Largely based on our expectation that the eurozone crisis will get significantly worse before it is resolved, our core view has been that sideways trade is the best-case scenario for the commodity complex as a whole. With sentiment towards European banks continuing to sour, this view is playing out with particularly bearish implications for industrial… [Read more]

The apparent victory of centre-left candidate Ollanta Humala in the Peruvian president election could pose significant risks to the mining sector. Having said that, we believe these fears are to an extent overblown. 1: As Humala does not possess a majority in Congress, he will have to form a coalition or gain support from one… [Read more]

Yesterday, my colleagues and I wrote about the domestic implications of Japan’s earthquake. Today, we look at some of the more salient external ramifications: Downside Risks For Base Metals… Base metals continue to correct in line with the view our Commodities team presented last week, but the earthquake in Japan has added additional downside pressure… [Read more]

Fund managers, analysts and traders often talk about the importance of being selective in stock picking. While the emergence of the risk-off/risk-on trade in recent years has perhaps lessened the appeal of this somewhat, in many markets an investor’s choice of sector or company continues to mean vastly differing returns. Since the global financial crisis,… [Read more]

Shanghai interbank rates spiked by 300 basis points between Tuesday 18 January and Friday 21 January, with the 1-month rate hitting 7.48%. This is attributed to higher bank reserve requirement ratios, leaving banks short of cash just ahead of the Chinese New Year. BMI believes that the Chinese monetary authorities will correct the problem, but… [Read more]

Recent price action has bolstered my view that recent weakness in commodity markets is part of a temporary correction, rather than the start of a trend change. Commodities are bouncing across the board today, in line with a general recovery across asset classes. For instance, the Dow has held the key 11,000 level, while the… [Read more]

Gold prices have made significant ground in recent trading, prompting a surge of interest in the precious metal. Indeed, speculative interest in gold has risen to a 16-year high in recent days and the technical picture remains encouraging. Spot gold has broken above resistance around the US$990.00/oz level, and crucially, is currently sitting pretty above… [Read more]