Precious Metals: Platinum remained near one-year low
Precious metals were weak on Wednesday as soft physical demand from India weighted down on the commodity group. However, speculation that the ECB and Fed will loosen their monetary policies limited losses of the precious metals.
Gold inched up despite weak demand from India. A hot and dry weather in India curbed crops, thus weighting on household revenues.
Silver was the top-loser on broadly stronger US Dollar and mixed global equities. Market participants are cautious ahead of US jobless claims data due on Thursday.
Platinum was almost flat, remaining close to one-year low. Meanwhile, Kitco expected platinum group metals to halt the slump as global economy started to stabilize.
Palladium was unchanged amid industrial demand uncertainties. On Wednesday, Kitco announced that palladium may stop declining but is unlikely to move higher in the nearest future.
Industrial Metals: Nickel was flat after Germany’s export data
Base metals apart from aluminum posted mild losses on Wednesday after Germany’s export data weighted on market sentiment. In June, Germany’s exports declined by 1.5% while industrial production of the country dropped by 0.9%.
Aluminum was the only gainer on building hopes for easing in the Eurozone. At the same time, elevating US wholesale inventories and strong US Dollar capped the upswing.
Copper retreated ahead of China’s retail sales and industrial output data due on Wednesday. Meanwhile, slight drawdown in inventories supported the red metal.
Nickel was steady despite persistent surplus in the market and stronger US Dollar. Weak Germany’s data also created heavy pressure on the metal.
Zinc slid further as inventories are remaining near record high levels. Negative manufacturing news from the Eurozone also sent zinc prices lower.
Energy: Natural gas dropped on cooler weather forecasts
Energy commodities were mixed on Wednesday, with heating and Brent oil moving higher and natural gas and crude oil retreating. A larger than expected decline in the US crude oil stockpiles boosted energy commodities in the early US trade. Meanwhile, supply concerns also pushed energy prices up.
Crude oil erased previous gains on profit-taking after the commodity hit three-month high. US crude oil inventories declined by 3.7 million barrels last week compared to expectations of a 0.26 million barrel fall.
Brent oil added 0.12% on hopes for monetary stimulus from China. A decline in US crude inventories coupled with supply disruptions caused by tropical storm in the Gulf of Mexico continued to support energy prices.
Natural gas tumbled on cooler weather forecasts in the US. Cooler weather dents demand outlook as less gas powered electricity is required for air-conditioning.
Heating oil was the top-performer, gaining 0.6%. US distillate fuel inventories declined by 0.7 million barrels last week and are below the lower limit of the average range for this year period.
Agriculture: Corn surged on brighter demand prospects
Agricultural commodities were mixed on Wednesday amid broadly stronger US Dollar and better weather conditions in Brazil and India. Meanwhile, continuous drought in Russia sent grain futures higher.
Wheat rebounded after USDA reported that Australia’s wheat output is likely to drop by 11% in 12 months starting from October 1. At the same time, a 8% increase in Indian production in 12 starting from April 1 capped the upswing.
Corn was the top-gainer, jumping for the first time this week on speculation that corn demand for ethanol production will strengthen.
Sugar prolonged the longest slump in three years as favorable weather in Brazil and India improved global supply prospects.
Coffee declined as dry and warm weather in the next ten days in Southern region in Brazil is likely to benefit coffee harvest.
EXPLANATIONS
Commodities
Gold - spot 995 fine gold
Silver - spot 999 fine silver
Platinum - spot platinum with minimum purity 99.95%
Palladium - spot palladium with minimum purity 99.95%
Aluminium - three-month forward contract on the London Metal Exchange
Copper - three-month forward contract on the London Metal Exchange
Zinc - three-month forward contract on the London Metal Exchange
Nickel- three-month forward contract on the London Metal Exchange
Crude oil - light, sweet crude oil active contract on the New York Mercantile Exchange
Brent oil - Brent oil active contract on the New York Mercantile Exchange
Natural Gas - natural gas active contract on the New York Mercantile Exchange
Heating oil - heating oil active contract on the New York Mercantile Exchange
Sugar - white sugar wheat active contract on the Chicago Board of Trade
Wheat - wheat active contract on the Chicago Board of Trade
Coffee - benchmark Arabica coffee active contract on the NYB-ICE Futures Exchange
Corn - corn active contract on the Chicago Board of Trade
Indices
Dow Jones-UBS Precious Metals Subindex Total Return - commodity group subindex composed of gold and silver; the index reflects return on underlying commodity futures price movement
Dow Jones-UBS Industry Metals Subindex Total Return - commodity group subindex composed of futures contracts on aluminium, copper, nickel and zinc; the index reflects return on fully collateralized futures positions
Dow Jones-UBS Energy Subindex Total Return - commodity group subindex composed of futures contracts on crude oil, heating oil, unleaded gasoline and natural gas; the index reflects return on fully collateralized futures positions
Dow Jones-UBS Agriculture Subindex Total Return - commodity group subindex composed of futures contracts on coffee, corn, cotton, soybeans, soybean oil, sugar and wheat; the index reflects return on fully collateralized futures positions
Chart
SMA (20) - Simple Moving Average of 20 periods
SMA (60) - Simple Moving Average of 60 periods
Correlation - a statistical measure of the linear relationship of two random variables. It is defined as the covariance divided by the standard deviation of two variables
Indicators
Daily Ranked Price Moves - daily price changes in an ascending order for positive changes and in a descending order for negative or mixed changes
Monthly Ranked Price Moves - monthly price changes in an ascending order for positive changes and in a descending order for negative or mixed changes
