PSLV - Commodity Roundup: Metals tick lower as traders pare aggressive rate cut bets; oil up

2023-12-05 05:51:33 ET

Precious metal prices inched lower on Tuesday, with spot gold ( XAUUSD:CUR ) down -0.23% to $2,025.10 an ounce by 6 am ET, as traders pause on Federal Reserve rate cut bets, which dimmed the appeal of non-yielding bullion to some extent.

Last week’s optimism over the Fed moving close to cutting rates petered out as the market reflected on the tough road ahead in bring inflation down. This saw losses across the board in commodity markets, ANZ Research said.

Investors rushed back into the popular SPDR Gold Shares ETF ( GLD ) with net inflows of more than $1B in November, as gold prices rallied to record highs on expectations that the Federal Reserve could start cutting interest rates as early as March. Markets have however pared aggressive bets. The fund ended November with a 2.5% gain but fell 2.1% on Monday.

ANZ further added that , copper led the base metals sector lower as the market judged the optimism over rate cuts that helped spur a strong rally last week was overdone. The change in tone was triggered after the market reflected on comments from Fed Chair Jerome Powell that they will raise interest rates again if required.

The dollar index ( DXY ) in the meantime regained some ground and hovered near a one-week high against major peers, in part due to a reversal of its heavy selloff in recent weeks.

In the energy market, oil and natural gas prices were trading higher , with crude prices getting a lift from uncertainty over voluntary output cuts by the OPEC+ group of producers, tensions in the Middle East and some encouraging economic signals in Europe. Comments by Saudi Arabia's energy minister that OPEC+ production cuts could continue past the first quarter of 2024 lent some price support, OANDA analyst Kelvin Wong told Reuters.

U.S. natural gas futures fell to their lowest settlement in more than two months on Monday on milder than normal start to December.

Meanwhile in the agriculture market, soybean and wheat prices gained, while cocoa fell. Statistics Canada increased its wheat production estimates to 32mt (still down 7% YoY) for the 2023/24 season compared to previous estimates of 29.8mt, ING reported. Soybean production estimates also increased from 6.7mt to 7mt (up 7% YoY) for the above-mentioned period. The rise in estimates was largely driven by an increase in harvest area by 6.8% to 5.6m acres.

Recent Commodity Price Movements

• Energy

  • WTI Crude Oil ( CL1:COM ) +0.60% to $73.48.

  • Natural Gas ( NG1:COM ) +0.35% to $2.70.

  Metals

  • Palladium ( XPDUSD:CUR ) -0.84% to $968.14.

  • Silver ( XAGUSD:CUR ) -0.69% to $24.32.
  • Copper ( HG1:COM ) -1.13% to $3.78.

  Agriculture

  • Corn ( C_1:COM ) +0.77% to $463.77.
  • Wheat ( W_1:COM ) +2.54% to $597.84.
  • Soybeans ( S_1:COM ) +0.31% to $1,310.25.

  Commodity ETFs

  Gold ETFs:

  • SPDR Gold Shares ETF ( GLD )
  • VanEck Gold Miners ETF ( GDX )
  • VanEck Junior Gold Miners ETF ( GDXJ )
  • iShares Gold Trust ETF ( IAU )
  • Direxion Daily Gold Miners Index Bull 2X Shares ETF ( NUGT )
  • Sprott Physical Gold Trust ( PHYS )

  Other Metal ETFs:

  • iShares Silver Trust ETF ( SLV )
  • Sprott Physical Silver Trust ( PSLV )
  • Global X Silver Miners ETF ( SIL )
  • U.S. Copper Index Fund, LP ETF ( CPER )
  • abrdn Physical Palladium Shares ETF ( PALL )

  Oil ETFs:

  • U.S. Oil Fund, LP ETF ( USO )
  • Invesco DB Oil Fund ETF ( DBO )
  • U.S. 12 Month Oil Fund, LP ETF ( USL )
  • U.S. Brent Oil Fund, LP ETF ( BNO )
  • U.S. Natural Gas Fund, LP ETF ( UNG )
  • U.S. Gasoline Fund, LP ETF ( UGA )

  Agriculture ETFs:

  • Invesco DB Agriculture Fund ETF ( DBA )
  • Teucrium Soybean ETF ( SOYB )
  • Teucrium Wheat ETF ( WEAT )
  • Teucrium Corn Fund ETF ( CORN )

For further details see: