MARKET MOVEMENTS:
--Brent crude oil rises 0.7% to $112.75 a barrel.
--Copper prices in London weaken 0.4% to $9,303 a metric
ton.
--Wheat prices in Chicago decline 2.6% to $12.44 a bushel.
--Benchmark European natural gas prices rise 3.1% to EUR97.05 a
megawatt hour.
TOP STORY:
China's New Home Prices Fall for the First Time in More Than Six
Years
A monthly measure of new home prices in China fell for the first
time in more than six years, offering further evidence of the pain
that Beijing's regulatory campaign is inflicting on a sector that
has long served as an economic growth engine.
Average new-home prices in 70 major cities edged 0.11% lower in
April from a year earlier, according to Wall Street Journal
calculations based on data released Wednesday by China's National
Bureau of Statistics.
The decline, though slight, marks the first such decrease since
November 2015 when China was wrestling with a pronounced slowdown.
It follows a 0.66% on-year increase in March.
When compared with the previous month, Chinese new-home prices
declined for an eighth consecutive month, falling 0.3% in April,
wider than March's 0.07% on-month decrease.
OTHER STORIES:
Stock Futures Edge Lower After Rally
U.S. stock futures crept lower after major stock indexes rallied
in the prior session, putting Wall Street on course to extend the
year's volatility.
Futures for the S&P 500 fell 0.2% Wednesday. Contracts for
the tech-focused Nasdaq-100 receded 0.4% and futures for the Dow
Jones Industrial Average edged 0.1% lower. Technology shares led a
rebound in markets Tuesday.
Stocks have largely fallen in recent weeks as investors
contemplated the global economic outlook, central banks' plans to
tame inflation, geopolitical tensions, and China's zero-Covid
strategy. The culmination of factors has boosted volatility in
markets. Even with Tuesday's rally, the S&P 500 is down about
14% this year.
---
Anglo American's De Beers Diamond Sales Rose in Fourth Cycle
Anglo American PLC on Wednesday reported an increase in diamond
sales from its De Beers subsidiary for the fourth sales cycle of
2022.
MARKET TALKS:
Palm Oil Rises Amid Uncertainties Over Indonesian Export Ban
1035 GMT - Palm oil prices finished higher in Asian trade after
a day of mixed trading in anticipation of some changes to the
Indonesian palm oil export ban, Singapore-based Palm Oil Analytics
co-founder Sathia Varqa says. There is speculation the world's
largest palm oil producer is evaluating whether to lift the export
ban, while still able to ensure that cooking oil remains cheap for
the domestic market, he says. The benchmark Bursa Malaysia
Derivatives contract for August delivery closed 20 ringgit higher
at MYR6,136 ($1,399) a ton. (chester.tay@wsj.com)
---
Metals Waver After Powell Comments
0830 GMT - Industrial metals weaken on gloomy signs for the
global economy. Three-month copper on the LME edges down 0.5% to
$9,289 a metric ton while nickel weakens 0.7% to $26,230 a ton.
Federal Reserve Chairman Jerome Powell said Tuesday that he was
prepared to hike interest rates as high as needed to bring down
inflation, even if it meant crimping economic growth. "Restoring
price stability is an unconditional need," Powell said, adding
"there could be some pain involved." Meanwhile, weak Chinese
economic data in recent days caused by lockdowns have raised
concerns about demand. Data on new home prices Tuesday added to
those concerns. (william.horner@wsj.com)
---
Oil Prices Rise on Signs of Growing Tightness
0811 GMT - Oil prices rise on easing lockdowns in China and
expectations for new sanctions on Russia. Brent crude oil rises
1.1% to $113.17 a barrel while WTI adds 1.4% to $114 a barrel. A
combination of increased demand as China eases its Covid-19
lockdowns and declining Russian oil production is likely to
completely exhaust global oil production capacity by the end of the
year, DNB Markets says in a note. Highlighting the tightness, the
API expects U.S. inventories dropped last week by 2.4 million
barrels. DNB expects oil prices to rise as high as $130 a barrel by
the end of the year before easing to $115 a barrel next year.
(william.horner@wsj.om)
---
Dairy Prices Extend Fall, Dip in China Demand Likely
Temporary
0450 GMT - New Zealand milk that was earmarked for consumer
foods production in Sri Lanka and China looks to have been rerouted
in May to the Global Dairy Trade auction as milk powders,
accounting for the additional weakness in dairy commodity prices,
Westpac senior agricultural economist Nathan Penny says in a
report. The global dairy price index dropped 2.9% at the overnight
auction from the previous fortnightly auction and whole milk powder
fell 4.9%. Over five auctions, overall prices have dropped 15.9%,
reflecting China's Omicron outbreak, and to a lesser extent, Sri
Lanka's economic crisis, Penny says. "We still expect this dip in
Chinese demand will prove temporary as Covid restrictions will
eventually ease," he says. (stephen.wright@wsj.com)
---
Iron Ore Falls on Concerns Over Steel Demand in China
0244 GMT - Iron-ore prices are lower on concerns over steel
demand in China. According to a media report, China Steel Corp.
said this week that it will lower domestic steel prices by 2.1% on
average for June delivery, partly due to a brief slowdown in steel
demand. Commodity-grade steel prices remain under pressure as
international supply-side constraints continue to ease for basic
steel products, says Rystad Energy analyst Alistair Ramsay in an
email. The most-traded September contract on the Dalian Commodity
Exchange is 2.3% lower at CNY815.5 a ton.
(ronnie.harui@wsj.com)
---
Oil Prices Likely to Fade in 2H as Supply Grows
0014 GMT - While the near-term outlook for oil prices is strong,
Macquarie's research analysts expect prices to fade in 2H. Brent
crude--the global benchmark--has averaged $107/bbl in 2Q so far but
a likely increase in oil supply from OPEC and other countries,
potentially including Iran, should weigh on prices in 2H, Macquarie
says. "We maintain our long-term assumption of $65/bbl but defer
this to 1Q of 2024 [from 1Q of 2023]," Macquarie says. Among
Australian energy stocks, Macquarie has outperform calls on Santos,
Karoon Energy and Strike Energy. (david.winning@wsj.com;
@dwinningWSJ)
Write to Will Horner at william.horner@wsj.com
(END) Dow Jones Newswires
May 18, 2022 07:37 ET (11:37 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.