US STOCKS-Futures rise as 1st-qtr earnings off to strong start - Reuters News
18-Apr-2018 07:46:45 PM
- Futures up: Dow 0.25 pct, S&P 0.28 pct, Nasdaq 0.27 pct
By Sruthi Shankar
April 18 (Reuters) - U.S. stock futures rose on Wednesday after the latest batch of results including Wall Street bank Morgan Stanley added to optimism about the U.S. corporate reporting season.
Morgan Stanley jumped 2.6 percent after the company reported a 40 percent jump in quarterly profit, helped by higher trading revenue, wrapping up earnings for the big U.S. banks.
The S&P 500 companies are expected to post an 18.6 percent rise in profits in the first quarter, the biggest increase in seven years, according to Thomson Reuters data.
At 6:58 a.m. ET, Dow e-minis were up 63 points, or 0.25 percent. S&P 500 e-minis were up 7.5 points, or 0.28 percent, and Nasdaq 100 e-minis were up 18.25 points, or 0.27 percent.
The main indexes have gained solidly in the past two days after stellar results from industry bellwethers as well as strong economic data, helping investors turn attention away from geopolitical and trade tensions, which have upset the markets in the recent months.
U.S. President Donald Trump said on Wednesday that Mike Pompeo, the current CIA director and his nominee to be the top U.S. diplomat, met with North Korean leader Kim Jong Un last week.
"Meeting went very smoothly and a good relationship was formed. Details of Summit are being worked out now. Denuclearization will be a great thing for World, but also for North Korea!" Trump said on Twitter.
The CBOE Volatility index, a measure of short-term stocks market volatility hit a level not seen in more than 5 weeks at 14.57. It was last down at 15.26 points.
United Airlines rose 3.22 percent after the company reported a rise in profit, helped by higher fares.
CSX Corp was up 4.3 percent after the No. 3 U.S. railroad operator topped profit estimates, benefiting from a cost-cutting drive.
IBM, a Dow component, fell about 5 percent after the technology company reported profit margins that fell short of Wall Street expectations.
Ebay jumped 4.2 percent after Morgan Stanley upgraded the stock by two notches to "overweight", encouraged by the company's payments initiatives.
Federal Reserve issues its so-called Beige Book, a compendium of anecdotes on the health of the economy drawn from the central bank's sources across the nation.
(Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta)
Dollar rises as risk appetite returns, investors turn to data - Reuters News
18-Apr-2018 08:59:00 PM
- Euro zone and UK CPI data weaker than expected
- Euro unable to capitalise on gains over USD
- Bank of Canada rate hike unlikely
Adds details, updates prices
By Tom Finn
LONDON, April 18 (Reuters) - The U.S. dollar clung to gains on Wednesday after rising from a three-week low as fading concerns about a trade war fed broader appetite for risk-taking among investors.
U.S. markets were buoyed by strong corporate earnings and that helped European equities on Wednesday as investors focused on economic data and put to one side worries about a global trade war.
Markets in Asia picked up on a positive finish in the United States and were helped by China's decision to cut bank reserve requirements by 100 basis points for some commercial banks.
"Concerns about military action in Syria, trade tensions between the U.S. and China and the pace of rate hikes in the U.S. have abated somewhat," Commerzbank economist Michael Schubert said in a note.
The dollar index against a group of six major currencies traded flat at 89.490.
The dollar was helped by a weakened pound which fell to a four-day low on Wednesday after British inflation unexpectedly cooled to a one-year low in March.
The data has raised doubts over a near consensus view that the Bank of England will raise interest rates next month.
Euro zone data also came in weaker than expected as investors looked for signs of the viability of further European central bank monetary tightening.
The dollar has found support from economic indicators recently as perceived political risks recede, with Western strikes on Syria not expected to escalate.
The dollar rose 0.3 percent to 107.280 yen buoyed as improving risk appetite reduced demand for its Japanese peer, a currency often sought in times of market turmoil and political tensions.
But caution over U.S.-China trade tensions continued to linger in the background, confining currencies to narrow ranges.
"Over the last couple of days there have been few incendiary tweets from the U.S. or China to unsettle markets further. So the markets are turning a bit more risk-on but there's always the fear of what comes next," said Berenberg economist Florian Hense.
The euro was up 0.1 percent at $1.2387.
The common currency rose to a three-week high of $1.2414 on Wednesday but slipped on a ZEW research institute survey showing German investor morale reached its lowest since November 2012.
The pound was down 0.5 percent at $1.4229 after it was nudged away from a post-Brexit referendum 22-month high of $1.4377 on Tuesday by weaker-than-expected British wage data.
Markets were still pricing in a more than even chance the Bank of England will hike interest rates in May, expectations of which have helped sterling advance aggressively this month.
The Canadian dollar was up 0.2 percent at C$1.2581 per dollar and in reach of a seven-week high set the previous day ahead of the Bank of Canada's interest rate decision later on Wednesday.
While the BoC is not expected to raise rates this time, expectations have risen that the central bank will tighten policy as early as next month given strong data. Investors will be looking for any hints that could reinforce such views.
Elsewhere, the Swiss franc fell to its lowest versus the euro since the Swiss National Bank scrapped its currency peg in January 2015.
(Editing by Catherine Evans and Ken Ferris)
RPT-POLL-U.S. crude inventories likely saw a draw in latest week - Reuters News
18-Apr-2018 08:45:00 PM
Repeats POLL originally published April 17, no changes
| REUTERS FORECAST FOR WEEK ENDED 4/13/18 | ACTUAL FOR WEEK (EIA) ENDED 4/6/18 | CHANGE VS PREVIOUS WEEK | YR-AGO CHANGE WEEK ENDED 4/14/17 | |
| CRUDE | -1.4 MLN | 428.6 MLN | 3.3 MLN | -1.0 MLN |
| DISTILLATE | -0.3 MLN | 128.4 MLN | -1.0 MLN | -2.0 MLN |
| GASOLINE | -0.2 MLN | 238.9 MLN | 0.5 MLN | 1.5 MLN |
| REFINERY RUNS | 0.1 PCT PT | 93.5 PCT | 0.5 PCT PT | 1.9 PCT PTS |
| NATGAS STORAGE FORECAST | -28 BCF TO -7 BCF (10 FORECASTS) | |||
April 17 (Reuters) - U.S. crude stockpiles and refined product inventories likely fell last week, an expanded Reuters poll showed on Tuesday.
Eleven analysts polled ahead of inventory reports from industry group American Petroleum Institute (API) and the U.S. Energy Department's Energy Information Administration (EIA) estimated, on average, that data would show crude stocks fell about 1.4 million barrels in the week ended April 13.
Crude inventories rose by 3.3 million barrels in the week ended April 6, compared with analysts' expectations for a decrease of 189,000 barrels.
The API is scheduled to release its data for last week at 4:30 p.m. EDT (2030 GMT) on Tuesday, and the EIA report is due at 10:30 a.m. EDT on Wednesday.
Analysts forecast that stockpiles of gasoline fell about 200,000 barrels last week.
Distillate inventories, which include heating oil and diesel fuel, were seen down 300,000 barrels last week, the poll showed.
The rate of refinery utilization was projected to rise 0.1 percentage point from 93.5 percent of total capacity the previous week, according to the poll.
All figures for fuel stocks in millions of barrels, percentage points for refinery runs:
| Organization | Crude | Distillate | Gasoline | Refinery Runs |
| Again Capital | 1.3 | 0.7 | 0.5 | 0.3 |
| Citi Futures | -2.5 | 0.0 | -1.0 | -0.5 |
| Confluence | 2.0 | -0.5 | -1.0 | 0.5 |
| Commodity Research Group | 0.3 | -0.4 | 0.3 | -0.2 |
| Energy Management Institute | -2.1 | -0.3 | -1.0 | -0.3 |
| Excel Futures | -2.2 | -0.4 | 0.7 | 0.4 |
| ION Energy | -2.5 | 0.5 | 1.0 | N/A |
| Price Futures Group | -3.0 | -2.0 | -2.0 | 1.0 |
| Ritterbusch Associates | -0.6 | -0.5 | -1.0 | 0.5 |
| Stratas Advisors | -3.4 | -0.6 | 0.7 | -1.0 |
| Thomson Reuters Oil Research and Forecasts | -1.6 | N/A | N/A | N/A |
(Reporting by Nithin Prasad in Bengaluru; Editing by David Gregorio)
UPDATE 4-Oil breaks above $72 as supply concerns build - Reuters News
18-Apr-2018 07:48:36 PM
- U.S. crude stocks down 1 mln barrels at 428 mln barrels - API
- Supply risks in Middle East, Venezuela also buoy crude
Updates prices
By Amanda Cooper
LONDON, April 18 (Reuters) - Oil prices extended gains on Wednesday, lifted by a reported decline in U.S. crude inventories and the risk of supply disruptions.
Brent crude oil futures rose 87 cents to $72.45 a barrel by 1143 GMT, while U.S. WTI crude futures rose 95 cents to $67.47.
"Yesterday evening saw the API report a surprising decrease in U.S. crude oil stocks and a reduction in oil product stocks that was sharper than anticipated," Commerzbank oil analyst Carsten Fritsch said in a note.
U.S. crude inventories fell by 1 million barrels last week to 428 million barrels, the American Petroleum Institute (API) said.
OPEC's ministerial committee tasked with monitoring the group's supply-cutting deal with non-OPEC countries, led by Russia, meets in the Saudi city of Jeddah on Friday.
The Organization of the Petroleum Exporting Countries and 10 rival producers have restrained output by a joint 1.8 million barrels per day since January 2017 and pledged to do so until the end of this year.
"Despite an oil price of over $70 per barrel and the fact that the oversupply has been eliminated, a phase-out of the production cuts will not be on the agenda," Fritsch said.
Oil has been supported by the perception among investors that tensions in the Middle East could lead to supply disruptions, including renewed U.S. sanctions against Iran, as well as falling output in crisis-hit Venezuela.
"Oil prices are holding near three-year highs (reached earlier in April) for the time being, and with inventories back in line with normal levels, the supply glut of the last few years appears to be over," said William O'Loughlin, investment analyst at Australia's Rivkin Securities.
Dutch bank ING said in a note to clients that Brent had risen back above $70 in April "due to geopolitical risks along with some fundamentally bullish developments in the market".
It raised its average 2018 price forecast for Brent to $66.50 a barrel from $60.25, and its 2018 WTI forecast to $62.50 from $57.75.
For next year, however, ING expects lower prices due to rising U.S. crude output, which has jumped by a quarter since mid-2016.
Official weekly data on U.S. inventory levels will be published by the Energy Information Administration on Wednesday.
(Additional reporting by Henning Gloystein in SINGAPORE; Editing by Dale Hudson and David Evans)
Alerts History
- 18-Apr-2018 07:48:33 PM - SAUDI ARABIA FAVOURS OIL PRICE OF $80, EVEN $100 A BARREL - THREE INDUSTRY SOURCES
- 18-Apr-2018 07:48:33 PM - OPEC, PARTNERS UNLIKELY TO CHANGE OIL SUPPLY-CUTTING DEAL AT JUNE MEETING EVEN IF INVENTORY TARGET REACHED - THREE OPEC SOURCES
EXCLUSIVE-OPEC's new price hawk Saudi Arabia seeks oil as high as $100 - sources - Reuters News
18-Apr-2018 07:50:12 PM
- Saudi Arabia favours oil at $80-$100 - three sources
- Oil last traded at $100 in 2014 before glut
- Oil stocks close to level sought in OPEC-led supply deal
- But OPEC production cuts unlikely to be adjusted in June
By Rania El Gamal and Alex Lawler
DUBAI/LONDON, April 18 (Reuters) - Top oil exporter Saudi Arabia would be happy to see crude rise to $80 or even $100 a barrel, three industry sources said, a sign Riyadh will seek no changes to an OPEC supply-cutting deal even though the agreement's original target is within sight.
The Organization of the Petroleum Exporting Countries, Russia and several other producers began to reduce supply in January 2017 in an attempt to erase a glut. They have extended the pact until December 2018 and meet in June to review policy.
OPEC is closing in on the original target of the pact - reducing industrialised nations' oil inventories to their five-year average. There is no indication yet, however, that Saudi Arabia or its allies want to wind down the supply cut.
Over the past year, Saudi Arabia has emerged as OPEC's leading supporter of measures to boost prices, a change from its more moderate stance in earlier years. Iran, once a keen OPEC price hawk, now wants lower prices than Saudi Arabia.
Industry sources have linked this shift in Saudi Arabia's stance to its desire to support the valuation of state oil company Aramco ahead of the kingdom's planned sale of a minority stake in an initial public offering.
The supply cut has helped boost oil prices this year to $73 a barrel, the highest since November 2014. Oil began a slide from above $100 - a price that Saudi Arabia endorsed in 2012 - in mid-2014, when growing supply from rival sources such as U.S. shale began to swamp the market.
But the kingdom wants the rally to go further. Two industry sources said a desired crude price of $80 or even $100 was circulated by senior Saudi officials in closed-door briefings in recent weeks.
"We have come full circle," a separate high-level industry source said of the change in Saudi thinking. "I would not be surprised if Saudi Arabia wanted oil at $100 until this IPO is out of the way."
Once the Aramco share sale is done, Riyadh would still want higher prices to help fund initiatives such as Vision 2030, an economic reform plan championed by Crown Prince Mohammed bin Salman.
"Saudi Arabia wants higher oil prices and yes, probably for the IPO, but it isn't just that," an OPEC source said.
"Look at the economic reforms and projects they want to do, and the war in Yemen. How are they going to pay for all that? They need higher prices."
To be sure, OPEC and Saudi Arabia have no official price target and say the objective of the production cut is to balance supply and demand, and reduce the inventory glut.
But guidance on preferred price levels comes from officials speaking off the record, and from industry sources who have discussed the issue with Saudi officials.
"I personally think that now $70 is the floor for oil prices," a second OPEC source said. "But OPEC is unlikely to make any changes in June, maybe by the end of the year. The market still needs support."
TALKS IN JEDDAH
OPEC and its partners meet on June 22 to review policy and before then a ministerial monitoring panel gathers in Jeddah, Saudi Arabia, on April 20.
By OPEC's parameters, the deal has worked. Oil stocks in developed economies in February stood a mere 43 million barrels above the latest five-year average, down from 340 million barrels above in January 2017.
The cuts have been even bigger than those specified in the deal, thanks in part to a slide in Venezuelan production due to an economic crisis in the South American country.
Compliance has reached 150 percent, according to OPEC, meaning the organisation's members have cut production by about 1.8 million barrels per day, 600,000 bpd more than pledged.
Few OPEC sources call for an exit strategy. Most officials are talking of introducing additional inventory metrics to assess the success of the deal, and of a need to support investment in new production to avert any supply crunch.
The impression is that oil prices are seen as not yet high enough to encourage sufficient oil investment.
"We will know what will be the good price when the market is balanced and we have enough investments," the United Arab Emirates' energy minister, Suhail al-Mazroui, told Reuters last week. "We need to have more investments coming."
The Jeddah meeting of the Joint Ministerial Monitoring Committee is unlikely to change the parameters for assessing the deal's success, Mazroui and other OPEC officials said, and sources see little chance of a major tweak in June.
"Even if we reach the five-year average before June, it does not mean we just go and open the taps," a third OPEC source said. "We have to test it."
(Editing by Dale Hudson)
PRECIOUS-Gold snaps three sessions of gains as dollar, equities edge up - Reuters News
18-Apr-2018 03:31:35 PM
- Spot gold may retrace to $1,334/oz -technicals
- Firm U.S. data helps, but lingering trade woes limit USD gains
(Adds comment, updates prices)
By Eileen Soreng
BENGALURU, April 18 (Reuters) - Gold prices slipped on Wednesday after rising for three straight sessions as investors opted for riskier assets, with the dollar holding its gains on the back of upbeat U.S. economic data.
"There was a general increase in risk appetite, which boosted equities ... Conversely, there was less demand for safe-haven assets such as gold," said John Sharma, an economist with National Australia Bank.
Spot gold was down 0.3 percent at $1,343.31 per ounce at 0709 GMT, U.S. gold futures for June delivery fell 0.2 percent to $1,346.30 per ounce.
Gold prices had surged to $1,365.23 per ounce last week, their highest since Jan. 25, on heightened tensions over Syria and U.S. sanctions on Russia.
"Historically, geopolitical tensions have a short-term impact on price movement, but overall it is the economy that determines prices," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
The dollar index, which measures the greenback against a basket of currencies, was up 0.2 percent at 89.657.
The index touched a three-week low of 89.229 on Tuesday before pulling back on stronger-than-expected March U.S. housing starts and steady industrial production figures.
A stronger greenback makes dollar-priced gold costlier for holders of other currencies.
Asian shares inched up after Wall Street took heart from upbeat corporate earnings.
The gold market has also seen some profit-booking from recent peak levels, said Hareesh V, head of commodity research, Geojit Financial Services.
"Currently there has been no significant news update or event from the global point of view, further prompting the mild correction in prices," Hareesh said.
Spot gold may retrace to a support level at $1,334 per ounce because it failed to break resistance at $1,350, said Reuters technical analyst Wang Tao.
Meanwhile, spot silver climbed 0.2 percent to $16.78 per ounce, after touching a one-week high of $16.83 earlier in the session.
Platinum advanced 0.5 percent to $941.10 per ounce. Prices earlier marked a three-week high of $944.10.
Palladium rose 0.1 percent to $1,010.47 per ounce.
(Reporting by Eileen Soreng and Apeksha Nair in Bengaluru Editing by Eric Meijer and Joseph Radford)
CBOT Trends-Corn steady-up 3 cents, wheat up 5-8 cents, soy up 4-6 cents - Reuters News
18-Apr-2018 09:02:37 PM
CHICAGO, April 18 (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 Wednesday.
WHEAT - Up 5 to 8 cents per bushel
- Forecasts for return to dryness in western U.S. Plains after some rains in coming days underpinning market as hard red winter wheat crop remains under severe pressure from drought stress. Support for May soft red winter wheat contract noted at 20-day moving average overnight. Resistance seen at 40-day moving average.
- CBOT May soft red winter wheat last traded up 6 cents at $4.72-1/4 per bushel. K.C. May hard red winter wheat was last up 7-1/2 cents at $4.88 and MGEX May spring wheat was last up 3-1/2 cents at $6.16.
CORN - Steady to up 3 cents per bushel
- Following wheat higher. Firm cash markets also lend support. CBOT May corn futures hit resistance at 40-day moving average during overnight trading.
- CBOT May corn last traded up 2-1/4 cents at $3.82-1/2 a bushel.
SOYBEANS - Up 4 to 6 cents per bushel
- Bargain buying, short-covering continue to push prices higher after dips amid concerns about crop shortfalls in Argentina. Firm crude oil market also seen as bullish. May soybean contract found support at its 40-day moving average during overnight trading session.
- CBOT May soybeans last traded up 6 cents at $10.52 per bushel.
(Reporting by Mark Weinraub; editing by Jonathan Oatis)
RPT-COLUMN-Cold weather may cap U.S. corn acres, but what about yield? -Braun - Reuters News
18-Apr-2018 07:30:00 PM
Repeats for wider distribution. The opinions expressed here are those of the author, a market analyst for Reuters.
By Karen Braun
CHICAGO, April 18 (Reuters) - Unless yields soar to never-before-seen highs, the United States this summer will certainly harvest the smallest corn crop in three years since the production volume may not be padded by a boost in plantings.
When the government's corn planting intentions came in at an unexpectedly low 88 million acres last month, some market participants figured the actual acreage could eventually be higher since it was still early and U.S. farmers "love to plant corn."
But neither the futures market nor the weather – in particular – are supporting that idea. Winter never loosened its grasp across the core U.S. Corn Belt, and 2018 is vying for the title of coldest Midwestern April on record since 1895.
As of Sunday, only 3 percent of the corn crop had been planted compared with an average of 5 percent. While it is too early to consider this delayed, very little – if any – progress will be made in the top producing states this week. Soils remain largely too cold and the Upper Midwest is bracing for yet another winter storm on Wednesday.
If U.S. producers plant fewer than 88 million corn acres in 2018, it would be the smallest area since 2009, and this outcome is still in play. But yield remains a wide-open ballgame.
NO EXTRA ACRES?
When corn planting progress is notably below average by the middle of May, market watchers start to genuinely worry that plantings will fall below the U.S. Department of Agriculture's March target, and with good reason.
In the last two decades, there were 10 instances in which May 15 planting progress was below the long-term average of 75 percent. Final corn plantings came in below USDA's March intentions in eight of those 10 years.
This means that if 2018 progress still lags by mid-May, the 88 million-acre scenario may be the most generous.
One of the two slower planting years with rising corn acres was last year, but both the increase in acres and the planting delays were relatively minor. The other was 2009, and final plantings came in 1.4 million acres higher than the March projection.
In 2009, corn planting was severely delayed in parts of the Eastern Corn Belt and Northern Plains due to persistently cold and wet conditions. But in the five weeks from the end of April to the start of June 2009, CBOT December corn futures steadily climbed more than 20 percent from the lows, peaking at $4.73-1/2 a bushel on June 2.
This likely encouraged some farmers in the affected areas to stay the course, while inspiring other farmers, especially in fringe states, to expand on their original corn plans. The Chicago futures market was also suggesting better corn profitability relative to soybeans in the spring of 2009, which is not the case in 2018.
Futures have ultimately drifted lower since USDA's planting report, which was initially friendly for price. December corn settled at $4.06 a bushel on Tuesday, down 1 percent since March 29, even though many planters will remain idle for at least the next several days across the Corn Belt.
THE 'Y' WORD
Anyone trying to talk about U.S. corn yield in mid-April might risk some ridicule from the market. Luckily, there is no need to throw around reckless numbers right now since yield penalties are not guaranteed from late planting.
But summer weather becomes more important. Most recently, the generally favorable conditions during the summer of 2014 pushed corn yield to a record high, despite the lag in planting.
Seasons in which mid-May planting is close to average have statistically featured the most consistent results, with yields performing better than expected.
Interestingly, crops that were planted quicker than normal, such as 2010 or 2012, might actually have more downside risk. This is somewhat ironic since early planting is perceived to be advantageous because the crop can pollinate before the hottest stretch of the summer.
Planting is fast when temperatures are warm and soils are relatively dry. But that weather pattern – if observed during the spring – is highly susceptible to persisting during the U.S. summer. This is exactly what happened in 2010 and especially in 2012, both of which were poor harvests.
If U.S. farmers plant the full 88 million-acre intention, national yield would have to break 180 bushels per acre in order to tie with last year's 14.6 billion-bushel crop. The current production record of 15.1 billion bushels was set in 2016.
(Editing by Matthew Lewis)
