SMART MONEY FLOW VS S&P 500

Google Inc reveals self-driving vehicle prototypes designed in collaboration with several automotive partners

The co-founder of Google Inc. – Mr. Sergey Brin revealed that the company has designed its own self-driving vehicles. The company developed a two-seated prototype that transports passengers at the push of a button.

Mr. Brin said in an official statement, which was cited by Bloomberg: “We took a look from the ground up as to what it would be like if we had self-driving cars in the world. We’ve worked with partners in the Detroit area, Germany and California.”

According to the company’s statement, Google has been working on the project for the past four years. The company revealed that the vehicle prototype lacks a steering wheel, accelerator pedal or brake pedal and basically looks like a gondola on wheels. The owners of such a car will be provided with the opportunity to set a destination address and the vehicle basically will do the rest by driving them there. The top speed disclosed by Google for now is limited to 25 miles per hour.

The company said that it works in collaboration with several automotive partners. For starters, the co-founder Mr. Brin said that Google Inc. has set a goal of manufacturing 100 to 200 test cars. The news comes at a time when there is a campaign aiming to make driverless vehicles more popular in order to make the roads safer.

The design of Google’s driverless cars resembles the one of Fiat 500 or the one of Mercedes-Benz Smart, but it won’t be equipped with a gas pedal, brake, steering wheel and gear shift. The only operations controlled by the driver will be pressing a red “e-stop” button that is intended for panic stops, as well as pressing a start button.

According to one of the analysts working at IHS Automotive – Egil Juliussen – the self-driving vehicles will gain greater popularity over the next twenty years. Mr. Juliussen said that the number of such cars in 2035 is expected to reach 11.8 million, and also projected that almost all cars are to become self-driving by 2050.

Google Inc. was 1.96% up to close at 574.87 dollars per share yesterday, marking a one-year change of +30.34%. According to the information published on CNN Money, the 41 analysts offering 12-month price forecasts for Google Inc. have a median target of 660.00, with a high estimate of 750.00 and a low estimate of 525.00. The median estimate represents a +14.81% increase from the last price of 574.87.

Protesters burn vehicles, buildings at New Caledonia nickel mine

Rioters torched vehicles, equipment and buildings at Vale's nickel mine in the French Pacific territory of New Caledonia over the weekend, as anger boiled over about a chemical spill in a local river.

The $6 billion Vale plant at Goro in southern New Caledonia was closed earlier this month after some 100,000 liters of acid-tainted effluent leaked, killing about 1,000 fish and sparking renewed protests at the mine site.

The Vale plant has a production target of 60,000 tonnes of nickel at full capacity, compared with global supply of around 2 million tonnes. But it has been beset by problems in recent years, including several chemical spills and violent protests.

Tensions between the local population and Vale escalated over the weekend with young protesters frustrated at the latest spill by the Brazilian-based giant and a lack of response from indigenous Kanak chiefs, according to local media. Television footage showed images of burnt mining vehicles and equipment.

"There was damage at the site, but no damage to the plant. We had burned vehicles, one administration building was damaged, but no damage to the plant itself," Vale spokesman Cory McPhee told Reuters.

Peter Poppinga, an executive director at Vale, told Les Nouvelles Caledoniennes newspaper that damage to the mining site was estimated at least $20 million to $30 million, including the destruction of perhaps one third of the truck fleet.

"If there is no activity for several months, we will shut the plant, but that's not the case. The closing of the plant is not on the table," Poppinga was quoted as saying.

The scale of the damage could not immediately be independently verified.

Nickel mining is a key industry in New Caledonia, which holds as much as a quarter of the world's known reserves. Vale's plant is the second-largest employer in the southern province, with some 3,500 employees and contractors, including a large number of Filipino workers.

PLANT HALTED

New Caledonia's southern provincial government ordered an immediate halt to operations after the spill earlier this month and started legal proceedings under its environmental code.

The local government, which changed leadership last week, said it would not lift the production suspension until safety procedures were revised, an oversight committee was reinstated and an independent expert's report was completed.

"We got to this point because, clearly, part of the local youth, particularly from the southern tribes, reject the perspective of maintaining the plant in activity, even with the reinforcement of safety procedures," Philippe Michel, the newly elected president of New Caledonia's Southern Province, told local television on Monday.

Global nickel prices hit a 27-month high earlier this month and are up by about 40 percent this year, driven by a decision by Indonesia to halt exports of raw nickel ores and news of the Goro closure. Indonesia's ban left nickel buyers in China and Japan scrambling to secure supplies amid a fear of shortages.

"Vale's got lots of issues in the country," said Tom Price, a mining analyst at UBS in Sydney. "Nickel has recovered back to the marginal cost of production. It's inviting for them to continue to invest, but it's been a world of pain for them for quite a few years."

Given market expectations of Goro production of just 15,000-20,000 tonnes this year, any impact on nickel prices from the closure would be sentiment driven, Price added. LME nickel prices rose 0.7 percent to $19,745 a tonne on Tuesday.

The Goro mine produced 4,100 tonnes of nickel in the first quarter, up 41 percent on a year ago. Vale is the world's second-biggest nickel producer, but Goro made up just 6 percent of its nickel output in the first quarter.

The mine employs high pressure technology and acids to leach nickel from abundant tropical laterite ores.

"There is an inherent risk in Goro's type of operation," said Gavin Mudd, a professor of environmental engineering at Monash University in Melbourne.

Buy Aluminium May expiry or accumulate Aluminium mini in June in MCX

As of Friday 23rd May 2014, 3 month forward LME Aluminum is seen trading at $1818/MT up by 2.70% from its previous close. We had suggested a bullish outlook on the metal in the last week and believe the same scenario may maintain in the next week too. 

There are several reasons for the metal to trade higher and a few prominent factors are as follows: 

A) Global Aluminum stocks which were at record high at 5.492 million tons in the beginning of 2014 has been continuously declining and in May as of now the total stocks stood at 5.233million tons a fall over 5% supporting the prices to rebound from record low since 2013. 

B) Producers are cutting smelting operations after prices declined amid rising costs. Aluminum on the LME fell 13 percent last year and in February touched the lowest since 2009. Oslo-based Norsk Hydro ASA this month said it would permanently close its Kurri Kurri plant in Australia. Earlier this year, Alcoa said it planned to shut a facility in Point Henry, Australia and curb capacity at two smelters in Brazil where producers are reducing output to the lowest in 12 years. 

C) Aluminum premiums are rising in Europe and Japan to a record levels in the recent time also helping the metal to move higher. We believe similar trend may continue in the short term by which prices may remain elevated. European spot aluminium premium rose to a record $390-405/MT, from $370-380/MT a week earlier. Spot ingot premiums in main Japanese port rose to an all-time high of $380-385/MT, up from $365-370/MT previous week. 

D) Aluminum buyers in Japan, Asia’s largest importer, are set to agree on a record fee next quarter as demand rode out a sales-tax gain amid falling global output.

 E) Fees in the U.S. and Europe climbing to a record high as financing transactions and waits to get metal from some LME-tracked warehouses keeping supplies unavailable to users. 

Strategy: Buy Aluminium May expiry or accumulate Aluminium mini in June at Rs. 103 and Rs. 104 respectively for a target of Rs. 107 and Rs. 109 while stop loss should be below Rs. 100 and Rs. 101.

Weekly Economic Data for the week 24-May-14 to 30-May-14

Expected impact on price:	This indicator shows the effect of the anticipation of data on the prices of related country’s major indices. We have categorized it as below: Very Good Good Neutral Bad Very Bad
Actual:	Refers to the actual/latest figures after its release.

Data for the week 24-May-14 to 30-May-14

Date	Time (IST)	Country	Data	Exp.	Prior	Exp. chg today	Avg. chg of last 1 year	Exp. Impact on Price
26-May-2014	05-20 AM	Japan	Bank of Japan Releases April 30 Meeting Minutes					Neutral
26-May-2014	12-30 PM	Japan	BOJ Deputy Governor Iwata Speech					Neutral
26-May-2014	05-00 PM	European Monetary Union	Merkel Holds News Conference in Berlin After EU Election					Neutral
27-31 May-2014	--	Germany	Retail Sales (MoM)	0.2%	-0.7%	0.90%	1.29	Neutral
27-May-2014	06-00 PM	United States	US-Durable Goods Orders	0.7%	2.60%	-1.90%	6.72	Neutral
27-May-2014	07-30 PM	United States	Consumer Confidence	83	82.3	0.70	4.00	Neutral
28-May-2014	00-30 AM	United Kingdom	BOE Governor Mark Carney Speaks in London					Neutral
28-May-2014	01-30 PM	European Monetary Union	M3 3-month average	1.2%	1.2%	0.00		Neutral
28-May-2014	02-30 PM	European Monetary Union	EC - Consumer Confidence	-7.1	-7.1	0.00	1.04	Neutral
29-May-2014	06-00 PM	United States	GDP Annualized QoQ	0.5%	0.1%	0.40%	0.45	Neutral
29-May-2014	08-00 PM	United States	EIA Natural Gas Storage change	--	106	-106.00	33.60	Neutral
29-May-2014	08-30 PM	United States	EIA Crude Oil Stocks change	--	-7.2	7.20	3.45	Neutral
30-May-20134	05-30 PM	India	Gross Domestic Product Quarterly (YoY)	4.7%	4.7%	0.00%	0.45	Neutral
30-May-2014	05-30 PM	Germany	Merkel Takes Part in Panel at German Catholic Conference					Neutral
30-May-2014	07-25 PM	United States	Reuters/Michigan Consumer Sentiment Index	82.5	81.8	0.70	2.48	Neutral

Shanghai Copper Rises to 11-Week High as Stockpiles Drop

Copper in Shanghai climbed for a third day to a 11-week high as stockpiles tracked by exchanges in London, Shanghai and New York slumped. Aluminum rose to the highest in four weeks.

The contract for delivery in August on the Shanghai Futures Exchange added as much as 0.8 percent to 49,110 yuan ($7,875) a metric ton, the highest price since March 7, and was at 49,020 yuan by 9:54 a.m. local time. Futures advanced 1 percent last week, gaining for the second straight week.

Refined-copper inventories dropped to 283,645 tons last week, the lowest level since 2008, according to data from exchanges. SHFE-tracked reserves fell 4.5 percent to 92,652 tons, near the lowest since December 2011. Inventories available for removal from LME warehouses fell below 100,000 tons for the first time since 2008. Markets in the U.S. and U.K. are closed today for holidays.

“Copper was supported by strong spot premiums in Shanghai and London because of the falling inventories,” said Lian Zheng, an analyst at Xinhu Futures in Shanghai. “The momentum should continue unless China posts disappointing economic data again and concerns over China’s physical demand arise.”

Copper for immediate delivery on the LME settled at $93 a ton above the three-month contract on May 23, the widest since May 2012. Higher prices for earlier deliveries usually signal limited supplies. The metal for delivery in July on the Comex in New York rose 0.7 percent to $3.189 a pound.

In Shanghai, aluminum for delivery in August added 0.5 percent to 13,565 yuan a ton after touching 13,660 yuan, the highest since April 25. The global aluminum market will be in deficit this year by 1.3 million tons, leading producer United Co. Rusal said May 23.

Gold production in Australia, the world's second-biggest producer falls 7%

Gold production in Australia, the world's second-biggest producer after China, declined 7% due to bad weather in Q1 2014.

According to industry consultant Surbiton Associates output declined to 68 metric tonnes in the three months through March compared to Q4 last year, but is up 8% year on year.

Heavy rain in the Goldfields region of Western Australia in mid-February is to blame for the drop according to the Melbourne-based firm.

Full mining at top producer in the region Regis Resources' Garden Well mine may only resume in June after it was submerged.

The price of gold is up nearly 8% this year, but down sharply from 2014 highs struck in March to trade below $1,300 an ounce.

Source: USGS via Wikipedia