Commodities

Commodity prices drive TSX up, while Wall Street opened mixed

The Toronto Stock Exchange opened this morning moderately higher as commodity prices increased driven mainly by traders’ hopes of a U.S. housing market in recovery mode.

Xstrata and Glencore to close $90bn merger

After months of speculations and secret negotiations, Xstrata PLC (LON:XTA) and Glencore International PLC (LON:GLEN) have formally announced an all-share merger that would create a $90bn giant named "Glencore Xstrata International PLC."

Codelco already struggling to match 2011 copper output

Chilean state giant Codelco, the world's biggest copper producer, will have to strive this year to match record 2011 copper production of 1.735 million tonnes, said CEO Diego Hernandez to the El Mercurio newspaper's Sunday edition.

Randgold Resources shines bright as year profit soars

London- and Nasdaq-listed gold producer Randgold Resources Ltd. (LON:RRS) (NASDAQ:GOLD) stocks went up 3.5 percent after the West Africa-focused miner reported a more than fourfold rise in net profit for the year ended December 2011 due to higher gold prices and a significant increase in production.

Jonathan Lee: Graphite and Vanadium to benefit from battery market growth

Graphite and vanadium may be relatively obscure materials, but these commodities could get a jolt from developing battery technology.

Why invest in commodities?

The demand we are now placing on our planets resources appears to have begun to outpace the rate at which they can be supplied.

Exclusive PIMCO Interview: What will drive commodities higher for years?

Intelligent Commodity Indexingis a new book that explains how investors can intelligently use commodities in a portfolio in order to diversify risk and protect against inflation. Readers will find the book filled with decades of experience from its authors.

The end of the commodities boom

MoneyControl says the equity sell off of the last 48 hours is evoking the memory of the start of the financial crisis in mid 2008. Oil and other commodities prices have fallen, although from historically high levels. The big fear – reflected in a dramatic sell off of natural resources stocks – is that the commodities boom is over, with raw materials set to drop sharply.

Investing in commodities: will oil reach $120 by December?

Although there have been numerous economic reports to derail oil (NYSE:USO), the black gold continues to hold firm.

Burned by sub-prime, banks turn to resource sector for profits

Data out this week show the likes of Goldman Sachs and JP Morgan raking in record revenues of almost $1bn/month in commodity and other trading revenue.

A recent study of mining mergers and acquisitions shows the proportion of financial firms – as opposed to other miners – taking over resource companies had increased fourfold.

And perhaps the most significant indication that US banking practices honed in the property markets have arrived in minerals is news that star metals traders now command pay as high as $3 million/year.

Top investment bank limits hiring as pay for star metals traders reach $3 million a year

UBS AG, Switzerland’s largest bank, is slowing down its commodities hiring expansion after a decade-long bull market drove up pay and created a scarcity of talent. UBS originally wanted to double its commodities staff. Salaries and bonuses for the most-profitable metals traders rose 20% to $2 million to $3 million last year, according to Commodity Search Partners.

The Standard & Poor’s GSCI index of 24 raw materials rose fourfold since the end of 2001 and the surge drove commodity investments to a record $451bn in April this year, about 50% more than a year earlier. A report by researcher Coalition showed a group of 10 large banks increase their commodities revenues by 55% in the first quarter.

UN say commodities bubbles need intervention

Direct government intervention may be needed to burst bubbles in commodity markets inflated by a new herd of financial investors, a UN study found. Excessive speculation has added around 20% to international oil prices, sending false signals to policy makers, said the report published on Sunday.

Since around 2000, as commodities were perceived to have entered a super-cycle and the equities market bubble burst, oil and other raw materials have lured financial investors, as well as the producers and big consumers historically in these markets.

Wood fuel poised to be next global commodity

Wood fuel, one of the oldest energy sources on the planet, could become the newest commodity market if it can overcome supply limits and green concerns as demand grows for renewable energy. Supply constraints are starting to put wood fuel into competition with the paper industry, experts say, in an uneasy reminder of existing tension between the food industry and companies making biofuels from food crops.

In theory burning wood and crop waste emits less carbon than fossil fuels because it simply returns to the air carbon accumulated by plants as they grow, but that balance breaks down if stock is not replanted, or natural forests are logged.

Commodities demand set to continue, say experts

Despite a recent dip in the price of commodities, fears over a longer-term commodities price crash remain unfounded, according to industry experts.

A word on corrections

Silver, in particular, has been hammered – down over 30% at one point. Now that's what I call a proper correction. Is it safe to go back into the water? I have to believe that the speed and depth of the sell-off makes it all the more likely that we'll see a pretty quick bounce back.

World markets down as commodities threaten profits

The AP title says it all this morning. The recovery was produced by will of man (and woman, as Janet Yellen continues to work the 'good cop' side of the street with Ben Bernanke, opposite those thugs Plosser and Bullard on the other side, talking about withdrawing policy accommodation), allowing Wall Street and the greater financial services industry to calculate PE ratios, growth extrapolations and the like.

We love silver but we respect the trends – be careful

We believe in investing in long term bull market trends.

Gold up-date

In such turbulent times, gold should be included in every investment portfolio.

Monetary inflation and supply concerns drive commodities more so than demand

The mainstream press loves to talk about emerging market demand as a cause of inflation, rising prices and the bull market in commodities.

Gold will outperform after stocks peak

At the end of December we posted a commentary titled “Three Things that could Halt Gold’s Run.”

S&P 500 stock index (SPX) correction looming

he US stock markets have enjoyed an awesome run since late August, with the flagship S&P 500 stock index (SPX) up 23.7%. Traders have earned huge profits in sectors that leverage general-stock-market gains, including commodities stocks.

QE2 and its Consequences

The Federal Open Market Committee (FOMC) announced on November 3, 2010 that it would purchase longer-term Treasury securities at a pace of $75 billion dollars per month through the Federal Reserve’s Permanent Open Market Operations (POMO) facility by the end of the second quarter 2011 and potentially beyond.

2011 financial meltdown fast approaching

Despite the best efforts by the American mainstream financial media, the eager PR division of the United States Dollar Ponzi Scheme, to paint the rosiest of rosy pictures for blindly optimistic readers, the stubborn image of a debt-swollen jobless behemoth economy slowly toppling persists.

Gold consolidation before the next move higher

I’ve been talking to subscribers this past week about the powerful move we’ve seen in US indices as of late and the recent pattern formed in the S&P which is a rarity. It’s the swiss steps pattern as shown below.