Global commodity prices tumble as speculators exit
Mumbai: Speculators in the international commodities markets exited on Monday fearing a fall in demand due to rising interest rates and the prices of precious and base metals plunged as a result.

Gold, silver, copper, aluminium and zinc moved down in early trade on the London Metal Exchange (LME). Copper and aluminium fell 6-7 per cent in early trade on LME. Zinc moved down by 10 per cent. Share prices also moved down with the key benchmark index falling 462 points.

The fall triggered a sharp decline in the Indian markets as well with standard gold spot prices falling nearly Rs250 or 2.5 per cent to Rs10,265 per 10gm from the previous day, while June futures contracts dipped Rs500 or 4.75 per cent to trade at around Rs10,342 per 10 g.

The rise in US bond yields also helped the fall in commodity prices. However, fundamentals for precious and base metals remain strong as demand is seen robust.
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Global markets: US blue-chip stocks rise as oil prices dip three per cent
New York: A sharp drop in the price of oil and other commodities led investors in the US to snap up blue-chip stocks on Monday. As oil prices fell more than three per cent, the Dow Jones industrial average was up 47.78 points to 11,428.77. The Standard & Poor's 500 Index was up 3.26 points to 1294.50. The Nasdaq Composite Index was down 5.26 points to 2238.52.

London: British shares recorded their worst two-day points decline in three and a half years, with the FTSE 100 ending the session down 70.8 points to 5841.3 points, having earlier slumped to 5755.4, its worst level since February.

Frankfurt: The DAX index ended at 5857.03, down 59.25 points.

Paris: The CAC-40 index closed at 5064.85, down 85.6 points or 1.66 per cent.

Tokyo: The Nikkei average fell just over half a per cent to its lowest lose in two months as investors reacted to a sharp fall in US stocks and concerns about the strong yen. The Nikkei shed 114.87 points to close at 16,486.91.

Hong Kong: Hong Kong stocks closed down almost 2.5 per cent, in their biggest one-day drop in nearly two years, as sharp losses in overseas markets weighed on the sentiment and interest rate fears knocked banking and property shares lower. The Hang Seng index ended at 16,494.84, down 407.01 points.

Wellington: The New Zealand share market fell 1.3 per cent on profit-taking and weakness overseas. The benchmark NZSX-50 gross index closed 47.80 points lower at 3633.08, while the NZSX all capital index fell just under 14.87 points to 1044.35.
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Oil prices dive below US$70
Oil prices fell more than 3 per cent Monday, dipping below US$70 a barrel amid concerns about weakening demand and rising inflation as well as profit-taking. Analysts felt that the markets were in desperate need of a correction.

The International Energy Agency said last week that high prices have pushed oil demand downward. The sentiment received a boost from the Federal Reserve which raised concerns about inflation, suggesting interest rates might be pushed higher in order to slow growth. Saudi Arabia said Monday that the market is well supplied, in part because high prices have trimmed consumption levels.

Light, sweet crude for June delivery fell $2.63 to settle at $69.41 a barrel on the New York Mercantile Exchange. That followed a drop of $1.42 on Friday. Nymex gasoline futures fell 12.45 cents to settle at $2.054 a gallon, heating oil futures finished 10.17 cents lower at $1.945 a gallon and natural gas futures fell 15.7 cents to end at $6.123 per 1,000 cubic feet.

June Brent crude futures on London's ICE Futures exchange fell $1.97 to $70.35 a barrel.

Meanwhile other analysts said that the easing of prices may not be of long duration as the hurricane season was round the corner. Last year's hurricanes Katrina and Rita devastated oil and natural gas production in the Gulf of Mexico, and forced the shutdown of refineries and pipelines in the area.
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Carbon trading chaos in Europe
Brussels: The credibility of Europe's carbon trading system received a battering as figures for 2005 showed that industry was given too much leeway to pollute last year.

Statistics from 21 of the EU's 25 member states showed an embarrassingly large surplus of 64 million tonnes of carbon credits after the scheme's first year of operation.

Under the scheme, 9,000 industrial installations are allocated a CO2 emission allowance by their government each year. Those that fall under that ceiling can sell their surplus to less energy-efficient companies.

The European Commission, which has to approve national schemes, was studying the reasons behind the 2005 overshoot and promised tougher targets for 2008-12.

Yesterday the price of a credit, which began at €5 (now £3.41) per tonne in January last year and rose to €30, slumped to just over €12, then rose to €17.25 when Germany announced plans to cut its allocation.
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Boeing in $615mn settlement with Justice Department
Washington, DC, USA: The Wall Street Journal has said that Chicago`s Boeing Co. will pay $615 million to end three years of federal investigations into defense contracting scandals.
The agreement with the Justice Department will allow the company to avoid criminal charges or any admission of wrongdoing.

The charges related to Boeing`s alleged wrongdoings, include stealing documents of rival bids in order to beat them in bids for Pentagon contracts as well as unethical recruitment of Pentagon officials to gain bidding advantages.

The tentative settlement would be the largest financial penalty imposed on a military contractor for weapons-program improprieties, according to observers.
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