Post by capitalstars Equity tips on Dec 31, 2015 19:27:54 GMT 8
ENERGY-
Energy prices are likely to stay weak, although there may be some upside potential to crude oil prices in the second half of the year if OPEC holds its nerve on its production ceiling and smaller companies, such as US shale producers, are forced to shut.
Natural gas prices posted a spike recently, recovering from 17-year lows due to unexpected forecasts of colder weather ahead in the US, which will spur demand for heating fuel.
IRON ORE
A slowdown in the growth of world’s largest consumer, China, is hitting the country’s property market hard and with a large steel inventory still waiting to be cleared, this is likely to continue to drag on iron ore prices, which have tanked to around USD 40 a ton now from almost USD 70 in January.
PRECIOUS METALS
Prices of gold and silver have tanked about 10 percent in 2015 on expectations of an interest rate hike from the US Federal Reserve, which earlier this month raised rates for the first time since 2006.
COPPER
The red metal has had a tumultuous year, falling over 20 percent year-to-date. But prices may rise, despite ongoing challenges, according to London-based Capital Economics.
Bain predicts copper will reach USD 6,000 a ton by end-2016, up from around USD 4,750 per ton now.
GRAINS
Despite fears of weather shocks from El Nino and La Nina, low grain prices are unlikely to get much boost due to ample inventories, Dominic Schnider, UBS Wealth Management’s head of commodity and Asia-Pacific forex, told CNBC’s Squawk Box on Monday.
“In general, there is a bias toward a little bit higher prices, but we have decent buffer and a decent inventory, so we can absorb whatever short-term weather volatility there is,”
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