MARKET UPDATE

Dollar within striking distance of 150 yen.

The dollar began the last quarter of the year in the ascendant on Monday due to prospects of U.S. interest rates staying higher for longer, and the yen’s slide to a near one-year low put traders on watch for intervention by Japanese authorities.

Currency moves were subdued in early Asia trade with parts of Australia out for a holiday and China away for its Golden Week, though analysts said a narrowly averted U.S. government shutdown could bring some relief to markets.

The yen eased to 149.83 per dollar, its weakest in over 11 months, moving ever close to the 150 mark that some traders believe could trigger intervention by Japanese authorities, similar to their action last year, to support the currency.

“Intervention risks could limit, if not partially reverse yen losses; especially as dollar/yen dangerously flirting with 150 prompts push-back from Tokyo,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank.

 

Natural gas dips on last day of Sept.

Natural gas futures finished the last trading day of September down while posting weekly, monthly and even quarterly gains as the price of America’s favourite fuel for indoor heating and cooling neared the key psychological bullish $3 mark.

The most-active November gas contract on the New York Mercantile Exchange’s Henry Hub settled at $2.929 per MMBtu, or million metric British thermal units — down 1.6 cents, or 0.5% on the day.

For the week though, November gas rose 11%. For the month, it was up 5.8% while for the third quarter, it gained 4.7%.

This month’s breakout to near $3 pricing marks the third attempt by gas bulls to get the market to that pivotal point since its fall from a high of $4.40 in January. For most of the year, the most-active gas contract on the Henry Hub has been stuck at mid-$2 levels, hampered by benign weather that neither needed too much cooling or heating.

Record daily production, often crossing 100 billion cubic feet, or bcf, per day has been another problem.

A huge stockpile overhang had also depressed the market. As of the end of last week, U.S. gas in storage stood at 3.359 trillion cubic feet, up 13.4 from a year ago and 6% higher than the five-year average.

 

Oil prices climb as risk appetite grows.

Oil prices edged up on Monday, recouping some of the losses suffered at the end of last week, as investors focused on a tight global supply outlook while a last-minute deal that avoided a U.S. government shutdown restored risk appetite.

Brent December crude futures rose 49 cents, or 0.5%, to $92.69 a barrel by 0645 GMT after falling 90 cents on Friday. Brent November futures settled down 7 cents at $95.31 a barrel at the contract’s expiry on Friday.

U.S. West Texas Intermediate crude futures gained 55 cents, or 0.6%, to $91.34 a barrel, after losing 92 cents on Friday.

Both benchmarks rallied nearly 30% in the third quarter on forecasts of a wide crude supply deficit in the fourth quarter after Saudi Arabia and Russia extended additional supply cuts to the end of the year.

The Organization of the Petroleum Exporting Countries with Russia and other allies, or OPEC+, is unlikely to tweak its current oil output policy when the panel called the Joint Ministerial Monitoring Committee meets on Wednesday, four OPEC+ sources told Reuters, as tighter supplies and rising demand drive an oil price rally.

“Oil prices started the week on a strong note amid supply concerns with no policy change by OPEC+ expected, while the avoidance of a U.S. government’s shutdown over the weekend gave some relief,” said Hiroyuki Kikukawa, president of NS Trading, a unit of Nissan (OTC:NSANY) Securities.

 

 

 

 

 

 

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