Etikett: Arabica coffee

Robotic ETFs continue to see inflows

Robotic ETFs continue to see inflows ETF SecuritiesRobotic ETFs continue to see inflows

ETF Securities – Robotic ETFs continue to see inflows

Highlights

  • US$15mn into robotic themed equity ETFs.
  • Industrial metals – buying on price dips.
  • Arabica coffee ETPs attract US$6.8mn – the highest since October 2017 – as investors bargain-hunt.
  • Crude oil ETPs resume outflows.

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US$15mn into robotic themed equity ETFs. Last week’s flows marked a 3 week high. Investors are increasingly enthusiastic about the role of robotics in the modern world and have identified an investment opportunity in the companies that enable the deployment of this technology.

Industrial metals – buying on price dips. Broad industrial metal ETPs received a second consecutive week of inflows (US$5.0mn) as investors bought on price dips. Long copper ETPs received US$8.7mn of inflows. These inflows were at a 4-week high. The International Copper Study Group’s latest set of data released last week showed that world mine production declined by 2.4% in the first eleven months of 2017, while world refined production is estimated to have slightly increased by 0.5% in the first eleven months of 2017. The International Copper Study Group expect another year of supply deficits in 2018 as supply remains tight while demand increases. Copper’s role in electrification of vehicles (upgrading of electrical networks and increased use of wiring in cars) presents a strong structural tailwind for the metal. Nickel ETPs continued to see inflows (US$34.3mn). Nickel also benefits from the electrification of vehicles (see Commodity Research: Nickel – electrification may boost demand)

Arabica coffee ETPs attract US$6.8mn – the highest since October 2017 – as investors bargain-hunt. With a cooler Southern Hemisphere summer, the prospects for heat damage to this year’s coffee crop is reduced. Coffee yields are likely to rise and stocks are likely to be replenished after withdrawals last year. However, should weather conditions turn or crops disease increase, this narrative will no longer apply and prices could rise. Investors appear to be trying to find bargains.

Crude oil ETPs resume outflows. While in the prior week we saw the first inflows since July 2017, outflows resumed last week (a modest US$2.9mn out of long oil ETPs). As prices bounced 3.9%, investors took profit. Rig counts in the US have been rising for five consecutive weeks, highlighting the extent to which US supply will keep rising if prices remain this high.

Important Information

General

This communication has been issued and approved for the purpose of section 21 of the Financial Services and Markets Act 2000 by ETF Securities (UK) Limited (“ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority (the “FCA”).
The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

ETFS UK is required by the FCA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction. No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

 

Investors seek to take profits on precious and industrial metals

Investors seek to take profits on precious and industrial metals

ETF Securities Weekly Flows Analysis – Investors seek to take profits on precious and industrial metals

  • Investors are taking profits on gold and silver as they reach multi months highs
  • Crude oil ETPs recorded moderate outflows as US refineries recover from storm Harvey
  • Investors are taking profits on industrial metals after a two-digit price increase year-to-date

Download the complete report (.pdf)

Investors reduced their long positions in gold and silver ETPs. We saw US$354.5mn and US$116.7mn out of our gold and silver ETPs respectively last week. The gold price is hovering around its highest level in twelve months, supported by the weakness of the US dollar and stock market declines. Fading market expectations of further Fed rate hikes, North Korea tensions and natural disasters are likely to prevent the US dollar from rising in the short term. Stanley Fischer, unexpectedly announced last week his resignation as Vice Chairman of the Fed for personal reasons. His departure from the Fed has increased uncertainty about the new governance of the Fed and the conduct of the future monetary policy. In addition, the ongoing bipartisan dispute over the increase of the US debt ceiling is also likely to lend further weaknesses to the US dollar as we move toward year end.

We saw US$26.3mn of outflows from oil ETPs as crude oil stocks are expected to rise. Oil prices gained 2% last week as refining capacity in the US increased after temporary shut-down in the wake of Tropical Storm Harvey. The US dollar weakened and talks between Russia and Saudi Arabia about a possible extension to the production cuts among OPEC producers added a tail-wind to crude oil prices. Hurricane Irma, ranked in the highest category, has reached Florida during the weekend, threatening the crude oil and natural gas production facilities and oil trading. The threat to pipeline infrastructure and refining capacity will again weaken crude oil prices and increase gasoline prices (as we saw on Friday). The US Department of Energy (DOE) weekly report has revealed a strong increase in US crude oil stocks in the week ending on the 1st of September as a result of Harvey. Hurricane Irma is likely to see crude stocks continue to rise while gasoline stocks decline.

Investors taking profits on industrial metals after prices slipped. We saw US$119.9mn of outflows from our industrial metals ETPs last week after metals experienced a moderate price correction on the back of falling US stock markets. While the overall global macroeconomic outlook remains supportive to commodity demand, prices are likely to face an unwind in speculative positioning as investors seek to take profit. Copper ETPs saw the largest outflows (US$65.5mn) since October 2014. Year-to-date, copper ETPs attracted US$41.7mn on the back of strong price performance (+18.4%).

Agriculture ETPs attracted US$43.3mn of inflows last week. A massive 8.1- magnitude earthquake hit Mexico’s southern coasts last Friday, causing tsunami waves. This natural disaster threatens production of Arabica coffee in Mexico and Central America, a region which accounts for 20% of the global output. The damages could slow down the upcoming harvest of Mexican coffee in October and possibly drive the price of coffee higher.

Video Presentation

Morgane Delledonne, Fixed Income Strategist at ETF Securities provides an analysis of last week’s performance, flow and trading activity in commodity exchange traded products and a look at the week ahead.

For more information contact

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E info@etfsecurities.com

Important Information

General

This communication has been provided by ETF Securities (UK) Limited (”ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority.

This is a strictly privileged and confidential communication between ETFS UK and its selected client. This communication contains information addressed only to a specific individual and is not intended for distribution to, or use by, any person other than the named addressee. This communication (i) is provided for informational purposes only, (ii) should not be construed in any manner as any solicitation or offer to buy or sell any securities or any related financial instruments, and (iii) should not be construed in any manner as a public offer of any securities or any related financial instruments. If you are not the named addressee, you should not disseminate, distribute or copy this communication. Please notify the sender immediately if you have mistakenly received this communication. When being made within Italy, this communication is for the exclusive use of the ”qualified investors” and its circulation among the public is prohibited.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

This document may contain independent market commentary prepared by ETFS UK based on publicly available information. ETFS UK does not warrant or guarantee the accuracy or correctness of any information contained herein and any opinions related to product or market activity may change. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data.

Any historical performance included in this document may be based on back testing. Back tested performance is purely hypothetical and is provided in this document solely for informational purposes. Back tested data does not represent actual performance and should not be interpreted as an indication of actual or future performance.

Historical performance is not an indication of or a guide to future performance.

The information contained in this communication is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision.

ETFS UK is required by the United Kingdom Financial Conduct Authority (”FCA”) to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction. No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

Risk Warnings

Any products referenced in this document are generally aimed at sophisticated, professional and institutional investors. Any decision to invest should be based on the information contained in the prospectus (and any supplements thereto) of the relevant product issue. The price of any securities may go up or down and an investor may not get back the amount invested. Securities may valued in currencies other than those in which there are priced and will be affected by exchange rate movements. Investments in the securities which provide a short and/or leveraged exposure are only suitable for sophisticated, professional and institutional investors who understand leveraged and compounded daily returns and are willing to magnify potential losses by comparison to investments which do not incorporate these strategies. Over periods of greater than one day, investments with a short and/or leveraged exposure do not necessarily provide investors with a return equivalent to a return from the unleveraged long or unleveraged short investments multiplied by the relevant leverage factor. Investors should refer to the section entitled ”Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in any securities referenced in this communication.

If you have any questions please contact ETFS UK at +44 20 7448 4330 or info@etfsecurities.com for more information.

Shackles of La Niña removed from agricultural prices

Shackles of La Niña removed from agricultural prices

The chances of a La Niña weather pattern developing have fallen, removing a potential weight on agricultural prices. The US National Oceanic and Atmospheric Administration has downgraded the probability of a La Niña weather pattern this year to around 40% from above 70% when they made their assessment in June. Neutral conditions are favoured with a probability of about 55%-60%. In February we published our analysis which showed that if a La Niña starts in the Northern Hemisphere Autumn/Winter, it would be supportive for the growing of wheat, corn, soybean, coffee and cocoa and hence it would be price negative. Now that the probability of that event has diminished, we believe that a source of negative price pressure has been removed. (Click to enlarge) However, in the short term, prices of grains remain under pressure. Despite the poor EU wheat crop due to weather damage, we are likely to see record global wheat production this year as yields in the US and Russia have remained very strong. The Northern Hemisphere wheat harvest for 2016/17 is largely over and the winter wheat planting for the next season will now take place. Given the elevated stocks (outside of EU), we could see wheat planting reduce, which if confirmed will be price supportive during the 2017/18 crop. Corn is also likely to see record global production in 2016/17. The US harvest is likely to be completed around November.  Once again, if elevated stocks are confirmed, planting of next year’s crop, which will start in March 2017, is likely to be pared down. Arabica coffee has been in a supply deficit for the past two years. The absence of a La Niña could mean a dryer Southern Hemisphere Summer which could continue the recent rally we have seen in coffee prices (up 10% in the past 3 weeks).

Nitesh Shah, Research Analyst at ETF Securities

Nitesh is a Commodities Strategist at ETF Securities. Nitesh has 13 years of experience as an economist and strategist, covering a wide range of markets and asset classes. Prior to joining ETF Securities, Nitesh was an economist covering the European structured finance markets at Moody’s Investors Service and was a member of Moody’s global macroeconomics team. Before that he was an economist at the Pension Protection Fund and an equity strategist at Decision Economics. He started his career at HSBC Investment Bank. Nitesh holds a Bachelor of Science in Economics from the London School of Economics and a Master of Arts in International Economics and Finance from Brandeis University (USA).

UK Averts Coalition Chaos

UK Averts Coalition Chaos

ETFS Multi-Asset Weekly

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Highlights

Arabica coffee slid 4.2% as Colombian production continues to rise.

FTSE 100 recouped weekly losses after the election result.

Euro downside risk as Greek tension mounts.

Contrary to pre-election polls, the UK has managed to secure a majority government, averting the chaos that many had expected would follow in forming a stable coalition. UK equities and the Pound Sterling strengthened on the news after a week of losses. Meanwhile, with a debt payment due to the IMF tomorrow by Greece, the market is seeking hedges against a potential accident should Euro area finance ministers fail to avoid brinkmanship in their discussions with the cash-strapped nation today. The Chinese central bank cut interest rates yesterday, providing a tailwind for Chinese equities and cyclical commodities.

Commodities

Arabica coffee slid 4.2% as Colombian production continues to rise. The Colombian Coffee Growers Federation reported that the country’s coffee production for April grew 11.06% year-on-year. However, Colombia only produces 11% of global Arabica output. Brazil who produces 45% of global output, has had significant drought damage to its coffee bushes in 2014 threatening the yield in 2015. While some were optimistic about a reversal of that damage due to beneficial rain in Minas Gerais (a key growing area) in recent months, precipitation over the past week has moderated significantly. Added to that, a firmer Brazilian Real removes a catalyst for stock-offloading by Brazilian farmers. We believe that coffee prices could benefit from a tightening in supply from Brazil. While zinc, nickel and copper rose on the hopes of tighter supply this year, aluminum fell moderating the gains from the previous week.
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Equities

FTSE 100 recouped weekly losses after the election result. With markets having braced themselves for chaos, the election results led to a relief rally when a majority government was formed. The MSCI China A-Share index fell 6.4%, moderating its gains after reaching a 7-year high the week prior. A disappointing Chinese manufacturing PMI reading and weaker trade figures deflated some of the optimism in the market. However, that disappointment let to interest rate cut effective today, which should provide the equity markets with a shot of adrenalin. Moreover, with further financial market liberalization on the cards for this year, we expect the domestic equity to undergo a period of secular expansion. This week, a number of Chinese data releases including industrial production and retail sales will help the central bank and investors assess the strength of the near-term growth.

Currencies

Euro downside risk as Greek tension mounts. The Euro has been one of the most volatile currencies this year and this week is unlikely to change that trend. We expect that this week’s Greek negotiations pose a downside threat, especially as the Euro remains elevated against the USD, despite last week’s strong jobs report in the US. We believe the soft patch in US economic activity will begin to fade and support a further rally in the USD. The British Pound was one of the strongest performing currencies last week, following the surprise Conservative majority victory in the general election. Investors will be looking ahead to the Bank of England meeting this week to gauge the central banks desire to hike rates. We expect that tighter policy is a long way off and that GBP/USD will gradually move back toward the levels it was trading at pre-election levels near 1.50.

For more information contact:

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E  info@etfsecurities.com

Important Information

General

This communication has been issued and approved for the purpose of section 21 of the Financial Services and Markets Act 2000 by ETF Securities (UK) Limited (”ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority (”FCA”).

Investments may go up or down in value and you may lose some or all of the amount invested.  Past performance is not necessarily a guide to future performance. You should consult an independent investment adviser prior to making any investment in order to determine its suitability to your circumstances.

The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value.

This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. Although ETFS UK endeavours to ensure the accuracy of the content in this communication, ETFS UK does not warrant or guarantee its accuracy or correctness. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data. Where ETFS UK has expressed its own opinions related to product or market activity, these views may change. Neither ETFS UK, nor any affiliate, nor any of their respective, officers, directors, partners, or employees accepts any liability whatsoever for any direct or consequential loss arising from any use of this publication or its contents.

ETFS UK is required by the FSA to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction.  No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

Other than as set out above, investors may contact ETFS UK at +44 (0)20 7448 4330 or at retail@etfsecurities.com to obtain copies of prospectuses and related regulatory documentation, including annual reports. Other than as separately indicated, this communication is being made on a ”private placement” basis and is intended solely for the professional / institutional recipient to which it is delivered.

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Gold in Demand as Global Risks Linger

Gold in Demand as Global Risks Linger

Commodity ETP Weekly Gold in Demand as Global Risks Linger

Highlights

Global risks drive US$435mn of inflows into long gold and oil ETPs.
Arabica coffee remains in focus on low crop expectations.
Price correction prompts US$6.3mn of inflows into ETFS Copper (COPA)

Download the complete report (.pdf)

 

Gold ETPs saw the largest inflows since August 2012 last week, as lingering global risks lifted demand for safe havens. Fears of a further slump in the euro following the ECB quantitative easing announcement last week, and Greece once again threatening the Eurozone’s unity alongside continued geopolitical risks, are likely to continue to buoy gold prices and lift demand for alternative stores of value.

Global risks drive US$435mn of inflows into long gold and oil ETPs. Although the announcement of quantitative easing (QE) by the European Central Bank (ECB) was widely anticipated, the overall size was larger than expected. At EUR60bn a month until September 2016, the ECB will purchase more than a EUR1trn over the course of the programme. The ECB clearly wants the Euro area to move out of a deflationary mind-set. Fear of a further slump in the Euro as the ECB’s looks to boost its balance sheet buoyed the gold price and prompted US$294mn of inflows into our long gold ETPs. Safe havens are likely to remain in demand this week after the Syriza party won the Greek election yesterday, raising prospects that the country will seek to renegotiate the terms of its international bailout. At the same time, oil prices trended higher on Friday as news of Saudi King Abdullah’s death added to uncertainty in energy markets. While prices might remain weak for some time, inflows into long oil ETPs have totalled over US$572mn since the beginning of the year, showing investors are becoming increasingly confident in a price rebound.

Arabica coffee remains in focus on low crop expectations. Long coffee ETPs saw US$4mn of inflows last week as CONAB, the Brazilian forecasting authority, revised down its forecasts for the 2015/16 crop. Brazil is the biggest producer of Arabica coffee with 45% of global production. The development of the coffee trees in the country has been disappointing so far following extreme drought conditions last year. Although rainfall in November had eased the situation somewhat, since then the weather has turned dry again. This could result in a substantially lower crop this year and could prompt a price rally.

Price correction prompts US$6.3mn of inflows into ETFS Copper (COPA). Strong back-to-back weekly inflows into long copper ETPs highlights that investors deem the recent price slump excessive. China’s latest statistics showed that the country grew more than expected in 2014, at 7.4%, easing fears of a hard landing. Although China is turning its focus from construction and export dependent manufacturing to domestic consumption, demand for copper has remained strong in 2014, with imports rising for the 5th consecutive month in November. While low energy prices have dragged down metal prices by reducing their cost of production, we think negative sentiment, rather than weak fundamentals, is weighing on the copper price at the moment.

Key events to watch this week. This week Europe will remain in focus, as the new Greek government seeks to renegotiate the terms of its bailout that is set to expire at the end of February. After the BOC and the ECB surprised markets by cutting rates and announcing a full-blown QE programme respectively, the FOMC meeting on Wednesday will be closely monitored by investors for any signs of a delay in tightening by the Fed. Gold would likely benefit from the Fed highlighting any potential spill-over effect on the US economy from weak oil prices and global risks.

Video Presentation

 

Simona Gambarini, Research Analyst at ETF Securities provides an analysis of last week’s performance, flow and trading activity in commodity exchange traded products and a look at the week ahead.

For more information contact

ETF Securities Research team
ETF Securities (UK) Limited
T +44 (0) 207 448 4336
E info@etfsecurities.com

 

Important Information

General

This communication has been provided by ETF Securities (UK) Limited (”ETFS UK”) which is authorised and regulated by the United Kingdom Financial Conduct Authority.

This is a strictly privileged and confidential communication between ETFS UK and its selected client. This communication contains information addressed only to a specific individual and is not intended for distribution to, or use by, any person other than the named addressee. This communication (i) is provided for informational purposes only, (ii) should not be construed in any manner as any solicitation or offer to buy or sell any securities or any related financial instruments, and (iii) should not be construed in any manner as a public offer of any securities or any related financial instruments. If you are not the named addressee, you should not disseminate, distribute or copy this communication. Please notify the sender immediately if you have mistakenly received this communication. When being made within Italy, this communication is for the exclusive use of the ”qualified investors” and its circulation among the public is prohibited.

This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States.

This document may contain independent market commentary prepared by ETFS UK based on publicly available information. ETFS UK does not warrant or guarantee the accuracy or correctness of any information contained herein and any opinions related to product or market activity may change. Any third party data providers used to source the information in this communication make no warranties or representation of any kind relating to such data.

Any historical performance included in this document may be based on back testing. Back tested performance is purely hypothetical and is provided in this document solely for informational purposes. Back tested data does not represent actual performance and should not be interpreted as an indication of actual or future performance.

Historical performance is not an indication of or a guide to future performance.

The information contained in this communication is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision.

ETFS UK is required by the United Kingdom Financial Conduct Authority (”FCA”) to clarify that it is not acting for you in any way in relation to the investment or investment activity to which this communication relates. In particular, ETFS UK will not provide any investment services to you and or advise you on the merits of, or make any recommendation to you in relation to, the terms of any transaction. No representative of ETFS UK is authorised to behave in any way which would lead you to believe otherwise. ETFS UK is not, therefore, responsible for providing you with the protections afforded to its clients and you should seek your own independent legal, investment and tax or other advice as you see fit.

 

Risk Warnings

Any products referenced in this document are generally aimed at sophisticated, professional and institutional investors. Any decision to invest should be based on the information contained in the prospectus (and any supplements thereto) of the relevant product issue. The price of any securities may go up or down and an investor may not get back the amount invested. Securities may valued in currencies other than those in which there are priced and will be affected by exchange rate movements. Investments in the securities which provide a short and/or leveraged exposure are only suitable for sophisticated, professional and institutional investors who understand leveraged and compounded daily returns and are willing to magnify potential losses by comparison to investments which do not incorporate these strategies. Over periods of greater than one day, investments with a short and/or leveraged exposure do not necessarily provide investors with a return equivalent to a return from the unleveraged long or unleveraged short investments multiplied by the relevant leverage factor. Investors should refer to the section entitled ”Risk Factors” in the relevant prospectus for further details of these and other risks associated with an investment in any securities referenced in this communication.

If you have any questions please contact ETFS UK at +44 20 7448 4330 or info@etfsecurities.com for more information.