Archive for May, 2011

Oil drops to $113 as traders eye dollar, bin Laden

Monday, May 2nd, 2011 | Finance News

SINGAPORE – Oil prices fell to $113 a barrel Tuesday in Asia as a stronger U.S. dollar made crude more expensive for investors with other currencies.

Benchmark crude for June delivery was down 49 cents at $113.03 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 41 cents to settle at $113.52 on Monday.

In London, Brent crude for June delivery was down 42 cents to $124.70 a barrel on the ICE Futures exchange.

Crude has jumped 34 percent since mid-February, fueled disruption oil supplies in Libya and a weaker dollar. On days when the dollar rallies, commodities such as oil tend to fall.

The euro fell to $1.4818 on Tuesday from $1.4823 late Monday.

Traders are also mulling the impact of the death of Osama bin Laden in Pakistan on Sunday. Some are concerned about revenge attacks on U.S. targets while others estimate a weaker al-Qaida lowers the risk that terrorism will destabilize the oil-rich Middle East.

Some analysts consider bin Laden's death a minor issue for the oil market, and are more focused on U.S. monetary policy. Federal Reserve Chairman Ben Bernanke said last week that the U.S. would keep interest rates low for an extended period, comments that helped weaken the dollar.

"In a number of respects, Ben Bernanke is much more central to the future of oil prices than Osama bin Laden," Cameron Hanover said in a report. "We have seen the impact a weaker U.S. dollar has had on oil prices."

In other Nymex trading in June contracts, heating oil fell 1.1 cents to $3.24 a gallon and gasoline dropped 1.3 cents to $3.34 a gallon. Natural gas futures were up 0.1 cents at $4.70 per 1,000 cubic feet.


Metro Q1 sales flat, confirms targets

Monday, May 2nd, 2011 | Finance News

DUESSELDORF (Reuters) – Metro AG (MEOG.DE), the world's fourth largest retailer, reported flat first-quarter sales, missing expectations, and confirmed its forecasts for the year. The German group, which runs cash and carry markets, electronics outlets, department stores and hypermarkets, said on Tuesday the late timing of Easter meant sales came in at the prior year's level of 15.5 billion euros.

Taking the Easter period into account, 4-month sales were up 1 percent, the group said.

"This tells us we continue on a profitable growth course," Chief Executive Eckhard Cordes said in a statement.

The group reported first-quarter earnings before interest, tax and special items of 145 million euros.

Analysts were expecting adjusted EBIT of 150 million euros and sales up 0.9 percent to 15.65 billion, according to a Reuters poll.

(Reporting by Victoria Bryan)


Conservatives romp to crushing Canadian election win

Monday, May 2nd, 2011 | Finance News

OTTAWA (Reuters) – Canada's ruling Conservatives won a crushing victory in Monday's federal election, cementing plans for tax cuts and a pro-business agenda, as the left-wing vote split and Quebec separatists faded to almost nothing.

Provisional results showed the Conservatives had 166 seats in Parliament, well above the 155 they needed to transform their minority government into a majority. They won 40 percent of the vote, more than most pollsters had expected.

"Canadian politics has changed dramatically tonight," said Jason Kenney, immigration minister in the last Conservative government. "Canadians have gotten what they want; a stable majority which will focus on governing and economic growth and responsible fiscal policy."

The Conservatives, describing themselves as the guardians of a surprisingly resilient Canadian economy, had stressed throughout the election campaign that they needed a majority to keep the economy strong, and they promised a string of tax-cut goodies that will take effect once they balance the budget.

The Canadian dollar firmed as the results emerged, and analysts expected the stock market to follow it up on Tuesday.

"I think generally this is probably very good for the Canadian dollar," said Firas Askari, head of foreign exchange trading at BMO Capital Markets. "We haven't had a majority government in some years and I think this provides a measure of stability that the market was looking for."

The provisional results showed the left-leaning NDP winning around 103 seats, by far its strongest showing, and catapulting itself into the position of official opposition in the nation of more than 34 million people.

The NDP gains came largely at the expense of the separatist Bloc Quebecois and of the once-mighty Liberal Party, which lost more than half its seats in a dismal black eye for party leader Michael Ignatieff, a broadcaster and academic turned politician who never managed to connect with Canadians.

"We have seen tonight I think the emergence of a polarization in Canadian politics," Ignatieff said in a sad address to the party faithful.

"We have a government that will pretend to govern from the center and there's a risk it will move the country to the right. We will have an official opposition that will criticize from the center but possibly move the country to the left."

He added: "It's tough to lose like this."


The result was a historical low for the Liberals, who saw both their lowest seat total ever and their smallest share of the popular vote, at just under 20 percent.

Their massive defeat will prompt more talk about a possible merger with New Democrats to create a united center-left party capable of defeating the Conservatives.

The Bloc Quebecois was set to win just three seats, a sign perhaps that Quebeckers were fed up with being represented in Ottawa by a party that doesn't want Canada to exist in its present form. Party leader Gilles Duceppe lost his seat and said he would quit.

Before the election the Bloc, the federal offshoot of a party that wants independence for French-speaking Quebec, had 47 seats, a strong majority of seats in the province.

"It may even give the Canadian dollar an extra boost, given the fact that perhaps that the question of sovereignty is really going to be put on the back burner," said Serge Pepin, of BMO Investments in Toronto.

"Canadian markets should react relatively positively."

In a first for Canada, Green Party leader Elizabeth May captured the party's first seat in Parliament, where she would be a vocal critic of a Conservative government that opponents say has dragged its heels on global warming.

Before the election, the Conservatives had 143 seats, compared to 77 for the Liberals and 36 for the New Democrats. There were two independents and three seats were vacant.

(Additional reporting by Pav Jordan, Jeffrey Jones, Scott Haggett, Randall Palmer, Allan Dowd, Claire Sibonney and Louise Egan; Editing by Eric Walsh)