2025-01-07 11:30
NAPERVILLE, Illinois, Jan 6 (Reuters) - Speculators forged all-time bearish bets in Chicago corn midway through 2024, though they are entering 2025 on a completely different – and optimistic – note. However, they hold firmly pessimistic views across U.S. wheat, soybean and soybean product futures. In the week ended Dec. 31, money managers boosted their net long position in CBOT corn futures and options to 228,806 contracts from 160,947 a week earlier, marking funds’ most bullish stance since February 2023. That move consisted of both new longs and short covering, though the former was more prominent. Most-active CBOT corn had posted 2.2% gains during the four-day trading week. Most-active corn futures ended 2024 up 19% from the year’s lowest levels in late August, and those lows came just weeks after funds’ record net short. CBOT March corn on Monday hit the highest levels since June and traded above relevant moving averages, including the 20-day and 200-day. Monday’s settle of $4.57-3/4 per bushel is basically even with the year-ago price. While funds’ recent bullishness in corn is strongly tied to a demand increase, demand has been somewhat of a concern for soybeans. Top soybean buyer China has not been as active in the market as might be expected given the plentiful nature of global supplies. However, dry weather in top soybean meal exporter Argentina sparked a round of short covering in soybeans and meal during the week ended Dec. 31. That corresponded with futures jumps of 3% and 5%, respectively. Money managers that week slashed what had been a record net short of 96,371 CBOT soybean meal futures and options contracts down to 64,942 that week, all on short covering. They also cut their net short in CBOT soybean futures and options to an 11-week low of 42,447 contracts from 67,883 a week earlier. Still, that marked funds’ most bearish year-end soybean view in seven years. Contrary to beans and meal, money managers added gross shorts in CBOT soybean oil futures and options during the week, lifting their net short to a 15-week high of 28,576 contracts, up about 9,000 on the week. Funds’ CBOT wheat stance is also their most bearish end to a year in seven years, though they trimmed their net short through Dec. 31 to 86,762 futures and options contracts from 95,009 in the prior week, which was an eight-month high. CBOT wheat futures have recently battled a strengthening in the U.S. dollar to two-year highs, making U.S. exports less attractive to overseas buyers. U.S. winter wheat planting data will hit the market on Friday, the first piece of the upcoming 2025-26 marketing year. Friday’s data from the U.S. Department of Agriculture will also feature U.S. corn and soybean production, U.S. quarterly grain stocks and other U.S. and global supply and demand updates for 2024-25. All eyes will be on these reports this week, though market participants should stay in tune with weather models for Argentina as Monday’s runs suggested the grain belt could stay warm and dry through mid-month. Karen Braun is a market analyst for Reuters. Views expressed above are her own. Sign up here. https://www.reuters.com/markets/us/funds-open-2025-with-most-bullish-cbot-corn-view-two-years-2025-01-07/
2025-01-07 11:16
Jan 7 (Reuters) - Storm surges often are the most deadly and destructive phenomena to accompany a hurricane or tropical cyclone. Here is an explanation of how they form and why they are so dangerous. WHAT IS A STORM SURGE? As a hurricane approaches a coast, the churning winds force ocean water up onto land. Atmospheric pressure from the storm also helps squeeze the water ashore. The shallower the continental shelf, the higher the threat of a dangerous surge. The waters may take a couple of days to fully subside. According to the U.S. National Hurricane Center , opens new tab, surges are often the greatest threat to life and property from a hurricane. WHAT MAKES STORM SURGES SO DANGEROUS? Water is heavy: about 1,700 pounds (770 kg) per cubic yard. And it can move quickly in a surge, sweeping people to their deaths, tossing about boats and vehicles and pulverizing buildings and other structures. Six inches (15 cm) of fast-moving water is enough to knock over an adult, according to the hurricane center. Surges become even more dangerous when they coincide with high tide. A powerful storm surge can cause long-term damage by sweeping away roads, eroding beaches and contaminating land with salt water, harming wildlife and agriculture. WHAT WAS THE DEADLIEST STORM SURGE ON RECORD? In 1970, a tropical cyclone formed in the Bay of Bengal and hit northeastern India and what was then East Pakistan. Storm surge of up to 35 feet (10.7 m) washed over barrier islands, including Bhola, the largest. The death toll was estimated between 300,000 and 500,000 people, making it the deadliest tropical cyclone on record, according to the Atlantic Oceanographic and Meteorological Laboratory , opens new tab. WHAT WAS THE LARGEST STORM SURGE? The highest storm tide noted in historical accounts was produced by the 1899 Cyclone Mahina, estimated at almost 44 feet (13.4 m) at Bathurst Bay, Australia. In the United States, one of the largest storm surges recorded was during Hurricane Katrina that struck Gulf Coast states in 2005. The maximum high water mark observation of storm surge was 27.8 feet (8.5 m) at Pass Christian in Mississippi, according to the National Hurricane Center , opens new tab. The hurricane killed as many as 1,500 people. In Florida, Hurricane Michael in 2018 brought storm surges that were 20.6 feet (6.3 m) high and destroyed Mexico Beach on Florida's Panhandle. HOW DOES CLIMATE CHANGE AFFECT STORM SURGE? Warmer ocean temperatures create more intense and frequent hurricanes that pack higher rainfall and greater storm surge risk due to rising sea levels, according to climate scientists. HOW TO PREPARE FOR A STORM SURGE The most important way to survive storm surge is to evacuate if you are in a flood zone. If you cannot evacuate, experts advise moving to the highest level of the building and staying indoors. They warn against attempting to drive through floodwaters. Sign up here. https://www.reuters.com/business/environment/how-hurricanes-cause-dangerous-destructive-storm-surges-2025-01-07/
2025-01-07 11:04
Jan 7 (Reuters) - A look at the day ahead in U.S. and global markets by Amanda Cooper. Trading action so far has been dominated by uncertainty over incoming U.S. President Donald Trump's threatened tariffs. But the "will he, won't he" narrative looks likely to take a backseat as a number of key metrics on the labour market start to filter through ahead of Friday's jobs data. The December employment report is expected to show 150,000 workers were added to nonfarm payrolls, down from November's 227,000, which would bring the total number of jobs created in 2024 to 2.34 million. Excluding 2020, when the pandemic brought the global economy to a halt for months, this would be the smallest number since 2019's 1.988 million. But it's still pretty much in line with average annual job creation prior to 2020's anomalous dynamics. U.S. exceptionalism is alive and well, it seems. For better or for worse, investors have plenty of job-related data points to mull over in the run-up to the mighty NFP report on Friday, starting today, with the JOLTS report on job openings and the Institute for Supply Management's (ISM) non-manufacturing survey - where the employment component is likely to come under extra close scrutiny. The Labor Department's Job Openings and Labor Turnover Survey (JOLTS) is expected to show job openings - a measure of demand for workers - remained roughly unchanged at 7.7 million in November, from 7.74 million in October. The October report showed the ratio of job openings to unemployed workers was 1.11, indicating an employment market in balance, which aligns nicely with the Federal Reserve's mandate to ensure full employment. So far, so good. The "but" here is the volatility of the survey itself, which is often subject to quite large revisions, and the fact that it is for the month prior to the upcoming NFP report, which makes it a tad backward-looking. But investors will no doubt react to it, given the heightened sensitivity of markets to U.S. rate expectations. Hot on the heels of the JOLTS survey is the ISM non-manufacturing survey for December, which captures activity in the mammoth U.S. services sector. The November headline number came in at 52.1, above the 50-watermark that separates growth from contraction. On a seasonal basis over the last 10 years, December has tended to be one of the weaker months of the year for employment, with the sub-index averaging 51.3. November's employment sub-index came in at 51.5, having hit a 13-month high of 53 the month before. A separate reading of overall business activity, including the factory sector, shows the United States was the only major economy to show growth in November and since then, there has been little evidence in the data to suggest this may have changed much last month. The futures market shows traders are fairly certain there will be no Fed rate cuts much before June. Nonfarm payrolls may be the one data point that can materially move the needle on that. But with so much of that expectation riding on the U.S. economy's ability to generate jobs at a decent clip, anything in the run-up to Friday's number that suggests otherwise could deliver an unwelcome jolt. Key developments that should provide more direction to U.S. markets later on Tuesday: * November U.S. trade balance * December JOLTS report * December Institute for Supply Management non-manufacturing survey Sign up here. https://www.reuters.com/markets/us/global-markets-view-usa-2025-01-07/
2025-01-07 10:07
MUMBAI, Jan 7 (Reuters) - The Indian rupee logged its biggest one-day gain in more than a month on Tuesday as the dollar dipped towards a one-week low, boosting regional currencies, while foreign banks' dollar sales also helped. The rupee closed up 0.1% at 85.7125 against the U.S. dollar, its strongest daily gain since late-November. The dollar index fell 0.3% to 107.9, while other Asian currencies rose between 0.2% and 0.9% as traders pondered whether U.S. President-elect Donald Trump's trade tariffs would not be as aggressive as anticipated. A report by the Washington Post on Monday said Trump's aides were exploring tariff plans that would apply to every country but only cover certain sectors deemed critical to national or economic security, prompting a slump in the dollar. Trump later denied the report in a post on his Truth Social platform, helping the dollar trim some of its decline. The dollar's failure to recover losses "likely indicates two factors: first, the market had been heavily favouring the dollar following a nearly continuous three-month rally; second, a view that there is no smoke without fire," ING Bank said in a note. Dollar sales from at least two large foreign banks also helped the rupee, a trader at a bank said. But relief for the local unit is likely to be temporary amid growing anticipation of weakness among speculators and hedgers, indicated in market activity data covering options and forwards. India's benchmark equity index Nifty 50's (.NSEI) , opens new tab return below the 200-daily moving average, a key technical indicator, "could spell more trouble for the rupee," Societe Generale said in a note. The Nifty rose on Tuesday after a slump in the previous session, but remained below the 200-day average after a brief recovery last week. "It remains to be seen if anticipated passive inflows into index-eligible (FAR) government bonds will stem the depreciation," the note said. Sign up here. https://www.reuters.com/markets/currencies/rupee-logs-biggest-one-day-gain-over-month-regional-peers-jump-2025-01-07/
2025-01-07 09:34
FRANKFURT, Jan 7 (Reuters) - Euro zone households increased their inflation expectations in November, a European Central Bank poll showed on Tuesday, suggesting years of high inflation were still weighing on households' psychology. The ECB has been steadily cutting interest rates after bringing down price growth to just above its 2% target but some of the latest indicators, including German inflation data on Monday, suggest the battle might not be over just yet. The median respondent in the ECB's Consumer Expectations Survey expected prices to grow by 2.6% over the following 12 months in November, from 2.5% in October - marking the second increase in a row. The expectation for three years ahead was raised to 2.4% - the highest level since July - from 2.1%. The ECB has considered such levels as being "around" its 2% target before, so this latest survey alone is unlikely to change its intention to keep reducing borrowing costs. But investors have become less confident that the central bank will manage to cut rates four times by June. Inflation data for the euro zone is due to be published at 1000 GMT. Sign up here. https://www.reuters.com/markets/europe/euro-zone-consumers-raise-inflation-expectations-november-ecb-poll-2025-01-07/
2025-01-07 09:31
Jan 7 (Reuters) - Overseas investors turned net sellers of Asian equities in 2024, primarily due to a surge in selling in the last quarter amid concerns that U.S. President-elect Donald Trump's trade policies might hit Asian economies. They sold a net $15.8 billion worth of equities in Taiwan, South Korea, India, Thailand, Indonesia, Vietnam and the Philippines last year, after buying $26.6 billion in 2023. They had invested $14.67 billion in the first three quarters, encouraged by expectations of Federal Reserve easing and regional growth. But they later shifted to accelerated selling, hit by a stronger dollar and higher U.S. yields. Last year, Taiwan led the region with outflows of $12.4 billion, followed by Thailand and Vietnam with net selling of $4.11 billion and $3.63 billion. The macro backdrop for Asian equities remains challenging this year, said Timothy Moe, an analyst at Goldman Sachs. Early-year market headwinds include mixed economic data, rising U.S. 10-year yields and a stronger dollar, along with potential new U.S. tariffs on Asia-Pacific economies, persistently high economic policy uncertainty and geopolitical risks, Moe added. Higher returns in other markets also pulled overseas investors away from Asian markets last year, with MSCI Asia Pacific index (.MIAP00000PUS) , opens new tab yielding just 7.23% in 2024, much lower than MSCI World's < .MIWD00000PUS> 15.73% and MSCI United States' < .dMIUS00000PUS> 23.4%. Trump, who takes office on Jan. 20, has pledged to implement a 10% tariff on all global imports to the U.S. and a 60% tariff on Chinese goods, measures that are expected to affect other Asian exporters due to integrated supply chains with China. Although Trump's threats could eventually be negotiated lower, "banking on less aggressive tariffs at this stage could seem premature," said Yeap Jun Rong, market strategist at IG, adding: "Inflows may still stay limited for now, until more policy clarity emerges". "We believe foreign investors will be selective on the markets and sectors as we envisage more divergence across Asian equity market based on their own domestic policy agenda vs. sensitivity to US monetary and trade policies," said Jason Lui, Head of APAC Equity and Derivative Strategy, BNP Paribas. Sign up here. https://www.reuters.com/markets/asia/trump-win-triggered-2024-exit-by-overseas-investors-asian-equities-2025-01-07/
