20180411 Crude Oil Futures Technical View

Crude Oil Technical: 

Resumption of uptrend. 

Previous resistance at 66.66 broken.

Prices supported by Syria U.S. tension.

Stock & Commodities Related News.

US STOCKS-Wall St set for losses as U.S.-Russia tensions weigh - Reuters News

11-Apr-2018 09:07:42 PM

• Eyes on Zuckerberg's second U.S. congressional hearing
• U.S. consumer prices posts first drop in 10 months in March
• Core CPI rises 2.1 pct year-on-year in March
• Futures down: Dow 0.94 pct, S&P 0.87 pct, Nasdaq 0.88 pct

Changes comment, adds details, updates prices

By Sruthi Shankar

April 11 (Reuters) - Wall Street was set to open lower on Wednesday due to heightened concerns over a row between the United States and Russia over military action in Syria.

The face-off intensified after Russia warned that any U.S. missiles fired at Syria over a suspected chemical weapons attack on a rebel enclave would be shot down.

As a reply, U.S. President Donald Trump declared that missiles "will be coming" and blasted Moscow for standing by Syrian President Bashar Assad.

At 8:34 a.m. ET, Dow e-minis were down 230 points, or 0.94 percent. S&P 500 e-minis fell 23 points, or 0.87 percent and Nasdaq 100 e-minis declined 58 points, or 0.88 percent.

"There is going to be broad-based weakness, although one sector that is likely to outperform will be anything tied to the energy space," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.

Escalating tension in Syria lifted oil prices to its highest in more than three years.

On Tuesday, the main U.S. indexes closed up nearly 2 percent after Chinese President Xi Jinping promised to lower import tariffs in an attempt to defuse trade dispute with the United States.

"With Xi's comments yesterday calming some of the trade war concerns, some of that optimism is going away with the concerns over what the final outcome might be over U.S. involvement over Syria," James said.

U.S. consumer prices fell for the first time in 10 months in March, weighed down by a decline in the cost of gasoline, but underlying inflation continued to firm amid rising prices for healthcare and rental accommodation.

The Labor Department said its Consumer Price Index slipped 0.1 percent, the first and largest drop since May 2017. But the core CPI, which excludes the volatile food and energy components, rose 2.1 percent year-on-year in March, the largest advance since February 2017.

Later in the day, the Federal Reserve is set to release the minutes of its March meeting, at which it voted to raise interest rates.

The minutes will show the view within the Fed on the possible impact of the Trump administration's trade policies.

Among stocks, Hilton Worldwide jumped 3 percent after the hotel operator's main shareholder HNA Tourism Group decided to sell its stake in the company.

Facebook Inc shares were down 0.8 percent in premarket trading.

Shares closed up 4.5 percent on Tuesday after Chief Executive Mark Zuckerberg, in the first of two U.S. congressional hearings, made no further promise to support new legislation or change how the social network does business.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Arun Koyyur)

 

 

 

UPDATE 4-Brent hits highest since 2014 after Trump warns missiles 'will be coming' - Reuters News

11-Apr-2018 08:10:30 PM

• Airlines warned of possible air strikes
• Brent hits highest since Dec 2014
• Rising U.S. output, inventories weigh

Updates details, prices

By Amanda Cooper

LONDON, April 11 (Reuters) - Oil hit its highest in more than three years on Wednesday after U.S. President Donald Trump threatened to fire missiles at Syria in response to a suspected chemical attack last week.

Some major airlines were re-routing flights on Wednesday after Europe's air traffic control agency warned aircraft flying in the eastern Mediterranean to exercise caution due to possible air strikes on Syria.

Trump has criticised Moscow for standing by Syrian President Bashar al-Assad.

"Russia vows to shoot down any and all missiles fired at Syria. Get ready Russia, because they will be coming, nice and new and 'smart!'," he wrote in a post on Twitter on Wednesday.

Brent crude jumped to a high of nearly $72 a barrel, its strongest since early December 2014, after Trump's comments, while gold rallied for a fourth day, as investors ditched risk-linked assets such as equities.

Brent stood at $71.85 a barrel by 1143 GMT, up 81 cents on the day, while U.S. crude futures rose 83 cents from their last close to $66.34 a barrel.

The United States and its allies are considering air strikes against Assad's forces following a suspected poison gas attack last weekend.

Syria is not a significant oil producer, but any sign of conflict in the region tends to trigger concern about potential disruption to crude flows across the wider Middle East, home to some of the world's biggest producers.

There are also concerns that the United States could renew sanctions against Iran.

"The focus right now is definitely on a possible military strike against Syria," Commerzbank head of commodity research Eugen Weinberg said.

"We think the fundamentals do not justify the current price, but unfortunately, the market is focusing more on the politics and ignoring some of the warning signs, especially the hike in U.S. oil production."

Saudi Arabia Energy Minister Khalid al-Falih said on Wednesday his country would not sit by and let another supply glut surface, implying that the de-facto leader of the Organization of the Petroleum Exporting Countries (OPEC) would continue to withhold supply.

Not all oil market indicators suggest the price will continue to rally strongly, analysts said.

U.S. crude inventories rose by 1.8 million barrels in the week to April 6 to 429.1 million, according to a report by the American Petroleum Institute (API) on Tuesday, compared with analysts' expectations for a decrease of 189,000 barrels.

The U.S. Energy Information Administration (EIA) said on Tuesday that it expects domestic crude oil production in 2019 to rise by more than previously expected, driven largely by growing U.S. shale output.

(Additional reporting by Henning Gloystein in Singapore; editing by Jane Merriman and Jason Neely)

 

 

 

PRECIOUS-Gold rises as risk aversion hurts equities and dollar - Reuters News

11-Apr-2018 08:03:34 PM

• Gold climbs to two-week high of $1,351.43/oz
• Palladium extends this week's 6 pct rally
• Markets await U.S. CPI, Fed minutes later in the day

 (Updates prices)

By Jan Harvey

LONDON, April 11 (Reuters) - Gold rose for a fourth day on Wednesday as concerns over escalating tensions in Syria, U.S. sanctions on Russia and the U.S.-China trade stand-off weighed on stock markets and helped to knock the dollar index to a two-week low.

The metal reached its strongest in two weeks as appetite for nominally lower-risk assets sharpened. Palladium, which has also benefited from fears that sanctions on Russia could hurt supply, rose further after climbing nearly 6 percent in the past two days.

Spot gold was up 0.8 percent at $1,349.75 an ounce by 1155 GMT, having touched its highest in two weeks at $1,351.43. U.S. gold futures rose 0.5 percent to $1,352.90.

"We've seen fears of a trade war and now more recently the Russian sanctions," said Capital Economics analyst Simona Gambarini. "Uncertainty, volatility and geopolitical risk have been rising steadily since the start of the year."

That has sparked good demand for gold through products such as bullion-backed exchange-traded funds, she said. "Gold is benefiting from the risk-off sentiment and because people are trying to hedge against worst-case scenarios."

European equities fell after two days of gains as tensions over Syria and U.S. sanctions drove Russia's rouble to a two-year low, while concerns about the prospect of a trade war boosted traditional safety plays at the dollar's expense.

The U.S. unit languished near a two-week low against a basket of currencies.

Gold is often perceived as a safe store of value during times of political and financial uncertainty.

Markets are also awaiting cues on the outlook for U.S. monetary policy from consumer inflation data and minutes from the Federal Reserve's March meeting, due later on Wednesday.

Tighter monetary policy raises the opportunity cost of holding non-yielding bullion.

Among other precious metals, silver was up 0.2 percent at $16.59 an ounce, while platinum gained 0.5 percent to $928.50.

Palladium was up 0.4 percent at $955.72.

The metal, more than 40 percent of which is produced in Russia, has bounced strongly this week as sanctions against the country fed into a technically driven rebound after the first quarter's 10 percent slide.

Although Russian output of the metal has not been affected directly, the sanctions have caused enough concern over supply in a market that has been in deficit for a decade to bring some speculative money back in, analysts said.

"With (sanctions target) UC Rusal owning 28 percent of Norilsk Nickel, a significant producer of platinum group metals, traders remain wary that supplies of the precious metal may also be impacted," ANZ said in a note.

(Reporting by Jan Harvey in London; Additional reporting by Swati Verma in Bengaluru; Editing by Dale Hudson and David Goodman)

 

 

WRAPUP 1-Rusal removed from share, debt indexes, metal suspended - Reuters News

11-Apr-2018 08:36:03 PM

• Rusal shares to be deleted from FTSE Russell's indexes
• Bonds excluded from JPMorgan's CEMBI indexes
• LME, CME suspend aluminium from metal exchanges

By Eric Onstad

LONDON, April 11 (Reuters) - International financial groups took action on Wednesday to distance themselves from the shares, bonds and metal of Russian aluminium giant Rusal after the United States imposed sanctions on the company.

In Moscow, Russian Prime Minister Dmitry Medvedev said his government should look at U.S. goods or goods produced in Russia by U.S. companies when considering a possible response to the sanctions.

Shares of United Company Rusal, one of the world's biggest aluminium producers, will be deleted from global equity and debt indexes while its metal will not be allowed on the London Metal Exchange (LME) and the CME Group.

The U.S. Treasury on April 6 announced sanctions against seven Russian oligarchs and 12 companies they own or control, saying they were profiting from a Russian state engaged in "malign activities" around the world.

This included Oleg Deripaska and his Hong Kong-listed company Rusal and his newly created holding company En+ Group

The two companies will be deleted from FTSE Russell's equity indexes effective from the open on April 13, the index provider said in a statement.

Rusal's shares in Hong Kong have slumped by half since the sanctions were imposed on Friday and gave up another 1.9 percent on Wednesday.

DEBT, METAL EXCLUDED

On the debt front, Rusal will be excluded on April 30 from JPMorgan's CEMBI index group of emerging market corporate bonds, the U.S. bank said.

The exclusion will be done as part of the end-of-month rebalancing of the indexes, it added.

As of Friday, April 6, Rusal has a weight of 0.12 percent and 0.15 percent in the CEMBI Broad Diversified and CEMBI Diversified indexes respectively, JPM said in a statement seen by Reuters that was sent to clients late on Monday.

Moody's said it was withdrawing all ratings for Rusal due to its own business reasons.

"At the time of withdrawal the ratings were: corporate family rating of Ba3 and probability of default rating of Ba3-PD At the time of withdrawal these ratings had a positive outlook," it said in a statement.

Rusal's aluminium brands are being excluded from the LME, the world's biggest market for industrial metals, and the U.S. Comex exchange owned by the CME.

The CME revoked approved status for Rusal's metal for delivery against CME aluminium futures contracts, effective from April 10, a notice on the CME website said.

The London Metal Exchange said late on Tuesday Rusal's aluminium would be suspended from its list of approved brands from April 17 after some members raised concerns about settling contracts with sanctions-hit companies.

Aluminium prices extended their rally on Wednesday to a sixth straight session, hitting an 11-week peak, amid persistent worry about shortages.

Analysts at CRU say Rusal accounts for 14 percent of aluminium supplies outside top producer China. Global output this year is estimated at 65 million tonnes.

"There's a lot of panic and uncertainty. Buyers are scrambling to try to replace where they can, to plug the gap left by not having Russian-origin metal," said Robin Bhar, head of metals research at Societe Generale in London.

The sanctions have had knock-on impact on precious metal palladium, which has surged 6 percent this week on the back of concerns about supply from number one producer Russia.

Although the supply pipeline of the metal, more than two-fifths of which is sourced in Russia, has not been directly hit by the sanctions, the market has been rattled by the inclusion of Deripaska on the blacklist.

Deripaska's Rusal owns a 28 percent stake in Norilsk Nickel, the world's biggest palladium producer.

(Additional reporting by Claire Milhench, Sujata Rao-Coverley, Jan Harvey and Pratima Desai in London; Polina Devitt, Polina Nikolskaya and Vladimir Soldatkin in Moscow, Swati Verma in Bangalore and Melanie Burton in Melbourne
Editing by Richard Balmforth)

 

 

 

CBOT Trends-Wheat down 4-5 cents, corn steady-firm, soybeans up 6-8 - Reuters News

11-Apr-2018 09:27:55 PM

CHICAGO, April 11 (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 Wednesday.

 

WHEAT - Down 4 to 5 cents per bushel

• Wheat lower on technical selling and reminders of plentiful global supplies, after the USDA in its monthly supply/demand report on Tuesday raised its forecast of world 2017/18 wheat ending stocks to a record-high 271.2 million tonnes.
• Market underpinned by worries about poor weather in the U.S. Plains wheat belt.
• CBOT May soft red winter wheat last traded down 4-1/4 cents at $4.87-3/4 per bushel. K.C. May hard red winter wheat was last down 7 cents at $5.14-3/4 and MGEX May spring wheat  was last down 1-1/4 cents at $6.25-1/4.

CORN - Steady to up 1/4 cent per bushel

• Corn futures flat to firmer on technical buying and cold, wet conditions in the U.S. Midwest that could delay planting. Weak tone in wheat futures may limit rallies.
• The USDA in its monthly supply/demand report on Tuesday raised its forecast of U.S. 2017/18 corn ending stocks to 2.182 billion bushels, roughly in line with trade expectations.
• CBOT May corn last traded up 1/4 cent at $3.89-1/2 a bushel.

SOYBEANS - Up 6 to 8 cents per bushel

• Soybeans higher on follow-through buying a day after the USDA trimmed its forecast of U.S. 2017/18 soybean ending stocks, bucking trade expectations for an increase. The USDA also lowered its global soy ending stocks forecast more than analysts expected.
• Fresh export demand lends support. The USDA said private exporters sold 141,518 tonnes of U.S. soybeans to Mexico and another 120,000 tonnes to Argentina, all for 2018/19 delivery.
• The sale to Argentina was the second in as many days. The South American country this week booked its largest purchase of U.S. soybeans in 20 years after drought cut the harvest in the world's third biggest soy producer.
• CBOT May soybeans last traded up 7-1/2 cents at $10.57-1/2 per bushel.

(Reporting by Julie Ingwersen)

 

 

 

VEGOILS-Palm slips on weaker related edible oils - Reuters News

11-Apr-2018 07:12:05 PM

• Palm charts third straight day of losses
• Market seen trading between 2,400-2,450 rgt/T - trader
• Palm oil may fall more to 2,392 rgt/T - trader

Updates with closing prices

By Emily Chow

KUALA LUMPUR, April 11 (Reuters) - Malaysian palm oil futures were lower in late trade on Wednesday, recording a third straight day of losses on the back of weaker related edible oils on the U.S. Chicago Board of Trade and China's Dalian Commodity Exchange.

The benchmark palm oil contract for June delivery on the Bursa Malaysia Derivatives Exchange fell 0.1 percent to 2,431 ringgit ($627.68) a tonne at the end of the trading day.

Trading volumes stood at 36,862 lots of 25 tonnes each at the close of trade.

"The market is still under correction and following weaker related oils," said a Kuala Lumpur-based futures trader.

Another trader said the market is taking a break from recent movements and would trade in the 2,400-2,450 ringgit range.

Palm oil rose to a five-week high last week after Malaysia said it would extend tax exemptions on crude palm oil (CPO) exports to a fourth straight month in April, a move aimed at cutting inventories and propping up prices.

It fell over 1 percent in the previous session on bearish data from industry regulator, the Malaysian Palm Oil Board.

Palm oil production rose 17.2 percent to 1.57 million tonnes in March from the previous month, while exports climbed 19.2 percent to 1.57 million tonnes, the data showed.

While stockpiles fell 6.2 percent to 2.32 million tonnes, the decline was smaller than market expectations. A Reuters poll had forecast March end-stocks in Malaysia to decline 8.6 percent from February to 2.27 million tonnes.

In related oils, the Chicago Board of Trade's May soybean oil contract dropped 0.4 percent.

Meanwhile, May soybean oil on China's Dalian Commodity Exchange fell 1 percent, while the Dalian May palm oil contract was down 0.6 percent.

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

Palm oil may break support at 2,419 ringgit per tonne and fall more towards the next support at 2,392 ringgit, said Wang Tao, a Reuters market analyst for commodities and energy technicals.

Palm, soy and crude oil prices as of 1053 GMT

Contract	Month	Last	Change	Low	High	Volume
MY PALM OIL	APR8	0	-4.00	0	0	0
MY PALM OIL	MAY8	2432	-4.00	2420	2437	348
MY PALM OIL	JUN8	2431	-2.00	2422	2440	14499
CHINA PALM OLEIN	SEP8	5118	-42.00	5104	5146	299152
CHINA SOYOIL	SEP8	5900	-60.00	5888	5986	493598
CBOT SOY OIL	MAY8	31.73	-0.12	31.65	31.92	5691
INDIA PALM OIL	APR8	645.00	-1.10	642.00	645.4	423
INDIA SOYOIL	APR8	769.9	-1.10	768	775	8290
NYMEX CRUDE	MAY8	65.80	+0.29	65.15	66.00	158549

 

Palm oil prices in Malaysian ringgit per tonne

CBOT soy oil in U.S. cents per pound

Dalian soy oil and RBD palm olein in Chinese yuan per tonne

India soy oil in Indian rupee per 10 kg

Crude in U.S. dollars per barrel

 

($1 = 3.8730 ringgit)

($1 = 65.1900 Indian rupees)

($1 = 6.2847 Chinese yuan)

 

 

(Reporting by Emily Chow; Editing by Sunil Nair and David Evans)

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Grains Related News.

UPDATE 1-USDA trims soy stocks view; raises corn, wheat stocks view - Reuters News

11-Apr-2018 12:34:20 AM

Adds prices, analyst quote

By Mark Weinraub

WASHINGTON, April 10 (Reuters) - The U.S. Department of Agriculture (USDA) on Tuesday issued a surprise downward revision to its forecast for domestic soybean supplies as strong profit margins at processors encouraged them to crush more beans.

The government raised its outlook for wheat and corn ending stocks, reflecting decreased demand for both grains from the feed and residual sector.

Soybean futures rallied to their highest since March 9 after the report was released. Corn and wheat remained in negative territory.

In its monthly supply and demand report, USDA pegged soybean ending stocks for the 2017-18 marketing year at 550 million bushels, down 5 million from its March estimate.

It raised its estimate for soybeans used for crushing by 10 million bushels to 1.970 billion bushels. USDA left its U.S. soybean export forecast unchanged at 2.065 billion bushels.

Analysts had been expecting soybean ending stocks of 574 million bushels, based on the average of estimates given in a Reuters poll.

Despite USDA's lower forecast, soybean ending stocks would still be the second-biggest total on record if realized.

USDA also lowered its estimate for the Argentine soybean crop by 7 million tonnes to 40 million tonnes, and reduced its export outlook for that key South American supplier by 2.60 million tonnes to 4.20 million tonnes.

"We are seeing some benefit from what's happening with the short Argentina (soybean) crop, but not enough to offset the export business we lost in the first half of the marketing year," said Arlan Suderman, analyst at INTL FCStone. "We need a late-year surge in export business just to hit USDA's current target."

The harvest outlook for Brazil was raised to 115 million tonnes from 113 million tonnes. Brazil soybean exports were pegged at 73.10 million tonnes, up 2.60 million tonnes from USDA's March outlook.

For corn, USDA raised its domestic ending stocks outlook to 2.182 billion bushels, up from 2.127 billion in March.

USDA lowered corn usage in the feed and residual category by 50 million bushels and by 5 million bushels in the food, seed and industrial category.

The government also lowered its estimate of both Brazil's and Argentina's corn harvests and said that reduced competition was expected to impact U.S. exports during the first half of the 2018-19 marketing year.

For wheat, U.S. ending stocks were raised to 1.064 billion bushels from 1.034 billion bushels. Wheat usage in the feed and residual sector was cut by 30 million bushels.

 

(Additional reporting by Michael Hirtzer in Chicago, editing by G Crosse)

 

 

UPDATE 1-Argentina buys most U.S. soy in 20 years after drought cuts crop - Reuters News

11-Apr-2018 01:44:11 AM

Adds quotes, USDA crop outlook, bylines

By Michael Hirtzer and Maximiliano Rizzi

CHICAGO/BUENOS AIRES, April 10 (Reuters) - Argentina booked its largest purchase of U.S. soybeans in 20 years on Tuesday after drought cut the harvest in the world's third biggest soy producer, forcing crushers there to turn to imports.

The surprise move pushed Chicago soybean futures to a one-month high, in the latest development to upend global soy trading after top buyer China last week proposed tariffs on U.S. imports amid an intensifying Washington-Beijing trade dispute.

The U.S. Department of Agriculture in its daily export sale reporting system said 120,000 tonnes of U.S. soybeans were sold to Argentina for delivery during the 2018-19 marketing season that starts on Sept. 1 - the biggest such sale since 1997.

The USDA separately forecast Argentina's soybean harvest at 40 million tonnes, the smallest since 2009's crop of 32 million tonnes. Argentina is the world's top exporter of soymeal and soyoil.

"We're very rapidly seeing a realignment in soybean trading," said international agricultural trade and policy consultant John Baize, president of John C. Baize and Associates.

Argentina will need soybeans by October, a time when crushers in the South American country usually lack sufficient domestic supplies, and the crushers want to make sure they have enough after this year's drought. Argentina exporter chamber spokesman Andrés Alcaraz said the U.S. soybeans sold this week would be crushed and exported as soymeal and soyoil.

"The industry already had a lot of idled capacity and now it is going to have even more because it does not have grain," Ezequiel de Freijo, chief economist at Argentina's Rural Society producers' group, said of soybeans.

European buyers have also scooped up cargoes of U.S. soybeans in recent days. U.S. soybeans have been a relative bargain due to surging prices in Brazil.

China, which buys about two-thirds of global soy exports, was favoring Brazilian supplies and threatening to impose tariffs on U.S. soybean imports to retaliate against U.S. tariffs on China's electronics and other goods.

Soybean futures on the Chicago Board of Trade initially plunged 5 percent after China announced the proposed tariffs but have recovered all of those declines.

CBOT May soybeans were up 5 cents to $10.52 per bushel in early afternoon trading, after earlier reaching $10.64, the highest since March. 9.

 

(Additional reporting by Karl Plume in Chicago and Luc Cohen in Buenos Aires
Editing by P.J. Huffstutter and Chris Reese)

 

 

WASDE: World, U.S. Soy Reserves Fall Below Analyst Estimates

By Stephen Cunningham

(Bloomberg) --  

World soy reserves drop below all analyst estimates as U.S. ending stocks unexpectedly decline, according to April report released in Washington.

• Soybeans:
• World 2018 reserves 90.8m tons; survey range 91m-96m
• U.S. 2018 reserves 550m bu (prior 555m) ; survey avg 574m
• China imports unchanged at 97m tons
• Brazil crop 115m tons; est. 115.6m
• Argentina crop 40m tons; est. 42.6m
• Corn:
• U.S. 2018 reserves 2.182b bu; survey avg 2.197b
• World 2018 reserves 197.78m tons; survey avg 197.1m
• Brazil crop 92m tons; est. 92.1m
• Argentina crop 33m tons; est. 33.3m
• Wheat:
• U.S. 2018 reserves 1.064b bu; survey avg 1.039b
• World 2018 reserves 271.2m tons; survey range266.5m-270m
• U.S. exports 15m bales; est. 15.16m
• U.S. 2018 reserves 5.3m bales; est. 5.14m
• World crop 759.8m tons; prior  758.8m