AUG 02 DanskeCommodities Daily

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Investment ResearchGeneral Market Conditions

Commodities news

Overview – Commodities in positive mode this morning despite the Chinese PMI and

US Q2 GDP pointing to further slowdown in global growth. Asian stock markets also

generally higher on strong earnings. Markets looking ahead to US ISM today and the

US employment report this Friday.

US – Q2 GDP growth was on the whole somewhat disappointing. While headline Q1

figures were revised higher, Q2 came in below expectations at 2.4% q/q AR. Private

consumption was the big disappointment, adding to the view that employment and

private consumption are the main weaknesses in the US recovery.

China – The July PMI report showed that the economy weakened further in July as

the HSBC PMI fell to 49.4 in July from 50.4 in June; this is the weakest level since

March 2009. A separate PMI index released by the National Bureau of Statistics on

Sunday showed a decline to 51.2 in July from 52.1 in June. Both indices indicate that

tightening measures from the government are working to cool the Chinese economy.

China’s appetite for commodities remains key to the sector but official data may

understate demand, see WSJ: China's Ore Demand Flies Under the Radar .

Investor flows - The weekly positioning data from US exchanges showed that

investors built up long positions in copper and wheat alike last week; notably, the

recent weather-related surge in wheat prices has led speculators to reverse their net

stake in the market to now be on average net long the grain.

Cross commodities - During most of July, commodities have in general seen

consistent price increases, not least over the past two weeks. Corporate earnings have

in general surprised on the upside, and Euroland data have in fact turned out on

average slightly better than analysts’ forecasts. As a result, risk markets have taken

comfort from the fact that if Europe was supposed to be the weakest link in the global

recovery, then things may not look too bad. However, as highlighted by Friday’s US

GDP report, US growth may already have peaked and thus we cannot rule out that a

disappointing US ISM number could spark a sell-off in commodities this afternoon.

Manufacturing sentiment and metal prices

Source: EcoWin, Danske Markets.

02 August 2010

Todays key points

Euroland manufacturing PMIs

US ISM manufacturing

Commodities Daily

Commodities overview

Contract Last price %, d/d

WTI, NYMEX 1. pos 79.3 1.2

Brent, ICE 1. pos 78.4 1.0

Heating Oil, NYMEX 1. pos 209.3 2.7

Gasoline, NYMEX 1. pos 213.1 1.6

Aluminium, LME 3M 2196 4.9

Copper, LME 3M 7410 2.5

Lead, LME 3M 2108 2.8

Nickel, LME 3M 21650 4.7

Zinc, LME 3M 2038 2.4Steel, LME 3M 500 6.8

Hot Rol Coil, NYMEX 1. pos 580 0.9

Gold, spot 1182 1.5

Silver, spot 18 3.2

Wheat, CBOT 1. pos 675.8 7.7

Corn, CBOT 1. pos 397.0 4.7

Source: Bloomberg, Danske Markets.

Commodities Research:

Chief Analyst

Arne Lohmann Rasmussen+45 4521 [email protected]

Senior Analyst

Christin Tuxen+45 [email protected]

Commodities Sales:

Senior Dealer

Martin Vorgod+45 4514 3286

[email protected]

Vice President

Fredrik Åberg+45 4514 [email protected]

Bloomberg: DRFX <GO>

http://online.wsj.com/article/SB10001424052748703314904575399562576908060.html?KEYWORDS=china+ore+demand#printMode





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Commodities Daily

Commodity-price movements

This year

Last price %, today Close %, d/d Price %, m/m Price %, y/y %, YTD

Energy (1. pos):

NYMEX WTI ($/bbl) 79.3 0.4 79.0 0.8 72.1 9.9 69.4 14.2 -0.1

ICE Brent ($/bbl) 78.4 0.3 78.2 0.8 71.7 9.4 71.7 9.3 0.6

NYMEX Heating Oil ($/gallon) 209.3 0.2 208.8 2.5 191.5 9.3 179.4 16.7 -1.2

NYMEX RBOB Gasoline ($/gallon) 213.1 0.4 212.2 1.2 197.8 7.8 204.5 4.2 3.8

ICE Gasoil ($/ton) 658.3 1.5 648.3 -0.3 613.8 7.3 570.5 15.4 3.6

ICE NWE Jet Fuel, CIF ($/ton) 719.9 1.0 712.7 0.9 666.9 8.0 629.5 14.4 2.8

TTF NL Natural Gas ( /mwh) 18.0 1.1 17.8 3.1 20.2 -10.7 9.7 86.8 40.2

Henry Hub Natural Gas ($/MMBtu) 5.0 1.1 4.9 2.0 4.7 6.2 3.7 36.3 -10.7

Nordpool electricity ( /mwh) 43.0 -1.1 43.4 0.0 46.8 -8.1 - - -

Fuel oil, 1%, FOB NWE ($/ton) 459.0 -0.8 462.5 - 446.5 3.8 301.3 53.8 81.3

Fuel oil, 3.5%, FOB ARA ($/ton) 433.0 -0.5 435.0 - 433.0 3.7 227.0 97.8 98.2

API2 steam coal, CIF ARA ($/ton) 93.9 0.2 93.7 1.6 96.5 -2.8 68.0 38.0 12.8

ICE ECX Carbon Emission ( /tn) 14.1 -0.3 14.2 0.9 15.4 -8.1 14.1 -0.1 12.6

Base metals:

Aluminium, LME 3M, $/ton 2196 1.0 2175 3.9 1937 13.4 1890 16.2 -1.5

Copper, LME 3M, $/ton 7410 1.6 7297 0.9 6410 15.6 5719 29.6 0.5

Lead, LME 3M, $/ton 2108 1.5 2078 1.3 1753 20.2 1879 12.2 -13.3

Nickel, LME 3M, $/ton 21650 2.4 21150 2.3 18800 15.2 17950 20.6 16.9

Zinc, LME 3M, $/ton 2038 0.6 2025 1.8 1780 14.5 1750 16.5 -20.4

Steel, LME 3M, $/ton 500 4.6 478 2.1 430 16.2 390 28.1 22.0

Hot Rolled Coil, NYMEX, 1. pos, $/ton 580 -0.9 585 1.7 615 -5.7 480 20.8 5.5

Precious Metals (spot, $/t oz.):

Gold 1182 0.1 1180 1.3 1209.4 -2.3 951.7 24.2 7.6

Silver 18 0.1 18 3.2 17.7 2.1 14.0 29.8 7.0

Agriculturals (1. pos):

CBOT Wheat ($/bu.) 675.8 2.2 661.5 5.4 487.8 38.5 528.3 27.9 24.8

Matif Mill Wheat ( /ton) 186.0 4.1 178.8 -0.8 136.5 36.3 127.0 46.5 41.7

CBOT Corn ($/bu.) 397.0 1.1 392.8 3.6 364.0 9.1 339.5 16.9 -4.2

CBOT Soybeans ($/bu.) 1063.3 1.0 1052.5 2.5 962.8 10.4 1134.0 -6.2 2.3

NYBOT Sugar ($/lb.) 19.6 0.4 19.5 3.3 18.0 8.5 18.8 4.4 -27.4

Commo dity indices (total return):

DJ-UBS 270 1.8 265 1.5 249 8.3 254 6.3 -3.5

S&P GSCI 4253 1.2 4201 1.7 3905 8.9 4276 -0.5 -6.2

Reuters CRB 274 1.5 270 1.5 254 7.8 257 6.7 -3.1

Rogers commodity index 3207 0.7 3184 1.7 2898 10.7 2976 7.8 -2.0

DJ-AIG 134 1.8 132 1.5 124 8.3 126 6.1 -3.5

S&P GSCI Energy 932 0.8 925 1.9 901 3.5 952 -2.1 -8.3S&P GSCI Industrial Metals 1627 2.1 1594 1.1 1463 11.2 1373 18.5 -4.7

S&P GSCI Precious Metals 1527 1.2 1508 0.8 1609 -5.1 1211 26.1 7.2

S&P GSCI Agriculture 593 3.1 575 1.7 504 17.7 556 6.7 -3.7

Yesterday Month ago Year ago02.08.2010

Source: Bloomberg, Danske Markets.




Commodities Daily

Energy

Oil prices US crude oil stocks, EIA

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Jet fuel and gasoil crack spreads Gasoline crack spread, RBOB, NYMEX 1. Pos


WTI (NYMEX) forward curve Brent (ICE) curve





Commodities Daily

Heating oil crack spread, NYMEX 1. pos Fuel oil, NWE, crack spreads


CO2 emission rights, ICE 1. pos Electricity, Nordpool quarterly, 1. Pos


Natural gas, 1. pos API2 coal, 1. Pos





Commodities Daily

Metals

Aluminium Aluminium forward curve


Copper Copper forward curve


Nickel Nickel forward curve





Commodities Daily

Zinc Zinc forward curve


Copper SHFE-LME spread Steel


Gold and silver Gold forward curve





Commodities Daily

Grains

Wheat Milling wheat forward curve, NYSE LIffe


Corn, CBOT 1. pos Corn forward curve, CBOT


Soybeans, CBOT 1. pos Soybeans forward curve, CBOT




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Commodities Daily

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AUG 02 DanskeCommodities Daily

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