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Sun, Jul 19, 2009 - Page 10 News List

Commodities recover on good news from US, China

AFP , LONDON AND NEW YORK

Prices of raw materials, including oil and gold, rebounded this week on growing signs of economic recovery in the US and China, traders said.

Positive US bank earnings and strong growth data from China led investors to believe that the world economy was on course to drag itself free of the worst downturn in decades.

“The US reporting season for 2009 corporate earnings had a good start and recent macro-economic data was by and large better than expected,” analysts at Dresdner Kleinwort said in note to clients. “This alongside a high level of liquidity or large cash holdings at investment funds boosted both equity and commodities markets.”

OIL: Prices advanced for a third straight day on Friday, buoyed by positive US housing construction data that could provide a lift for the recession-mired economy.

New York’s main futures contract, light sweet crude for delivery in August, gained US$1.52 to close at US$63.56 a barrel from US$59.16 one week earlier.

In London, Brent North Sea crude for September delivery advanced US$1.63 to settle at US$65.38 a barrel, from US$59.80 a week earlier. The August contract expired on Thursday at US$62.75.

The New York futures contract, which showed little direction at the market opening, shot up more than 3 percent after the US Commerce Department reported construction starts on privately owned homes rose 3.6 percent last month to a seasonally adjusted rate of 582,000, the fastest pace since November.

PRECIOUS METALS: Precious metals advanced across the board.

“Precious metals remain very much at the mercy of the dollar and equity markets, with few independent drivers of their own,” said UBS analyst John Reade.

By late Friday on the London Bullion Market, gold rose to US$937.50 an ounce from US$913 a week earlier.

Silver climbed to US$13.16 an ounce from US$12.63.

On the London Platinum and Palladium Market, platinum grew to US$1,165 an ounce at the late fixing on Friday, from US$1,095.

Palladium increased to US$245 an ounce from US$234.

BASE METALS: Base metals prices rallied. By Friday on the London Metal Exchange, copper for delivery in three months jumped to US$5,325 a tonne from US$4,890 a week earlier.

Three-month aluminum climbed to US$1,725 a tonne from US$1,574.

Three-month lead rose to US$1,675 a tonne from US$1,625.

GRAINS AND SOYA: Maize and soya prices fell as weather conditions in the US Midwest favored production. By Friday on the Chicago Board of Trade, maize for delivery in December dropped to US$3.26 a bushel from US$3.38 a week earlier.

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