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US STOCKS-Wall St set to open lower ahead of Trump Iran decision - Reuters News

08-May-2018 08:43:15 PM

• Comcast prepares all-cash bid for Fox assets
• Citigroup rises after ValueAct raises stake
• Trump to decide on Iran nuclear deal at 2 p.m. ET
• Futures down: Dow 0.15 pct, S&P 0.21 pct, Nasdaq 0.2 pct

Adds comments, details, updates prices

By Medha Singh

May 8 (Reuters) - U.S. stock indexes were on track to open lower on Tuesday as investors braced for President Donald Trump's decision on whether to withdraw from the Iran nuclear deal.

A U.S. withdrawal would tighten economic sanctions on Iran, curtailing the country's output that could bolster this year's 13 percent oil rally.

Crude prices were down about 1 percent - easing from 2014 highs, which had boosted Wall Street in the past two sessions - ahead of Trump's decision at 1800 GMT (2:00 p.m. ET).

"(Trump's decision) has been so well covered, it's probably all in the price by now. And most recent commentary seems to be that after all the bluster, he may only partially withdraw from the deal," said Frances Hudson, global thematic strategist at Aberdeen Standard Investments.

At 8:33 a.m. ET, Dow e-minis were down 37 points, or 0.15 percent. S&P 500 e-minis were down 5.5 points, or 0.21 percent and Nasdaq 100 e-minis were down 13.75 points, or 0.2 percent.

"Depending on the magnitude of energy markets being affected, it could spillover to the rest of equities in general," said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey.

Shares of Comcast fell 1.8 percent premarket after Reuters reported the cable operator is preparing to make an all-cash offer for media assets that Twenty-First Century Fox has agreed to sell to Disney for $52 billion.

Fox's shares rose 2.4 percent. Disney, which is due to report its results after markets close, was down 0.7 percent.

Snap Inc gained 1.6 percent after hiring Tim Stone, who had led Amazon's $13.7-billion integration with Whole Foods, as its chief financial officer.

Dish Network dipped 1.2 percent after its quarterly revenue came below expectations due to a drop in its legacy pay-TV subscriptions.

Citigroup advanced 1.8 percent after activist investor ValueAct invested $1.2 billion in the bank, citing its low risk and reliable revenue.

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

 

 

 

UPDATE 4-Oil backs off 2014 highs ahead of Trump Iran decision - Reuters News

08-May-2018 08:04:40 PM

• Trump decision on Iran nuclear deal expected 1800 GMT on Tues
• Iran crude exports could be hit if U.S. pulls out of deal
• U.S. crude back below $70 per barrel

Updates prices

By Amanda Cooper

LONDON, May 8 (Reuters) - Oil retreated from its highest level in 3-1/2 years on Tuesday ahead of an announcement by President Donald Trump later in the day on whether the United States will reimpose sanctions on Iran.

Should Trump pull the United States out of a multi-nation agreement on Tehran's nuclear programme, Iranian crude exports might be affected, but analysts said it would also fan the flames of geopolitical tensions in the Middle East, which is home to a third of the world's daily oil supply.

Brent crude futures were down 69 cents at $75.48 a barrel by 1143 GMT, while U.S. West Texas Intermediate (WTI) crude futures fell 74 cents to $69.99 a barrel.

Trump said on Monday that a decision on whether to remain in the Iran nuclear deal or to impose sanctions would be announced at 2:00 p.m. EDT (1800 GMT) on Tuesday, four days earlier than expected.

"Until we get more clarity on Trump's intentions, we are unlikely to get further upside on crude," said Virendra Chauhan, oil analyst at Energy Aspects in Singapore.

"If we assume he goes back to 2012 sanctions, we estimate a loss of 0.4 million barrels a day of Iranian supply based on recent Iranian export numbers. Anything larger than this will be bullish," he added.

Trump is likely to either announce he will not be renewing a waiver on sanctions or will restate his opposition to the nuclear agreement, Barclays Research analysts said in a report.

"The geopolitical consequences of a possible dismantling of the (Iran deal) would likely to play a larger and long-lasting role in pushing oil prices higher than short-term policy uncertainty," the bank said.

If Trump restores core U.S. sanctions, under U.S. law he must wait at least 180 days before imposing their furthest-reaching measure, which is to target banks of nations that fail to significantly cut their purchases of Iranian oil.

"If all current importers of Iranian crude oil decide to ask for exemptions and thus continue to import Iranian crude they would still need to reduce imports by 20 percent every 180 days," SEB head of commodity research Bjarne Schieldrop said.

"It will have limited impact on the 2018 balance as it takes time to revive the sanctions. It would hamper investments in Iranian oil resources thus leading to a potentially tighter future oil market. This is probably why we have seen oil prices for longer-dated contracts rise just as much as the front end of the crude oil curve lately."

Under the deal to limit Iran's nuclear programme, formally known as the Joint Comprehensive Plan of Action, the United States agreed to ease a series of sanctions on Iran and has done so under a string of "waivers" that effectively suspend them.

(Additional reporting by Aaron Sheldrick in TOKYO; Editing by Louise Heavens)

 

 

 

PRECIOUS-Gold slips as dollar hits 2018 high, Iran tensions underpin - Reuters News

08-May-2018 08:38:30 PM

• Market awaits Trump decision on Iran nuclear deal
• Spot gold may revisit May 1 low of $1,301.51/oz - technicals

(Updates prices, adds details)

By Maytaal Angel

LONDON, May 8 (Reuters) - Gold slipped on Tuesday as the dollar surged to a new 2018 high, though the precious metal's losses were limited by worries the United States may be set to pull out of a key nuclear accord with Iran.

U.S. President Donald Trump will announce at 1800 GMT whether Washington will withdraw from a deal that eased economic sanctions on Iran in exchange for Tehran limiting its nuclear programme.

A decision to leave the accord could raise risk aversion in the broader markets, helping gold, seen as a safe asset that holds its value in times of geopolitical turmoil.

Still, gold has been under pressure over the last three weeks with the dollar having rallied around 4.5 percent. A strong dollar makes dollar-priced gold costlier for non-U.S. investors.

"A stronger dollar has created headwinds for gold but we don't see the dollar going much higher on a medium-term basis and in terms of geopolitics, there are some factors to keep an eye on," said Jens Pederson, senior analyst at Danske Bank.

"It's not our base case that the (Trump announcement) will turn out to be a big market moving event but the risk (is there) that Iran will be hit with sanctions and (so we) could see gold buying again."

Spot gold was down 0.2 percent at $1,311.39 per ounce at 1225 GMT. The precious metal has lost some 3.5 percent of its value over the last three weeks.

U.S. gold futures for June delivery were down 0.2 percent at $1,311.50.

Against a basket of rivals, the dollar surged to a 2018 high as expectations that other major central banks would follow the footsteps of the U.S. Federal Reserve in normalising monetary policy have been dashed.

Gold in 2018 will deliver its strongest annual price performance in five years, GFMS analysts forecast on Tuesday, as political uncertainty drives investment in bars and bullion-backed investment funds.

India's gold imports in April fell for a fourth straight month from a year ago to 57 tonnes, on subdued demand after local prices jumped to 21 month highs, provisional data from consultancy GFMS and bank dealers showed.

Spot gold may revisit its May 1 low of $1,301.51 per ounce as it twice failed to break resistance at $1,317, Reuters technical analyst Wang Tao said.

Silver rose 0.3 percent to $16.49 an ounce, while platinum edged up 0.1 percent at $912.40, having hit its highest since April 25 in the last session.

Palladium rose 0.4 percent to $975.72 an ounce, after hitting on Monday its highest since April 27.

 

(Additional reporting by Apeksha Nair in Bengaluru, editing by Ed Osmond and Jon Boyle)

 

 

CBOT Trends-Wheat mixed, soy up 5-7 cents, corn steady-up 2 cents - Reuters News

08-May-2018 09:08:33 PM

CHICAGO, May 8 (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 Tuesday.

 

WHEAT - Mixed, down 2 cents to up 2 cents per bushel

• Forecasts for rain in key growing regions of Australia and the Black Sea as well as improving weather in U.S. Plains pressuring wheat market. Short-covering to limit declines.
• The CBOT reported no May wheat or K.C. May wheat deliveries. The MGEX reported no May  spring wheat deliveries.
• CBOT July soft red winter wheat traded down 1/2 cent at $5.11 per bushel. K.C. July hard red winter wheat was up 1/4 cent at $5.39-3/4 and MGEX July spring wheat was up 1 cent at $6.12 a bushel.

CORN - Steady to up 2 cents per bushel

• Technical buying expected after benchmark CBOT July contract found support overnight near 38.2 percent retracement point on Fibonacci chart tracking recent rally to 9-1/2-month high. U.S. Agriculture Department report that showed corn planting progress at a better-than-expected 39 percent complete seen as limiting buying opportunities.
• The CBOT reported 314 deliveries against May corn futures.
• CBOT July corn traded up 1-3/4 cents at $4.02-1/2 a bushel.

SOYBEANS - Up 5 to 7 cents per bushel

• Mild round of bargain-buying expected after two straight days of sharp declines pushed prices to their lowest in more than a month. CBOT July soybean futures rose through their 20-day and 200-day moving averages during overnight trading.
• Deliveries against CBOT May soybeans totaled 68 contracts. The CBOT reported no May soymeal deliveries and no May soyoil deliveries.
• CBOT July soybeans traded up 6 cents at $10.17-1/2 per bushel.

(Reporting by Mark Weinraub
Editing by Jeffrey Benkoe)

 

 

 

VEGOILS-Palm falls from 2-week high on weaker demand expectations - Reuters News

08-May-2018 07:46:20 PM

• Palm earlier hit 2-week top of 2,400 rgt/T
• Malaysia's early May exports seen weak - trader
• Markets closed on Wednesday for Malaysia election day

Updates with closing prices, quote

By Emily Chow

KUALA LUMPUR, May 8 (Reuters) - Malaysian palm oil futures rose to a two-week high in early trade on Tuesday, before falling back to end lower on speculation of weaker demand so far in May.

The benchmark palm oil contract for July delivery on the Bursa Malaysia Derivatives Exchange dipped 0.1 percent to 2,381 ringgit ($603.09) a tonne at the close of trade, snapping two previous days of gains.

Trading volume stood at 50,670 lots of 25 tonnes each on Tuesday evening.

"The outlook is that exports for the first ten days of May are bad," said a futures trader from Kuala Lumpur, explaining that May demand is forecast to slump from the previous month as Malaysia's crude palm oil export tax is reinstated this month.

Malaysia, the world's second-largest palm oil producer after Indonesia, set its crude palm oil export tax at 5 percent for May, after extending a duty suspension implemented at the start of 2018 until the end of April.

Malaysia first suspended its export tax on crude palm oil in early January for three months to increase demand and boost prices, as it expected stockpiles to grow in 2018.

The same trader added that the market was also squaring positions ahead of Malaysia's national elections on Wednesday, which has been declared a public holiday. Markets will resume trading on Thursday.

Palm had earlier rose as much as 0.7 percent to 2,400 ringgit, its highest since April 26, on expectations of slowing output.

Palm oil output for April is forecast to remain flat at 1.57 million tonnes, following a surge in March when output rose to its highest level for that month since 2000, according to a Reuters poll.

In other related oils, the Chicago July soybean oil contract was down 0.3 percent, while the September soybean oil on China's Dalian Commodity Exchange fell 0.2 percent.

The Dalian September palm oil contract was up 0.3 percent.

Palm oil is impacted by movements in rival edible oils as they compete for a share in the global vegetable oils market.

 

 

 

FOREX-Widening cracks in euro sends dollar to 2018 highs - Reuters News

08-May-2018 08:02:30 PM

• Trump announcement on Iran nuclear deal key event risk
• Australian dollar, Canadian dollar lead losers

Updates prices, adds detail

By Saikat Chatterjee

LONDON, May 8 (Reuters) - The dollar surged to a 2018 high against its rivals on Tuesday as a rout of the euro prompted traders to buy the greenback despite some concerns its rally may have been too quick.

Against a basket of rivals, the dollar has surged about 4.5 percent in three weeks as expectations that other major central banks would follow the U.S. Federal Reserve in normalising monetary policy have been disappointed.

The latest leg in the dollar's run higher came as sterling and the euro came under renewed pressure, the former from waning expectations of a Bank of England rate increase this week and the latter from prospects of early elections in Italy.

"The big risks from the sovereign bond markets in the world is about the growing Italian election concerns and the markets love nothing more than a good momentum story," said Neil Mellor, a senior FX strategist at BNY Mellon in London.

President Sergio Mattarella called on Monday for Italy's bickering parties to rally behind a neutral government. Italy's two largest parties, the far-right League and anti-establishment 5-Star Movement, came out against the proposal.

That pushed the euro down by half a percent to $1.18620, its lowest levels since late December. It is already 1 percent lower since the start of the year, a big reversal from 2017 when it notched up double-digit gains against the dollar.

On Tuesday, the dollar extended recent gains and rose 0.4 percent to 93.13 against the basket -- in which the euro holds the biggest weight -- as markets further cut short bets against it built up in recent months. The dollar has now risen for three consecutive weeks.

A Citi gauge on European economic data surprises is meanwhile languishing at its lowest levels in 5-1/2 years.

 

DOLLAR SQUEEZE

Some of the dollar's biggest gains on Tuesday came against the euro and the Australian dollar which declined by 0.4 percent and 0.8 percent respectively.

The sell-off in these currency pairs rippled through the foreign exchange markets and prompted investors to unwind some of the best performing trades this year.

They include buying the Norwegian currency against the Swedish crown, which on Tuesday fell half a percent.

Short dollar positions saw a further squeeze with latest positioning data keeping the greenback well supported.

On a two-weekly basis, short dollar bets saw the biggest position unwind in six months.

"For the time being there is no possibility of avoiding U.S. dollar, which is also due to the fact that the likelihood of an imminent monetary policy normalisation in other parts of the world is falling," Commerzbank analysts wrote in a note.

But despite the dollar's rally, the Japanese yen was still holding its own against the greenback and other majors indicating that underlying caution remained as investors focused their attention on U.S. President Donald Trump's decision about the future of an international nuclear agreement with Iran.

Trump is expected to make an announcement on the nuclear deal at 1800 GMT. A U.S. withdrawal from the deal, which eased economic sanctions in exchange for Tehran limiting its nuclear programme, would impact risk sentiment in the broader markets.

"It is an event risk and has the potential to make risk sentiment which is already cautious more unstable," said Manuel Oliveri, a currency strategist at Credit Agricole in London.

(Reporting by Saikat Chatterjee; Additional reporting by Sujata Rao; Editing by Catherine Evans)