of England cut its growth outlook while hiking inflation forecasts, raising the spectre of stagflation.
Sterling fell to the day's low of $1.6040, compared with around $1.6140 before the report was released. It also lost ground against the euro, with the common currency rising to a session high of 84.29 pence from 83.85 pence.
U.S. wheat claws back losses, risk of more fund selling
SYDNEY, Feb 16 (Reuters) - U.S. wheat futures rose around 0.5 percent as buyers took advantage of a 3.6 percent plunge the previous session to shore up supplies, while bullish fundamentals including drought in China helped support prices.
"It is not unexpected to a see a little bit of a recovery but it really depends if we see continuing fund selling in the U.S. tonight," said Adam Davis, a senior trader at Merricks Capital in Melbourne.
Global stocks rise; sterling up on rate view
LONDON, Feb 16 (Reuters) - Global stocks rose on optimism about a strong outlook for corporate earnings, while expectations for higher interest rates in the UK lifted sterling and the euro gained against the dollar on sovereign demand.
"There is a growing confidence in the outlook for the global economy. The recovery looks like it is being transformed into a sustainable expansion and that does mean that the outlook for earnings is very positive," said Mike Lenhoff, chief strategist at Brewin Dolphin.
Argentina soy, corn exports seen down
SINGAPORE, Feb 16 (Reuters) - Argentina's soybean and corn exports are likely to drop in the 2010/11 marketing year as dry weather shrinks output, though recent rainfalls have boosted initial estimates of soy production, an industry official said on Wednesday.
Exports from the world's third-largest soybean supplier are likely to drop to 9 million to 10 million tonnes from 12 million tonnes in the 2009/10 season, Freddy Pranteda, director of grain trading firm Cosur, told Reuters.
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