The latest Market Talks covering Commodities. Published exclusively on Dow Jones Newswires throughout the day.
0626 ET - Palm oil futures closed lower Friday, reversing earlier gains as optimism over a possible Malaysian export duty waiver faced after the anticipated announcement failed to materialize, says David Ng, a trader at Kuala Lumpur-based Iceberg X. He expects cautious trading as investors assess the upcoming MPOB supply-demand report, particularly September inventories and export performance, he adds. Ng expects crude palm oil futures to find support at 4,500 ringgit a ton and face resistance at 4,750 ringgit a ton. The Bursa Malaysia Derivatives contract for December delivery fell 69 ringgit to 4,592 ringgit a ton. (jiahui.huang@wsj.com; @ivy_jiahuihuang)
0338 ET - Gold gains more than 1% as a softer dollar and lower oil prices support the metal, while market participants reassess the inflation and interest-rate outlook. In early European trading, New York gold futures rise 1.4% to $4,216.70 an ounce. The U.S. dollar index slips 0.1% to 102.20, making dollar-denominated commodities less expensive for overseas buyers. According to CME's FedWatch tool, traders are pricing in a 19% chance of a rate hike in October and an 83% probability of an increase in December. Investors will next focus on the University of Michigan's preliminary consumer sentiment data due later Friday. (giulia.petroni@wsj.com)
0337 ET - EU approval for MMG's acquisition of Anglo American's Brazilian nickel business would be "the very best outcome" for European stainless steel customers and for the company's workers in Brazil, the London-listed mining company's chief operating officer Ruben Fernandes says. His comments come on the back of a closed-door hearing with EU merger officials Thursday, who have raised concerns the transaction could divert supplies from Europe to China. "Prohibition means that we will head towards 'care and maintenance' as the pathway to closure of the operations in Brazil. That would be the ultimate lose-lose outcome," he says, adding that Anglo American presented "the clear realities of the market during the hearing."(edith.hancock@wsj.com)
2324 ET - Iron ore prices are lower in early Asian trade, weighed by weak demand from steelmakers amid widespread losses across the steel industry, Baocheng Futures analysts write in a note. Meanwhile, despite a holiday-related decline in port arrivals, overseas shipments have rebounded, with both arrivals and outbound shipments remaining elevated for the year, they add. High supply, softening demand and easing freight rates are adding to the bearish outlook, with steel mills' production levels remaining a key factor to watch, they say. The most actively traded January iron ore contract on the Dalian Commodity Exchange is 1.5% lower at 680 yuan a ton. (jiahui.huang@wsj.com; @ivy_jiahuihuang)
2318 ET - The structural drivers behind the gold bull cycle seem intact, State Street Investment Management strategists say in a report. These drivers include record government debt, robust physical demand from central banks and the Chinese retail sector and heightened geopolitical and economic uncertainty. Higher rates can exacerbate debt service costs and fiscal imbalances for major economies, they say. Onshore gold price premiums in China have surged this year, with consumer gold imports hitting a record 1,141 tonnes in the first eight months despite higher prices. The strategists maintain their base-case gold price forecast at $4,750-$5,500 an ounce by the end of 1Q 2027. Spot gold is at $4,174.5 an ounce, according to LSEG data. (monica.gupta@wsj.com)
2246 ET - Palm oil rises in Asian trading, tracking soybean oil's gains overnight on the Chicago Board of Trade. Technical analysis shows crude palm oil futures are gaining upward momentum, while market participants are awaiting data from the Malaysian Palm Oil Board for further directional cues, AmInvestment Bank says in a note. It expects CPO futures to find support at 4,546 ringgit a ton and face resistance at 4,730 ringgit a ton. The Bursa Malaysia Derivatives contract for December delivery is 68 ringgit higher at 4,729 ringgit a ton. (yingxian.wong@wsj.com)
2202 ET - Copper regains some momentum after falling overnight. Both rising energy prices and a selloff on the tech-heavy Nasdaq exchange overnight have weighed on investors' risk appetite, ANZ Research analysts say in a research note. However, copper is still near its record levels, supported by supply constraints, as workers at Chile's Centinela mine are on strike, they note. Copper has also found some support, with Chinese traders returning from a weeklong holiday in a buoyant mood, the analysts say. The three-month copper futures contract on the London Metal Exchange rises 1.1% to $14,461.50 a metric ton, ICE data show.(sherry.qin@wsj.com)
2101 ET - Crude palm oil prices are expected to remain elevated into 2027 as supply tightens, Hong Leong IB analyst Chye Wen Fei says in a note. Indonesia's B50 biodiesel mandate could boost domestic palm oil demand, while El Nino-related dry weather could weigh on yields next year, she says. Indonesia's enforcement against plantations operating illegally in forest areas could further constrain supply, she reckons. While rising Malaysian inventories and softer exports may weigh on prices in near term, stocks may decline as production eases and weather-related losses emerge, she adds. Chye raises her 2027 CPO price estimate to 4,500 ringgit from 4,300 ringgit a ton. Hong Leong maintains an overweight rating on Malaysian plantation sector, pegging Hap Seng Plantations and IOI Corp. as top picks.(yingxian.wong@wsj.com)
2056 ET - Gold edges higher in early Asian trade. Sentiment is likely buoyed by the expectation that the People's Bank of China will continue adding to its gold reserves, ANZ Research writes in a note. However, the prospect of more Fed rate hikes still hangs over the market, it adds. Spot gold is 0.2% higher at $4,142.86 an ounce. (kimberley.kao@wsj.com)
Barring any material disruptions, West African Resources should comfortably meet its production targets, particularly if improved access to explosives continues. That is Macquarie's view following the gold miner's 3Q operational update. West African Resources reported 3Q output of 127,950 oz of gold. That beat Macquarie's forecast by 11%. "We are likely to see improved all-in sustaining costs this quarter, given stronger sales (135,000 oz, +22% quarter-over-quarter) offsetting the increase in mined and milled tonnage," Macquarie says. It retains an outperform call and A$4.00/share price target on West African Resources, which ended Thursday at A$3.50. (david.winning@wsj.com; @dwinningWSJ)
1811 ET - The big news in Fortescue's unscheduled operational update was 3.9 million tons of missing iron-ore sales and a commensurate build in working capital, Bell Potter says. Fortescue reported sales of 42.9 million tons in 1Q. That was 8% below shipments of 46.8 million tons. Fortescue attributed the gap to continuing negotiations with China Mineral Resource Group, which is China's centralized ore buying agency. "Typically, variance between Fortescue's shipments and sales is immaterial," analyst David Coates says. Price realizations appear to have suffered as a result. "While we view resolution as likely, we also view it as likely that the resolution will include lower price realizations over the long term, particularly as pricing power shifts to buyers in market conditions of stable demand and growing supply," Bell Potter says. (david.winning@wsj.com; @dwinningWSJ)
1555 ET - Crude oil futures settled higher as Hurricane Isaias heads for the U.S. Gulf coast, shutting in production. The market reacts less to proclamations from President Trump regarding the status of negotiations with Iran and a pause on attacks until after the midterm elections on Nov. 3. Even though Trump's comments would suggest that negotiations are progressing, their effect on price movement appears to have weakened. "The market has heard it all before, and the pullback just isn't what it was in the past," says Robert Yawger of Mizuho Securities USA in a note. WTI finished up 3.6% to $91.49 a barrel, and Brent crude settled up 4.1% to $104.28 a barrel.
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