Review Oil Market for 02.02.10
Dynamics
Quotes of the oil market on Tuesday, February 2 on the basis of trading closed with the increase in price on the back of weak U.S. dollar in the foreign exchange market, FOREX, and also because of the positive dynamics of neighboring markets and stock exchanges.
On the New York Stock Exchange NYMEH the March futures price for U.S. light crude rose by 2.80, or 3.8%, and its price was 77.23 dollars per barrel.
On the ICE exchange in London, Brent crude futures price rose 2.96, or 4.1%, to 76.07 dollars per barrel.
Causes
Tuesday, February 2 quotes in the market of “black gold” were closed with an increase in the price of the following factors: 1 - the decline of the dollar in the FOREX market against a background of increasing risk appetite after makrostatistiki and economic news (the National Realtors Association of the United States reported that the index of signed contracts for the sale of housing in December rose by 1%, although it is expected that the rate will remain unchanged), 2 - positive dynamics of the stock exchanges where shares of the U.S. grew, the index S P500 showed a maximum of two day, the growth supported by strong financial reports - Lexmark International Inc. and D.R. Horton Inc. (Dow Jones industrial average - 10296.85 (111.32, or 1.09%), Nasdaq Composite - 2190.06 (18.86, or 0.87%), SP 500 - 1103.31 (14.13, or 1.30%)), 3 - Strengthening the neighboring markets, and namely the growth of the market price of precious metals, 4 - Economic News - Weather forecasts for the Northeast U.S. suggests cooling where it is expected that in the next 10 days the temperature falls below the mean values, thereby increasing the demand for fuel.
From the news it is worth noting the message Deputy Prime Minister Igor Sechin that oil production in Russia in 2010 will be at least 500 million tons, natural gas production will also grow. In particular, increased oil production Talakanskoye field. Last year there were produced about 1,5 million tons of oil, this will get about 2.7 million tons. He also noted that investment in oil field Junin-6 in Venezuela in the next 7-10 years will be about $ 12 billion, total investment could reach $ 20 billion. Sechin is expected within the next two months to convince the Ministry of Finance of the need to maintain duty-free export of oil from fields in Eastern Siberia. Ministry of Finance is looking for sources to compensate for about 120 billion rubles decreased income of Finance. According to Sechin, such sources are found, and it will not be associated with export duties on oil from Eastern Siberia.
What to expect?
The main event of today”s trading session is out of data on oil and petroleum products from the U.S. Department of Energy, which may set a further course of trading. Market participants expected to reduce stockpiles of distillates, but at the same time, expect growth stocks of gasoline and crude oil. Among distillates include heating oil and diesel fuel.
Why worry?
The main negative factors1000in the oil market are U.S. dollar and the technical picture, namely, psychological and technical level of $ 80 per barrel, which does not allow oil prices to go higher, thereby encouraging market participants to take profit on the open long positions.
Review precious metals market for 02.02.10
Dynamics
Tuesday, February 2 quotes for gold, and silver closed with an increase in price on the back of weak U.S. dollar in the foreign exchange market, FOREX, and also because of the positive dynamics of neighboring markets and stock exchanges.
According to the results of trading on the COMEX, division of the New York Mercantile Exchange (NYMEX), quotes gold futures rose by 13.00 to 1118.00 dollars per troy ounce, quotes, silver futures rose 8 cents to 16.74 dollars per ounce.
Causes
Tuesday, February 2 futures on precious metals have completed trades with an increase in the price of the following factors: 1 - the decline of the dollar in the FOREX market against a background of increasing risk appetite after economic makrostatistiki and news, to reassure them that the United States withdraws from the recession (the National Association of Realtors USA reported that the index of signed contracts for the sale of housing in December rose by 1%, although it is expected that the rate will remain unchanged) 2 - Economic News - the assumption that the European Commission on Wednesday approved a plan by the Greek budget deficit reduction have provided support for more risky assets - a Greek plan is important both for Greece itself, and for other countries in the eurozone, and 3 - positive dynamics of stock exchanges, where the major U.S. stock indexes closed in the Green Zone with the support of strong financial reports (Dow Jones industrial average - 10296.85 (111.32, or 1.09%), Nasdaq Composite - 2190.06 (18.86, or 0.87%), SP 500 - 1103.31 (14.13, or 1.30%)), 4 - technical reasons - the level of resistance in the area of 1100.00 dollars per troy ounce was reached, thereby serving as a one of the positive signal for investors to open long positions and 5 - to strengthen the adjacent markets, namely the rise in prices for crude oil market.
silver futures rose after gold futures. However, the growth of silver was not as significant in percentage terms. Perhaps, the growth was restrained by some concerns about industrial demand for silver in the 2 nd quarter.
From news can note that in 2009. Iamgold company produced 930 thousand ounces (28.9 tonnes) of gold, which is 7% higher than predicted. This result was achieved mainly by increasing production at the main project of the company - Rosbel gold deposit in Suriname. The average cost of production, as expected, in contrast, fell from 470 to 460 dollars per ounce. The expectations of company management, production of gold in 2010. should be from 29 to 31 tons of metal at an average production cost of 490-510 dollars per ounce.
What to expect?
Traditional purchase of precious metals in the early years of the funds, the overall improvement in investor sentiment, as well as decrease the U.S. dollar will provide sustained support to the quotations of gold and silver. However, the situation could change dramatically if the dollar will resume its strengthening, as the inverse correlation between the dollar and the prices of precious metals continues.
Why worry?
volatile changes in the currency market may be reflected in the sharp fluctuations of prices for precious metals.
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