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US STOCKS-Nike, energy stock help Wall St steady, but chip stocks weigh - Reuters News

23-Mar-2018 11:47:00 PM

• Nike jumps on positive N. America sales forecast
• Micron sinks on pricing worries, weighs on chip stocks
• Dropbox surges as much as 48 pct in trading debut
• Dow up 0.29 pct, S&P up 0.08 pct, Nasdaq down 0.15 pct

Changes comment, adds details, updates prices

By Sruthi Shankar

March 23 (Reuters) - Nike and energy companies led modest gains in U.S. stocks on Friday, amid lingering fears of a trade war, although a Micron-led slump in semiconductor companies kept gains in check.

The Dow Jones Industrial Average was modestly higher, helped by Nike and as industrial stocks gained after a bruising day on Thursday when the United States moved to impose tariffs on up to $60 billion of Chinese imports, sparking fears of a trade war.

China on Friday retaliated by disclosing own plans for tariffs on up to $3 billion of U.S. imports, but also urged the United States to "pull back from the brink."

"Nothing's happened yet, except for the tariffs in the U.S. Investors don't want to sell and buy back at a higher price and if the diplomacy wins and trade war is not as severe as everyone's thinking," said Adam Sarhan, chief executive of 50 Park Investments in New York.

"So right now the market's in a wait-and-see period, they are waiting to see what the next catalyst will be - bullish or bearish."

Also helping sentiment was data showing new orders for key U.S.-made capital goods posted its biggest gain in five months in February.

Orders for non-defense capital goods excluding aircraft, a closely watched proxy for business spending plans, jumped 1.8 percent last month. Economists had forecast a 0.8 percent gain.

At 11:00 a.m. ET, the Dow Jones Industrial Average index, which gained 0.29 percent to 24,027.28. The S&P 500 rose 0.08 percent to 2,645.88 and the Nasdaq Composite fell 0.15 percent to 7,155.72.

Nike shares rose 3.2 percent after the company said it expected North America business to return to growth in the latter half of the year.

Oil prices jumped more than 1.5 percent after the Saudi energy minister said OPEC and allied producers would need to keep coordinating supply cuts into 2019.

The S&P energy index was up 1.23 percent. The industrial index was up 0.36 percent, led by a 2.5 percent gain for Boeing.

Micron Technology fell about 5 percent after Citigroup downgraded the chipmaker, citing falling NAND prices. The company, however, posted better-than-expected quarterly results on Thursday.

Shares of other chipmakers also came under pressure, weighing on the S&P tech index, which was off 0.13 percent, and leading to a 1.2 percent drop on the Philadelphia semiconductor index.

Dropbox Inc surged as much as 48 percent in their market debut on Friday as investors rushed to buy into the biggest tech IPO in more than a year.

Advancing issues outnumbered decliners on the NYSE for a 1.11-to-1 ratio, and for a 1.37-to-1 ratio on the Nasdaq.

 

(Reporting by Sruthi Shankar in Bengaluru; Editing by Savio D'Souza)

 

 

UPDATE 8-Oil rises as Saudi backs extending output cuts into 2019 - Reuters News

23-Mar-2018 11:01:52 PM

• Brent heads for strongest weekly rise since July
• Trump's new National Security adviser seen as hawk on Iran
• Brent to hit $75/barrel by Q3 on strong demand -Morgan Stanley
• Coming up: Baker Hughes drilling data and CFTC report

New throughout, updates prices, market activity and comment; new byline, changes dateline, previous LONDON

By Ayenat Mersie

NEW YORK, March 23 (Reuters) - Crude prices rose on Friday, hitting their highest since late January after the Saudi energy minister said OPEC and allied producers would need to keep coordinating supply cuts into 2019, and as concerns grew over the future of Iranian crude exports.

Brent crude futures hit a session high of $70.22 a barrel before retreating to $70.13 by 10:27 a.m. EDT (1427 GMT), up $1.22 or 1.77 percent. For the week, Brent was up about 5.9 percent, its strongest weekly rise since July.

U.S. West Texas Intermediate (WTI) crude futures were at $65.34 a barrel, up $1.04, or 1.6 percent. On the week, WTI was up about 4.4 percent.

"There are a number of bullish things to hang the hat of the rally on this week; be it the inventory report ... or the tariff news, or the heightened tensions between Saudi and Iran," said Matt Smith, director of commodity research at Clipper Data in Louisville, Kentucky.

President Donald Trump's decision to replace national security adviser H.R McMaster with John Bolton, who is seen as more hawkish on Iran, also supported prices, Smith said.

Oil's rise defied a slump in global stock markets, which fell in response to worries about a trade stand-off between the United States and China. Gold, seen as a safe haven, hit a two-week high.

Since January 2017, the Organization of the Petroleum Exporting Countries as well as a group of non-members, have curbed output by 1.8 million barrels per day.

Saudi Energy Minister Khalid al-Falih told Reuters that such curbs would need to continue into 2019 to reduce global oil inventories.

"As the Saudi guessing game for the new rebalancing target begins, Brent seems well positioned to have another crack at the $70 (a barrel) level," PVM said in a note.

Although analysts said the stand-off between the United States and China could hit oil markets, for now most said demand looked healthy.

"Geopolitical tensions are coming to the front. But global balances are relatively tight at the moment. That's enough to amplify relatively small factors," said Andrew Wilson, head of energy research at BRS Brokers.

Morgan Stanley also cited an expected pick-up in seasonal demand in the coming months.

"We are only three-four weeks away from peak refinery maintenance, after which crude and product demand should accelerate ... Global inventories are already at the bottom end of the five-year range," the U.S. bank said.

"There are sufficient reasons to expect oil prices to strengthen further from here, and we stick with our (Brent) $75 per barrel call for Q3," Morgan Stanley said.

Goldman Sachs said in a note this week that demand and OPEC cuts pushed its Brent spot price expectations to $82.50 a barrel by mid-year.

(Additional reporting by Shadia Nasralla, Henning Gloystein and Roslan Khasawneh
Editing by David Gregorio and Dale Hudson)

 

 

UPDATE 1-China Feb LNG imports eased on slower industrial demand growth, New Year holiday - Reuters News

23-Mar-2018 12:34:46 PM

• Spot LNG prices fell as demand declined
• Feb gas imports by pipeline gained 16 pct on year
• Feb fuel exports fell

Re-casts to lead with LNG

BEIJING, March 23 (Reuters) - China's liquefied natural gas (LNG) imports fell in February from a record high in January, with growth in demand from industrial users easing as the country enjoyed its traditional week-long Lunar New Year holiday last month.

The world's number 2 economy brought in 3.99 million tonnes of LNG in February, up 69 percent from a year ago, but well down from the previous month's 5.18 million tonnes, data from the General Administration of Customs showed on Friday.

Still, for the first two months for the year, LNG arrivals climbed 58 percent from the same period a year earlier to 9.15 million tonnes.

Warmer weather will continue to dampen LNG imports, with China's winter heating season having come to a close in mid-March.

"The market needs less gas now," gas analyst Diao Zhouwei with IHS said, predicting import volumes will decline again this month.

Spot LNG prices fell to around 3,000 yuan per tonne ($474 per tonne) this week, slipping from a high of more than 6,000 yuan per tonne in December, Diao said.

However, demand from industrial consumers such as fertilizer makers is set to pick up, with some businesses having resumed operations after shutting for more than two months during a winter gas supply crunch.

Gas imports through pipelines grew 16 percent in February to 2.9 million tonnes, customs data showed. For the first two months of the year, gas piped in grew 12 percent to 5.5 million tonnes.

Meanwhile, China's monthly diesel exports fell to 1.04 million tonnes in February, the lowest since January 2017, while gasoline exports fell again from the peak level in December.

(Reporting by Meng Meng and Aizhu Chen
Editing by Kenneth Maxwell)

 

 

 

Gold Prices near Two-Week Highs on Fed Decision, Trade Fears - MIST

23-Mar-2018 11:20:40 PM

Investing-

Gold prices were trading near their highest levels in two weeks in European mid-morning trade on Thursday, boosted by a softer dollar after a less hawkish than expected Federal Reserve and growing concerns over trade tariffs.

Gold futures for April delivery on the Comex division of the New York Mercantile Exchange were up $9.7 or 0.73% to $1,331.2 a troy ounce by 05:28 AM ET (09:28 GMT).

The dollar weakened broadly after the Federal Reserve raised interest rates on Wednesday but stuck to its forecast for two more hikes this year.

Some investors had expected the Fed to project three more rate hikes this year so the decision to stick to its forecast for two additional hikes was seen as less hawkish than expected.

Expectations for a slower pace of rate hikes tend to buoy gold, which struggles to compete with yield bearing assets when interest rates rise.

The U.S. dollar index, which measures the greenback's strength against a basket of six major currencies, was last down 0.18% at 89.13 after plumbing a one-month low of 89.06 overnight.

A weaker dollar makes gold, which is denominated in the U.S. currency less expensive for overseas buyers.

Prices of the precious metal received an additional boost from increased safe haven demand amid growing concerns over the prospect of a U.S. - led trade war.

U.S. President Donald Trump was expected to unveil up to $60 billion in new tariffs on Chinese imports later in the day. The Trump administration already imposed tariffs on U.S. steel and aluminum imports earlier this month.

Investors are concerned that major U.S. trade partners could retaliate with similar measures and threaten the outlook for global growth.

In other precious metal trade, silver futures were up 0.83% at $16.555 a troy ounce, while platinum futures were little changed for the day at $958.60.

Copyright (c) 2018 Sourced by MIST all rights reserved

 

 

Farm Futures survey puts U.S. soy area at record 91.5 million acres - Reuters News

23-Mar-2018 10:27:11 PM

CHICAGO, March 23 (Reuters) - U.S. farmers are likely to plant a record 91.5 million acres of soybeans in 2018 and 90 million acres of corn, according to a Farm Futures survey of nearly 1,400 growers released on Friday.

The plantings survey, conducted by email from March 1 to March 22, projected U.S. all-wheat plantings for harvest in 2018 at 46.2 million acres.

 

		Change vs
Crop	Acreage	USDA final 2017
Corn	90 million	-0.2%
Soybeans	91.5 million	1.5%
All Winter Wheat	32.3 million	-1.3%
Spring Wheat	11.7 million	5.9%
Durum	2.3 million	-2.0%
All Wheat	46.2 million	0.5%
Sorghum	5.9 million	4.1%
Cotton	13.3 million	7.9%

 

(Reporting by Julie Ingwersen)

USDA Attache Report: China Targets U.S. Agriculture in Response to U.S. Trade Actions Beijing China - Peoples Republic of - Reuters News

23-Mar-2018 10:15:50 PM

March 23 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in China - Peoples Republic of:

On March 23, 2018, the People's Republic of China's Ministry of Commerce (MOFCOM) announced a proposal to levy retaliatory tariffs impacting approximately $2.0 billion in U.S. food and agricultural exports to China in response to the recent U.S. 232 Trade Action on steel and aluminum. The products subject to this proposed increase in tariffs include pork and pork products, horticultural products, wine, American ginseng, and denatured ethanol. Interested domestic parties have until March 31, 2018 to comment or submit additional information to MOFCOM's Trade Relief and Investigation Bureau regarding these countermeasures.

 

CBOT Trends-Soybeans down 6-10 cents, down 3-4, wheat down 4-6 - Reuters News

23-Mar-2018 09:29:24 PM

CHICAGO, March 23 (Reuters) - Following are U.S. trade expectations for the resumption of the grain and soy complex trading at the Chicago Board of Trade at 8:30 a.m. CDT (1330 GMT) on Friday.

 

WHEAT - Down 4 to 6 cents per bushel

• Lower on technical selling and spillover weakness from soybeans and corn amid worries about mounting trade tensions with China. Market underpinned by dry conditions in the U.S. Plains wheat belt and forecasts that scaled back rain coverage next week.
• The U.S. Department of Agriculture reported export sales of U.S. wheat in the latest week at 428,600 tonnes (old and new crop years combined), in line with trade expectations.
• CBOT May soft red winter wheat last traded down 5-1/2 cents at $4.50-1/4 per bushel. K.C. May hard red winter wheat was last down 2-3/4 cents at $4.68-1/4 and MGEX May spring wheat was last down 2-3/4 cents at $5.90-1/4.

CORN - Down 3 to 4 cents per bushel

• Corn turned lower in early moves on technical selling and worries about growing trade tensions with China. The CBOT May contract fell below its 50-day moving average, which had been a support level this week. Long liquidation expected ahead of the weekend.
• The USDA reported export sales of U.S. corn in the latest week at 1,455,700 tonnes (old and new crop years combined), at the low end of a range of trade expectations.
• Traders are looking ahead to the U.S. Department of Agriculture's March 29 planting intentions and quarterly stocks reports.
• CBOT May corn last traded down 3-3/4 cents at $3.72-1/4 a bushel.

SOYBEANS - Down 6 to 10 cents per bushel

• Soybeans turned lower in early moves on technical selling and worries about trade tensions with China, the world's top soybean buyer. The CBOT May contract dipped to $10.12, its lowest since Feb. 13.
• Chinese buyers of soybeans, the United States' biggest agricultural export, are quietly drawing up contingency plans to ensure supplies of alternative feed ingredients in the event of a trade war, sources said.
• The USDA reported export sales of U.S. soybeans in the latest week at 899,100 tonnes (old and new crop years combined), in line with trade expectations.
• CBOT May soybeans last traded down 9-1/2 cents at $10.20-1/4 per bushel.

 

(Reporting by Julie Ingwersen)

 

As trade tensions mount, China soybean buyers devise contingency plans - Reuters News

23-Mar-2018 08:04:52 PM

• Soybeans are America's biggest farm export to China
• US soybean prices under pressure on worries over orders
• Feedmakers worry trade action would push up prices
• China soymeal prices rise on Friday

By Hallie Gu and Josephine Mason

BEIJING, March 23 (Reuters) - Chinese buyers of soybeans, the United States' biggest agricultural export to the country, are quietly drawing up contingency plans to ensure supplies of critical raw materials in the event of a trade war, sources said.

The moves are the strongest sign yet that businesses in the world's most populous country are growing worried that critical commodities could get caught up in escalating trade tensions.

At least two trading houses have started buying more rapeseed meal, an alternative ingredient used to make animal feed, in case the oilseed is a target of retaliation by Beijing, sources at the company familiar with the strategies said.

"It is an obvious choice to seek other protein sources. We are buying more rapeseed meal, for example," said one of the sources.

As an extra layer of protection, his company has also started to include exit clauses in purchase contracts with U.S. suppliers giving them the right to cancel the order if needed.

The second source said their firm was also purchasing more domestic distillers' dried grains (DDGS), a byproduct of ethanol production used as an animal feed ingredient.

The company is also considering ramping up purchases of Brazilian soybeans.

The sources declined to be named as they are not authorised to speak to the media and would not disclose further details due to the commercial sensitivity of the issue.

 

POWERFUL WEAPON

Penalties on soybeans would be a powerful weapon in Beijing's arsenal because they would especially hurt Iowa, a state that backed U.S. President Donald Trump in the 2016 presidential elections. U.S. Ambassador to China Terry Branstad was previously a long-serving governor of the farm state.

The United States shipped more than $12 billion worth of soybeans to China last year. China buys two thirds of the beans traded worldwide, mainly from Brazil and the United States.

China's commerce and agriculture ministries told a delegation of U.S. soy growers last September that soybeans were being considered as a target for retaliatory action in the event of U.S. trade action against Beijing.

On Thursday, Trump announced plans for tariffs on up to $60 billion in Chinese goods for what he says is misappropriation of U.S. intellectual property, moving the world's two largest economies closer to a trade war.

China showed readiness to retaliate by declaring plans to levy additional duties on up to $3 billion of U.S. imports including fruit and wine in response to U.S. import tariffs on steel and aluminium, which were due to go into effect on Friday.

U.S. PRICES UNDER PRESSURE

Jim Sutter, chief executive of the U.S. Soybean Export Council, said it would not be a surprise for Chinese crushers and importers to make emergency plans.

"They're business people and they have to be thinking about their alternatives," he said.

Sutter had not heard of any specific contingency plans being developed. However, Chinese buyers would likely find it difficult to get by only using alternatives, because its industry relies so heavily on U.S. soybeans, he said.

Even so, worries that China may cancel orders pushed cash bids for both soybeans and corn lower at grain elevators along Midwest rivers on Thursday, indicating decreased demand from export terminals at the U.S. Gulf, a U.S. grains exporter said.

Soybeans dropped by about 2 cents to 6 cents per bushel and corn was down 1 to 4 cents per bushel.

NOW IT SEEMS REAL

The threat of a trade war drove up prices for soymeal, hurting feedmakers and pig farmers, on Friday. The most-active soymeal futures prices on the Dalian Commodity Exchange were up 1.4 percent at 3,046 yuan per tonne.

Traders and millers who crush soybeans and rapeseed to make meal and oil in China say there are no signs of panic in the country's vast farming and livestock sector.

Any immediate impact on crushers will be cushioned by a Brazilian crop coming to market.

"We will deal with it if it happens," said Ji Feng, a senior soybean trader at global commodities merchant Cargill, in a panel discussion at an oilseeds conference on Thursday.

Still the increasingly heated rhetoric between the two countries has given some industry insiders pause this week.

"I feel the trade war is really happening. Before it was just talk, but now it seems real," said a purchasing manager at a medium-sized feed company who is bracing for a further spike in soymeal prices.

"For me, the impact will be mainly on soymeal prices."

 

 

(Reporting by Hallie Gu and Josephine Mason in BEIJING; additional reporting by Mark Weinraub and Tom Polansek in CHICAGO
Editing by Bill Tarrant)

 

GRAINS-Soybeans slide as investors fret over U.S.-China trade fallout - Reuters News

23-Mar-2018 07:44:06 PM

• Soy turns lower as China lists possible tariffs vs U.S.
• Soybeans seen as unlikely target with Chinese import needs
• Trade fears encourage drop after Argentina weather rally
• Wheat, corn track soy lower; rain in U.S. also curbs wheat

Writes through with market fall during European hours, changes byline/dateline

By Gus Trompiz and Naveen Thukral

PARIS/SINGAPORE, March 23 (Reuters) - U.S. soybean futures turned lower on Friday, hitting a one-month low as a deepening trade dispute between the United States and China, respectively the world's biggest soybean producer and importer, triggered selling after a recent weather rally.

Traders and analysts do not expect U.S. soybeans to be directly targeted in any Chinese riposte to U.S. plans to impose tariffs on up to $60 billion of Chinese products, because of China's heavy reliance on soybean imports.

However, the growing tensions, with China issuing a list of U.S. goods including pork that could be subject to extra duties in response to U.S. tariffs, fuelled caution in the soybean market.

"It's a case of concern about whether these additional tariffs from Trump will result in retaliation from China," Charles Clack, a commodity analyst at Rabobank, said.

"On the soybean side, this is lowering confidence in the recent price strength in a market that has been popular with funds," he said.

"Fundamentally, our view is that in terms of retaliatory measures, soybeans is very difficult for China to do."

China is by far the world's biggest importer of soybeans and with drought slashing harvest prospects in No. 3 producer Argentina this year, China would struggle to replace U.S. supplies.

The most-active soybean contract on the Chicago Board Of Trade was down 1.2 percent at $10.17-1/2 a bushel by 1133 GMT. It earlier fell as low as $10.12, its weakest since Feb. 16, after erasing a small gain at the start of the session.

CBOT wheat was down 1.5 percent at $4.49 a bushel and corn was down 1.1 percent at $3.71-3/4, with the cereals pressured by the pullback in soybeans and wider losses in equity and commodity markets.

Wheat also remained under pressure from rains that could help drought-hit U.S. winter wheat crops as the crucial spring growth period begins.

 (Reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore; editing by Richard Pullin and Susan Fenton)