The latest Market Talks covering Commodities. Published exclusively on Dow Jones Newswires throughout the day.
0912 ET - Speculation around a potential interest rate increase by the Bank of Japan next month is behind a strengthening of the yen, Bannockburn's Marc Chandler writes. "The yen's surge is not the result of Japan's economic data." He says upcoming data is likely to show an uptick on both inflation and industrial production. A decline on U.S. Treasury yields further weakens the dollar, unwinding the greenback's gains since the election, Chandler says. The USDJPY cross falls 1% to 151. The dollar weakens against most major currencies. The ICE's DXY index is down 0.7%. (paulo.trevisani@wsj.com; @ptrevisani)
0900 ET - U.S. natural gas futures are lower with forecasts overnight showing slightly warmer near-term temperatures. The EIA's weekly storage report is expected to be a small withdrawal, but still widening the inventory surplus over the five-year average. "We don't expect today's release to spur much price response short of a miss of more than 10 Bcf off of average street ideas that favor negligible change," Ritterbusch says in a note. "Beyond the weather factor, an upswing in production and a softening in export activity appears to be adding to today's downside price pressure." Nymex natural gas is off 5.2% at $3.287/mmBtu as January takes the front month position. (anthony.harrup@wsj.com)
0830 ET - Crude futures gain with the market digesting the Israel-Hezbollah ceasefire agreement and Donald Trump's tariff threats while looking to the weekend's OPEC+ meeting. "We've seen limited interest in moving either WTI or Brent futures positioning around the post-ceasefire agreement and tariff news, and both factors are now largely in the price," Chris Weston of Pepperstone says in a note. Pre-positioning ahead of the OPEC+ meeting will need to be put in place by Friday even as some U.S. traders take an extended break for Thanksgiving, he says, but "calmness seen in the price action and lack of trending conditions suggests oil traders see the OPEC+ meeting as a lower volatility affair." The group is widely expected to extend output cuts beyond December. WTI is up 0.7% at $69.23 a barrel, and Brent is up 0.6% at $73.23. (anthony.harrup@wsj.com)
0630 ET - Metal prices rise, with LME three-month copper up 0.8% at $9,030.50 a metric ton and LME three-month aluminum up 0.1% at $2,610 a ton. Metals have strengthened as the U.S. dollar weakens, making it cheaper for foreign investors to purchase dollar-denominated commodities. Copper and aluminum remain down on-week and on-month, however, as Donald Trump's victory in the U.S. presidential election in early November sent the greenback sharply higher. The latest LME Commitment of Traders report released Tuesday shows speculators decreased bullish bets in copper, aluminum and zinc last week, ING analysts say in a note. Investors cut their net long positions in copper by 0.9% to 57,892 lots in the week ended Nov. 22, the lowest level since January, ING adds. LME three-month zinc rises 1.55% to $3,112.50 a ton. (joseph.hoppe@wsj.com)
0526 ET - Anglo American looks likely to sell its Brazilian nickel assets next, as it continues its business reshaping, Berenberg analysts write in a research note. They estimate a net asset value of $331 million for the mines. After this, the mining giant will seek to demerge Anglo American Platinum, before divesting its diamond business. However, Berenberg views the timing of these two disposals as poorly timed, with better days ahead for platinum prices and a bottom-of-the-cycle diamond price currently and broadly unappealing outlook. "We see downside sentiment risk on at least the nickel and De Beers divestments, and our perceived struggles for Anglo to execute on its strategy will disappoint the market." Shares are up 2.8% at 24.39 pounds.(christian.moess@wsj.com)
0508 ET - Palm oil ended higher, tracking overnight gains in soybean oil on the Chicago Board of Trade, Kenanga Futures said in a research note. Soybean and palm oil tend to trade in tandem as they are used in similar products. Prices may have also been supported by concerns over weaker production prospects in Malaysia due to adverse weather conditions, Kenanga Futures said. The Bursa Malaysia Derivatives contract for February delivery ended 62 ringgit higher at 4,797 ringgit a ton.(amanda.lee@wsj.com)
0426 ET - European natural-gas prices fall in early trade as fears of tighter supplies ease, with the benchmark Dutch TTF contract trading 2.4% lower at 46.10 euros a megawatt hour. "Concerns over an imminent halt to Russia gas supplies eased after a capacity auction in Austria suggested pipeline flows from Russia will continue in December," ANZ Research analysts say in a note. Still, uncertainties surrounding Russian flows persist as U.S. sanctions against Gazprombank will make it harder for European importers to handle payments and as a transit deal between Russia and Ukraine is set to expire at the end of the year. Prices are also supported by faster gas storage withdrawals across the EU as lower temperatures increase demand for the heating fuel. (giulia.petroni@wsj.com)
0407 ET - Gold futures rise as the U.S. dollar slips back. Futures rise 1.2% to $2,678.90 a troy ounce, and are broadly flat on week. The greenback eased as investors priced out a part of geopolitical risk, though appetite for gold remained intact, says Swissquote Bank's Ipek Ozkardeskaya. A strong greenback typically dampens the safe-haven appeal of gold. Easing geopolitical risks and the dollar's fall reflect a 60-day ceasefire between Israel and Lebanon, expected to take effect on Wednesday and ending more than a year of fighting. At the same time, the probability of a 25 basis point interest rate cut from the U.S. Federal Reserve rose to 65% after Tuesday's release of the Fed meeting minutes, Ozkardeskaya says in a note. A cut to rates would be a further boon for non-interest bearing bullion. (joseph.hoppe@wsj.com)
0358 ET - Oil prices edge higher in early European trade after Israel and Hezbollah reached a cease-fire deal and as markets await OPEC+'s next policy move. Brent crude and WTI are up 0.4% at $72.58 and $69.05 a barrel, respectively. The agreement is expected to go into effect on Wednesday, ending more than a year of fighting across the Israeli-Lebanese border. "The focus now shifts to the implementation of the current agreement and how it affects ongoing fighting in the Gaza Strip or the Israel-Iran conflict," ING analysts say. Meanwhile, OPEC+ is expected to further delay its plans to increase output at its next meeting on Sunday. "Crude oil prices continue to face stiff resistance around $75/bbl due to demand concerns," ING says. "Any premature production hike from the group could push the market into deeper oversupply." (giulia.petroni@wsj.com)
0315 ET - Anglo American's sell-down of shares in Anglo American Platinum is a small incremental positive toward its investment case, RBC Capital Markets analyst Marina Calero writes in a research note. The share disposal moves the London-listed mining giant closer to the complete merger of the unit by the middle of next year, she writes. The company is also planning to offload its diamond business next year. "An expected recovery in platinum-group metals and diamond prices could also help boost sentiment while a renewed approach from BHP cannot be ruled out, with the end-November deadline soon approaching," Calero says. Shares are up 1.7% at 24.13 pounds. (christian.moess@wsj.com)
2200 ET - Copper prices edge higher early Asian trade as investors await fresh cues. Macro factors' impact on copper prices could gradually decrease as traders continue to wonder how or if the composition of the new U.S. government will affect the market, Nanhua Futures analysts say in a research note. On the demand front, while there is potential for more demand from home appliance and auto sectors in China, overseas demand remains weak with no signs of improvement, they say. Copper prices will likely continue to be volatile in the near term, they add. The three-month LME copper contract is 0.1% higher at $9,007.50 a ton. (sherry.qin@wsj.com)
2140 ET - Palm-oil prices are higher in early Asian trading, supported by soybean oil's weakness overnight on the Chicago Board of Trade. Prices have found near-term support at 4,630 ringgit, but the commodity's premium over soyoil raises downside risks, especially as buying momentum remains subdued, Phillip Nova analyst Darren Lim Tai An says in a note. Traders are closely monitoring the broader vegetable oils market, particularly soybean oil, for signs of a narrowing price gap that could enhance palm oil's global competitiveness, he adds. The Bursa Malaysia Derivatives contract for February delivery rises 15 ringgit to 4,750 ringgit a ton. (yingxian.wong@wsj.com)
(END) Dow Jones Newswires
November 27, 2024 09:15 ET (14:15 GMT)
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