Asian shares hit two-week high on c.banks' liquidity move
TOKYO, Dec 1 (Reuters) - Asian shares rallied to two-week highs, building on strong global gains after the world's six major central banks moved to tame a liquidity crunch for European banks by providing cheaper dollar funding.
"It's clearly a risk-on day given everything that happened overnight," said Su-Lin Ong, senior economist at RBC Capital Markets.
China Stocks Rally Most in 18 Months on Reserve Ratio Cut; Rate Swaps Fall (Bloomberg)
China’s stocks rose the most in five weeks, the yuan gained and interest-rate swaps fell as lenders’ reserve-ratio requirement was cut for the first time since 2008 and six central banks took action on Europe’s debt crisis. The Shanghai Composite Index climbed 2.3 percent to 2,386.86 at the close, while the Hang Seng China Enterprises Index of Chinese stocks traded in Hong Kong rallied 8.3 percent. Financial companies and commodity producers advanced the most in Shanghai, with China Life Insurance Co. rising more than 7 percent and Jiangxi Copper Co. (600362) jumping the most in six months. The yuan advanced the most in almost four weeks while interest- rate swaps dropped to a one-year low. “This RRR cut is very positive for the banks,” Daphne Roth, Singapore-based head of Asian equity research at ABN Amro Private Bank, said in a telephone interview. “They timed it with the other central banks to inject liquidity into the system” in a move that will help spur a rebound for stocks.
China Manufacturing Weakest Since 2009 (Bloomberg)
China’s manufacturing recorded the weakest performance since the global recession eased in 2009, underscoring the case for monetary stimulus as Europe’s crisis weighs on the world’s second-largest economy. A purchasing managers’ index compiled by the China Federation of Logistics and Purchasing slid to 49 in November, lower than all but two of 18 forecasts in a Bloomberg News survey. Readings below 50 signal a contraction. Separate reports showed slowing retail sales and an industrial slump in Australia, which relies on China as its biggest export customer. Premier Wen Jiabao is shifting policy gears as Europe’s woes combine with a domestic real-estate slowdown to impair the outlook for growth, with China’s central bank yesterday lowering lenders’ reserve ratios. Asian nations from China to India to South Korea will cut key interest rates next year as the global economy deteriorates, Goldman Sachs Group Inc. (GS) predicted today.
Fed Dollar-Funding Cut Shows Limits of Action (Bloomberg)
The Federal Reserve-led global effort to ease borrowing costs for financial firms shows both the central bank’s power to jolt markets -- and the limits of its ability to alleviate the European debt crisis. Stocks rallied worldwide, commodities rose and yields on most European debt fell after the Fed and five other central banks yesterday cut the cost of emergency dollar loans to banks outside the U.S. At the same time, the action falls short of more-drastic moves that central banks are reluctant to take, including purchases or guarantees of countries’ bonds. Fed Chairman Ben S. Bernanke and his counterparts are revisiting their playbook from the U.S. housing-induced financial crisis that started in 2007 to cushion markets and economies from Europe’s fiscal turmoil today. Yesterday’s move deals with the consequences of the crisis without addressing the causes, said John Ryding, chief economist at RDQ Economics LLC.
Japan to Compile Fourth Extra Budget (Bloomberg)
Japan plans a fourth extra budget, a step unprecedented since postwar reconstruction, to help shore up a rebound that’s under threat from a surge in the yen, Europe’s crisis and Thai floods that have disrupted production. Prime Minister Yoshihiko Noda today ordered the measure, which will probably be at least 2 trillion yen ($26 billion), Finance Minister Jun Azumi told reporters in Tokyo. The step won’t require the sale of deficit-covering bonds, he said. Japan has already allocated 18 trillion yen in three packages since the record earthquake in March. The plan is Japan’s latest effort to secure its recovery, building on efforts including 15 trillion yen in asset purchases by the central bank and record amounts of yen sales to counter the currency’s surge. Nissan Motor (7201) Co. Chief Executive Officer Carlos Ghosn said yesterday his company will gradually shift production abroad because of Japan’s challenges.
FOREX-Euro takes breather after rally; Aussie dips
SINGAPORE, Dec 1 (Reuters) - The euro stabilised on Thursday after rallying the previous day as major central banks acted together to ease a credit squeeze stemming from the euro zone's debt crisis, while the Australian dollar gave back some of its hefty gains.
"It may be effective in alleviating some of the excessive tensions in the money market. But the market still hasn't been shown any convincing steps aimed at solving the (euro zone's) debt problems," said Masahide Sato, vice president at Mizuho Corporate Bank's forex division in Tokyo.
Dutch unhappy with Indonesia palm tax move
NUSA DUA, Indonesia Nov 30 (Reuters) - Palm oil plants in Europe will suffer from Indonesia's cut in export taxes in favour of refined palm oil over the crude grade, which will cut supplies of the crude feedstock, a top industry official told Reuters on Wednesday.
Frans Claassen, General Manager of the Dutch Product Board of Margarine, Fats and Oils (MVO) said the industry body had asked its government to bring up the issue with Jakarta this week at a bilateral meeting on the Indonesian island of Lombok.
Wheat climbs 1.4 pct on short-covering, liquidity move
SINGAPORE, Dec 1 (Reuters) - U.S. wheat jumped 1.4 percent, while soybeans and corn rose for a fourth straight session, supported by the world's major central banks' move to tame a liquidity crunch for European banks by providing cheaper dollar funding.
"It is perhaps some more short-covering by funds which are very short in wheat and today is the first day of the month," said Adam Davis, a senior commodity analyst at Merricks Capital in Melbourne. "Corn and soy are trying to catch up while wheat is certainly the leader."
Argentine soy crop seen at 52 mln T - industry
BUENOS AIRES, Nov 30 (Reuters) - Argentina's 2011/12 soy crop should reach 52 million tonnes, the head of the Acsoja industry group said on Wednesday, matching the latest forecast by the U.S. Department of Agriculture (USDA).
Argentina is the world's third-biggest soy exporter and the top provider of soyoil and soymeal. The country's farmers have planted more than half of this season's
Colombia coffee growers see long-term weather issues
BOGOTA, Nov 30 (Reuters) - Colombian coffee growers must be ready to face more frequent bad weather in the long-term while a tree renovation program should guarantee production at historical averages, the coffee federation said on Wednesday.
The world's top producer of high-quality Arabica faces a third consecutive year of lower-than-expected coffee production in 2011 as bad weather, fungus and a tree renovation program keep output below historic averages of 11 million 60-kg bags.
Russia could harvest 97 mln T grain in '12-SovEcon
MOSCOW, Nov 30 (Reuters) - Russia could harvest around 97 million tonnes of grain next year, equivalent to the 2009 crop which was one of post-Soviet Russia's largest, a leading Russian analyst said on Wednesday.
The forecast was based on a winter grain harvest forecast of 45.5 million tonnes -- including 39.5 million tonnes of winter wheat -- as well as prevailing weather and multi-year averages.
Bumper EU maize crop to cut import needs
HAMBURG, Nov 30 (Reuters) - The European Union is expected to have harvested much more maize (corn) this year, which will greatly reduce EU maize import requirements in coming months, analysts said on Wednesday.
"The signs are the EU has gathered an excellent maize crop with dry weather in parts of Europe in past weeks helping harvest work," said Claus Keller, grains analyst at German commodity analysts FO Licht.
Cuba aims to boost sugar yields - minister
LONDON, Nov 30 (Reuters) - Cuba aims to boost sugar production yields by 15-20 percent a year by 2016, exceeding 45 tonnes per hectare of cane, Cuban Vice-Minister for Sugar Lourdes Castellanos Jimenez said on Wednesday.
She told the annual International Sugar Organization (ISO) seminar that Cuba aimed to boost sugar production to around 2.5 million tonnes by 2016.
Brent stays above $110, Europe worries cap prices
SINGAPORE, Dec 1 (Reuters) - Brent crude traded above $110 for the third session after the world's major central banks moved to tame a liquidity crunch for European banks, but concerns about slower demand capped prices and offset any gains due to Iran.
"The pressure on Brent is the weak economy in Europe. We are not sure if we are going to see significant growth in oil demand. It could be remain flat for a few years," said Tony Regan, analyst at Tri-Zen Capital in Singapore.
China primary aluminium output to rise 12 pct in 2012 -Antaike
ZHUHAI, China, Dec 1 (Reuters) - China faces a surplus of 250,000 tonnes of primary aluminium in 2012 as smelters expand low-cost capacity, a senior analyst at state-backed research firm Antaike said on Thursday.
China's aluminium production may rise 12 percent on the year to 21.95 million tonnes next year, above the 11.3 percent growth rate forecast for 2011 and the year's 19.6 million tonne production, Yao Xizhi told an industry conference in Zhuhai, Guangdong province.
China aluminium capacity to rise 60 percent by 2015
ZHUHAI, China, Nov 30 (Reuters) - China's annual production capacity of primary aluminium may rise by 60 percent in the next four years as smelters build new facilities in resource-rich provinces, a director at a state-backed industry association said on Wednesday.
Hu Changping of the China Nonferrous Metals Industry Association said capacity would jump above 40 million tonnes by 2015 from 25 million tonnes forecast for the end of 2011.
Q1 Metals demand from German carmakers to increase
LONDON, Nov 30 (Reuters) - Demand for steel and metals from German carmakers will increase in the first quarter next year as car sales to developing countries continue to grow, industry sources told Reuters.
The outlook for the rest of 2012 however remains uncertain as weakening consumer confidence in Europe and a growth slow down in China may hit sales later next year.
LME copper retreats after China PMI, Shanghai limit up
SINGAPORE, Dec 1 (Reuters) - London copper futures edged lower after rising the most in a month in the previous session as poor Chinese manufacturing data trimmed some of the optimism spurred by a move by major central banks to aid distressed European lenders.
"After the big gains yesterday, this somewhat weaker Chinese number is prompting a little bit of profit taking," Nick Trevethan, senior commodities strategist at Australia and New Zealand Bank, said referring to Thursday's losses on LME.
China primary aluminium output to rise 12 pct in 2012 -Antaike
ZHUHAI, China, Dec 1 (Reuters) - China faces a surplus of 250,000 tonnes of primary aluminium in 2012 as smelters expand low-cost capacity, a senior analyst at state-backed research firm Antaike said on Thursday.
China's aluminium production may rise 12 percent on the year to 21.95 million tonnes next year, above the 11.3 percent growth rate forecast for 2011 and the year's 19.6 million tonne production, Yao Xizhi told an industry conference in Zhuhai, Guangdong province.
METALS-LME copper retreats after China PMI, Shanghai limit up
SINGAPORE, Dec 1 (Reuters) - London copper futures edged lower on Thursday after rising the most in a month in the previous session as poor Chinese manufacturing data trimmed some of the optimism spurred by a move by major central banks to aid distressed European lenders.
"After the big gains yesterday, this somewhat weaker Chinese number is prompting a little bit of profit taking," Nick Trevethan, senior commodities strategist at Australia and New Zealand Bank, said referring to Thursday's losses on LME.
PRECIOUS-Gold hits 2-week high on gains in equities, euro
SINGAPORE, Dec 1 (Reuters) - Gold hit a 2-week high on Thursday as gains in equities and the euro prompted buying from speculators after major central banks took coordinated action to prevent the euro-zone debt crisis from igniting a global economic meltdown.
"Gold is up alongside other risk assets. Sentiments are positive after the central banks' action and the huge rally in Wall Street last night," said Ong Yi Ling, an analyst at Phillip Futures in Singapore.
Gold hits 2-week high on gains in equities, euro
SINGAPORE, Dec 1 (Reuters) - Gold hit a 2-week high as gains in equities and the euro prompted buying from speculators after major central banks took coordinated action to prevent the euro-zone debt crisis from igniting a global economic meltdown.
"Gold is up alongside other risk assets. Sentiments are positive after the central banks' action and the huge rally in Wall Street last night," said Ong Yi Ling, an analyst at Phillip Futures in Singapore.
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