Open interest, the net total of long and short bets on the market, across 28 commodities held steady on Wednesday, with several key markets such as crude oil and copper seeing an increase, according to exchange data.A sharp drop in positions in the relatively smaller gasoline market, which led the collapse in prices, as well as corn and wheat was more than offset by gains in crude oil. The US oil futures benchmark hit a record high open interest.The data was similar to last Thursday, when oil prices fell precipitously, and means that for the second time in a week investors have reacted to a sharp commodity price decline by adding positions.The new bets meant the notional value of these commodities markets fell only $228 million, a sign, traders said, that bulls were not panicking but that big bets were still coming in looking for a fall in raw materials prices.The big bets came despite gasoline futures suffering their worst single day since the height of the financial crisis in September 2008, losing 7.6 per cent.The upshot is that the tug-of-war between bulls and bears in commodities has only intensified over the last week, setting the stage for more volatility in coming trading sessions."They may be seeing some speculative long liquidation on one side of the market but you may be seeing some consumer hedge buying interest on the opposite side of things," said Tim Evans of Citi Futures Perspective in New York.Trend SignalsCommodity investors typically look at the direction prices, open interest and trading volumes are moving for clues to the future direction of the market.Rising open interest with strong volumes and a falling price is seen as a sign that a market will continue to decline because more short sellers are entering.The number of contracts traded on Wednesday exceeded the 30-day average by nearly a quarter. Nearly 820 million paper barrels of West Texas Intermediate crude oil changed hands.US crude futures on the NYMEX set a new record high for open interest on Wednesday as prices plunged more than 5 per cent and took oil back below $100 per barrel.Crude futures had also set a record open interest during the previous sell-off on May 5. Indeed, both commodity sell-offs in the past week may well have been exacerbated by the huge short bets, traders said.But growing open interest in energy, which dominates the commodities sector, has obscured a shrinking of open interest in other areas.Open interest in cotton is down 22 per cent, soybeans have dropped 17 per cent and silver has fallen 12 per cent.Coffee saw open interest hit a 1-1/2-year low on Wednesday as prices have tumbled from a 34-year high. Copper open interest is at the lowest level since October 2009 and many agricultural commodities, such as corn and soybeans, are at their lowest number of open positions since the fall of 2010.(Reuters)
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Shutting down of call centres in India may not be a bad sign for just job seekers but the growth of primary education in India too. According to a study, call centres, typically outsourced by Western firms, have a positive impact on the number of students enrolling at local schools.The study found that introducing a new call centre causes a 4 per cent to 7 per cent increase in the number of children enrolling in primary schools. The findings also show that enrolment in English-language schools increases by about 15 per cent with the introduction of a new call centre. These effects are concentrated in the immediate areas around the call centre and are independent of the changes in population or income.The results suggest that introducing a call centre with 80 employees increases enrolment in the local post code by 280 children, according to Millett.The number of individuals employed in outsourcing-related businesses in India has increased from roughly 50,000 in 1991 to over 2 million in 2010 (Nasscom). These jobs demand employees with high levels of education and a good command of English, and pay high salaries by Indian standards.The study used government data (DISE) on enrolment at 239,000 schools between 2001 and 2008 in three Indian states - Karnataka, Andhra Pradesh and Tamil Nadu. This data were further combined with the locations and opening dates of 401 call centres. The report was authored by Emily Oster, Associate Professor of Economics at the University of Chicago Booth School of Business and Bryce Millett of Harvard University. Although this paper focuses on the case of India, the results may well have implications for other countries, adds Oster.
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Silver prices dropped further at the domestic bullion market in Mumbai on Monday on sustained unwinding from stockists and speculators, amid bearish overseas trend.On the other hand, standard gold moved up on mild local buying interest at existing lower levels.Silver ready (.999 fineness) fell sharply by a hefty Rs 1,085 per kg to end at Rs 53,750 from last Saturday's closing level of Rs 54,835.However, standard gold (99.5 purity) looked up by Rs 10 per 10 grams to settled at Rs 21,945 as compared to Rs 21,935 last weekend, while pure gold (99.9 purity) held steady at Rs 22,045 per 10 grams.In Europe, spot gold was trading almost flat at $1,490 an ounce on deepening concerns about the euro zone debt crisis and strengthening dollar against major currencies. Silver was bid at $34 an ounce.(PTI)
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Unlike Soros, famed gold bull John Paulson held his ground, but Soros was joined in the retreat by several other big names, including Eric Mindich and Paul Touradji, according to 13-F filings with the US Securities and Exchange Commission that provide the best insight into where hedge funds are placing their bets.Gold prices barely reacted to the news, with spot gold up 0.3 per cent at $1,494.29 an ounce by 0327 GMT. Rising inflation worries and a debt crisis in the euro zone should help prevent any sell-off in the precious metal, analysts said.Soros, who has been bullish on gold in the past several years, cut his holdings in the SPDR Gold Trust to just $6.9 million by the end of first quarter, compared with $655 million in December, becoming the most high-profile investors to turn his back on one of the market's best-performing assets.He also liquidated a 5 million share stake in the iShares Gold Trust, the filings showed. His total holdings in gold-backed ETFs was $774 million as of December.Gold rose for a tenth consecutive quarter in the three months to March, hitting record highs above $1,400 an ounce, buoyed by political turmoil in the Middle East and North Africa and lingering worries about indebted European countries.The gains accelerated in April, but peaked at the start of this month, reaching a record $1,575 an ounce on May 2.Prices have since fallen more than 5 per cent amid the biggest commodities slump since late 2008, a move partly triggered by a Wall Street Journal report that Soros' $28 billion fund was selling precious metals - and fuelling fears other big funds were also seeing a peak.Eric Mindich, who runs Eton Park Capital Management, nearly halved his stake in the SPDR gold trust to $326 million for the first quarter, a filing showed on Monday.Mindich's fund also owned $839 million worth of call options by the end of the first quarter, compared with $1.1 billion worth of put options at the end of the fourth quarter.Touradji Capital Management, one of the world's largest commodities-oriented hedge funds run by Paul Touradji, sold 173,000 shares in the SPDR Gold Trust during the quarter. Those shares would be worth about $25 million at current prices.But John Paulson, who notched up the industry's biggest ever payout last year, kept his 31.5 million shares, or $4.4 billion stake, in the SPDR fund, remaining the biggest shareholder of the world's largest gold-backed exchange traded fund for the quarter, according to regulatory filings.Deflation Threat RecedesThe sales make sense given that Soros said he had bought gold because he was worried about deflation, said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Pittsburgh."It's pretty hard to make the case for deflation right now so if that was a reason you were buying gold, you should take this signal from Soros," he said.Inflation is now the greater concern, Luschini said. So most investors should still keep about 3 per cent to 5 per cent of their assets in gold to protect against inflation and possible further problems in the world financial system."It's not the most bullish news I've ever heard in gold, but it's not the end of the world either," said Citigroup analyst David Thurtell."With the euro zone sovereign debt problems still going on, inflation worries and the dollar weakness, gold's got good underpinnings at the moment. I think it will be well supported in the $1,450-$1,475 range. I don't see a widespread sell-off."Still, many investors are likely to follow Soros' lead."Obviously hedge funds and speculators have scaled back their long positions. But they are still holding massive positions in metals, so I won't be surprised to see continuous liquidation in all commodities," said a Hong Kong-based trader.Soros also slashed stakes in gold and silver mining companies during the first quarter. The firm owned 1.4 million shares of Kinross Gold at the end of the quarter, down from 4 million shares three months earlier. Holdings in Novagold Resources dropped to 3.5 million shares from 12.9 million.Gold ended the first quarter little changed, as the spot gold prices were only $10 higher to end at $1,430 an ounce on March 31, and the SPDR Gold Trust was up 1.3 per cent.In the second quarter, gold hit a record high $1,575.79 an ounce on May 2 fueled by the outlook of low US interest rates.So far in the second quarter, SPDR Gold Trust's bullion holdings gained only about 1 per cent to 1,229 tonnes by Friday, well below its record high of 1,320.436 tonnes set on June 29 last year.Institutional investment managers are required to file form 13-F with the SEC within 45 days after the end of each quarter.(Reuters)
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IT and business executives in India are out of synch on the potential of cloud computing. There are disparities between expectations and reality indicating that organizations are still learning what these technologies are capable of and how to overcome the new challenges they bring with them, reveals a a study by Symantec Corporation released last month.The 2011 Virtualization and Evolution to the Cloud Survey found 43 per cent of CFOs as well as CEOs who are implementing hybrid/private clouds are less than "somewhat open" to moving business-critical applications to cloud. They were mostly concerned over issues of reliability (71 per cent), security (76 per cent), availability and performance (81 per cent).In practice, however, many C-level concerns proved to be unfounded based on responses from IT. For example, concerns about performance was cited as a top reason for caution. Yet more than 75 per cent of those who deployed server virtualization, managed to achieve their goals related to performance. "Awareness around these emerging technologies is prevalent, but the Indian enterprise is yet to move completely. There is a wait and watch approach to the level of maturity in the market before implementation," said Anand Naik, director, Technology Sales (India & SAARC), Symantec. "Indian CIOs evaluate new technologies with a business driven ROI approach to technology decision–making to meet company's objectives."The Symantec commissioned survey covered 3,700 enterprises including large, medium and small across segments in 35 different countries based in North and Latin America, Europe, Middle East Asia (EMEA), Asia Pacific and Japan (APJ) regions. From India, 200 firms participated in this survey.The survey highlighted topics including server, client, and storage virtualization, storage-as-a-service, and hybrid/private cloud technologies; and the results uncover disparities between expectations and reality as enterprises deploy these solutions. CEOs and CFOs are concerned with moving business-critical applications into virtual or cloud environments due to challenges including reliability, security, availability and performance. The survey shows that organizations are increasingly leveraging or planning to leverage virtualization for business-critical applications. Of enterprises who are implementing virtualization, 73 per cent plan to virtualize database applications in the next 12 months. Forty per cent plan to virtualize web applications, and 33 per cent plan to virtualize email and calendar applications. Thirty-three per cent plan to virtualize ERP applications.About 57 per cent Indian firms have adopted server virtualization against 45 per cent globally, while one-third of the 200 Indian firms surveyed are discussing or are at a planning stage for private and hybrid cloud deployments, the survey found."Indian enterprises are discussing virtualization and private/hybrid clouds. While agility and affordability are the main drivers, having fewer legacy systems is helping this transition," Vijay Mhaskar, Symantec's vice president - Information Management Group, said.Server and storage virtualization topped as the most mature technologies with 31 and 26 per cent of enterprises implementing it, while Private Storage-as-a-Services stood at just 21 per cent of adoption, the survey noted. "Awareness around these emerging technologies is prevalent but Indian enterprise is yet to move completely. There is a wait and watch approach to the level of maturity in the market before implementation," Anand Naik, Symantec's director -Technology Sales (India & SAARC)."Indian CIOs evaluate new technologies with a business driven ROI approach to technology decision–making to meet company's objectives," Naik added. (BW Online Bureau)
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Both the precious metals, silver and gold, strengthened on Tuesday on stockists and speculators buying amid a firming global trend and rising seasonal demand.While silver surged by Rs 1,100 to Rs 54,300 per kg, gold rose by Rs 110 to Rs 22,690 per 10 grams, wiping of most of the losses suffered in the previous session. Trading sentiments turned bullish after gold gained in London as deepening concern over Europe's sovereign debt crisis spurred the demand for the precious metals as a protection of wealth.Gold in global markets, which normally sets a price trend on the domestic front, rose by $2.55 to $1,519.57 an ounce and silver gained 1.2 per cent to $35.49 an ounce. Besides, fresh buying by stockists and jewellery makers for the ongoing marriage season further fuelled the uptrend.On the domestic front, silver ready gained Rs 1,100 to Rs 54,300 per kg, after losing Rs 1,000 in the last two trading sessions.Weekly based-delivery gained Rs 1,050 to Rs 54,100 per kg, after losing Rs 760 in the last two days.Silver coins also jumped up by Rs 3,000 to Rs 62,000 for buying and Rs 63,000 for selling of 100 pieces.In line with a general firming trend, gold of 99.9 and 99.5 per cent purity recovered sharply by Rs 110 each to Rs 22,690 and Rs 22,570 per 10 grams, respectively. Both had shed Rs 90 yesterday.Sovereigns also gained Rs 50 to Rs 18,600 per piece of eight grams.(PTI)
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The country is estimated to have harvested a record 235.88 million tonnes (MT) of foodgrains in the 2010-11 crop year, ending June, helped by all-time high output of wheat and pulses, the government today announced.Economists feel that the higher foodgrain production will help further ease food inflation -- which stood at 9.5 per cent for the week ended March 19 -- in the coming weeks."The third advance estimate figures are available with me, which show an all-time record production of foodgrains at 235.88 million tonnes. Wheat at 84.27 million tonnes and pulses at 17.29 million tonnes are also the highest recorded production ever," Agriculture Minister Sharad Pawar said here.He released the third advance estimate of foodgrains production for the 2010-11 crop year (July-June) at the Kharif Conference for the next crop year.The Agriculture Ministry has revised the estimates for foodgrains production upward to 235.88 million tonnes (MT) in the third advance estimates for 2010-11 from 232.07 MT in the second advance estimates released in February.Thanks to the good monsoon, foodgrain production this year is nearly 18 MT higher than the 218.11 MT achieved in drought-hit 2009-10. The earlier record was 234.47 MT in 2008-09.In the foodgrains basket, the ministry has upped the production estimates for wheat, rice, pulses and coarse cereals."The benefit of higher foodgrains production is already showing in food inflation. The announcement of bumper crop would help further ease pressure on food prices," said D K Joshi, Principal Economist with credit rating agency Crisil.According to the third advance estimates, wheat output has risen by 3 MT from the February projection to a record 84.27 MT in 2010-11. The earlier record was 80.8 MT in 2009-10.Similarly, pulses output has been upped by nearly one million tonnes from the second advance estimate to a record 17.29 MT this year. Last year, pulses production stood at 14.66 MT, while the all-time record of 14.91 million tonnes was achieved in 2003-04.While rice production has been revised upward marginally to 94.11 MT in 2010-11 vis-a-vis the second advance estimate, it is much higher than the last year's output of 89.09 MT.Coarse cereals production, too, has been revised slightly upward to 40.21 MT in 2010-11 from the earlier estimate. Last year's production stood at 33.55 MT.Pawar said the high level of production is expected to be achieved despite significant crop damage due to drought in Bihar, Jharkhand, Orissa and West Bengal and occurence of bad weather conditions in several other parts of the country.Oilseeds production is estimated at 30.25 MT this year, as against 24.8 MT in the previous year. Sugarcane output is pegged at 340.55 MT in 2010-11, as against 292 MT last year.Cotton output is estimated to have set a fresh record of 33.92 million bales (one bale is equal to 170 kg) this year, as against 24.2 million bales last year.(PTI)
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Rising wheat and rice procurement for the last few years are adding to the grain storage problem in Punjab, which arose due to slow movement of grain to other states and limited space in granaries.With a bumper wheat production expected this season ending June 2011, Punjab Chief Minister Parkash Singh Badal on Wednesday met Prime Minister Manmohan Singh, seeking help in augmenting storage capacity and fast disbursal of old food grain stock from granaries to accommodate the new crop."Excessive procurement of food grain (wheat and paddy) from Punjab is one of the reasons, besides constraints like insufficient rail rakes, that have led to accumulation of old stock occupying the storage space (leaving less space for storing fresh crop)," a senior FCI official told PTI on Thursday.The FCI data shows wheat and rice procurement from the country's food bowl have grown considerably over the past five years on the back of higher output.Wheat lifting from Punjab reached 102.18 lakh Metric Tonne (MT) in 2010-11, as against just 69.46 lakh MT in 2006-07. In 2009-10 also, it broke all previous records by contributing 107.36 lakh MT to the central pool.Similarly, rice procurement has also gone up to 93.29 lakh MT in 2010-11 against 77.93 lakh MT in 2006-07.Punjab has 95 lakh MT of covered space, the majority of which is occupied by wheat and rice, with the effect that the state faces a shortage of over 70 lakh MT of space to store the crops, a fact highlighted by the Chief Minister during his meeting with Prime Minister Manmohan Singh."Before the start of wheat lifting season, there should not be any stock of old crop in storage because the space would be needed to store fresh crop," said Punjab Food and Supplies, Secretary, DS Grewal."Besides affecting the quality of rice, space shortage force the state authorities to store crop (wheat) in open and in the rice mills that lead to deterioration in the quality of grain," he said.As on April 1, granaries in the state are still holding last year?s wheat stock of 51 lakh MT and 61 lakh MT of rice, forcing Punjab to store almost 105 lakh MT of fresh arrival at the open plinths.The state needs to find a quick and lasting solution to avoid rotting of food grains in the absence of adequate storage.Initially, the Centre had decided to build 71 lakh MT of new storage capacities in Punjab. However, it later pruned this to 51 lakh MT under Private Entrepreneurship Guarantee Scheme.Further, to the state's request for transferring every month almost 25 lakh MT of wheat and rice lying in state granaries to other states, FCI has so far managed to shift 15 lakh MT of wheat and rice to the best of its abilities.Notably, storage houses in Punjab are still holding over 50 lakh MT each of wheat and rice of preceding years, which should have ideally been shifted to consuming states before the start of next procurement season.(PTI)
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The ginger crop was badly hit by drought in 2009-10 and production came down to 14,900 tonnes, whereas it was 18,760 tonnes in 2008-09 and 19,200 tonnes in 2007-08, chief minister Prem Kumar Dhumal said."We are inviting private firms to set up agriculture and food processing units as the state is one of the leading ginger producing states in the region and has produced 21,267 tonnes of ginger during 2010-11", he informed the house."Sirmaur is the leading ginger producing district as 70 per cent of the total production of the state comes from this district alone while it is also cultivated in Chamba, Kullu, Mandi, Shimla, Solan and Una districts", he added.He said that agriculture was the main occupation of the people in the state, providing direct employment to 69 per cent of its workforce but more than 80 per cent horticulture and agricultural activities were rainfed.(PTI)
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Last month's devastating tsunami in Japan will have no impact on the progress of the June-September monsoon rains in India, a top official of the World Metereological Organisation (WMO) said on Thursday."Tsunami is a short-term phenomenon. Its occurrence in Japan will have no impact on the Indian monsoon," said Rupa Kumar Kolli, chief of WMO's world climate applications and services division told Reuters.Kolli was speaking on the sidelines of the South Asian Outlook Forum, which should issue its agenda-setting consensus forecast for this year's monsoon on Friday.India will give its first official forecast for this year's monsoon on April 19. The monsoon is crucial for India, which depends heavily on its agriculture sector to feed its 1.2 billion population.(Reuters)
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