Commodities tumbled into a bear market as U.S. reports on manufacturing, jobless claims and home sales signaled a faltering economy after the Federal Reserve refrained from announcing another round of stimulus. The Standard & Poor’s GSCI Spot Index of 24 raw materials fell 2.8 percent to settle at 559 at 3:56 p.m. New York time. The gauge has dropped 22 percent from this year’s highest close of 715.52 on Feb. 24, entering a bear market. Earlier, the measure touched 558.14, the lowest since November 2010. Metals and energy led today’s slump.
Thursday, June 21, 2012
Commodities Fall Into a Bear Market
Commodities tumbled into a bear market as U.S. reports on manufacturing, jobless claims and home sales signaled a faltering economy after the Federal Reserve refrained from announcing another round of stimulus. The Standard & Poor’s GSCI Spot Index of 24 raw materials fell 2.8 percent to settle at 559 at 3:56 p.m. New York time. The gauge has dropped 22 percent from this year’s highest close of 715.52 on Feb. 24, entering a bear market. Earlier, the measure touched 558.14, the lowest since November 2010. Metals and energy led today’s slump.
IMF Sees Euro Crisis at Critical Stage
The euro area crisis has reached a “critical stage” and member nations must make a “strong commitment” to the shared currency to stop the plunge in investor confidence, the International Monetary Fund said in a report that recommended issuing common debt as one solution.
ISM Services Index in U.S. rose to 53.7 in May from 53.5
The Institute for Supply Management’s index of non-manufacturing businesses, which covers about 90 percent of the economy, rose to 53.7 in May from the prior month’s 53.5, the Tempe, Arizona-based group said today. The median forecast of 75 economists surveyed by Bloomberg News projected 53.4. Readings above 50 signal expansion.
Citigroup may take $5 billion hit on forex
June 20 (Bloomberg) -- Citigroup Inc. could take a $3 billion to $5 billion “hit” this quarter related to foreign exchange, according to Charles Peabody, an analyst at Portales Partners LLC.
CBOE to trade SPX variance strips
CHICAGO, IL -- June 19, 2012 - The Chicago Board Options Exchange (CBOE) has announced that it plans to introduce, starting July 27, a process for trading SPX Variance Strips -- a portfolio of S&P 500 Index options (SPX) intended to replicate S&P 500 implied variance exposure -- in a single transaction.
U.S. stocks tumble amid concern about global economic slowdown
June 21 (Bloomberg) -- U.S. stocks tumbled, sending the Standard & Poor’s 500 Index lower for a second day, as signs of a slowdown in global manufacturing added to disappointing housing and labor market data at the world’s largest economy.
Stock market retraces to key support levels
Was it Moody’s post-close downgrades… hanging over the market’s head all day, that caused its session-long decline? Probably not, since there hasn’t been much of a relief rally since then. And when the market ignores unfinished business above, usually it is being overwhelmed by something substantial.
10 celebrities who worked on futures trading floors
The trading floors of futures exchanges in Chicago and New York have not only been training venues for successful traders and futures exchange executives but many famous folks have spent some of their formative years in the trading pits. The list is slightly skewed towards athletes who always have been drawn to the trading floor due to the physical demands of trading, but a few may surprise you. Futures would like to thank CME Group for help in compiling this list.
NFA bars Colorado futures firms
June 21, Chicago - National Futures Association (NFA) has permanently barred Arjent Capital Advisors LLC (ACA), a commodity pool operator, and Chicago Trading Managers LLC (CTM), a commodity pool operator and commodity trading advisor, located in Boulder, Colorado. NFA also barred Spencer K. Montgomery, the firms' principal, from NFA membership for three years. The Decision, issued by NFA's Hearing Panel, is based on a Complaint filed on March 12, 2012 and a settlement offer submitted by ACA, CTM and Montgomery.
Texas forex firms must pay $5.4M in restitution and sanctions
The U.S. Commodity Futures Trading Commission (CFTC) today announced that it obtained a federal court order imposing more than $5.4 million in restitution and a civil monetary penalty on defendants Linda Harris, Chance Harris and their companies, CDH Forex Investments, LLC (CDH Forex) and CDH Global Holdings, LLC (CDH Global), all of Flower Mound, Texas, for fraud in connection with the operation of a commodity pool and managed accounts trading off-exchange foreign currency (forex) contracts.
Grain complex closes lower Thursday
Corn futures settle 17 to 22 cents lower on Thursday. Prices in the corn market tumbled after midday on long liquidation and sluggish ethanol demand. Weakness in the outside markets, the higher index, and lower crude oil prices weighed on the market. Bearish weekly corn export sales were pegged at 171,400 metric tonnes, below estimates of 450,000-650,000 metric tonnes. Soybean futures settled 7 to 22 cents lower on Thursday...
FINRA fines Merrill Lynch $2.8M, $32M in remediation
The Financial Industry Regulatory Authority (FINRA) announced today that it has fined Merrill Lynch, Pierce, Fenner & Smith, Inc. $2.8 million for supervisory failures that resulted in overcharging customers $32 million in unwarranted fees, and for failing to provide certain required trade notices. Merrill Lynch has provided $32 million in remediation, plus interest, to the affected customers.
Stocks, oil, gold sink on growth worries
Global stocks fell 2.0 percent and Brent crude oil ended at its lowest in 18 months o n Thursday as data showing Chinese, European and U.S. manufacturing activity had slowed further underscored worries about weaker global growth. The disappointing data came just a day after the Federal Reserve extended its monetary stimulus program aimed at boosting the U.S. economy. U.S. stocks posted their worst day in three weeks, adding to losses after Goldman Sachs recommended shorting the benchmark S&P 500 index.
Gold drops 2.5 percent after data stirs deflation fears
Gold fell 2.5 percent on Thursday, nearly wiping out this year's gains as renewed fears of a global economic slowdown and disappointment over a lack of aggressive U.S. Federal Reserve stimulus dampened bullion's inflation-hedge appeal. The metal posted its biggest one-day drop since February 29. Its selloff started on Wednesday when the Fed ended a policy meeting without launching a new round of monetary easing but instead opted to lengthen its "Operation Twist" program aimed at lowering long-term interest rates. Silver slid more than 4 percent, following steep losses on Wall Street and Brent oil's 3.5 percent drop to below $90 a barrel. Thursday's selloff in assets across the board lessened the need for buying gold to hedge against inflation.
Brazil-China to Sign $30 Billion Currency Swap Agreement Soon
Brazil and China will sign an agreement in the coming weeks to swap as much as $30 billion in their two currencies, Brazil Finance Minister Guido Mantega said. The currency swap, worth 60 billion reais or 190 billion yuan, will be the first step in a broader agreement with Russia, India and South Africa to allow members of the so-called BRICS group of emerging markets to pool resources to better weather the global financial crisis, Mantega told reporters yesterday in Rio de Janeiro. The agreement, which was discussed this week by leaders of the BRICS at a Group of 20 summit in Mexico, marks another step in a deepening trade between the world’s two largest emerging markets. China overtook the U.S. in recent years to become Brazil’s biggest trading partner, though Mantega said yesterday that the $76 billion in bilateral commerce last year, 17 percent of Brazil’s total, is just the beginning. “There’s no limit to how much trade can grow,” Mantega said.
Cattle trading lower ahead of USDA report
Corn futures are trading 6 to 14 cents lower at midday. New crop prices have improved from morning levels but are still trading lower. Prices dipped as parts of the western Corn Belt received much needed rains the boost soil moisture levels, however forecasts across the eastern Corn Belt still remains relatively dry. Weakness in the outside markets and the higher dollar index are pressuring prices. Weekly corn export sales were pegged at 171,400 metric tonnes, below estimates between 450,000-650,000 metric tonnes...
Early Ohio wheat harvest opens door for double-crop soybeans
The near-record warm winter in and the early and unusually warm spring in the Midwest this year have caused wheat to mature sooner than normal, which could let farmers plant a second crop, such as soybeans, to increase their profit potential using the same land, an Ohio State University Extension educator says. Traditionally, Ohio wheat comes off around July 4 and sometimes as late as July 20. But for growers to be considering harvesting wheat around June 20 this year is highly unusual, said Ed Lentz, an associate professor who specializes in crop production and agronomy. “Ohio typically is too far north to have a growing season long enough to raise two crops before a killing frost,” he said. “But if you think about it, how often do we get a record warm winter and early spring such as this with everything two or three weeks ahead of time? It’s been a very unusual year.” While Ohio growers have had seasons that have been compatible for planting double crops in the past, it doesn’t happen very often, Lentz said. “Growers in southern Ohio typically have a better chance of double cropping because they have more days before the first killing frost in October than other parts of the state,” he said. “They typically have at least two to four more weeks than northern Ohio. But this year, the entire state can potentially look at double cropping, which is highly unusual.” This is significant, considering the financial boost a double crop could potentially mean for a grower’s bottom line, Lentz said. “If you can plant soybeans and still get a harvest and make more money than it took to grow them, you can increase your profits,” he said. “It’s using the same number of acres but getting the yields and financial benefit from two crops.”
Stocks Drop While Commodities Poised for Bear Market
U.S. stocks fell for a second day, commodities were poised to enter a bear market and Treasuries rose as reports on global manufacturing fueled concern the economy is slowing. Spanish bonds rallied. The Standard & Poor’s 500 Index tumbled 1.5 percent to 1,335.44 at 1:34 p.m. in New York. The S&P GSCI gauge of 24 commodities slid to the lowest level since November 2010 and is down more than 21 percent from a closing high in February. Oil dipped below $80 a barrel for the first time in eight months. Ten-year Treasury yields lost five basis points to 1.60 percent, while Spain’s two-year yield slipped 34 points to 4.67 percent as the nation sold more debt than planned at an auction.
Commodities Fall to Lowest Since 2010 as Fed Cuts Outlook
Commodities were poised to enter a bear market as U.S. reports on manufacturing, jobless claims and home sales signaled a faltering economy after the Federal Reserve refrained from announcing another round of stimulus. The Standard & Poor’s GSCI Spot Index of 24 raw materials fell 2.4 percent to 561.37 at 1:57 p.m. New York time. Earlier, the measure touched 559.89, the lowest since November 2010. The gauge will shift into a bear market with a settlement at 572.41 or lower, a 20 percent drop from this year’s highest close of 715.52 on Feb. 24. Metals and energy led today’s slump..
Comex Gold Sells Off Sharply amid Fully Bearish Outside Market Forces
Comex gold futures prices ended the U.S. day session sharply lower and at a fresh three-week-low close Thursday. The key “outside markets” were fully bearish for the precious metals Thursday–the U.S. dollar index posted strong gains, while crude oil prices were sharply lower and hit a fresh 8.5-month low. It was also a raw-commodity-market-bearish “risk-off” day in the market place Thursday, following downbeat economic data coming out of China overnight and after Tuesday’s FOMC report that showed an anemic U.S. economy. Gold bears also gained fresh downside near-term technical momentum Thursday. August gold last traded down $48.00 at $1,567.80 an ounce. Spot gold was last quoted down $39.50 an ounce at $1,567.75. July Comex silver last traded down $1.484 at $26.915 an ounce.
Corn drops as Brazil crop may add to glut
Corn fell in Chicago on concern a record harvest in Brazil’s Mato Grosso state may add to a supply glut and on speculation slowing U.S. economic growth will cut demand for grain used to make ethanol.
Mato Grosso’s second-season corn crop is expected to be “super-sized,” climbing to 13.1 million metric tons from 6.9 million tons in 2010-11, Soybean & Corn Advisor wrote June 19. World stockpiles are expected to reach the highest level in more than a decade in 2012-13 on a record crop in the U.S., the country’s Department of Agriculture estimates.
Oil Futures Drop Below $80 for First Time in Eight Months
Oil tumbled below $80 a barrel for the first time in eight months on weak economic data that increased concern that demand will slow with supplies at the highest level in almost 22 years.
Futures dropped as much as 2 percent as manufacturing slumped in the U.S., Europe and China and more Americans than forecast filed applications for unemployment benefits. Sales of previously owned U.S. homes declined in May. U.S. oil stockpiles rose last week to the most since 1990, the Energy Department reported yesterday.
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