NEW YORK | Thu Jan 3, 2013 5:00pm EST

NEW YORK (Reuters) - A portrait by Italian artist Agnolo Bronzino is expected to fetch as much as $18 million this month at auction, the highlight among top-priced paintings and antiquities that include works by Goya, Batoni and Rubens.

"Portrait of a Young Man with a Book," which auction house Christie's has touted as one of the most important Renaissance portraits remaining in private hands, dates to the early 16th century and is among Bronzino's earliest known portraits.

At auction house Sotheby's, the top lot in its series of sales is Pompeo Girolamo Batoni's "Susanna and the Elders," a 1751 work which is estimated to sell for $6 million to $9 million.

One of the very last portraits by Goya, "The Artist's Grandson," which has been in the same collection since 1954 and has been out of the public eye for some 60 years, is expected to fetch $6 million to $8 million, Sotheby's said.

Sotheby's is also featuring 16 paintings being sold by the Metropolitan Museum of Art to benefit its acquisitions fund, as well as property from other major U.S. museums.

Its sales, estimated to total from $90 million to $135 million, will be held from January 29 to February 1, with highlights on view at its New York headquarters starting on January 25.

At Christie's, where several days of sales are expected to take in anywhere from $75 million to about $115 million, top offerings also include a pair of Madonna and child paintings.

A rare, circular-format portrait by Fra Bartolommeo, which dates to the mid-1490s, is still set in its original frame and is being sold from a private collection, is expected to sell for $10 million to as much as $15 million.

Botticelli's "Madonna and Child with the Young Saint John the Baptist," known as "the Rockefeller Madonna" owing to its five decades in the collection of noted collector John D. Rockefeller, is estimated at $5 million to $7 million.

Both works will be sold at Christie's special January 30 Renaissance sale, devoted to European works from 1300 to 1600.

"The 'Rockefeller Madonna' is a rare and important example of Botticelli's mature style that now holds its rightful place in the canon of the great masters' work," Nicholas Hall, co-chairman of Old Masters and 19th-century art, said in a statement.

The sales took in a combined total of about $120 million at both auction houses a year ago.

(Reporting by Chris Michaud; Editing by Patricia Reaney and Paul Simao)

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New housing construction is seen in Darnestown, Maryland, October 23, 2012.

NEW YORK | Wed Dec 26, 2012 9:50am EST

NEW YORK (Reuters) - Single-family home prices rose in October for nine months in a row, reinforcing the view the domestic real estate market is improving and should bolster the economy in 2013, a closely watched survey showed on Wednesday.

The S&P/Case Shiller composite index of 20 metropolitan areas gained 0.7 percent in October on a seasonally adjusted basis, stronger than the 0.5 percent rise forecast by economists polled by Reuters.

"Looking over this report, and considering other data on housing starts and sales, it is clear that the housing recovery is gathering strength," David Blitzer, chairman of the index committee at Standard & Poor's, said in a statement.

While record low mortgage rates and modest job growth should keep the housing recovery on track, analysts cautioned home prices face downward pressure from a likely pickup in the sales of foreclosed and distressed properties and reduced buying investors and speculators.

Prices in the 20 cities rose 4.3 percent year over year, beating expectations for a rise of 4.0 percent.

Las Vegas posted the biggest monthly rise on a seasonally adjusted basis at 2.4 percent, followed by a 1.7 percent increase in San Diego, the latest Case-Shiller data showed.

"Higher year-over-year price gains plus strong performances in the Southwest and California, regions that suffered during the housing bust, confirm that housing is now contributing to the economy," Blitzer said.

Housing contributed 10 percent to the overall U.S. economic growth in the third quarter, while the sector represented less than 3 percent of gross domestic product, he said.

Last week, the government said U.S. GDP expanded at a stronger-than-expected 3.1 percent annualized pace in the third quarter.

Excluding seasonal factors, however, home prices in 12 of the 20 cities fell in October from September as home values tend to decline in fall and winter, Blitzer said.

Chicago experienced the largest non-seasonally adjusted decline at 1.5 percent, followed by a 1.4 percent fall in Boston.

(Reporting by Richard Leong; Editing by Chizu Nomiyama)

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LONDON | Fri Oct 12, 2012 8:58am EDT

LONDON (Reuters) - Frantic drilling activity across the United States has at last begun to moderate, as the industry responds to the plunge in prices for natural gas and now liquids such as butane and natural gasoline.

Production companies have switched towards oil-rich and liquids-rich plays since 2008, driven by the gas glut and falling gas prices. But now the number of rigs targeting oil and condensate plays also appears to have peaked.

Between July 2008 and July 2012, the number of rigs drilling for gas fell by almost two thirds, from 1,555 to just 522, while the number of rigs targeting oil rose four-fold, from 393 to 1,427, according to oilfield services company Baker Hughes, as the industry responded to a record oil/gas price ratio (Chart 1).

Rigs shifted from dry-gas plays such as the Barnett shale underneath Fort Worth in Texas to wet-gas plays such as Eagle Ford in south-west Texas, where methane is found in association with heavier molecules like ethane, and oil-rich plays like North Dakota's Bakken.

High prices for co-products helped support continued gas drilling and production even as prices sank below $3 per million British thermal units. They have also significantly improved the economics of oil wells drilled in comparatively expensive shale plays.

Bakken wells cost an average $8.5 million each to drill, making them some of the most expensive in the country. But the internal rate of return is almost 60 percent, among the highest, according to a recent study by Bentek, in part because of the high yield of natural gas liquids, which can be stripped from the associated gas production and sold separately ("The Williston Basin: Greasing the Gears for Growth in North Dakota" July 2012).

CONDENSATE GLUT

The massive expansion of liquids output is now causing its own problems, however, as the market becomes flooded with record stocks of ethane, propane, butane and natural gasoline, weighing down prices.

Combined stocks of natural gas liquids (NGLs) currently stand at 188 million barrels, up from 147 million at the same point last year, according to the Energy Information Administration (EIA). Butane prices have fallen to just $62 per barrel, down from $75 in 2011. Natural gasoline prices are down to $87, from almost $100 last year.

The total number of rigs drilling on land for some combination of oil, gas and condensates across the United States has fallen by 189 (9.6 percent) from 1,978 to 1,789 over the last 12 months.

Over the border, in Canada, the number of rigs drilling on land is down by 150 (29 percent) from 521 to 371 over the last year.

Rig counts alone provide a misleading indication of total drilling activity, since drillers have become adept at drilling faster, more accurately, minimizing downtime and generally becoming more efficient.

As the oil and gas boom has sent the costs of hiring rigs and crews soaring, the pressure to improve efficiency has become intense. Fewer drilling rigs can now drill more wells than before.

Nonetheless, there are signs the drilling market in North American is starting to cool slightly as poor prices for natural gas and now liquids have an impact.

In its second quarter earnings release, oilfield services company Schlumberger noted the hydraulic fracturing market on land in North America has weakened in recent quarters.

The downturn appears to be quite general across the United States, with rig counts down in most major petroleum-producing states (Charts 2-3).

DRILLING SHIFTS AGAIN

Outside North America, where prices are not so affected by freely available shale gas, drilling continues to rise.

In September, there were 1,254 rigs drilling for oil or gas outside the United States and Canada, according to Baker Hughes. It was more than double the number in 1999 and the highest number of operating rigs since 1986 (Chart 4).

The boom centers on the Middle East, where there were 381 rigs drilling last month, up from 292 in September 2011 and 276 in 2010. Latin America has also witnessed a sharp expansion in exploration and production activity, with a smaller uptick in Africa.

As surplus oil and gas production in North America depresses prices, more drilling assets and specialist crews will be redeployed overseas to take advantage of higher returns.

(Editing by Keiron Henderson)

(John Kemp is a Reuters market analyst. The views expressed are his own)

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CHICAGO | Mon Oct 8, 2012 12:25pm EDT

CHICAGO (Reuters) - Exchange-traded index funds are a bit like mobile phones -- models offer an increasing array of features over time, while prices on even the plain-vanilla models keep falling.

So, in step, prices have been dropping lately on garden-variety ETF index expenses. Typically these have offered rock-bottom costs on most products, relative to actively managed mutual funds. Yet there are several components of ETF pricing, so you need to be careful. You could miss some of the nuances and pay more than you should.

The good news is that competition is forcing expense ratios down to near-institutional-pricing levels. Now you can pay roughly what big money managers do for entire baskets of stocks, bonds and other vehicles. (An expense ratio is what a money-management firm charges you every year for owning their ETFs -- a percentage based on assets under management. Generally, the lower the expense ratio, the better, since more of your money is being invested and not going into the manager's pocket.)

The latest salvo of price cuts came from the discount broker Charles Schwab, which recently reduced fees by up to 59 percent on its 15 ETFs, which hold more than $7 billion in assets. Schwab is trying to play catch-up with the three giants in the field -- Blackstone/iShares, State Street's SPDRs and Vanguard Group -- which offer an even wider selection of low-cost ETFs.

Expenses on Schwab funds range from 0.04 percent for its Multi-Cap Core Fund to 0.20 percent for its International Small/Mid-Cap Growth fund. How does that compare with previous levels? Expenses on the Mid-Cap ETF were cut in half, from 0.13 percent to 0.07 percent, while others were trimmed by as little as 0.02 percentage points.

While this sounds like counting pennies, it makes a difference over time. Say you had a large-company stock fund in your 401(k), had $100,000 invested and were paying 1 percent annually. Drop that expense to 0.04 percent and you'd have $107,000 more if your fund returned 5 percent annually over 30 years, according to the Securities and Exchange Commission's Mutual Fund Cost Analyzer (here). The SEC's calculator shows money lost to expenses and forgone earnings -- gains you would've made if expenses were lower.

If expense ratios were all you needed to scout when buying an ETF, I would suggest that you buy the cheapest index ETFs possible to cover stock, bond, real estate and commodities markets across the world. But here's what else you need to consider:

1. Look at the bid/ask spread.

Since ETFs are traded on exchanges, the spread is the difference between the highest and lowest prices for buying and selling. Generally, the smaller, or "tighter," the spread, the better for you, the investor. Higher bid/ask spreads mean you're paying a premium for ETFs, which adds to your transaction costs. According to the website Indexuniverse.com, which tracks index funds, bid/ask spreads on the Schwab group, for example, are as high as 0.12 percent for the Schwab International Equity ETF. When you're shopping for ETFs, look for the funds with the lowest bid/ask spreads, which can be as little as a penny for large ETFs such as the Vanguard S&P 500 ETF.

2. How large is the average capitalization of the securities within the ETF?

ETFs containing megacap blue-chip stocks generally have the tightest bid/ask spreads because the stocks within the fund are highly liquid. As you get lower down the food chain into thinly traded small-cap or international stocks and other vehicles such as real estate investment trusts, the bid/ask spreads widen.

3. How closely does the ETF track an underlying index?

Some track more closely than others. ETFs following large, widely followed indexes such as the S&P 500 should be really close to the underlying benchmark. If they don't track an index closely -- more than 0.10 percent variation is a warning sign -- that means you're veering further away from the total return on your chosen basket of securities.

4. What kind of trading commission are you paying?

Since ETFs are securities traded on an exchange, you have to go through a broker to buy and sell them. Deep-discount online brokers typically offer the lowest commissions, but many large mutual-fund managers offer commission-free ETFs on a select group of ETFs, which are typically their most popular funds.

As you become more discerning about the total cost of ETF ownership, consider replacing actively managed mutual funds in your retirement and other portfolios such as 529 college savings plans with ETFs.

A good place to start is your 401(k) portfolio. Under new Department of Labor disclosure rules, your employer is required to disclose the expense ratios and the actual dollar amounts you pay for each fund in your plan. How much are you paying and how much can you save?

If you're paying more than 0.50 percent annually for any fund, it's time to ask your employer to find lower-cost funds. Since it's likely that you're paying the expenses on the funds within your portfolio, any savings you can reap can help improve your total performance. As I've illustrated above, even seemingly small cuts in expenses can help you accumulate bigger returns over time.

(The author is a Reuters columnist and the opinions expressed are his own. For more from John Wasik see link.reuters.com/syk97s) (Editing By Heather Struck, Beth Pinsker Gladstone and Douglas Royalty)

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A man looks at food at Khartoum's central food market July 18, 2012.

ROME | Thu Aug 9, 2012 5:11am EDT

ROME (Reuters) - The world could face a new food crisis of the kind seen in 2007/08 if countries resort to export bans, the UN's food agency warned on Thursday, after reporting a surge in global food prices due to a drought-fuelled grain price rally.

A mix of high oil prices, growing use of biofuels, bad weather, restrictive export policies and soaring grain futures markets pushed up prices of food in 2007/08, sparking violent protests in countries including Egypt, Cameroon and Haiti.

Concern about extreme hot and dry weather in the U.S. Midwest sent corn and soybean prices to record highs last month, driving overall food prices higher again and reversing the Food and Agriculture Organisation's expectations for steady declines this year.

"There is a potential for a situation to develop like we had back in 2007/08," FAO's senior economist and grain analyst Abdolreza Abbassian told Reuters.

"There is an expectation that this time around we will not pursue bad policies and intervene in the market by restrictions, and if that doesn't happen we will not see such a serious situation as 2007/08. But if those policies get repeated, anything is possible."

Grain markets have been boosted by speculation that Black Sea grain producers, particularly Russia might impose export restrictions after a drought there hit crops.

Markets drew a little comfort from official Russian comments on Wednesday that the country saw no grounds to ban grain exports this year but did not rule out protective export tariffs after the end of the 2012 calendar year.

The FAO Food Price Index, which measures monthly price changes for a food basket of cereals, oilseeds, dairy, meat and sugar, averaged 213 points in July against 201 points in June, the FAO said in its monthly index update.

The rise followed three months of declines. Although below a peak of 238 points in February 2011, when high food prices helped drive the Arab Spring uprisings in the Middle East and North Africa, the index is still higher now than during the food price crisis in 2007/08.

Higher food prices mean higher import bills for the poorest countries, which do not produce enough food domestically.

Charity Oxfam said that the surge in grain prices could drag millions of people around the world into conditions of hunger and malnourishment, in addition to nearly one billion who are already too poor to feed themselves.

Abbassian said the situation was still quite different from 2007/08, when crude oil prices were at record levels, adding to farmers' costs.

Abundant supplies of rice and sluggish economic growth should also ease the upward pressure on prices, but a lot will depend on how the weather develops for U.S. crops and how much demand will be rationed in coming months, he said.

The Rome-based food agency usually does not release the food price index this month but it has broken with tradition due to the exceptional market situation.

It did not update its supply and demand outlook for cereals on Thursday as it does during a normal release. The U.S. Department of Agriculture (USDA) will publish its August crop production and supply/demand report on Friday.

(Reporting By Catherine Hornby; editing by Veronica Brown and Keiron Henderson)

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