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Weekly Market Report 18 November 2014 18 November 2014
SUGAR MARKET UPDATE March 15 sugar squeezed higher last Tuesday in what appears to have been just stop loss buying. The rally continued slightly further on Wednesday, and fell away to have all the gains for the week, erased by Monday night this week. Volumes have been moderate (at best). As we have mentioned before, producers are not in a hurry to sell given the length of the contract and consumers are looking at the fundamental backdrop of a stronger USD/BRL, a larger Indian Crop and rain in Brazil and are let...Read full article -
Weekly Market report 6 January 2015 6 January 2015
SUGAR MARKET UPDATE Sugar finished 2014 on the back foot and has started 2015 in the same way. Life of contract lows were made in Mar at 14.07 and a small reversal ensued following the straight line move from 15.20 just before Christmas. The Indian crop is moving along at a very swift pace, especially compared to last year, with the ‘failed monsoon’ chatter looking more like hope than reality. There is also plenty of talk of export subsidies, with Pakistan beating India to announce first. On a slightly more...Read full article -
Weekly Market Report 13 January 2015 13 January 2015
SUGAR MARKET UPDATE Sugar rallied dramatically on Tuesday last week in what appears to have been a series of stop loss buying finding very little selling. More stops were triggered on Wednesday, over 1500, but they met with very strong selling from all different types of sellers. There has been some talk about January being very dry in Brazil, but given the good December rainfall, and the forecast of above average rainfall for the end of January, we feel the ‘price has been driving the news’. It has been o...Read full article -
Weekly Market Report 10 March 2015 10 March 2015
USD MACRO CURRENCY UPDATE: The data in the US has continued to print strongly, with the latest non-farm payrolls exceeding all expectations printing close to +300k. This has primed expectation the Federal Reserve will remove the ‘patience’ comment in their statement when they meet on March 18th and will move to being data dependent for the next move in rates higher. This means, assuming the data continues to print strongly, the US will begin a hiking cycle some time between June and September this year. The US...Read full article -
Weekly Market Report 17 March 2015 17 March 2015
USD MACRO CURRENCY UPDATE The USD has continued to appreciate although with slowing momentum. The highlight of the week was the capitula on style move in USD/BRL trading from 3.06 to a high on 3.27 on Friday. AUD/USD moved lower in the beginning of the week, squeezed in the middle and it currently working at the bottom of the recent range. Key events this week are the RBA minutes which should leave the door open to further rate cuts should the economy continue to struggle; and the FOMC meeting in which it is widel...Read full article -
Weekly Market Report 31 March 2015 31 March 2015
USD MACRO CURRENCY UPDATE: The post FOMC USD sell off appears to be complete with most sugar relevant currencies resuming their downtrend. AUD and NZD both technically broke higher only to fail and move back into the range. From a charting (technical) point of view this would suggest a test of the bottom of the range. 7550 for AUD and 7200 for NZD. We maintain our short AUD position looking for low 70s. Key data out this week are US employment on Friday night and the RBA decision the following Tuesday. The market...Read full article -
Weekly Market Report 14 April 2015 14 April 2015
USD/MACRO CURRENCY UPDATE: Sideways price action has dominated the USD in the moves since the Easter break. The market is receiving very mixed signals from the Federal reserve with Governor Lacker calling for the first interest rate hike in June 2015, while Governor Kocherlakota is suggesting they should wait until the second half of next year. This sort of uncertainty would suggest the USD will struggle for conviction, either up or down. Elsewhere, the story is different. The European Central Bank meets Thurs...Read full article -
Weekly Market Report 30 April 2015 30 April 2015
GLOBAL MACRO UPDATE The global markets are moving in between conflicting forces. On the one hand Q1 US GDP printed a very low 0.2%, yet the FOMC is expecting growth to bounce back and has left the door open for hikes later this year. The market has taken a lot of the hikes out that had previously been priced in and this has had flow on effects to various asset markets. Rates across the globe have moved higher. Equities have moved lower, which would generally be USD supportive, but instead the big dollar has sold ...Read full article -
Weekly Market Report 12 May 2015 12 May 2015
BRAZIL UPDATE — WHAT TO EXPECT The Brazilian campaign has begun with the usual favouring of ethanol. The market completely overestimated the effect of the drought last season with (realistic) estimates of a crop as low as 540 mmt giving way to the reality of ~575 mmt. This season the market is calling for slightly higher at ~585 mmt, remembering at full swing Brazil can crush around 2.5mmt per day. Given the abundant rain this season, we are fully expecting the crop to be large, even surpassing market estimates...Read full article -
Weekly Market Report 26 May 2015 26 May 2015
AUSTRALIAN INTEREST RATES , AUD/USD … WHAT NEXT The Reserve Bank of Australia lowered the overnight cash rate to an all time low of 2% at the May board meeting. The bank has found itself in a difficult position with the terms of trade (the price of goods we export such as iron ore) falling, but offsetting that has been the property bubble of Sydney and a lesser extent Melbourne. Sydney accounts for 20% of the Australian market so it does bode for concern for the bank. Rather than the government using record low...Read full article