Precious Metals: Platinum rose after Lonmin closed its mine
Precious metals were mixed as hopes for EQ3 in the US started to fade after strong retail sales data. US retail sales rose by 0.8% in July compared to a forecast of a 0.3% increase. Broadly stronger US Dollar also weighted down on the commodity group.
Gold was the worst performer as hopes that the Fed will ease its monetary policy vanished. Adding pressure on gold, physical demand from India is likely to decline by 30% this year as drought affected households’ income.
Silver balanced between potential industrial demand increase and stronger US Dollar. On Monday, the IMF upgraded global growth forecast for 2013 from 3.5% to 3.9%, thus boosting demand prospects for the white metal.
Platinum rose after Lonmin reported that it closed its mine as two people were killed and six injured after illegal work stoppage at Western Platinum.
Palladium climbed on brighter demand prospects as global economic outlook has improved recently.
Industrial Metals: Nickel surged after German GDP data
Industrial metals were mixed on Tuesday, with nickel and copper rising and aluminum and zinc falling. Positive data from the US and Eurozone boosted market sentiment. Germany’s GDP grew slightly more than expected in Q2 while US retail sales beat estimates in July.
Aluminum was steady as positive headlines from the Eurozone and US did not manage to outweigh recent dismal data flow from Asia.
Copper gained 0.30% on hopes that central banks in the Eurozone and Asia will embark on stimulus measures.
Nickel was bullish on positive data flow from both sides of the Atlantics. However, China’s factories continued to cut output, thus sending nickel futures lower.
Zinc retreated as global inventories remain at record levels. Moreover, industrial demand uncertainty weighted down on the base metal.
Energy: Natural gas soared on supply concerns
Energy commodities edged up on Tuesday amid upbeat US and German data. US PPI and retail sales advanced more than expected last month. Meanwhile, traders are cautious ahead of US crude oil inventory report due on Wednesday.
Crude oil climbed on hopes that positive economic trends in the US and Germany will boost energy demand.
Brent oil was slightly higher amid potential increase in demand and persistent supply concerns. Tensions in the Middle East intensified again on speculation that the military conflict between Israel and Iran may be inevitable.
Natural gas jumped as storm in the Gulf of Mexico may disturb production. Meanwhile, market participants monitor US weather forecasts to estimate fuel demand in the next weeks.
Heating oil went up on brighter demand prospects and supply uncertainties in the Middle East and Gulf of Mexico.
Agriculture: Coffee tumbled on improved weather in Brazil
Rural commodities extended previous losses on Tuesday as favorable weather in Brazil and India is expected to increase crops. At the same time, drought in the US and Russia limited the downswing of the farm commodities.
Wheat declined despite strengthening demand from major importers amid lower crops in the US and Russia.
Corn slumped on speculation that recent rally may erode demand for the commodity. However, a decline in China’s harvest this year limited the downswing.
Sugar slid as more favorable weather conditions in Brazil and India, the world’s top producers, removed supply risk premium of the sweetener.
Coffee approached six-week low on signs that harvesting in Brazil gathered pace amid dry and warm weather.
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
