Commodities mostly fell in volatile trading this week as investors eyed demand fears, the US presidential election and a looming leadership change in China.
Investors’ focus was firmly fixed on US President Barack Obama’s victory over Republican challenger Mitt Romney in the US, which is a major consumer of most raw materials.
Markets were hit as traders fretted over the US’ looming “fiscal cliff” following Obama’s re-election on Tuesday.
Dealers are also awaiting a once-in-a-decade leadership change in commodities-hungry China. Outgoing Chinese President Hu Jintao (胡錦濤) is due to hand over the reins to Chinese Vice President Xi Jinping (習近平).
OIL: World oil prices experienced rollercoaster trade as dealers took their cue from demand concerns and the US election, but finished the week in positive territory.
Sentiment was hammered after the EU lowered its economic forecasts for the eurozone to a contraction of 0.4 percent this year and miniscule 0.1 percent growth next year.
The market was also dented by profit-taking, the recovering US dollar and rising US crude inventories data that signaled weak demand.
By Friday on the New York Mercantile Exchange, West Texas Intermediate, or light sweet crude, for next month stood at US$85.74 a barrel from US$85.32 a week earlier.
On London’s Intercontinental Exchange, Brent North Sea crude for delivery next month rose to US$108.23 a barrel from US$106.49 a week earlier.
PRECIOUS METALS: Gold prices rallied to US$1,739.04 on Friday, hitting the highest point since last month, lifted by hopes that Obama would keep ultra-loose US monetary policy, dealers said.
By late Friday on the London Bullion Market, gold jumped to US$1,738.25 an ounce from US$1,685 a week earlier.
Silver rose to US$32.16 an ounce from US$31.92.
On the London Platinum and Palladium Market, platinum dipped to US$1,559 an ounce from US$1,552.
Palladium nudged higher to US$612 an ounce from US$608.
BASE METALS: Base or industrial metal prices enjoyed mixed fortunes as traders fretted over the US fiscal cliff.
“Obama has less than two months to negotiate a new budgetary agreement with a potentially hostile [US] House of Representatives, or risk incurring automatic tax hikes and spending cuts worth in excess of 4 percent of US GDP next year,” Natixis analyst Nic Brown told reporters.
By late on Friday on the London Metal Exchange, copper for delivery in three months dropped to US$7,534 a tonne from US$7,687.50 a week earlier.
COCOA: Prices hit three-month lows, falling in line with most financial markets.
By Friday on LIFFE, London’s futures exchange, cocoa for delivery in March fell to ￡1,524 a tonne compared with ￡1,573 a week earlier.
On New York’s NYBOT-ICE exchange, cocoa for next month dropped to US$2,340 a tonne from US$2,435 for the contract a week earlier.