10/28/2011 – Closing Comments

Currencies-

Canada’s Dollar Declines as Euphoria of European Debt Crisis Deal Wanes

Canada’s dollar weakened after rising yesterday to the highest level in more than a month as optimism that Europe’s debt crisis is contained faded, damping demand for riskier assets.

The Canadian currency was headed for its fourth straight weekly advance against the greenback, which has lost value against all of its 16 major counterparts since Oct. 21. The Canadian dollar is the fourth-worst performing major after the Bank of Canada cut its growth outlook this week. Canada’s dollar capped the biggest two-day gain yesterday since May 2010 after European leaders announced a plan to stave off a Greek default and safeguard banks.

Cont. Reading @ Bloomberg.com

Pound Strengthens Against Euro as Waning EU Optimism Spurs Safety Demand

The pound rose against the euro, snapping a two-day decline, as waning optimism that the European Union’s plan to resolve the debt crisis spurred demand for the comparative safety of U.K. assets.

Gilts erased losses and sterling rallied to an almost two- month high versus the dollar after Italian borrowing costs increased at a debt sale today, prompting declines in European and U.S. equities. U.K. consumer confidence dropped to a 2 1/2- year low this month as Britons became more pessimistic about spending, GfK NOP Ltd. said. Sterling’s advance extended its third consecutive week of gains versus the dollar.

Cont. Reading @ Bloomberg.com

Metals-

Gold Declines From Five-Week High in N.Y. Amid Renewed Europe Debt Concern

Gold declined from a five-week high on renewed concerns thatEurope’s debt crisis will hamper global growth, damping prospects for commodity demand.

Italy’s borrowing costs rose to a euro-era record at a sale of three-year bonds. The Standard & Poor’s GSCI Index of 24 raw materials slumped as much as 1.3 percent. A rebound in the dollar also reduced demand for gold as an alternative asset.

Cont. Reading @ Bloomberg.com

Copper Traders See End to Record Rally as China Demand Slows: Commodities

Copper traders and analysts are forecasting an end to the biggest weekly rally since at least 1986 on concern demand will slow in Chinawhile Europe’s lingering financial crisis limits growth.

Eleven of 23 people surveyed by Bloomberg say copper will drop next week, eight predicted a gain, and four said prices will be little changed. The last time respondents were mostly bearish, on Sept. 23, the metal slumped 4.6 percent in the following week. Traders also predicted lower sugar prices next week, and gains in gold, corn and soybeans.

Cont. Reading @ Bloomberg.com

Energy-

Crude Oil Pares Biggest Weekly Gain Since March as Japanese Output Falls

Crude oil futures fell in New York, paring the biggest weekly gain since February, as a drop in Japan’s industrial output prompted traders to lock in profits from yesterday’s rally.

Crude dropped 0.7 percent as Japanese factory production declined 4 percent in September, almost twice as much as the median estimate of economists surveyed by Bloomberg News. Oil advanced 4.2 percent yesterday after data showed the U.S. economy grew at the fastest pace in a year and European leaders agreed on a plan to curb the region’s debt crisis.

Cont. Reading @ Bloomberg.com

Grains-

Wheat Declines, Paring Weekly Advance, on Higher Global Reserve Estimates

Wheat fell in Chicago, paring a third weekly advance, on a prediction that global stockpiles will exceed a prior estimate as production climbs and demand wanes. Corn and soybeans dropped.

World wheat inventories will be 202 million metric tons at the end of the 2011-12 marketing year, up 4.7 percent from last month’s 193 million-ton forecast, the International Grains Council said yesterday. Output will total 684 million tons, above the 679 million tons forecast in September, as consumption retreats to 677 million tons, it said.

Cont. Reading @ Bloomberg.com