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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Square_Dealings who wrote (20565)	1/6/2005 10:49:00 AM
From: mishedlo	Respond to of 116555

Miners far firmer than gold today and IMO have already discounted this drop. The question is..... Does gold drop more? If not Miners MAY outperform. Lots of IFs there. Mish

To: Square_Dealings who wrote (20565)	1/6/2005 11:03:04 AM
From: mishedlo	Read Replies (4) \| Respond to of 116555

GFI HMY DROOY all up today did SA cut interest rates? What's up Mish

To: Square_Dealings who wrote (20565)	1/6/2005 11:31:08 AM
From: mishedlo	Respond to of 116555

My contacts tell me there was huge overnight hedge fund speculation in the RAND. There was a 3.31% move today in the RAND. That is huge. It is lending support to SA miners for sure. Mish

To: Square_Dealings who wrote (20565)	1/6/2005 11:47:17 AM
From: mishedlo	Read Replies (1) \| Respond to of 116555

UPDATE 2-Oil up nearly $2 on U.S. natural gas draw Thursday, January 6, 2005 4:17:34 PM reuters.com (updates throughout) By Barbara Lewis LONDON, Jan 6 (Reuters) - Oil prices rose nearly $2 on Thursday after a big fall in U.S. natural gas inventories triggered renewed concerns about winter fuel stocks in the world's biggest energy consuming nation. U.S. light crude <CLc1> by 1615 GMT was up $1.71, gaining 4 percent, to $45.10 a barrel, the top of a $40-$45 trading range held since Dec. 22. London Brent rose $1.99, up 5 percent, to $42.50 a barrel. The U.S Energy Information Administration reported natural gas storage levels declined by 151 billion cubic feet (bcf) in the week ended Dec. 31. That was higher than analysts' expectations of a draw of 135-140 billion cubic feet, which itself would have been much higher than five-year average draw of 118 bcf in this week. "The number was bullish relative to consensus expectations," said Katherine Spector, analyst with JP Morgan Securities. The draw cut the U.S. natgas supply surplus over last year to 3 percent, from last week's 9 percent, the EIA data showed. The price rise comes after a spell of mild U.S. weather saw oil prices fall at the start of this week. The latest 6 to 10 day forecast from the National Weather Service, released Wednesday showed temperatures unusually high in the eastern United States -- home to the main heating markets -- with cold in the west. Prices fell one percent on Wednesday after a U.S. government report showed a two-million-barrel rise in the nation's stocks of distillate, including heating oil and diesel, in the final week of 2004 when use of heating fuel. The counter-seasonal increase in winter fuel supplies came as U.S. refiners cranked up production to record levels and unseasonably mild temperatures kept heating demand at bay in the Northeast, the world's largest heating oil market. But heating oil stocks are still nine percent lower than the same time a year ago, while escalating violence in oil producer Iraq ahead of elections at the end of the month, as well as OPEC production cuts have helped to staunch selling, analysts said. "Fundamentals are on the weaker side but geopolitical factors are holding things up," said Edward Meir of Man Energy. Producers' cartel the Organisation of the Petroleum Exporting Countries has tightened fundamentals by cutting back production after an agreement struck in December to remove one million bpd of excess supply from the world market from Jan. 1. Top exporter Saudi Arabia said on Tuesday it had sliced 500,000 bpd from its production, bringing it down to 9 million bpd. Qatar said on Wednesday it had implemented a cut of 40,000 bpd. OPEC is seeking to avoid a big build-up in global stocks ahead of the second quarter of the year, when oil demand drops at the end of winter. Some OPEC ministers have said the group might need to cut formal production limits of 27 million bpd when it meets on Jan. 30 to stop prices falling further. Speaking in New Delhi on Thursday, Iran's oil minister said there was still too much oil on the international market. "No one is doubting it," Iranian Oil Minister Bijan Zanganeh said when asked if markets were oversupplied. forexstreet.com

To: Square_Dealings who wrote (20565)	1/6/2005 12:08:11 PM
From: microhoogle!	Read Replies (3) \| Respond to of 116555

Is GLD a good way to play the gold ? What are positives / negatives of buying into GLD?

To: Square_Dealings who wrote (20565)	1/6/2005 12:46:19 PM
From: mishedlo	Respond to of 116555

Grain Report JANUARY 5, 2005 CORN: Hi, this is Tim Hannagan and it is Wednesday, January 5th and the markets are closed. Note, I will be out of my office Thursday morning returning by noon. Corn fell out of bed this week off a dime from last week’s high, with March touching its contract lows. Today saw light profit taking by one commercial and one fund. Fundamentals remain bearish as a huge inventory and average at best demand keeps anyone from going long. I stick to my opinion that we will not go below 1.97 this week but after next Wednesday’s USDA crop report we could see 1.90 to 1.93. Stay short until 2.10 is broken. Cash sales are a little slow with our current winter storm keeping farmer’s feet close to the fire but WXRISK.COM see a big warm up next week leaving conditions ripe to move grain off the farm for cash. BEANS: Shorts in the market after a 30 cent break from last week’s high went to the bank today pulling profits out and prices up 5 to 6 in early trade. Technicals remain weak while demand remains good. China was in for a 116 t.t. purchase overnight. Funds were heavy sellers Monday and Tuesday. We hit the top end of my low price projection for this week yesterday with a low under 5.25 area as my target this week. It is possible to see another dip in prices Thursday but Friday’s close should be higher as week’s end profit taking enters and traders lighten up ahead of next week’s crop report. My call for January was an early January break followed by a late January into February rally. We are on target. Again, we will not take out 5.18 this week so remaining shorts should cover on another break under 5.25 and ahead of 5.18. then possibly another selling opportunity after next Wednesday report to test our lows. WHEAT: Well, as expected we got our break down to 2.95 basis March futures we said would occur this week. A close under 2.95 and next support is 2.85. Those still short should consider taking profits under 2.95 and above 2.85 as we are unlikely to trade below 2.85 ahead of next Wednesday’s USDA crop report. Trade estimates look to show a smaller winter wheat crop was planted this year and funds short the market should be expected to buy back shorts ahead of the report. That leaves this week to give us our pre-report low. Bearish fundamentals continue to plague wheat with weak demand and weather next week looking to deliver a unseasonably mild pattern from January 11th to the 17th as noted on the weather site WXRISK.COM. We probably will come back as sellers after the reports release. Again, shorts should use another drop in prices to take profits and return as a seller next Wednesday. End.

To: Square_Dealings who wrote (20565)	1/6/2005 12:59:10 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Monster: Fewer job ads in December The online job advertising giant reported demand for workers decreased in 19 out of 23 categories. January 6, 2005: 7:54 AM EST NEW YORK, Jan 6 (Reuters) - U.S. job seekers found fewer online postings in December, suggesting employment growth for the month may have been disappointing, a report showed Thursday. Online job advertising giant Monster.com, one day before the government releases its monthly tally of December job creation, said its employment index eased to 113 last month from 117 in November. "Online demand for workers decreased in 19 out of 23 occupational categories in the month of December," including construction and food services, Monster said in a statement. Analysts currently expect a net employment gain of about 175,000 for December. But anecdotal evidence from industry surveys has pointed to stagnation in hiring, prompting some concern that current forecasts may be too rosy. While the U.S. economy has been growing robustly for almost two years, jobs have been the recovery's Achilles heel as the economy has barely generated enough work to absorb new entrants to the labor market. money.cnn.com =============================================================== This is very interesting because this index has been trending up regardless of what jobs did. My hypothesis was that companies were shifting away from newspaper advertizing of jobs to monster. This is the first time that both have dropped hard that I am aware of. Mish

To: Square_Dealings who wrote (20565)	1/6/2005 1:34:42 PM
From: mishedlo	Read Replies (3) \| Respond to of 116555

Defense Cutbacks Pentagon eyes Northrop Grumman ship cuts - report By Abby Deveney LONDON (CBS.MW) -- Pentagon planners are proposing deep cuts in Northrop Grumman's (NOC: news, chart, profile) multibillion-dollar shipbuilding business as part of a major rollback in defense spending, said analysts and government officials quoted Tuesday by the Los Angeles Times online. But several of Northrop's large weapons programs appear to have been spared, or even enhanced, by the budget planners, the LA Times also said. The cuts were outlined in an internal Pentagon document that proposes slashing the military's budget request by $30 billion over the next six years. According to several sources, the cutbacks would hit Bethesda, Md.-based Lockheed Martin Corp. (LMT: news, chart, profile) the hardest as the Pentagon wants to halt purchases of Lockheed's C-130J cargo planes and slash the number of F/A-22 fighters it buys. Boeing Co. (BA: news, chart, profile) could be hurt by a decrease in missile defense spending, but the effect would probably be small, the LA Times report said. Boeing responds to defense budget cuts reports By Carla Mozee SAN FRANCISCO (CBS.MW) -- Boeing (BA: news, chart, profile) on Tuesday issued a response to media reports that it, along with other large defense contractors, will lose billions of dollars in business if proposed defense budget cuts are approved. "We have said for some time that competing priorities would flatten future defense spending," Boeing said in a statement. Published reports Tuesday indicated Boeing, Lockheed Martin (LMT: news, chart, profile) and Northrop Grumman (NOC: news, chart, profile) could face sharp reductions in defense contracts. Boeing said the reports reference Department of Defense deliberations "to which we are not privy." Boeing said given its current backlog and strong performance of its mix of development, production and support programs, it sees itself as "very well-positioned for the future." ============================================================== The Times-Picayune reports Northrop Grumman may cut up to 2500 jobs at the company's Avondale shipyard in New Orleans and the Ingalls shipyard in Mississippi over the next 3 years. The two shipyards, plus smaller facilities employ a total of roughly 20K people. Mish

To: Square_Dealings who wrote (20565)	1/6/2005 2:31:44 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

China's CNOOC discussing $13bn bid for Unocal By Francesco Guerrera and Joseph Leahy in Hong Kong Published: January 6 2005 14:17 \| Last updated: January 6 2005 17:53 cnooc china national offshore oil company CNOOC, China's third-biggest oil and gas group, is considering a bid of more than US$13bn for its US rival Unocal in a deal that would mark the largest and most significant overseas acquisition by a Chinese company. People close to the deal said the state-controlled group was interested in Unocal's Asian assets and had asked bankers to study a takeover of the whole company followed by a subsequent sale of the US assets. People close to the negotiations warned the deal was at a very early stage and detailed talks had yet to take place. It is understood the Chinese group is also looking at other overseas targets. CNOOC's plans are the latest sign of Beijing's determination to push its flagship commodity companies to acquire natural resources to fuel the country's rapid industrialisation and economic growth. Chinese oil demand is expected to keep growing at or above forecast GDP growth of 8 percent this year, Zhang Xiaoqiang, vice chairman of China's National Development and Reform Commission said on Thursday. They also underline the recent emergence of Chinese companies on the global merger and acquisitions stage withprivate and state firms attempting to exploit their domestic strengths to expand overseas. Last month, the computer maker Lenovo bought IBM's personal computer business for US$1.75bn, while state-owned Minmetals offered about US$5bn in a failed attempt to buy Noranda, the Canadian mining giant. An acquisition of California-based Unocal would represent a change in strategy for China's three oil majors - CNOOC, Sinopec and Petrochina - which have so far focused on buying oil fields and asset packages in developing countries. Industry experts said buying the whole of Unocal, which is valued at about US$11bn and had net debt of US$2.4bn at the end of 2003, would be difficult for CNOOC, whose market value is about US$21.5bn and had cash resources of US$1.6bn at the end of 2003. However, the Chinese company would be able to draw on financial help from its state-owned parent China National Oil Offshore Corporation and on the proceeds of any sale of Unocal's US assets. Unocal's main attraction for CNOOC is its extensive operations in several Asian countries, including Indonesia, Thailand, Bangladesh and Burma. However, a sale of Unocal's US assets to a rival party could prove problematic for CNOOC as the American company is burdened with legal disputes relating to the US' environmental Superfund legislation. The law requires companies to pay to clean up hazardous waste. In addition, in Asia it reached an out-of-court settlement only last month in a landmark case alleging it was complicit in human rights abuses committed in Burma. The deal would be likely to be attacked by interests in the US opposed to Chinese takeovers in important industries. In 2003, Hutchison Whampoa, the Hong Kong-based conglomerate, was prevented from taking over bankrupt US telecoms company Global Crossing on national security grounds. news.ft.com ============================================================= Looks like China smartly wants to get rid of its wasting US$ and put them to use in unloved energy assets. Smart move Mish