Commodity Blog

Posts Tagged ‘dollar’

Gold declined today after it closed almost unchanged yesterday.

Gold could have profited from the debt crisis in the European Union. The problem is investors prefer to buy the US dollar rather than the precious metal as a safe haven. The greenback rose and gold fell.

It’s not the first time gold behaves as a simple commodity, not as a haven, suffering from negative market sentiment, not profiting from it. How long such unusual situation will last is hard to tell, but, perhaps, signs of slower economy of the United States could make the precious metal more preferable than the US currency? For now, though, the fundamental reports from the USA are good for the most part and the greenback remains in favor of investors seeking refuge from issues of the world economy.

Settlement for gold was at $1,769.90 today as of 7:31 GMT on COMEX. Yesterday, the closing price was $1,782.10, slightly above the opening of $1,781.60.

Crude oil gained today on concerns that the disturbance in the Gulf of Mexico would turn into a tropical cyclone. The output from the region has already declined by about 36.9 percent for and 18.1 percent for natural gas. Analysts expect that the report tomorrow will show that US inventories of crude decrease by 2 million barrels last week. October futures for delivery of crude oil gained $3.32 to $89.34 per barrel on NYMEX, posting the biggest advance since August 10.

Gold slipped today as gains of stocks reduced demand for metal as a safe haven and prompted traders to take profit from record prices. The Standard & Poor’s 500 Index surged 2.7 percent and the MSCI All-Country World Index jumped as much as 2.8 percent. The precious metal also retreated after the dollar climbed to the highest level in more than a month against the basket of six major currencies. December futures for delivery of gold retreated $55.70 (3 percent) to $1,817.60 per ounce as of 13:25 on COMEX. December futures for silver slipped $0.237 (0.6 percent) to $41.631 per ounce.

Crude oil gained as the US inventories declined. US stockpiles of crude fell by 3.7 million last week as refineries operated at 90.3 percent of capacity, the highest rate in 11 months. August for crude oil delivery advanced $0.64 to $98.14 per barrel on NYMEX.

Wheat posted today the biggest gain in a weeks as the dollar weakened and on the forecast that supply from Europe will decrease. Droughts in spring already reduced expected yield in Europe and now heavy rains can harm quality of the grain. September futures for delivery of wheat gained $0.0725 (1 percent) to $7.0075 per bushel by 10:33 on CBoT.

Copper fell today after the report showed an unexpected decline of existing home sales in the US, the biggest consumer of the metal in the world. US existing home sales decreased from 4.81 million to 4.77 million in June. September futures for delivery of copper slipped $0.032 (0.7 percent) to $4.436 per pound as of 13:22 on COMEX.

Gold jumped to the new record and silver posted the biggest gain in more than two years as the dollar declined and on concerns that the European debt crisis are spreading. The US currency dropped after Federal Reserve Chairman Ben S. Bernanke signaled in his speech that he is ready to add more stimulus for the US economy. Ireland’s credit rating was downgraded to junk, following the credit ratings of Greece and Ireland. August futures for delivery of gold rose $23.20 (1.5 percent) to $1,585.50 on COMEX after touching the new all-time high of $1,588.90. Futures for delivery of silver in September surged as much as $2.517 (7.1 percent) to $38.151 per ounce, posting the biggest jump since March 19, 2009.

Crude oil advanced today after the report showed that US inventories of crude declined more than anticipated. The US Energy Department said that stockpiles dropped by 3.1 million barrels to 355.5 million. The expected drop was 2.3 million. August futures for crude oil delivery gained $0.62 to $98.05 per barrel on NYMEX.

Commodities rallied today on hopes that the Greek lawmakers will accept the austerity measures required to get the bailout and on the outlook for higher demand. Crude oil, copper and gold were among gainers. The weakness of the dollar also helped commodities.

Total amount of oil-related products supplied to the US, which indicates demand for fuel, increased 1.2 percent to 19 million barrels per day in the week ended June 17, according to the report of the Energy Department last week. The US crude oil inventories fell by 1.5 million barrels in the previous week, according to analysts’ estimates before the government report tomorrow.

August contract for crude oil delivery rose $2.28 to $92.89 per barrel on NYMEX. August futures for gold went up $3.80 (0.3 percent) to $1,500.20 per ounce as of 13:38 on COMEX. Contract for delivery of copper in three months climbed 0.6 percent to $9,020 before trading at $9,019 on LME.

Gold fell, posting the biggest two-day decline in seven weeks, and other precious metal dropped as the European Union pledged to safe Greece from the default if the nation’s government will proceed with the austerity measures. The stronger dollar reduced demand for precious metals as an alternative investment. At the same time, yesterday’s drop of fuel prices diminished appeal of gold and silver as a hedge against inflation.

Adam Klopfenstein, the senior strategist at the broker Lind-Waldock, commented:

Gold is losing the flight-to-quality bid in the near term as the leaders are working toward overcoming the Greek hurdle.

Futures for delivery of gold in August dropped as much as $19.60 (1.3 percent) to $1,500.90 per ounce by 13:45 on COMEX, the lowest price since May 19. The metal tumbled 3.4 percent in the past two days, the biggest drop since May 5. September futures for silver fell $0.366 (1 percent) to $34.65 per ounce. Futures for delivery of platinum in October slipped $17 (1 percent) to $1,680.50 per ounce on NYMEX. September contract for palladium delivery dropped $11.85 (1.6 percent) to $731.50 an ounce.

Copper gained on the speculation that supply will decline and as weaker dollar boosted prices of commodities. Contract for delivery of copper in three months went up 0.2 percent to $9,157.50 on LME

Gold metals fell as the euro gained, reducing demand for safer assets, after the European Central Bank supported plan for rollover of the Greek bonds. August futures for delivery of gold slipped $3.20 (0.2 percent) to $1,544 on COMEX. July silver futures advanced $0.264 (0.7 percent) to $37.046 per ounce.

Oil jumped on the speculation that increasing production quotas in the Organization of Petroleum Exporting Countries will reduce spare capacity. The US Energy Department revised its forecast for the global usage of oil this year to 88.43 million barrels per day from 88.08 million in May. July delivery for crude oil traded at $99.09 per barrel on NYMEX. July futures for Brent crude delivery rose $2.30 (2 percent) to $116.78 per barrel on ICE.

Sugar gained today for the fourth consecutive session on the speculation that production will fall, while demand continues to grow. According to Unica, the Brazilian Sugarcane Industry Association, the total amount of cane processed since the beginning of this year’s harvest in Brazil was 56.66 million tons as of May 15, 39.51 percent below 93.67 million tons for the same period in the previous year. The European Union and Mexico raised their import allowances this week. July delivery for raw sugar gained $0.0018 (0.8 percent) to $0.2287 per pound as of 9:52 on ICE.

Gold and silver advanced today as the dollar fell, increasing demand for commodities as alternative assets. The greenback slid 0.8 percent against the basket of six major currencies. The Thomson Reuters/Jefferies CRB Index of 19 raw materials headed for the third consecutive weekly gain. August contract for delivery of gold went up $9.70 (0.6 percent) to $1,533.50 by 10:41 on COMEX. July delivery for silver added $0.565 (1.5 percent) to $37.895 per ounce.

Natural gas advanced on the speculation that rising temperatures in the US will increase demand for the power plant fuel to support air conditioners. June futures for natural gas delivery added $0.116 to $4.346 per million British thermal units on NYMEX. Analysts predict that in the near term the prices will move between $4 and $4.50.

Oil rose as the dollar declined 0.4 percent against the euro. Crude also gained as Goldman Sachs Group Inc. and Morgan Stanley predicted that the prices will rise. Futures for delivery of crude oil in July gained $1.89 to $99.59 per barrel on NYMEX.

Gold advanced on the speculation that the debt crisis in Europe will worsen. Greece accelerated its asset sales and budget cuts to receive new bailout. June futures for delivery of gold rose $7.90 (0.5 percent) to $1,523.30 per ounce as of 13:41 on COMEX.

Commodities rallied today as falling dollar increased demand for alternative assets. The US currency fell 0.4 percent versus the basket of six major currencies. Gains of stocks also made traders look more favorable on commodity market.

The S&P 500 Index rose 0.5 percent to 1,348.08 by 13:20, following the drop by 0.8 percent. The Dow Jones Industrial Average advanced 0.5 percent to 12,695.12 after it dropped 0.7 percent earlier today. The Thomson Reuters/Jefferies CRB Index of 19 raw materials also gained, while the MSCI World Index of equities.

June contract for crude oil delivery rose $0.76 to $98.97 per barrel on NYMEX. Futures for delivery of corn in July advanced $0.0325 (0.5 percent) to $6.805 per bushel by 13:15 on CBoT. Contract for soybean delivery in July climbed $0.11 (0.8 percent) to $13.4275 per bushel. June futures for delivery of gold gained $5.40 (0.4 percent) to $1,506.80 as of 13:41 on COMEX. July futures for silver delivery dropped $0.718 (2 percent) to $34.797 per ounce.