Markets Overview

  • ASX SPI 200 futures up 0.3% to 7,372.00
  • Dow Average up 0.8% to 35,885.33
  • Aussie down 0.1% to 0.7226 per US$
  • U.S. 10-year yield rose 7.0bps to 1.6184%
  • Australia 3-year bond yield rose 0.2bps to 0.96%
  • Australia 10-year bond yield fell 2bps to 1.79%
  • Gold spot down 2.3% to $1,803.97
  • Brent futures up 0.9% to $79.62/bbl

Economic Events

  • 9am: (AU) Nov. Markit Australia PMI Composite, prior 52.1
  • 9am: (AU) Nov. Markit Australia PMI Mfg, prior 58.2
  • 9am: (AU) Nov. Markit Australia PMI Services, prior 51.8
  • 9:30am: (AU) Nov. ANZ Roy Morgan Weekly Consumer, prior 106.0
  • 11am: (AU) Australia to Sell A$150 Million 0.25% 2032 Bonds

Stocks erased gains while Treasury yields rose following President Joe Biden’s nomination of Jerome Powell to head the Federal Reserve for a second term. The dollar climbed.
U.S. stocks tumbled into the close, with the S&P 500 falling more than 40 points in the final 45 minutes of trading. The index had spent all of the session higher before a sell-off in tech shares dragged it lower for the day. The U.S. swaps market is now pricing in a full 25 basis point rate hike into the June Fed meeting, with a second increase seen for next November. The dollar climbed, while gold slumped more than 2% and oil gained.

Other News

If your french fries are tasting funny these days, it might be the oil.
A biofuels boom is driving up demand for vegetable oil, boosting costs for food manufacturers and restaurants who use it to bake bread and fry chicken, among other things.
So many restaurant operators are trying to stretch the life of the liquid in their fryers. Some are hunting for longer-lasting varieties known as high-performance fry oil — only to find it snatched up by big chains. In some regions, restaurants are battling thefts of used oil, which has also risen in value.
In upstate New York, executive chef David Wagner saw the biofuels frenzy taking shape earlier this year and rushed to stock up on cooking oil before prices skyrocketed. Clearing out space in the basement of his restaurant, called City Line Bar and Grill, he placed an order for 10 times the amount of cooking oil he normally buys — enough to last him five months — and stacked it to the rafters when it arrived. Since then, Mr. Wagner has instructed his fry staff to strain the restaurant’s cooking oil three times a day instead of twice to prevent detritus from City Line’s signature chicken wings and mozzarella sticks from building up. “It’s pretty much liquid gold,” Mr. Wagner said. “You’ve got to filter out the impurities.”
Federal incentives and regulations in places such as California, designed to cut greenhouse-gas emissions, are pushing up demand for products such as soybean oil, animal tallow and used cooking oil, which are used to make renewable diesel.
Rising cooking-oil costs have helped drive menu prices for City Line’s chicken wings 20% higher this year, Mr. Wagner said. He said his staff is careful not to stretch the oil too far, which can give fried food a bitter, greasy taste. As cooking oil ages, its color changes from golden to amber to motor-oil black.

Criminals have taken note of oil’s new cachet, fueling a growing black market for spent supplies, said Sumit Majumdar, president of New York-based Buffalo Biodiesel Inc., which collects used oil from restaurants, including City Line, as well as grocers and the U.S. Army. In June, thieves clipped the lock on a 350-gallon dumpster behind Mr. Wagner’s restaurant and siphoned out the used oil, the chef said.
Grease thieves have targeted restaurants for years, with the value of oil stolen from City Line alone nearing $30,000 over 3 1/2 years, according to Buffalo’s Mr. Majumdar, who keeps track.
Thefts have risen sharply this year, Mr. Majumdar said, adding that his company expects to lose more than $10 million worth of oil to theft this year, even after investing in new locks for restaurant dumpsters and boosting its reward for help convicting grease thieves to $5,000. The company, whose website says its biodiesel results in “better smelling exhaust,” with “the light aroma of wings or fries,” expects revenues for 2021 will exceed $20 million.
Futures prices for soybean oil, a key cooking oil, notched records this summer after climbing 70% in the first six months of this year. Used cooking oil recently sold for 66 cents a pound, nearly 80% higher than a year ago, according to price-reporting agency Fastmarkets The Jacobsen.