Tuesday, May 29, 2012

Screw-Up: Funds Make Wrong-Way Bets Before Price Slump




Speculators raised bullish bets on commodities before signs of Europe’s deepening debt crisis and slowing Chinese growth drove prices lower for a fourth consecutive week, the longest slump since September according to Bloomberg.

Money managers boosted net-long positions across 18 U.S. futures and options by 9.5 percent to 675,362 contracts in the week ended May 22, government data show. The Standard & Poor’s GSCI Spot Index of 24 raw materials reached a five-month low on May 23. A gauge of net positions for 11 U.S. farm goods surged 21 percent, the most since February, before agriculture prices tracked by S&P posted the biggest weekly loss in eight months.

The euro dropped to the lowest since July 2010 on May 25 after Catalonia’s president repeated his call for Spain’s central government to help regions access funding and S&P cut the credit ratings for five of the country’s banks. China’s biggest lenders may fall short of loan targets for the first time in at least seven years, three bank officials said, and the nation’s State Council refrained from backing Premier Wen Jiabao’s push to expand credit…..

Read more at http://www.bloomberg.com/news/2012-05-27/funds-may-wrong-way-bets-before-price-slump-commodities.html

No comments:

Post a Comment