WTI crude oil price rallied for another 2.1% to settle at 53.8 Monday as Treasury Secretary Tim Geithner's plan to remove toxic assets from banks improved investors optimism on economic recovery. At the same time, surges in stock markets and weakness in dollar also helped boost commodity prices.

The US Treasury Secretary Tim Geithner announced a $1 trillion Public-Private Investment Plan to buy toxic assets from the nation's banks. Together with the efforts from private sectors, the plan will finance as much as $1 trillion, of which $75-100B will be deployed from TARP's capitals, for the purchase of legacy assets (loans and securities) with Federal Deposit Insurance Corp as debt guarantees.

Although more details were given regarding how the legacy (toxic) assets will be bought, there are still difficulties on putting the plan in practice. The biggest question is how a mutually-agreed price on the assets can be achieved. Moreover, willingness for the banks to make provision to the assets remains uncertain.

In contrast with the abrupt plunge in stock markets after the plan was firstly revealed on Feb 10, major indices in the US and Europe reacted positively to Geithner's announcement yesterday. Dow Jones Industrial Average gained 6.8% to close at 7776 and the S&P 500 index added 7.1% to close at 823. In Europe, UK's FTSE gained 2.9%, Germany's DAX added 2.7% while France's CAC 40 index climbed 2.8% during the day. In Asia morning, stock prices continue to strengthen with the MSCI Asia Pacific Index soared 1.3% and Japan's Nikkei 500 gained 1.4%.

Reuters/Jefferies CRB Index of 19 raw materials rises for the 3rd consecutive trading day. The gauge added 1.5% this morning to 229.4 as soybeans, natural gas, cattle, cotton and coffee also gained.

Gold price's rally was once again damped by stock markets. The April contract retreated to 936 before rebounding to settle at 952 yesterday as the abundant rescue plans from the governments greatly increased investors' risk appetite. Today, the precious metal trades narrowly around 940. In the near-term, we will likely see gold moving choppily between 920 and 990 and outlook is mixed by dollar's retreat and stock markets' strength.

On the other hand, the platinum contract surged 2.6% to close at 1143.3 Monday, driven by the Obama administration's plan. Rather than spurred by demand for safe haven asset, platinum price's rally this time was due to revived hopes economic condition which will eventually help the auto industry.