Commodity markets rebounded in the past week on hopes that the US economy will haul itself out of recession and spur demand for raw materials.
Upbeat US company results and rising home sales fueled optimism that the world’s biggest energy consuming nation may soon emerge from the downturn.
“Commodity index returns have continued their upward march over the past week,” Deutsche Bank research analyst Michael Lewis said.
“We believe these higher returns are benefiting from recent strength in the US equity market and the increasing likelihood that the United States will move out of recession by the end of the current quarter,” he added.
Voracious Chinese demand also boosted prices, particularly for agricultural commodities and industrial metals.
OIL: Prices rose on Friday, powered higher by growing optimism that the recession-stricken US economy is on the mend after a series of positive corporate earnings reports.
New York’s main futures contract, light sweet crude for September, climbed US$0.89 to close at US$68.05 a barrel.
In London, Brent North Sea crude for September delivery increased US$1.07 to settle at US$70.32 a barrel.
The rise in prices “was sharply buoyed by positive economic sentiment,” and the upward trend is expected to persist, Amrita Sen of Barclays Capital said.
Even though the euphoria was tempered somewhat, oil prices advanced.
“Higher stock prices suggest higher aggregate output which spells increasing energy demand,” Mike Fitzpatrick of MF Global said.
“Short-term upward momentum though still appears quite strong, but unless strong signs of sustainable growth appear soon, that momentum could dissipate rather quickly,” he added.
PRECIOUS METALS: Prices rose across the board this week, with gold winning support from the weakening US currency.
A weaker dollar can make commodities prices in the US unit cheaper for buyers holding rival currencies, pushing up demand in the short term.
By late Friday on the London Bullion Market, gold rose to US$951.50 an ounce from US$937.50 a week earlier. Silver climbed to US$13.78 an ounce from US$13.16.
On the London Platinum and Palladium Market, platinum grew to US$1,186 an ounce at the late fixing on Friday from US$1,165.
Palladium increased to US$258 an ounce from US$245.
BASE METALS: Base metals prices soared, with aluminum and copper striking nine-month peaks on solid Chinese demand.
“Sentiment continues to improve as economic data show that not only is the worst behind us, but that growth in key metals-consuming countries, such as China, is speeding up,” Barclays Capital analysts said.
Copper raced as high as US$5,575 per tonne, while aluminum touched US$1,808 per tonne.
SECURITY: As China is ‘reshaping’ Hong Kong’s population, Taiwan must raise the eligibility threshold for applications from Hong Kongers, Chiu Chui-cheng said When Hong Kong and Macau citizens apply for residency in Taiwan, it would be under a new category that includes a “national security observation period,” Mainland Affairs Council (MAC) Minister Chiu Chui-cheng (邱垂正) said yesterday. President William Lai (賴清德) on March 13 announced 17 strategies to counter China’s aggression toward Taiwan, including incorporating national security considerations into the review process for residency applications from Hong Kong and Macau citizens. The situation in Hong Kong is constantly changing, Chiu said to media yesterday on the sidelines of the Taipei Technology Run hosted by the Taipei Neihu Technology Park Development Association. With
CARROT AND STICK: While unrelenting in its military threats, China attracted nearly 40,000 Taiwanese to over 400 business events last year Nearly 40,000 Taiwanese last year joined industry events in China, such as conferences and trade fairs, supported by the Chinese government, a study showed yesterday, as Beijing ramps up a charm offensive toward Taipei alongside military pressure. China has long taken a carrot-and-stick approach to Taiwan, threatening it with the prospect of military action while reaching out to those it believes are amenable to Beijing’s point of view. Taiwanese security officials are wary of what they see as Beijing’s influence campaigns to sway public opinion after Taipei and Beijing gradually resumed travel links halted by the COVID-19 pandemic, but the scale of
A US Marine Corps regiment equipped with Naval Strike Missiles (NSM) is set to participate in the upcoming Balikatan 25 exercise in the Luzon Strait, marking the system’s first-ever deployment in the Philippines. US and Philippine officials have separately confirmed that the Navy Marine Expeditionary Ship Interdiction System (NMESIS) — the mobile launch platform for the Naval Strike Missile — would take part in the joint exercise. The missiles are being deployed to “a strategic first island chain chokepoint” in the waters between Taiwan proper and the Philippines, US-based Naval News reported. “The Luzon Strait and Bashi Channel represent a critical access
Pope Francis is be laid to rest on Saturday after lying in state for three days in St Peter’s Basilica, where the faithful are expected to flock to pay their respects to history’s first Latin American pontiff. The cardinals met yesterday in the Vatican’s synod hall to chart the next steps before a conclave begins to choose Francis’ successor, as condolences poured in from around the world. According to current norms, the conclave must begin between May 5 and 10. The cardinals set the funeral for Saturday at 10am in St Peter’s Square, to be celebrated by the dean of the College