Gold review: Greeenback remains the focal point.
The metal's biggest nemesis - the US dollar - picked up a bid yesterday, possibly due to a rise in the 10-year treasury yield to a three-week high of 2.90 percent. The USD exchange rate, as represented by the dollar index, clocked a 14-day high of 95.74 yesterday, and was last seen trading at 95.29. The pullback from the highs seen yesterday has likely helped the yellow metal recover from $1,190 to $1,194. The data, due for release this Friday, is expected to show the average hourly earnings rose 2.8 percent year-on-year in August, following a 2.7 percent rise in July.
Market worries over US-Sino trade conflicts and a stronger US dollar accounted for the losses.
As the US dollar gained on support from strong US ISM manufacturing data, the SHFE 1811 contract lost 650 yuan/mt to close at 46,940 yuan/mt. LME copper slumped to test support at the $5,800/mt level, and dipped to approach the Bollinger lower band. Market worries over US-Sino trade conflicts and a stronger US dollar accounted for the losses. With potential fresh tariffs from the US on $200 billion worth of Chinese goods, longs should remain cautious when they enter the market today. Spot premiums are likely at 150-200 yuan/mt today.
Market concerns over a trade war and a surge in supplies also weighed on the contract.
LME nickel slumped to a low of $12,375/mt as the US dollar gained. It closed at $12,490/mt and LME stock lost 510 mt to 237,984 mt. The SHFE 1811 contract received support at the 102,000 yuan/mt level after it tumbled to a low of 102,010 yuan/mt as shorts added. Market concerns over a trade war and a surge in supplies also weighed on the contract. We expect LME nickel to hover weakly around $12,500/mt, and the SHFE contract at 102,000-103,500 yuan/mt today. Spot prices are set at 102,500-108,000 yuan/mt.
Oil dips as U.S. storm threat eases; Iran sanctions loom.
Oil prices fell on Wednesday, partly reversing a strong jump from the previous day, as the impact of a tropical storm on U.S. Gulf coast production was not as strong as initially expected. Prices jumped the previous day as dozens of U.S. oil and gas platforms in the Gulf of Mexico were shut in anticipation of tropical storm Gordon hitting the region. But the storm was shifting eastward late on Tuesday, reducing its threat to producers on the western side of the Gulf and most Gulf Coast refineries. Innes, head of trading for Asia/Pacific at futures brokerage OANDA, said many crude futures traders were "caught long and wrong over the past 24 hours due to tropical storm buying frenzy", adding that "prices pulled back considerably as the magnitude of the storm suggests production losses will be limited."
The metal's biggest nemesis - the US dollar - picked up a bid yesterday, possibly due to a rise in the 10-year treasury yield to a three-week high of 2.90 percent. The USD exchange rate, as represented by the dollar index, clocked a 14-day high of 95.74 yesterday, and was last seen trading at 95.29. The pullback from the highs seen yesterday has likely helped the yellow metal recover from $1,190 to $1,194. The data, due for release this Friday, is expected to show the average hourly earnings rose 2.8 percent year-on-year in August, following a 2.7 percent rise in July.
Market worries over US-Sino trade conflicts and a stronger US dollar accounted for the losses.
As the US dollar gained on support from strong US ISM manufacturing data, the SHFE 1811 contract lost 650 yuan/mt to close at 46,940 yuan/mt. LME copper slumped to test support at the $5,800/mt level, and dipped to approach the Bollinger lower band. Market worries over US-Sino trade conflicts and a stronger US dollar accounted for the losses. With potential fresh tariffs from the US on $200 billion worth of Chinese goods, longs should remain cautious when they enter the market today. Spot premiums are likely at 150-200 yuan/mt today.
Market concerns over a trade war and a surge in supplies also weighed on the contract.
LME nickel slumped to a low of $12,375/mt as the US dollar gained. It closed at $12,490/mt and LME stock lost 510 mt to 237,984 mt. The SHFE 1811 contract received support at the 102,000 yuan/mt level after it tumbled to a low of 102,010 yuan/mt as shorts added. Market concerns over a trade war and a surge in supplies also weighed on the contract. We expect LME nickel to hover weakly around $12,500/mt, and the SHFE contract at 102,000-103,500 yuan/mt today. Spot prices are set at 102,500-108,000 yuan/mt.
Oil dips as U.S. storm threat eases; Iran sanctions loom.
Oil prices fell on Wednesday, partly reversing a strong jump from the previous day, as the impact of a tropical storm on U.S. Gulf coast production was not as strong as initially expected. Prices jumped the previous day as dozens of U.S. oil and gas platforms in the Gulf of Mexico were shut in anticipation of tropical storm Gordon hitting the region. But the storm was shifting eastward late on Tuesday, reducing its threat to producers on the western side of the Gulf and most Gulf Coast refineries. Innes, head of trading for Asia/Pacific at futures brokerage OANDA, said many crude futures traders were "caught long and wrong over the past 24 hours due to tropical storm buying frenzy", adding that "prices pulled back considerably as the magnitude of the storm suggests production losses will be limited."
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