Torontos main market rose Monday afternoon as commodities gained, but BlackBerry maker Research In Motion (TSE:RIM) (NASDAQ:RIMM) still saw shares drop despite a major management shake up.

RIMs co-CEOs Mike Lazaridis and Jim Balsillie bowed to investor pressure over the weekend and resigned their top executive posts. The smartphone maker will now be led by current COO Thorsten Heins, a former Siemens AG executive who has risen steadily through RIMs upper management ranks since joining the company in late 2007, ending a two-decade long partnership of Lazaridis and Balsillie at the head of the company.

Still, the move did not seem to impress investors after Heins failed to make any major announcements on the companys future direction during a conference call this morning, with shares of the Waterloo-based company declining around seven percent.

The move can also be seen as too little, too late as RIMs share price has plummeted to eight-year lows in the wake of a loss of market share, flawed product launches, missed forecasts, service outages and security difficulties in emerging markets.

Numerous industry surveys put Apples (NASDAQ:AAPL) iPhone at the front of the pack in the smartphone market, closely followed by Googles (NASDAQ:GOOG) Android operating system.

Speculation was rife that RIM was up for sale, but investors pointed to the presence of Lazaridis and Balsillie at the helm as a stumbling block to any potential sale.

Despite higher commodities, RIMs share performance weighed on Canadas main market, with the Samp;P/TSX Composite Index rising 82.11 points, or 0.66%, to 12,479.21 as of just after 12:00pm ET. The more junior Samp;P/TSX Venture Composite gained 14.20 points, or 0.90%, to 1,585.54.

Commodities were in the green, with gold futures up 0.89% to $1,678.80 an ounce, and silver for March rising over 2.5% to $32.48 an ounce.

Base metal copper gained more than 1.4% to $3.80 a pound, while crude oil futures rallied 59 cents to $98.92 a barrel, after the EU adopted an oil embargo Monday against Iran, as well as a freeze of Irans central bank assets – part of sanctions designed to pressure the country to resume talks on its nuclear program.

Two Iranian lawmakers have reportedly repeated threats to close the Strait of Hormuz following the European Unions embargo.

Meanwhile, in Europe, Greece restructuring debt talks seemed to stall, as private creditors are being asked to take longer maturities and lower interest rates on new loans swapped for exisiting ones.

Greece is looking for rates as low as three percent on the new bonds, with private creditors seeking at least 4.5 percent. Still, reports say a deal is close regardless, with this agreement being a key condition for the country to secure additional funds necessary for a March bond payment.

In Toronto, energy and financials were the biggest gainers, with info-tech seeing the largest decline on account of RIM, falling more than 2%.

On the energy front, Suncor Energy (TSE:SU) was ahead 0.44%, while Canadian Natural Resources (TSE:CNQ) gained around 2%. Encana Corp (TSE:ECA) rose 5.3%.

Among materials, Kinross Gold (TSE:K) and Barrick Gold (TSE:ABX) moved higher by 2.6% and 1.3%, respectively. Copper heavyweight Teck Resources (TSE:TCK.B) advanced 0.72%, and Lundin Mining (TSE:LUN) shares increased 1.6%.

Financials were up over 1% as Royal Bank of Canada (TSE:RY), Toronto-Dominion Bank (TSE:TD) and Canadian Imperial Bank of Commerce (TSE:CM) all gained around 1%.

In corporate news, Canada saw some mergers and acquisitions activity in the mining sector, with two notable deals being signed.

Pan American Silver (TSE:PAA)(NASDAQ:PAAS) made a move Monday to increase production in Mexico as it bought Minefinders (TSE:MLF)(AMEX:MFN) for $1.5 billion. Mondays deal will create one of the largest diversified silver mining companies with a combined market capitalization of approximately $4 billion.

The new entity will consist of eight operating mines and an extensive portfolio of development and exploration projects in jurisdictions throughout the Americas, where Pan American currently operates. Minefinders shares rallied more than 24% on the day.

New York-based private equity firm Luxor Capital Group said Monday it has raised its offer to acquire a majority stake in Crocodile Gold Corp (TSE:CRK) from 56 cents a share to 62 cents per share, with Crocodiles board accepting the revised bid. The new offer represents a premium of roughly 82 percent to the closing price of Crocodile on the TSX on December 13, 2011, the last trading day prior to Luxors announcement of its intention to make the bid.

Shares of Crocodile, which also said separately Monday that it has achieved the upper target of its 2011 production guidance by producing 68,019 ounces last year, advanced around 7.3%.

Meanwhile, Ottawa-based Wi-LAN (TSE:WIN) has launched a patent suit against RIM in a US district court in Florida, which claims the BlackBerry maker is infringing on two Wi-LAN patents.

Canadian Pacific Railway (TSE:CP) signed a 10-year agreement with Canpotex, a company jointly owned by three of North Americas largest potash producers to export Canadian potash. Financial terms of the deal were not disclosed.

Ithaca Energy (TSE:IAE)(AIM:IAE) shares jumped over 14% as it confirmed early Monday that it has received a non-binding takover proposal from an undisclosed suitor, which is conditional on due diligence, definitive documentation, board approvals, and other conditions. The companys board is being advised by CIBC World Markets, and said that discussions are at a preliminary stage.

US/Europe

US markets were slightly down Monday afternoon, as investors anxiously awaited news from the Greece debt talks, with no domestic economic reports on tap today. The Dow was lately down 0.3%.

Oil and gas companies were gaining, after Chesapeake Energy (NYSE:CHK) announced Monday it would cut natural gas production to push up prices, sending its shares up around 4.6%.

Meanwhile, Halliburton (NYSE:HAL) reported fourth quarter earnings rose 50 percent to beat analysts estimates as North American sales drove growth.

For the three months that ended December 31, the provider of oilfield services posted earnings of $906 million, or $0.98 per share, up 50 percent compared to $605 million, or $0.66 per share, a year ago.

Adjusted for certain one-time items, including environmental-related charges, earnings rose to $921 million, or $1.00 per share. Total revenues rose to $7.06 billion, up 37 percent from $5.16 billion in the same period last year.

According to Bloomberg Businessweek, analysts were expecting 99-cents per share for the quarter, on $6.8 billion in revenues.

Aside from Greeces debt talks, Eurozone finance ministers were also meeting today, with debt issues still dominating the agenda.

European markets finished higher today with shares in London leading the region. The FTSE 100 was up 0.94%, while Frances CAC 40 rose 0.51% and Germanys DAX ended up 0.50%.

Tags : Commodity

Wheat is down 30%, corn up 10%, gold up 21%, and natural gas down 32% – the progress of commodities in 2011 presents a patternless set of data.

>Commodities are notoriously heterogeneous, and each ones pricing depends on a host of quite different factors. Often events that impact one commodity positively will prove a negative drag on another.

Making sense of it all is a lot to ask of a private investor.

Overall, commodity prices have pulled back recently on fears that economic growth will be sluggish. But while growth in the developed world looks set to be disappointing, it should be more than offset by economic strength across Asia and in particular China, which is still expected to grow at a rate of 8% next year.

The protracted European sovereign debt crisis has also dented confidence, but many commentators think Europes leaders will avert financial crisis. Having said that, low returns on other investments can help to drive demand for commodities.

For many commodities, the fundamental attractions have not materially weakened from where they were pre-2008. Jim Rogers, the famous commodity bull, points out for example that although sugar has risen steeply, it is still 60% below its all-time high. What else do you know that is 60% below its all-time high? he asks.

There is a good chance broad commodity prices could firm up again in 2012, though we are probably looking beyond the first quarter of next year for sentiment to really improve.

While most investors focus on demand – because it is easier to grip and understand – the other side of the equation is the supply position and the state of inventories. These are also diverse and dependent on myriad geopolitical factors, weather conditions, the industrial climate and even fashion.

For instance, supply of copper has been interrupted by industrial action at mines in Zambia, Peru and Indonesia. Copper is therefore unusual in being in supply deficit, and will be furiously in demand by Chinas massive investment in social housing.

However, not everyone believes that China can save the market – BMO >Capital Markets, for example, argues that industrial metals will struggle to make any serious headway in 2012 despite Asian growth.

At the other extreme, energy is in oversupply. Currently there is enough oil for 93 days of use compared with an historical average of 88 days. Natural gas faces particular excess as huge growth in extracting US shale formations outpaces consumption, and underground gas storage in the US has hit record levels.

The diversity of experience in production of crops is also enormous and at times contradictory. Corn has suffered from poor weather conditions and is in low stock while this years wheat crop has been exceptional, prompting the International Grains Council to hike their production forecasts for the grain. The floods in Thailand have taken out many rice crops and put pressure on all substitute products.

Hog prices have risen by nearly 30% over the course of the year partly as a consequence of buoyant demand from China and South Korea. In contrast, the price of canola (edible rapeseed oil) has been slipping all year as supplies of the oilseeds increase.

Most investor focus on precious metals, and there is no shortage of bets on gold topping the performance charts next year. TD Economics, for example, says that gold is heading towards $2,100. Gold also has the backing of Rogers. Adjusted for inflation, gold should rise to $2,400; it is already at $1,800 and the commodity bull market has at least a year to go, he says.

Gold is a special case, however. Its price is highly volatile and could crash if the global economy recovers as it is very largely supported by investors looking for a safe haven.

There are strong arguments for investing instead in platinum, because, historically, platinum has traded at a premium to gold, but the position has reversed recently. Platinum is $150 cheaper than gold but there is no reason why this should be the case as both are scarce and platinum is also widely used in industrial processes, says Chris Eibl, managing partner at Tiberius Asset Management. It does not make sense to be long gold in this environment. Platinum is the safe bet.

The strongest underperforming precious metal will be silver, he adds, not only because it is in oversupply but because so much of the demand is from investors and there is no other industrial or medical application that could absorb demand to the same scale.

Looking for a guide to gaining exposure to platinum? Read: How to trade platinum and palladium.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Tags : Commodity

Risk (Stocks and Commodity FX) and Reversal Characteristics

By

Jamie Saettele, CMT, Sr. Technical Strategist

Tags : Commodity

An appeals court in Washington has dismissed a lawsuit by the
financial industry challenging new federal regulations aimed at
cracking down on speculation in commodities markets, a move that
will likely delay a decision about whether the rules pass
muster.

The Securities Industry and Financial Markets Association and
the International Swaps and Derivatives Association in December
filed challenges to the regulations adopted last year by the
Commodity Futures Trading Commission.

The US Court of Appeals for the District of Columbia Circuit
dismissed the lawsuit saying that the case must first be heard by
a lower court, an argument advanced by the CFTC.

There is no express congressional authorization of direct
appellate review applicable to the petition for review in this
case, the three-judge panel said in a brief order issued late on
Friday.

They said that federal laws provided for appellate review for
other agency action but not the challenged regulation.

The CFTC voted 3-2 in October to set position limits on the
number of commodity futures and swaps contracts that a trader
could hold. It has been decried by traders as a politically
motivated effort to cap prices that will make markets less liquid
and more volatile.

The two trade groups sued to block the new rules arguing that
the CFTC exceeded its authority and that the regulations were not
adequately justified.

The CFTC had argued that the case should first be heard by the
US District Court for the District of Columbia. Once that court
hears the case, whatever decision reached there can be challenged
at the appeals court level, a lengthier process.

Although the statute was unclear, we thought that might be
the answer and were prepared for it, and for that reason we filed
in both courts, said Steve Kennedy, a representative of the the
International Swaps and Derivatives Association. We now will
move forward quickly in the district court.

The industry groups already have filed a challenge at the
district court as well, but it was put on hold pending a decision
by the appeals court on whether it would hear the case.

The CFTC declined to comment.

(Reporting by Jeremy Pelofsky; Editing by Vicki Allen)

Tags : Commodity

Smuckers Simply Fruit Strawberry is spread atop peanut butter. JM Smucker Co. said Thursday its fiscal second-quarter net income fell 15 percent as the food maker faces higher ingredient costs. (AP Photo/Gene J. Puskar)

Tags : Commodity

Cotton fell the most in more than
eight weeks on concern that Europe’s debt crisis will slow
global growth and trim commodity demand. Orange juice rose.

The Standard amp; Poor’s GSCI Index of 24 raw materials fell
as much as 3.2 percent as European borrowing costs surged amid
mounting concern the region’s leaders will fail to stem fiscal
woes. World cotton demand will be 1.7 percent lower than
forecast last month, leaving a “massive” surplus of more than
3.5 million metric tons, according to Cotlook Ltd., a research
company in Birkenhead, England.

“The world’s going to have enough cotton to meet its
demands,” John Flanagan, the president of Flanagan Trading
Corp. in Fuquay-Varina, North Carolina, said in a telephone
interview. “Demand is slow because of the economic situation in
the US and Europe.”

Cotton for March delivery declined by the exchange’s 4-cent
limit, or 4 percent, to settle at 96.48 cents a pound at 2:46
pm on ICE Futures US in New York, marking the biggest loss
since Sept. 19.

The fiber has tumbled 56 percent from a record $2.197 on
March 7. A bale weighs 480 pounds (218 kilograms)

“The commercial sector is still ailing, as evidenced by
the complete lack of demand outside of China,” Andy Ryan, a
senior-risk management consultant at INTL FCStone Inc. in
Nashville, Tennessee, said in a report.

Orange-juice futures for January delivery advanced 1.8
percent to $1.7185 a pound in New York, the biggest gain since
Oct. 24. The commodity has advanced 13 percent in the past year.

Inventories of frozen orange juice monitored by ICE have
dropped 59 percent to 24.4 million pounds from a year earlier,
exchange data show.

“Supplies have been a little tight,” Jack Scoville, a
vice president at Price Futures Group in Chicago, said in a
telephone interview.

To contact the reporter on this story:
Blair Euteneuer in Chicago at
beuteneuer@bloomberg.net

To contact the editor responsible for this story:
Steve Stroth at
sstroth@bloomberg.net

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Kotak Commodity has come out with its report on base metals. According to the research firm MCX Copper may note gains amid range bound movement in international markets and weakness in rupee, however the bias remains negative.

Tags : Commodity

Interbank traders targeted stops below parity in the Australian Dollar during the local morning as the signs of a fragile market on the back of weak overnight commodity moves put the fear into the commodity currencies. The minor support at 0.9980 was taken out with the price managing to reach 0.9970 before sovereign names were seen buying across most markets and with that the downward spiral was stopped in its tracks. The following short squeeze has all currencies higher with Euro touching 1.3500 after having found support at 1.3450 earlier in the day whilst Sterling could not move above the reported 1.5800 corporate selling. Reports that Merkel and Morti were holding discussions over the current Italian crisis via phone seemed to help the bullish mid session bias of the market but as the afternoon approached all the majors gave up there gains with AUD back at parity, Euro 1.3475 and Sterling 1.5770.

Reports out of Japan that Toyota would not be able to make a profit on US car sales whilst the Japanese currency was below 90.00 has done nothing to stop the strengthening of the Yen as the pair closes the day just above the next pivot point of 76.80. Reports that stops below in the Interbank market are increasingly becoming a target and we cant see a bounce for the USD until these are cleaned out.

Equity markets remained under pressure through the Asian trading session today as the negative sentiment seen in Europe and the US flowed into the region today. Negative comments about the property sector in China today didnt help either and saw China’s Shanghai Composite weaken by 1.50% to 2,425 and Hong Kong’s Hang Seng lost 1.80% to 18,476. South Koreas KOSPI also came under pressure and is generally the leader or loser in the Asian markets, currently weaker by 2.20% at 1,834. Australia’s ASX 200 performed inline with other major bourses as commodity prices remained weak and the AUDUSD dollar continued to fall. The ASX 200 finished trade weaker by 1.90% at 4,177.

Commodity markets were directionless today with early losses seen as equity markets opened and moved to session lows very quickly but we did see some support return in afternoon trade as shorts were seen covering going into the weekend. Crude prices were relatively unchanged with WTI weaker by 0.10% at $98.70 and Brent crude actually gained 0.20% to $108.41 as the spread narrowed slightly after recent losses. Precious metals remained under pressure with Silver declining by 0.40% to $31.37 and Gold finished the session unchanged at $1,720. Copper was relatively unchanged ending the session at $3.40.

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Tags : Commodity

MF Global Commodity Traders Fault Cash-Only Payment Plan
November 17, 2011, 5:25 PM EST

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• MF Global Missing Money May Double, Exceed $1.2 Billion
• U.S. Trustee Faults MF Global Customer Committee Proposal
• MF Global Holdings Asks for Court-Appointed Trustee
• MF Trustee Says ‘No Assurance’ of 100% Collateral Return
• JPMorgan, Goldman Sachs Sued for Alleged MF Global Misstatements

By Linda Sandler

(Updates with hearing in third paragraph.)

Nov. 17 (Bloomberg) — A group of commodity traders faulted a plan by the liquidator of broker-dealer MF Global Inc. to distribute 60 percent of the collateral in so-called cash-only accounts to customers, saying it was unfair to traders who had a small futures position in addition to a large cash MF holding.

Trustee James Giddens also was being too conservative in paying out only 60 percent of the collateral and should raise Com the amount to 85 percent, they said in a court filing yesterday.

U.S. Bankruptcy judge Martin Glenn in Manhattan will hold a hearing today on Giddens’s plan to transfer about $520 million in collateral to commodity customers whose accounts consisted solely of cash on Oct. 31, when the parent company filed for bankruptcy. The judge said at a hearing yesterday he’s “sympathetic” to customers who are suffering as cash is withheld, and held up a folder of filings faxed to his court by MF Global clients.

Royce Corp., which said it trades metals with clearing houses solely to hedge its business, said in a filing its accounts at MF Global now consisted only of cash, as it liquidated copper contracts after the Oct. 31 bankruptcy of the broker-dealer’s parent company. Under Giddens’s plan, Royce wouldn’t get 60 percent of its collateral as its account had open positions as of Oct. 31 to maintain its hedges.

Court Filing

Royce and other companies hedging their exposure in commodities would be “without relief and without access to any of their cash,” Royce said in a court filing yesterday, asking the judge to make a change.

About 15,000 futures customers would receive 60 percent of the $869 million in their accounts, and 6,000 other customers with small accounts may also get collateral, the trustee said. He aims to make one or more additional distributions later, he said in a filing.

Examiners from CME Group Inc. found unexplained wire transfers at the brokerage and a $900 million shortfall in client funds during the weekend the failing parent company was talking with possible buyers, a person briefed on the matter said. The Commodity Futures Trading Commission now is investigating about $600 million that should have been held in segregated accounts, according to a separate person with knowledge of the regulatory probe.

CME Group, the world’s largest futures exchange that’s fallen 8.5 percent this week, may face liability related to concerns it misled regulators over what it knew about MF Global Holdings Ltd., according to a note to clients written yesterday by Goldman Sachs Group Inc. analyst Daniel Harris.

U.S. Probe

U.S. Attorney Patrick Fitzgerald in Chicago issued subpoenas in a probe of MF Global Holdings Ltd., the broker- dealer parent, a person familiar with the matter said.

MF Global Holdings, which was run by former Goldman Sachs Group Inc. co-chief executive officer Jon Corzine, filed for bankruptcy after making bets on sovereign debt and getting margin calls. The New York-based company listed debt of $39.7 billion and assets of $41 billion in Chapter 11 papers. The broker-dealer is being liquidated separately.

The brokerage case is Securities Investor Protection Corp. v. MF Global Inc., 11-cv-7750, U.S. District Court, Southern District of New York (Manhattan). The parent’s bankruptcy case is MF Global Holdings Ltd., 11-bk-15059, U.S. Bankruptcy Court, Southern District of New York (Manhattan).

–With assistance from Tiffany Kary, Matthew Leising and Patricia Hurtado in New York and Silla Brush in Washington. Editors: John Pickering

To contact the reporter on this story: Linda Sandler in New York at lsandler@bloomberg.net

To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net

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Tags : Commodity

Commodity ETF Assets May Triple in Asia, S&P’s Steadman Says
November 20, 2011, 8:39 PM EST

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• Hedge Funds Cut Bullish Bets by Most in Seven Weeks: Commodities
• Copper Traders Most Bearish in Two Months on Europe: Commodities
• Buffett’s Burlington Exploits Boxed Asia Grain Up 29%: Freight
• Candy-to-Fuel Demand Cuts Oil Inventory to ’75 Low: Commodities
• MSCI Adds Bharti Airtel, Lundin, Herbalife to Global Indexes

By Sungwoo Park

(Adds analyst comment in fourth paragraph.)

Nov. 18 (Bloomberg) — Assets in exchange-traded funds backed by commodities may almost triple in Asia over the next five to seven years, according to S&P Indices.

Assets may grow to about $10 billion in the Asia-Pacific region from about $3.5 billion, Reid Steadman, global head of ETF licensing, said yesterday in an interview in Seoul.

Assets in exchange-traded products linked to commodities rose to a record $178.2 billion last quarter as funds flowing into gold outweighed reductions in energy and agriculture, ETF Securities LLC said in a report on Oct. 28. Commodities measured by the S&P GSCI Spot Index jumped 26 percent in the past two years, while the MSCI All-Country World Index dipped 1.5 percent.

“ETF physically backed by commodities should grow in Asia, with a lot of interest already in gold and silver,” said Natalie Robertson, an analyst with Australia & New Zealand Banking Group Ltd. in Melbourne. “The outlook for precious metal prices is positive, in part, due to the likely large inflows of investment expected in this sector.”

Commodities account for 3.6 percent of ETF assets in Asia, compared with 19 percent in Europe and 10.4 percent in the U.S., he said, citing Deutsche Bank data. ETFs enable buyers to invest in commodities without taking physical delivery.

‘Room for Growth’

“Commodity ETFs are set for growth in Asia, as they have grown in other regions,” said Steadman, who is based in Hong Kong. “Asian ETF markets are generally five to 10 years behind the U.S. and Europe. There’s definitely room for growth.”

Gold held in ETPs reached a record 2,330 metric tons on Aug. 18 worldwide as investors sought a haven amid Europe’s debt crisis and falling currencies. Holdings rose 0.4 percent to 2,324 tons as of Nov. 16, show Bloomberg data compiled from 10 providers.

Bullion for immediate delivery has risen 21 percent this year in an 11th year of bull market, reaching an all-time high of $1,921.15 an ounce on Sept. 6, and Brent oil on the London- based ICE Futures Europe exchange gained 15 percent.

“Asian investors are more skilled than any other investors elsewhere reaching outside the region to invest in products listed elsewhere,” said Steadman. “There is room to grow in terms of locally listed products.”

Asset managers in China, the world’s biggest gold producer, are seeking additional funds to invest in gold and precious metals as rising inflation spurs interest in alternative assets. Lion Fund Management Co. was the first to place money in foreign gold ETFs, raising more than 3.2 billion yuan ($500 million).

Hiring

Mirae Asset Global Investments Co., South Korea’s biggest mutual fund manager, plans to hire more employees for its ETF business in Hong Kong this year.

Assets invested against the S&P GSCI index of commodities were estimated between $100 billion and $110 billion, Michael McGlone, senior director of commodities at S&P Indices, said in the same interview yesterday. Assets were about $100 billion as of end-August, McGlone said in September.

The S&P GSCI spot index rose 3.5 percent this year, after surging 20 percent in 2010. S&P, a unit of New-York based McGraw-Hill Cos., agreed to buy the GSCI gauge from Goldman Sachs Group Inc. in February 2007.

–Editors: Jarrett Banks, Richard Dobson

To contact the reporter on this story: Sungwoo Park in Seoul at spark47@bloomberg.net.

To contact the editor responsible for this story: Richard Dobson at rdobson4@bloomberg.net

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Tags : Commodity