Jan. 12 (Bloomberg) — Adrian Kinderis, a member of the Internet Corporation for Assigned Names and Numbers’ advisory council and chief executive officer of ARI Registry Services, talks about domain names. Icann, manager of the Web’s address system under a U.S. Commerce Department contract, will start accepting applications for new top-level domains today. The Marina del Rey, California-based group may approve hundreds of new Web address extensions to the right of the “dot,” including company and brand names, cities and almost any word in any language. Kinderis speaks from New York with Susan Li on Bloomberg Television’s “First Up.” (Source: Bloomberg)
ECB Holds Benchmark Interest Rate Steady at 1%
Jan. 12 (Bloomberg) — The European Central Bank held interest rates steady after two straight cuts as signs of respite from the sovereign debt crisis gave it scope to pause. ECB policy makers meeting in Frankfurt kept the benchmark interest rate at a record low of 1 percent. Sara Eisen reports on Bloomberg Television’s “In the Loop.” (Source: Bloomberg)
Gold’s Appeal “Undiminished” as China Blocks High-Yield Savings, Euro-Debt Auction Succeeds “Thanks Only” to ECB Money
London Gold Market Report
from Adrian Ash
BullionVault
Thurs 12 Jan., 08:55 EST
The PRICE of BOTH gold and silver hit a 1-month high in London on Thursday morning, gaining 0.9% and 2.1% respectively as world stock markets also rose, as did the single Euro currency and industrial commodities.
US, German and UK government bond prices all ticked lower, nudging yields higher, after Spain and Italy successfully auctioned €22 billion in new debt between them, and at much lower interest rates than investors demanded in December.
Dollar prices to buy gold touched $1658 per ounce. Silver extended its New Year gains to 10.0% at $30.70.
“Because gold is easy to sell, it has seen the same flight to cash that risk assets such as equities have suffered,” says Mark Dampier head of research at UK equity and fund brokerage Hargreaves Lansdown, writing in Money Marketing magazine.
However, “The attractions of gold remain undiminished…I believe the fall back in price could present a buying opportunity,” says Dampier, advising investors to consider “more risky and potentially more rewarding” exposure to gold through mining stocks.
“Clearly the uptrend [in gold] will prevail,” agrees UBS Wealth Management’s head of commodity research Dominic Schnider.
“[But] technically we are still in a consolidation period after the record high in September, and this phase will likely end in end-February or early March.”
Ending New York trade on Wednesday some 0.3% higher – and “finally closing back above its 200-day moving average at 1636” – the rising price to buy gold means “We are more neutral now from our bearish outlook,” says Scotia Mocatta’s latest technical analysis.
Wholesale demand to buy gold in Hong Kong was “slow” overnight according to one local dealer.
“This is surprising,” says Thursday’s commodities note from Standard Bank, “given that we usually see a seasonal pick-up in physical gold demand from China ahead of the New Year celebrations” – falling earlier than usual in 2012 on January 23rd.
China meantime reported a drop in consumer-price inflation to 4.1% annually for December.
Currently offered just 3.5% annual interest on bank deposits, Chinese households were today deprived of yields of up to 9% offered by trust funds investing in short-term debt issued by banks and corporations known as commercial paper.
“We have received the phone call today, and the product has been banned,” Reuters quotes an un-named executive with a state-owned trust.
“If the notes aren’t sold to banks, it’s equivalent to moving a loan off banks’ balance sheets,” says She Minhua at Zhong De Securities.
One Chinese data provider says 17 such commercial-paper trusts were launched in 1 week in December. The China Banking Regulatory Commission reckons their total value is perhaps CNY300 billion ($48bn).
Beijing yesterday announced its 2012 targets for money-supply and bank lending growth, raising the permitted volume of new credit by 7% from 2011’s full-year total of CNY7.47 trillion ($1.18trn).
“Inflation is coming down, but there are still a lot of tailwinds and structural forces behind price rises,” says Kevin Lai at Daiwa Capital Markets in Hong Kong, speaking to Reuters and pointing to last year’s 22% rise in the China’s minimum wage.
But “China is more worried about an economic slowdown now and will continue the policy easing cycle,” says Nomura’s chief China economist Zhang Zhiwei.
Here in Europe on Thursday, both the UK and Eurozone central banks today voted to keep their interest rates on hold, and both also left their latest “extraordinary measures” on hold.
That enables the Bank of England to buy and hold a total of £275 billion ($420bn) in UK government bonds. The European Central Bank will next month repeat its unlimited offer of 3-year loans, of which commercial banks took €489 billion ($623bn) in December.
“The only reason [today’s Italian and Spanish debt sale] has been taken so well is abundant ECB liquidity,” reckons strategist Michael Leister at DZ Bank in Frankfurt.
“The market seems very complacent.”
Eurozone governments “need to do their utmost” to correct fiscal deficits, said ECB president Mario Draghi at the monthly press conference following today’s interest-rate decision, adding that the 50% write-down of privately-held Greek government debt is “unique and exceptional”.
The Euro rose on Thursday, but the Pound fell to its lowest level against the Dollar since early October, helping the price to buy gold in Sterling rise to 1-month highs just shy of £1080 per ounce.
Gold price chart, no delay | Buy gold online at live prices
Adrian Ash is head of research at BullionVault, the secure, low-cost gold and silver market for private investors online, where you can buy gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.
(c) BullionVault 2012
Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.
ABN’s Duret Says Weak Euro `More Blessing Than Threat’
Jan. 12 (Bloomberg) — Didier Duret, chief investment officer at ABN Amro Private Banking, talks about Europe’s debt crisis, its implications for global equity markets and the outlook for the euro. Duret speaks with Rishaad Salamat on Bloomberg Television’s “On the Move Asia.” (Source: Bloomberg)
Lasair’s McCabe on Outlook for Hedge Funds
Jan. 11 (Bloomberg) — Carrie McCabe, founder and chief executive officer at Lasair Capital LLC, talks about the outlook for hedge funds. She speaks with Pimm Fox on Bloomberg Television’s “Taking Stock.”
Forex CT 12-1-12 Video Market Update & Outlook
Video courtesy of ForexCT – A leading Australian forex broker, liscensed by the Australian Securities & Investments Commission, offers the MetaTrader4 and PROfit Platform to retail traders. Other services include Segregated Accounts, Trading workshops, Tutorials, and Commodities trading.
EUR Once Again Bearish Ahead of Debt Auctions
Source: ForexYard
Ahead of a key European interest rate announcement scheduled for later today, the EUR once again has turned bearish following comments from a from a leading credit agency which highlighted just how vulnerable the currency is. With Spanish and Italian debt auctions scheduled to close out the week, traders can count on heavy volatility throughout the day today.
Economic News
USD – Return to Safe-Havens Turns USD Bullish
The US dollar recouped many of its losses from earlier in the week yesterday, as traders once again abandoned riskier assets in favor of safe-haven currencies like the greenback. The move brought the EUR/USD just shy of its 16-month low, while the GBP/USD fell to right around the 1.5300 level. The dollar’s bullish movement began after comments by a leading credit agency regarding the euro-zone debt crisis sent traders to more secure currencies. The comments highlighted just how fragile the euro-zone situation is.
Turning to today, while most of the day is likely to be dominated by euro-zone news, traders will want to pay attention to several US economic indicators which may influence the markets. Both the Core Retail Sales and Retail Sales figures are forecasted to come in above last month’s figures. Additionally, the weekly US Unemployment Claims figure is predicted to show continued positive movement in the American employment sector. If so, investors may be more inclined to shift their funds to riskier assets. That being said, if any negative European news is released today, it would likely lead to heavy EUR losses in mid-day trading.
EUR – Euro Dips Ahead of Minimum Bid Rate
Negative comments by a top credit agency turned the euro bearish in yesterday’s trading, following several days of upward movement. The comments served as a warning to any trader who thought that the currency could maintain its bullish momentum. The EUR/USD once again dropped toward a 16-month low as investors reverted their funds back to safe-haven currencies.
Today, a batch of European news is forecasted to influence the market-place. The European Central Bank’s interest rate decision and subsequent press conference is expected to generate heavy market volatility. Additionally, euro-zone debt auctions scheduled for today and tomorrow will illustrate just how bad the current euro-zone crisis actually is.
Traders should note that unless the debt auctions go smoothly, the euro is unlikely to stage any kind of meaningful recovery before the end of the week. With market sentiment overwhelmingly against the euro at the moment, it would take substantially good news to turn the currency bullish.
JPY – Yen Drops to 5-Day Low against USD
The USD/JPY broke the 77.00 barrier yesterday to reach a 5-day high before edging back down in late day trading. Analysts attributed the spike to a return to safe-have assets following another negative day for the euro. The yen faired significantly better against its other main currency rivals, like the euro and British pound, as it was able to take advantage of its reputation as a stable currency during market volatility.
Today, the JPY is forecasted to remain bullish against the EUR and GBP, as a batch of euro-zone news is likely to create major price movements in the market. Without positive European news, the yen may continue its bullish run to close out the week. At the same time, the USD seems to be benefitting most from the current bout of negative euro-zone data. If the current trend remains, the USD/JPY is likely to rise even further.
Crude Oil – Oil Prices Fall Amid Euro-Zone Debt Fears
The price of crude oil fell on Wednesday, as fears of an economic slowdown in Europe prompted investors to shift their funds away from the commodity. With the USD once again rising, crude oil has become less attractive of an investment. A strong US dollar makes oil more expensive for international buyers and drives investors away.
Crude was still able to stay well above the $100 a barrel level, as continued tensions between Iran and the West kept supply side fears on investors’ minds. Today, with plenty of euro-zone news forecasted to impact the markets, traders can expect another hectic day for oil. Any increase in the value of the US dollar is likely to send the price of oil down further.
Technical News
EUR/USD
A bullish cross on the daily chart’s Stochastic Slow is a sign that upward movement may occur in the near future. This theory is supported by the Relative Strength Index on the same chart, which has drifted into the oversold zone. Traders may want to go long in their positions today.
GBP/USD
The Williams Percent Range on the weekly chart has dipped well into the oversold region, indicating that bullish movement may be on the horizon. Additionally, the Relative Strength Index is hovering close to the 20 level. Going long may be the preferred strategy today.
USD/JPY
Technical indicators are still providing mixed signals for this currency pair. While the Relative Strength Index on the 8-hour chart is in oversold territory, most other indicators are in the neutral zone. Taking a wait-and-see approach may be the preferred strategy today.
USD/CHF
The daily chart’s Williams Percent Range has drifted above the -20 level, indicating that bearish movement may occur in the near future. Traders may want to go short in their positions before any downward correction.
The Wild Card
Platinum
The 8-hour chart’s technical indicators show that this commodity has been overbought for some time. A bearish cross has formed on the Stochastic Slow, while the Relative Strength Index shows that a downward correction could take place. Forex traders may want to take this opportunity to open short positions ahead of a bearish correction.
Forex Market Analysis provided by ForexYard.
© 2006 by FxYard Ltd
Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.
AUDUSD stays in a upward price channel
AUDUSD stays in a upward price channel on 4-hour chart, and remains in uptrend from 0.9861. Initial support is at the lower line of the channel, as long as the channel support holds, the price action from 1.0385 is treated as consolidation of uptrend, and another rise towards 1.0600 is still possible. Key support is at 1.0145, only break below this level will indicate that the uptrend has completed at 1.0385 already, then the following downward movement could bring price back to 0.9800 zone.
Pakistan to Produce Gas – by Burning Underground Coal
As we start a new year, consider the miserable plight of the average Pakistani electricity consumer.
With about 50 per cent less electricity generation capability than the actual demand, Pakistan’s National Grid is facing more than a 5,000-megawatt shortfall in power generation, leading to blackouts in both urban and rural areas of the country. Due to unscheduled shortages by the National Power Control Center, urban areas are facing unscheduled minimum 8-hour power blackouts each day, while in rural areas the blackouts can last as long as 14 hours.
The situation is equally miserable in the country’s compressed natural gas (CNG) sector, which is now facing three days per week suspension of gas deliveries, the country’s textile sector -four days a week, while the gas supply to non-textile industry has been suspended for indefinite period.
Scrambling to exploit virtually any indigenous sources of energy, officials in the capital Islamabad are now pinning their hopes on the Thar Underground Coal Gasification (UCG) pilot project, situated in the Tharparkar desert in Sindh eastern Pakistan.
Underground coal gasification converts coal to gas while still in the coal seam, where injection wells are drilled and used to supply the oxidants to ignite and fuel the underground combustion process, with separate production wells used to bring the product gas to surface. The high pressure combustion is conducted at temperatures of 1,290-1,650 degrees Fahrenheit, but can reach up to 2,730 degrees Fahrenheit. The process produces carbon monoxide and dioxide, hydrogen and methane.
Boosters of the Thar UCG project note that Block Number 5 of Thar Coal Project contains 1.4 billion tons of low-grade lignite coal reserves. Overall the coal reserves at Thar are estimated at 175 billion tons of lignite coal.
Advantages claimed for the Thar UCG project include the fact that, as the coal is burnt 600 feet under the ground, threat of environmental pollution is minimized. In addition, as the coal is processed in situ rather than being dug out and brought to the earth’s surface to be burnt to generate electricity, UCG will minimize electricity generating costs, projected to be $0.04538 to $0.05673 per kilowatt hour, as opposed to current costs at $0.11345 to $0.13614 per kilowatt hour.
And all that is required to make this energy miracle happen is for the federal government to provide an additional $100 million in funding to generate electricity from the project as soon as possible, which will then reportedly allow the Thar UCG project to supply 100 megawatts of electricity annually to the national power grid by December 2013. According to Dr. Muhammad Saleem, director of the Thar UCG project, only $9.1 million has been spent on the Thar’s UCG development so far.
Science and Technology Planning Commission member Samar Mubarakmand said that Pakistan’s coal reserves are sufficient to provide electricity to the nation for more than 30 years.
But the Thar UCG project has its critics. A number of professional chemical engineers and petrochemical experts, speaking on condition of anonymity, have collectively voiced their concerns, particularly about the non-technical specialist management of the project, noting, “The huge energy and petrochemical potential of Thar is wholly dependent on the success of its pilot project and if the non-technical management of this plan does not remove the project’s flaws, the country would ultimately be deprived of these huge underground assets forever. You can imagine what can happen if any pilot project fails solely due to a lack of knowledge and expertise …
usually, every oil and gas company first does rigorous tests on oil and gas wells to determine the composition of the gas and oil and then build the multi-million dollar facility. This is the very first step but in the UCG project the team does not know anything about the composition of the gas and yet they want to build a facility. They are only spending lot of money…”.
Visionary project for Pakistan’s energy future or enterprise doomed to failure by inept crony management? Pakistani electricity customers will remain figuratively and literally in the dark until these questions are definitely answered.
By. John C.K. Daly of Oilprice.com
Analyst Moves: AKS, GM
AK Steel (AKS) was upgraded today by Credit Suisse (CS) from neutral to outperform with a $12 price target, as raw material prices have declined, and better market demand for products should bolster margins. Shares are higher by eight percent.
