U.S. Commodities Day Ahead: Gold Reaches Record on Debt Deadlock
The following are the top stories on metals, agriculture and shipping.
ECONOMIC EVENTS, AGRICULTURE REPORTS:
Forecast Prior Time
(N.Y.)
Dallas Fed Mfg. Activity JUL -5.6 -17.5 10:30
Poultry Slaughter LW YoY% JUN 7.6% 8:30
Export Inspections - Corn JUL 21 28.95 10:00
Export Inspections - Soybeans JUL 21 3.71 10:00
Export Inspections - Wheat JUL 21 18.73 10:00
USDA Cattle Slaughter JUL 25 126000 14:00
USDA Hog Slaughter JUL 25 374000 14:00
Crop Condition - Corn JUL 22 66% 16:00
Crop Condition - Soybeans JUL 22 64% 16:00
Crop Conditions - Cotton JUL 22 28% 16:00
Winter-Wheat Harvest JUL 22 16:00
METAL PRICES: ($/ton)
Last % Chg RSI
Copper 9,643 -0.3 58
Aluminum 2,606 +0.6 59
Zinc 2,468 -1.1 62
Lead 2,684 -0.2 53
Nickel 23,870 -0.4 55
Tin 28,250 -0.2 65
OTHER MARKETS:
Last % Chg % YTD
U.S. Dollar Index 74.117 -0.2 -6.2
Crude Oil $98.92 -1.0 +8.3
Gold $1,618.0 +1.0 +14
MSCI World Index 1,346.37 -0.2 +5.2
TOP STORY:
Gold Advances to Record as U.S. Debt Deadlock Boosts Demand
Gold climbed to a record in London and New York as U.S. lawmakers failed to reach an agreement on raising the federal debt limit, boosting demand for the metal as a protection of wealth.
COMMODITY EXCLUSIVES:
Lowest Yield Nearing Brazil’s as Oil Cuts Deficit: Russia Credit
Russia’s record-low bond yields are converging with Brazil as rising oil prices help erase the budget deficit of the world’s largest energy exporter.
Aussie Joining Reserve Currencies as Bankers Seek Havens (2)
Commodities are losing their influence over currencies of nations that depend on raw materials exports as traders seek havens from the deficit and debt turmoil roiling the European Union, U.S. and Japan.
AWE May Buy Oil, Gas Assets After Cutting N.Z. Reserves Estimate
AWE Ltd., whose shares fell the most in more than 2 1/2 years after cutting its oil-reserves estimate, said the company is considering acquisitions in Australia, New Zealand and Asia.
Oil at $120 Now Biggest Bet as Futures Leave Forecasters Behind
The biggest bet in the oil market has become a 20 percent increase to $120 by the end of the year as global growth drives demand for raw materials.
Goldman to Buy 26.5% of Aksa Enerji for $450 Million (1)
Goldman Sachs Group Inc. will buy 26.47 percent of Aksa Enerji Uretim AS, a Turkish electricity producer, by paying $450 million, or 5.05 liras a share, to Aksa parent Kazanci Holding AS, Aksa chairman Cemil Kazanci said in a telephone interview.
BP Breakup Worth $100 Billion to JPMorgan on Strategy Doubts (1)
Robert Dudley could unlock $100 billion for BP Plc investors by following ConocoPhillips and splitting up Europe’s second-biggest oil producer.
Investors Increase Bullish Commodity Bets by Most in a Year (1)
Funds boosted bets on rising commodity prices by the most in almost a year on speculation that the global economic recovery will prove resilient.
Food Prices to Stay High on Underinvestment, Climate, IFAD Says
Global food prices will remain high as underinvestment in agriculture over decades has left supplies unable to meet demand, according to a United Nations agency.
North Dakota Soggy Wheat Fields Dimming Prospects for Harvest
Wheat production in North Dakota, the biggest U.S. grower, may lag behind government estimates after unrelenting rains delayed planting and made fields more vulnerable to damage from hot summer weather.
INDUSTRIAL METALS:
Strike Contagion Afflicts BHP, Anglo as Miners Seek Bigger Share
Mine workers across three continents are striking over pay, disrupting production as near-record prices for coal, copper and gold boost profit at BHP Billiton Ltd., Xstrata Plc and Anglo American Plc.
Sterlite Profit Rises 62% on Higher Copper Prices, Refining Fees
Sterlite Industries (India) Ltd., the nation’s largest copper producer, reported a 62 percent jump in first-quarter profit, boosted by an increase in refining fees and base metal prices.
Copper, Oil, Corn Drop After U.S. Talks Stall; Gold at Record
Copper, oil and grains declined while gold climbed to a record as a lack of progress in raising the U.S. debt ceiling boosted concern that the world’s largest economy may default, hurting industrial commodities and increasing demand for a haven.
Copper May Drop for Fourth Day on Concern About a U.S. Default
Copper may fall for a fourth day in London on concern about a potential U.S. default after lawmakers failed to agree on raising the debt ceiling.
MINING:
Amplats Sees Costs Exceeding Target, Above Average Metal Price
Anglo American Platinum Ltd., source of about 40 percent of world output of the metal, expects costs to exceed its estimates, and average market prices, after energy charges rose and deaths at its mines doubled in the first half.
South African Jobs Under Threat as Wage Strikes Near Record (2)
Work stoppages in South Africa may reach record levels this year as unions demand inflation-busting pay increases that threaten to deter investment and worsen the 25 percent unemployment rate.
Anglo Platinum’s First-Half Profit Climbs 20% as Prices Gain (1)
Anglo American Platinum Ltd., the source of about 40 percent of world output of the metal, said first-half profit rose 20 percent as prices gained on demand for jewelry and anti- pollution devices.
Amplats Sees ‘Multiple’ Deep-Shaft Opportunities in South Africa
Anglo American Platinum Ltd. said it sees “multiple” deep-shaft opportunities within the next 10- to-20 years in South Africa, mainly in the Western Limb region.
Fortescue CEO Says Strong Cash Flow is Deferring Fund Raising (1
Fortescue Metals Group Ltd., Australia’s biggest junk-bond seller, said “very strong” cash flows from high iron ore prices is deferring its need to raise more capital for a $8.4 billion expansion of its operations.
PRECIOUS METALS:
Gold at $1,600 ‘Fundamentally Justified,’ Franklin’s Land Says
Gold at $1,600 an ounce is a “fundamentally justified price,” said Steve Land, lead portfolio manager at Franklin Templeton Investments’ Franklin Gold and Precious metals Fund, which has $3.8 billion in assets under management.
AGRICULTURE:
Palm Oil Futures Decline as U.S. Debt Impasse Threatens Demand
Palm oil dropped the most in almost two weeks as stalled U.S. debt-ceiling talks raised concern that the world’s largest economy may default, threatening the global economic recovery and slowing demand for commodities.
China Said to Buy Soybean Oil From Argentina for Stockpiling
China, the world’s largest cooking-oil user, bought 80,000 metric tons of soybean oil from Argentina last week, according to a person with direct knowledge of the transaction.
Wheat Slumps as Russian Exports Erode Demand for U.S., EU Grain
Wheat futures in Chicago slumped on speculation importers of the grain will further shun U.S. and European Union supplies in favor of Russian and Ukranian inventories. Corn also declined.
Cotton Output May Climb in India as Farmers Boost Plantings
Cotton production in India, the world’s second-biggest grower, may climb next year as farmers plant more of the crop because of high prices, according to the nation’s Cotton Advisory Board.
India Lifts 2010-11 Cotton Output Estimate to 32.5 Million Bales
India, the world’s second-largest cotton grower, raised its production estimate for the year ending Sept. 30 to 32.5 million bales, Textile Commissioner A.B. Joshi told reporters in Mumbai today after a meeting of the nation’s Cotton Advisory Board.
Japan’s Food Chain Threat Multiplies as Radiation Spreads (3)
Radiation fallout from the wrecked Fukushima nuclear plant poses a growing threat to Japan’s food chain as unsafe levels of cesium found in beef on supermarket shelves were also detected in more vegetables and the ocean.
SHIPPING:
Higher Ship-Fuel Prices Support Emissions Rules, Clarkson Says
Rising ship-fuel prices are supporting regulations aimed at cutting the industry’s carbon emissions, according to Clarkson Research Services Ltd., a unit of the world’s largest shipbroker.
Capesizes at Anchor Climb to 140 From 139, Global Ports Says
The number of capesize ships anchored worldwide rose to 140 last week from 139 a week earlier, Truro, England-based Global Ports said in a report.
One-Year Capesize Rents Decline Most in 12 Weeks, Clarkson Says
One-year rents for capesize commodity-hauling ships, mostly used to transport iron ore, fell the most in 12 weeks as fleet growth outpaced demand, data from Clarkson Research Services Ltd. showed.
ECONOMIES:
China Orders Rail-Safety Probe, Fires Officials on Fatal Crash
China ordered a two-month inspection of rail safety and fired three officials after at least 36 people were killed in a high-speed train crash two days ago.
Geithner Says Framework of Debt-Limit Deal Needed Today (2)
U.S. Treasury Secretary Timothy F. Geithner said he hopes lawmakers can agree on the framework of a debt-limit agreement today because the House of Representatives must start deliberations tomorrow to meet the Aug. 2 deadline.
Greece Sovereign Credit Rating Cut Three Levels by Moody’s (2)
Greece’s credit rating was cut three steps by Moody’s Investors Service, which said the European Union’s rescue for the debt-laden nation will cause substantial losses for investors and amount to a default.
El-Erian Says U.S. Vulnerable to Downgrade, May Avoid Default
The U.S. government may lose its AAA credit rating even if lawmakers reach a plan to avoid a default, said Mohamed A. El- Erian, whose Pacific Investment Management Co. is the world’s largest manager of bond funds.
Republicans, Democrats Prepare Rival Debt-Limit Raise Plans (1)
Republicans and Democrats prepared dueling plans for raising the U.S. debt ceiling, unable to break a partisan stalemate over how to tackle the nation’s $14.3 trillion debt and quell market concerns about a potential default Aug. 2.
Germany Flouts EMU Rules That Brazil, China Uphold: Euro Credit
Brazil, China, Mexico and other so-called emerging economies would make better European Monetary Union members than the nations currently sharing the euro, based on the economic criteria countries are supposed to meet.
Women Controlling Consumer Spending Sparse Among Central Bankers
In the early 19th century, an investor known as the Widow Borski acquired almost half the shares of the Netherlands’ new central bank to assist a nation strapped by the Napoleonic wars.
OTHER MARKETS:
Asian Stocks, Treasuries Drop on U.S. Debt Talks; Gold Advances
Asian stocks and oil declined for the first time in five days, while Treasuries dropped and gold rallied to a record as U.S. President Barack Obama and Congress failed to reach a deal on raising the debt limit, intensifying concern the nation will default.
Franc, Yen Gain as U.S. Debt Impasse Spurs Bids; Euro Declines
Switzerland’s franc strengthened to a record against the dollar on demand for the safest assets as U.S. lawmakers failed to agree on raising the nation’s $14.3 trillion debt ceiling and Greece’s credit rating was cut.
Asian Currencies Retreat From 14-Year High on U.S. Debt Risk
Asian currencies fell from a 14-year high and stocks slumped as the threat of a U.S. debt default damped demand for emerging-market assets.
European Stocks Halt Rally on U.S. Debt Stalemate; Lenders Drop
European stocks halted a four-day rally after President Barack Obama and Congress failed to reach a deal to raise the U.S. debt limit, increasing concern that the world’s largest economy may default. U.S. index futures and Asian equities retreated.
U.S. Stock Futures Drop After Lawmakers Fail to Reach Debt Deal
U.S. stock futures fell, indicating the Standard & Poor’s 500 Index will drop after rallying within 1.4 percent of a three-year high, as President Barack Obama and Congress failed to reach an agreement on raising the federal debt limit, intensifying concern the nation will default.
Oil Declines After U.S. Lawmakers Fail to Agree on Debt Ceiling
Oil declined for the first time in five days on concern a failure to reach a deal on raising the U.S. debt limit may cause the nation to default, threatening the economy of the world’s biggest crude consumer.
Clinton Assures China That U.S. Will Reach Debt Solution (2)
Secretary of State Hillary Clinton reassured China, the top holder of American Treasuries, that the U.S. will resolve its impasse over the debt ceiling and improve the country’s long- term fiscal outlook.
Egyptian Stocks Drop After Clashes Injure 300 People in Cairo
Egyptian stocks fell to the lowest in more than a week after clashes that erupted in central Cairo between supporters and opponents of the ruling military council injured more than 300 people.
SPORTS:
Wenger Wants Crackdown on Illegal Approaches to Players: Roundup
The following is a roundup of soccer stories from U.K. newspapers, with clickable links to the Web.
Forlan Joins His Forefathers as Uruguay Wins 15th Copa America
Diego Forlan scored twice as Uruguay beat Paraguay 3-0 to win its record 15th Copa America soccer championship and move ahead of archrival Argentina.
O’Hair Wins PGA Tour’s Canadian Open to End 12-Tournament Slump
Sean O’Hair couldn’t hold back the tears after his playoff win at golf’s Canadian Open, where he ended a season-long slump in which he failed to earn any prize money in nine of his previous 12 tournaments.
To contact the editor responsible for this story: Stuart Wallace in London at swallace6@bloomberg.net
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