In Tokyo on Monday equities markets saw gains, especially in domestically-focused stocks, as the Nikkei 225 added 1 percent to 15,885.38 and the Topix index ended the session 1 percent higher as well, at 1,553.01.
Export-focused stocks did not have as good a day of it. In the electronics sector, Sony dropped 0.7 percent to ¥4,570 after it said that eight of its best-selling models of digital cameras were defective, becoming unable to take pictures when exposed to heat and humidity. Sanyo, meanwhile, fell 5.6 percent to ¥170 as it announced another 2,200 employee layoffs and said it would end the fiscal year with losses for the third year in a row on declining mobile phone sales both in the US and domestically.
Automobile manufacturers saw declines as well. Toyota was 0.2 percent lower to ¥6,880, while Honda Motor was down 0.5 percent to ¥4,040.
Some of the domestic stocks that saw gains on the session were helped by broker upgrades. Fixed-line telecommunications company NTT added 2.3 percent to ¥578,000 on an increased target share price from Morgan Stanley. All Nippon Airways was 3.2 percent higher to ¥423 on an upgrade from Nikko Citigroup, which cited strong demand for international flights. Pharmaceutical company Eisai gained 3.3 percent to ¥6,240 on both a ratings upgrade and a raised target share price from UBS.
US retailers see losses despite good weekend sales
The New York equities markets were lower at midday on Monday as investors returned from the long Thanksgiving Day weekend. The Dow Jones Industrial Average was 1 percent lower to 12,154.4, while the Nasdaq Composite dropped 1.7 percent to 2,418.55 and the S&P 500 fell 1 percent to 1,386.74.
Retailers saw losses even though the National Retail Federation reported that average spending for the start of the holiday shopping season was up 18.9 percent from last year over the same period. JC Penney dropped 1 percent to $79.91 despite it’s statement Saturday that it was seeing a “good start” in holiday sales. Wal-Mart fell 1.8 percent to $47.06 after it said over the weekend that same-store sales in the US were down 0.1 percent in November, the first time it has seen a decline in that month in ten years. J Crew was 4.4 percent lower to $41.37 on a rating downgrade from CIBC, after gaining 22 percent last week on its profits report.
Stock exchanges were mixed. Nasdaq added 0.7 percent to $40.93 after elaborating on how it plans to raise the money for its bid on the London Stock Exchange. On the other hand, NYSE Group dropped 2.2 percent to $105.84 and the Chicago Mercantile Exchange fell 2.6 percent to $2.55.
The financial services sector was lower as Goldman Sachs declined 2.1 percent to $197.37. Morgan Stanley and Bear Stearns each fell 2.4 percent, to $77.06 and $154.76 respectively.
Automobile maker Ford Motor was 2.7 percent lower to $8.21 on its announced plan to borrow $18 million dollars. It said it would back the loans with collateral.
Internet search engine Google dropped 2.6 percent to $491.98 on profit-taking.
In London on Monday, the FTSE 100 was 1.2 percent lower to 6,050.1, its lowest close since early October and its largest one day percentage decline since the end of September. Meanwhile, the FTSE 250 also declined, dropping 0.9 percent to 10,493.6.
The retail sector saw declines on slow sales for clothing retailers due to mild weather so far this autumn. Debenhams dropped 1 percent to 194p, while Next fell 2 percent to £17.94. Rumors have underlying sales at Next down by up to 20 percent year-on-year.
In the steel sector, Corus was 1 percent lower to 499½p on worries that pension fund trustees might hold up merger talks with CSN of Brazil. Elsewhere, concerns that the government of Saudi Arabia might pull out of deal to buy 72 Eurofighter planes sent BAE Systems down 3.1 percent to 391p/
The 250 was saved from further declines by advances in the homebuilders sector when Wilson Bowden gained 14.6 percent to £20.98 after it said it has received several takeover inquiries. The mid-caps index was also helped by the news that First Choice Holidays is talking about selling its package tour operations to My Travel. My Travel was 7.1 percent higher to 214p, while First Choice gained 12 percent to 257p.
The FTSE Eurofirst 300 dropped 1.5 percent on Monday to close at 1,429.00. The declines was the Eurofirst’s furthest one-day fall in nearly six months.
Utilities were down after the announcement last week that the merger between Gaz de France and Suez was being delayed, as some hoped that Italian utility Enel might yet engineer a merger with Suez. Most analysts were skeptical of the possibility, and Enel dropped 1 percent to €7.59. Suez and Gaz de France were also lower, by 0.3 percent to €35.86 and by 0.6 percent to €32.27 respectively. Elsewhere in the sector, RWE dropped 0.6 percent to €86.05 even though it had gone as high as €90.81, an all-time high, earlier on rumors that Gazprom could be thinking about bidding.
Stock exchanges were also lower as investors took profits. Euronext dropped 3.4 percent to €92.25, while Deutsche Borse was 3.9 percent lower to €129.97.
The automobile manufacturing sector dropped on worries about the state of the US dollar. Volkswagen fell 1.6 percent to €80.01, while Peugeot dropped 2.5 percent to €46.78 and DaimlerChrysler was 2.8 percent lower to €44.25.
Tire makers were also lower, with Continental down 3.5 percent to €86.10 and Michelin dropping 4 percent to €65.20.
Crude oil prices were up during the day on Monday but not as much as might be expected after Saudi Arabia’s oil minister said over the weekend that OPEC will cut production again in December. He discounted the importance of price in the decision and emphasized the principle of balancing supply with demand.
January contracts for Brent crude were 16 cents higher to $60.19 per barrel. Meanwhile, West Texas Intermediate crude for January delivery gained 63 cents to $59.89 per barrel.
Metals prices were mixed on Monday. Among precious metals, gold added 0.2 percent to $639.10 per troy ounce after going as high as $641.75 per troy ounce earlier in the day, while silver gained 0.4 percent to $13.41 per troy ounce. Platinum, however, dropped 3.8 percent to $1,140 per troy ounce on profit taking after gains last week.
Base metals prices were also mixed, as nickel ended the session higher but copper and zinc prices both dropped. Zinc dropped 0.6 percent to $4,485 per tonne. Meanwhile, the price of copper went as high as $7,240 per tonne on decline in inventories in London Metal Exchange warehouses and on the news Friday that Hindalco of India suspended operations at one smelter because of a shortage of copper concentrate feed. Despite the news, copper ended the session 0.8 percent lower, to $7,095 per tonne. Nickel added 0.3 percent to $33,550 per tonne after the price went as high as $34,150 per tonne earlier.
The London equities markets were lower on Wednesday ahead of the four-day Thanksgiving Day weekend in the United States. The FTSE 100 dropped 0.7 percent to 6,160.3, while the FTSE 250 fell 0.6 percent to 10,687.7.
Ladbrokes was 1.1 percent higher on the session to 397¼p as rumors circulated that private equity might be interested in making a bid for the bookmaker. Also up was British Airways, which added 2 percent to 491p on the news that Qantas Airways of Australia had received a $7.7 billion offer. Specialty chemicals company ICI was 9.3 percent higher to 423p as investors speculated that the sale of its Quest unit leaves it open to bids.
Plumbing and constructions materials company Wolseley fell 1.6 percent to £11.68 ahead of its annual meeting next week. Analysts are worried that the plumber might be forced into a restructuring because of the slowdown in the US housing market.
In the defence sector, BAE Systems dropped 0.4 percent to 414½p amid concerns that Saudi Arabia could cancel the contract for the Al Yamamah 3 fighter plane.
Among media companies, BSkyB was 0.7 percent lower to 531p, while ITV fell 2.2 percent to 109½p on reaction to its rejection of an offer from NTL. In addition, US fund manager Fidelity sold its 11 percent stake in ITV to BSkyB last week and then bought back 58.3 million ITV shares Monday for a much lower price per share; however it appeared that Fidelity had stopped buying shares.
In Europe on Wednesday the FTSE Eurofirst 300 dropped 0.2 percent to 1,465.95.
Utilities fell to profit-taking and a court ruling that delayed the Suez/Gaz de France merger. Suez was 1.1 percent lower to €36.09, while Gaz de France dropped 2.5 percent to €32.36. Meanwhile Iberdrola, which is expected to bid for Scottish Power soon, fell 1.6 percent to €33.27.
The banking sector was mixed. Credit Agricole dropped 4 percent to €32.90 and earned it a broker downgrade after its third-quarter earnings report disappointed. Elsewhere in the sector, BNP Paribas added 0.2 percent to €84.20 but Societe Generale dropped 0.2 percent to €130.
Gainers on the session included the airlines sector. Lufthansa was 1.9 percent higher to €19.31, while Air France-KLM gained 3.2 percent to €32.25. The gains came after Australia’s Qantas Airways was the recipient of a takeover offer.
Stock exchanges were also higher. Euronext added 5.3 percent to €95.85 after it agreed with NYSE Group on the structure of the board of directors once the two complete their merger. Meanwhile Deutsche Borse was 6.5 percent higher to €138.13 on rumors that it will take a stake in Bulgaria’s stock exchange.
In the construction sector, French group Vinci gained 2.7 percent to €95.55 on speculation that it might be the target of a bid from private equity.
The Tokyo equities markets were substantially higher on Wednesday. The Nikkei 225 added 1.1 percent to 15,914.23 and the Topix index gained 1.3 percent to 1,552.87, while the Mothers index of small and mid-cap stocks was up 6 percent to 1,069.72 following multi-year lows reached earlier in the week. The gain in the Mothers index came as investors came to believe that stocks listed there have fallen enough to qualify as bargains.
Gains in the prices of metals took the non-ferrous metals sector 4.1 percent higher, with Sumitomo Metal Mining adding 3.4 percent to ¥1,414. Oil prices that were up Tuesday due to bad weather in Alaska sent Inpex 4.6 percent higher to ¥937,000.
Domestic sectors saw gains as well. The banking sector was up 2 percent as a whole, with Mitsubishi UFJ adding 2.2 percent to ¥1,420,000. Seven & I gained 2.3 percent to ¥3,500 in a retail sector that was 2.8 percent higher as a whole. The real estate sector was up 3 percent, with Mitsui Fudosan adding 2.1 percent to ¥2,620.
Telecommunications and internet company Softbank saw a gain of 8.4 percent on the session, to ¥2,320.
Among losers on the day was electronics maker NEC, dropping 5.6 percent to ¥557 on a report that showed losses in the first half and on a 64 percent downward revision in its prediction for the full year.
Crude oil prices were significantly lower on Wednesday after the release of new US inventory figures by the Energy Information Administration. Crude oil stockpiles were up by 5.1 million barrels in the week ending November 17. Inventories were expected to increase, but only by around 0.6 million barrels. The large increase was due to greater imports and declining refinery utilization. Imports were up to 10.49 million barrels per day, an increase of 1.04 million barrels per day over the past month, while refinery utilization was down by 0.2 percent to 87.1 percent. Meanwhile, demand for oil products was up 2.9 percent over last year at the same time to 21.05 million barrels per day over the past four weeks.
Gasoline inventories were up as well, adding 1.4 million barrels when a decline of 0.9 million barrels had been expected. Distillate stockpiles were down by 1.2 million barrels during the week, very close to expected declines.
Brent crude January contracts were $1.50 lower to $58.89 per barrel, while January delivery West Texas Intermediate crude dropped $1.63 to $58.54 per barrel on the New York Mercantile Exchange. Nymex Decmeber unleaded gasoline was 6 cents lower to $1.5730 per gallon and Nymex Decmeber heating oil was also down 6 cents to $1.6730 per gallon. Natural gas prices were lower as well, with Nymex December Henry Hub down just over 2 cents to $7.71 per million British thermal units.
Prices for precious metals were mixed on Wednesday. Gold added 0.4 percent to $628.80 per troy ounce, but platinum prices dropped 6.9 percent to $1,145 per troy ounce on continuing rumors that an exchange-traded fund for the metal will be introduced soon.
Base metals were also mixed. Zinc added 1.7 percent to $4,365 per tonne as inventories in London Metal Exchange warehouses dropped another 500 tonnes to 89,000 tonnes. However, nickel dropped 0.5 percent to $31,150 even though LME stockpiles fell another 534 tonnes to below 6,900 tonnes. Copper was also lower, by 1.2 percent to $6,895 per tonne.
The US dollar was weaker ahead of the Thanksgiving Day holiday amid slow trade and reports that the Council of Economic Advisors, made up of President George W. Bush’s economic advisors, have lowered their forecasts for growth of the US economy. The Council said that it made its growth revisions based on weakness in the US housing market. A larger than expected rise in unemployment claims also hurt the US currency.
The greenback fell 0.7 percent to $1.2940 versus the euro and dropped 0.8 percent to $1.9140 in relation to sterling. The euro was helped by comments from the prime minister of Luxembourg, speaking before the European Parliament, that criticized recent remarks by both the president and prime minister of France that called for more input into currency issues by members nations of the Eurozone. The Luxembourg PM said that the European Central Bank should be politically independent.
The Japanese yen and the Swiss franc gained even more versus the dollar during the day Wednesday. By mid-afternoon in New York the Swiss franc had added 1 percent versus the greenback to SFr1.2275, while the yen gained 1.1 percent to ¥116.60, its highest level against the US currency in two months. The yen was also higher against the euro, adding 0.4 percent to ¥150.80.
The New York equities markets were mixed at the mid-point in the session on Tuesday, with the Dow Jones Industrial Average and the Nasdaq Composite lower and the S&P 500 up slightly. The Dow was 0.02 percent lower to 12,314.54, while the Nasdaq had dropped 0.1 percent to 2,449.87. Meanwhile, the S&P was 0.08 percent higher to 1,401.57.
Google’s share price rose above $500 for the first time as it added 1.8 percent to $504.13 after going as high as $505.72 earlier in the day. Google has gained 37.6 percent since the beginning of August.
Boeing was up 1.6 percent to $90.54 on the news that Korean Air has placed an order for 25 aircraft. The order was said to be worth $5.5 billion dollars.
Oregon Steel Mills dropped 1.2 percent to $63 after its 8.2 percent gain on Monday after it was announced that Russian company Evraz Group will buy the steel maker. Elsewhere in the sector, share prices were up. Nucor added 2.5 percent to $58.88.
Dell Computer was 1.1 percent higher to $24.92 ahead of its quarterly report, due after trade closes for the day. The report, which was originally supposed to have been released last Thursday, is widely expected to show a drop in earnings per share of almost 40 percent.
Nasdaq dropped 0.9 percent to $37.37 amid speculation that it is thinking about raising its offer for the London Stock Exchange after its most recent bid was rejected on Monday.
The FTSE Eurofirst 300 added 0.1 percent to 1,468.30 on Tuesday on light trade.
Among gainers on the day was Alitalia, which gained 3 percent to €0.986 on speculation that the Italian airline could hook up with international carriers.
Consumer goods company Henkel was 3.8 percent higher to €112.28 on a target share price upgrade from Merrill Lynch, which also repeated its “buy” recommendation citing growth in sales. The broker raised the German company’s target share price from €100 to €127.
Bancha Monte dei Paschi di Siena added 1.3 percent to €4.89 when French insurance company CNP Assurances revealed that it is interested in bidding for the Italian bank’s insurance unit, MPS Vita. CNP added 0.2 percent to €82.15 on the news.
Danone was 1.9 percent higher to €119.00 after Goldman Sachs issued a “buy” recommendation for the French foods group on the basis of growth that was outpacing the sector.
Luxury goods group Richemont added 1.4 percent to SFr66.65 on an improved full-year earnings forecast from Goldman Sachs. The upgrade came after Richemont announced on Friday that profits were up 22 percent in the first half.
Deutsche Borse was up 3 percent to €129.74 after speculation surfaced that it might be interested in bidding on Spanish exchange BME now that the German exchange has withdrawn its bid for Euronext. BME gained 7.4 percent to €29.95 on the rumors.
Tokyo equities markets moved very little on Tuesday after Monday’s declines. Banks were still weak, but the consumer finance and electronics sectors saw gains. The Nikkei 225 added 0.1 percent to 15,734.14, while the Topix index dropped 0.1 percent to 1,532.95.
Bridgestone dropped 1.6 percent to ¥2,405 in reaction to Monday’s announcement by the tire maker that it is putting off its earnings target by another two years and will not reach the goal of 5 percent net profit margins until at least 2010.
Banks were hurt by data showing that core operations were hurt by lending margins that had tightened. Mizuho Financial was 2.2 percent lower to ¥805,000.
On the other hand, consumer finance were higher as some investors and hedge funds have begun to consider them to be bargains. Within the sector, Takefuji added 1.1 percent to ¥4,010.
The shipping sector did will on lower oil prices overnight, with Nippon Yusen gaining 2.1 percent to ¥768. The drop in oil prices did not help oil company Inpex, which dropped 0.7 percent to ¥896,000.
Tech sectors saw gains on the session, with Tokyo Electron adding 0.4 percent to ¥8,600. Among semiconductors, Advantest was 1.4 percent higher to ¥5,950.
Platinum prices were up on Tuesday as metals prices generally rose on a day of volatility in the metals markets.
Platinum ended the session 3.1 percent higher to $1,290 per troy ounce on continuing speculation that an exchange traded fund will be introduced for the metal after similar funds for gold and silver have met with notable success. At one point in the day, platinum had gained 11.5 percent to hit a new record price of $1,395 per troy ounce.
Elsewhere in precious metals gold added 0.7 percent to $626.50 per troy ounce, while silver gained 2.1 percent to $12.99 per troy ounce and palladium was 2.2 percent higher to $326 per troy ounce.
Base metals saw prices go up as well. Aluminium gained 0.8 percent to $2,676 per tonne even though inventories in London Metal Exchange warehouses dropped by over 6,000 tonnes. Copper was 1.5 percent higher to $6,940 per tonne. Zinc gained 2.9 percent to $4,290 per tonne as LME inventories fell to their lowest point since 1991, while nickel was up 3.5 percent to $31,300 per tonne on a decline of 168 tonnes in LME stockpiles.
Crude oil prices were up when foul weather in Alaska forced a halt in loading at Valdez. Brent crude January contracts added $1.06 to $60.04 per barrel, while January delivery West Texas Intermediate crude was 96 cents higher to $59.76 per barrel. Meanwhile, in Belgium, the head of the International Energy Agency said that he cannot see any reason for OPEC to cut production again in December, as inventories are merely comfortable.
Yields were up on government bonds on Tuesday as trade remained light ahead of the four-day Thanksgiving Day weekend in the United States. US Treasury bonds were nearly unchanged by midday in New York, with the two-year bond adding 0.4 basis points to a yield of 4.783 percent, while ten-year issues were even, yielding 4.599 percent.
In the Eurozone, the two-year Schatz was 4.1 basis points higher, yielding 3.699 percent. The ten-year Bund gained 0.5 basis points to 3.718 percent.
Meanwhile, in the UK, a new manufacturing survey from the Confederation of British Industry showed a stronger than expected recovery in the sector. While the numbers were still in negative territory, order books were up to -6 in November after having been at -20 in October. While some analysts maintained that the recovery was not as strong as it seemed, others see the new data as supporting another rise in UK interest rates.
The two-year gilt added 1.1 basis points to yield 4.974 percent late in the London session. The 10-year gilt was up 1.3 basis points to 4.552 percent.
Yields were also up in Japan after an official of the Bank of Japan was quoted as saying that there is still a possibility of an interest rate hike in December. The two-year Japanese government bond was 2 basis points higher to 0.800 percent.
At the mid-point of the trading session on Monday, the New York equities markets were higher, with the Dow Jones Industrial Average up 0.05 percent to 12,348.83. The Nasdaq Composite was 0.3 percent higher to 2,453.64, while the S&P 500 had gained 0.2 percent to 1,403.71.
Consolidation news was in focus. In the mining sector, Freeport-McMoran said it will purchase Phelps Dodge for $25.9 billion in cash and stock. If the deal goes through it will create the largest publicly traded copper company in the world. While Freeport-McMoran dropped 1.2 percent on the news to $56.71, Phelps Dodge added 28.3 percent to $121.87.
Nasdaq offered for the three-quarters of the London Stock Exchange that it doesn’t already own. While the London Stock Exchange rejected the offer on the basis that it “substantially undervalued“ the exchange, Nasdaq’s shares were still 1.6 percent higher to $37.15. Elsewhere in the sector, the New York Mercantile Exchange was up 2.1 percent to $135.75.
In the steel sector, Nucor added 3.4 percent to $59.04. AK Steel was 3.6 percent higher to $15.17, while Steel Dynamics gained 4.4 percent to $62.71 and US Steel was up 6.5 percent to $75.15. All had seen significant gains on Friday as well. Some of the gains came on the news that Evraz Group of Russia said that it will purchase Oregon Steel Mills for $2.3 billion. Oregon Steel Mills was 7.7 percent higher to $63.51.
The London equities markets were higher on Monday, with the FTSE 100 helped out by a bid for miner Phelps Dodge by Freeport-McMoran that raised hopes of further consolidation in the mining sector. The 100 added 0.2 percent on the session to 6,204.5. Meanwhile, the FTSE 250 gained 0.1 percent to 10,725.9, aided by a bid from Nasdaq for the London Stock Exchange, which was up 6 percent to £24.45 on the news.
The media sector was lower after BSkyB took 18 percent of ITV on Friday, which put a roadblock in the way of efforts of NTL to purchase ITV. BSkyB dropped 0.7 percent to 533p as investors figured that the purchase might be a good deal, while ITV was 1 percent lower to 114¼p.
Ladbrokes fell 1.9 percent to 390¾p on a downgrade from “buy” to “hold” from ABN Amro after an unsatisfactory trading update recently. Elsewhere in the leisure sector, Enterprise Inns added 2.3 percent to £11.67 ahead of its full-year report, due later in the day. Enterprise was expected to continue its share buy-back program instead of making new purchases.
The mining sector was higher after news of the Freeport-McMoran bid for Phelps Dodge. Anglo American added 2 percent to £24.45, while Rio Tinto was 2.4 percent higher to £27.32 despite the fact that there was some expectation that it might make a counter bid for Phelps. Antofagasta gained 4.1 percent to 476½p.
The FTSE Eurofirst 300 was higher on Monday, ending the session 0.3 percent higher to 1,466.91.
The car and truck making sector did not have as good a day. Porsche and Volkswagen were both lower on indications that Porsche does not intend to attempt a complete takeover of VW, as had been rumored last week. VW dropped 0.1 percent to €80.71, while Porsche was 1.3 percent lower to €889. French carmakers Renault and Peugeot each fell 0.8 percent on the session, to €95.40 and €48.46 respectively. DaimlerChrysler bucked the trend in the sector and added 0.2 percent to €47.26 on upgrades from HVB and Deutsche Bank.
In the insurance sector, reinsures were up. Hannover Re added 0.2 percent to €33.08 and Munich Re gained 1.1 percent to €125.67. Swiss Re was 3.1 percent higher to SFr106.3 on the lowest number of claims made in ten years and healthy premium payments which generated high reserves.
Among stock exchanges, Deutsche Borse gained 2.5 percent to €126.00 on consolidation hopes after Nasdaq offered for the London Stock Exchange.
Aerospace and defense company Thales dropped 1.2 percent to €37.22 even though UBS upped its target share price from €35 to €39 but left its recommendation at “neutral”.
Credit Suisse added 0.2 percent to SFr80.80 even though UBS downgraded the investment bank from “add” to “hold”. Meanwhile, Greek banks were lower on the session due to their exposure to the Turkish banking sector. The declines came after the European Union turned up the pressure on Turkey to resolve its differences with Cyprus ahead of an entrance of Turkey into the EU. National Bank of Greece dropped 1 percent to €36.60, while Alpha Bank was 1.5 percent lower to €23.70 and EFG Eurobank fell 1.8 percent to €28.20.
Investor worries about the US economy helped send the Tokyo equities markets significantly lower on Monday. The Nikkei 225 was 2.3 percent lower to 15,725.94, while the Topix index fell 2.5 percent to 1,533.94. The Mothers index of small and mid-cap stocks declined even further, dropping 6.2 percent to 1,022.54. Another possible reason for the declines were remarks from the head of the Tokyo Stock Exchange, who said that share price declines recently are due to an upcoming end to tax breaks on Japanese shares.
Export-focused sectors were lower in the face of bad economic news from the United States, including a drop in housing starts in October. In the automobile manufacturing sector, Honda Motor was 2.6 percent lower to ¥4,100. In the semiconductors sector, Advantest fell 4.1 percent to ¥5,870. Among electronics companies, Sanyo Electric dropped 12.7 percent to ¥179 on rumors that it could see a losing full-year report.
With crude oil prices still dropping, Inpex Holdings was 3.4 percent lower to ¥902,000.
The banking sector saw losses on concerns that lending might have slowed down. Mitsubishi UFJ fell 2.8 percent to ¥1,380,000, while Mizuho Financial was 3.1 percent lower to ¥823,000.
Despite announcements from Qatar and Algeria that both countries will support further OPEC production cuts in order to cut what the oil cartel sees as an oversupply on the market, crude oil prices were lower on Monday. Brent crude for January delivery was 23 cents lower to $58.76 per barrel, while West Texas Intermediate crude January contracts dropped 44 cents to $58.54 per barrel. According to Goldman Sachs, the lower prices are an isolated phenomenon in the United States and other markets are already adjusting to the OPEC cuts. Meanwhile, Lehman Brothers has predicted that US crude oil prices will average $73.50 per barrel next year.
In the metals markets on Monday, prices rose in both precious and base metals. Gold added 0.5 percent to $624.10 per troy ounce, while silver gained 1 percent to $12.88 per troy ounce and platinum was 5.1 percent higher to $1,246 per troy ounce. The price of platinum was helped by rumors that an exchange traded fund similar to those for gold and silver.
Among base metals, copper gained 0.6 percent to $6,840 per tonne even though London Metal Exchange inventories were up b y 2,050 tonnes on the day, helped by the announcement by Freeport-McMoran that it intends to purchase Phelps Dodge to create the largest publicly traded copper miner in the world. Elsewhere, nickel added 2.2 percent to $30,250 per tonne on a decline of 108 tonnes in LME stockpiles, while zinc was 3.6 percent higher to $4,169 per tonne as LME inventories dropped by 1,150 tonnes.
