Market Commentary
Crude Fluctuates as U.S. Economy Grows Less Than Expected.
West Texas Intermediate fluctuated as the U.S. economy grew less than economists forecast in the fourth quarter and jobless claims fell last week. Prices were poised for the first monthly drop since October as gross domestic product grew at a 0.1 percent annual rate, revised figures from the Commerce Department showed. The median forecast called for a 0.5 percent gain in a Bloomberg survey. Jobless claims decreased 22,000 from a week ago, the Labor Department reported. “The GDP number is adding some negative sentiment to the market but the jobless claims number is lending some support,” said Gene McGillian, an analyst and broker at Tradition Energy in Stamford, Connecticut. “The market is trying to stabilize.” WTI for April delivery fell 7 cents to $92.69 a barrel on the New York Mercantile Exchange. Prices are down 4.9 percent this month. The volume of all futures traded was 16 percent below the 100-day average for the time of day. Brent for April settlement gained 30 cents, or 0.3 percent, to $112.17 a barrel on the London-based ICE Futures Europe exchange. Volume was 37 percent above the 100-day average. The European benchmark crude’s premium over WTI widened for the first time in three days to as much as $19.72.
Gold Demand in India Seen Rebounding After Import Tax Maintained.
Gold demand in India, the world’s biggest user, is poised to climb after the government unexpectedly refrained from raising import taxes and as prices headed for a fifth monthly decline. Finance Minister Palaniappan Chidambaram refrained from boosting the tax from 6 percent after it was tripled in the past year to curb demand. All India Gems & Jewellery Trade Federation, a grouping of retailers, traders and exporters, had predicted the duty to climb to 8 percent. The “status quo” on taxes is a good sign for the industry and will attract people to gold, said Bachhraj Bamalwa, chairman of the federation. India has boosted taxes from as low as 2 percent in January last year after the current-account shortfall, the broadest measure of trade, widened to an all-time high and the rupee slumped to a record. Overseas purchases dropped 11 percent last year from a record in 2011, the World Gold Council estimates. Imports probably slumped as much as 50 percent to 40 tons this month from January, Bamalwa said yesterday.
Copper Swings Between Gains and Declines Amid Lack of Demand.
Copper swung between gains and drops in London, set for a second monthly slide in three, as investors weighed better-than-expected U.S. economic figures against a lack of physical demand. Aluminium fell for a ninth session. U.S. orders for durable goods rose the most in a year in January excluding transportation and pending home sales climbed more than forecast, reports showed yesterday. Global copper usage expanded 1 percent last year, below the 10-year average of 3 percent, according to Macquarie Group Ltd. Copper stockpiles tracked by the London Metal Exchange swelled for a fifth month. “The U.S. is not a big swing factor in base-metals demand,” said Guy Wolf, a macro strategist at Marex Spectron Group in London. “It’s much more about China. In base metals, there’s been limited physical demand all year.” Copper for delivery in three months slipped 0.1 percent to $7,862 a metric ton by 10:58 a.m. on the LME after climbing as much as 0.8 percent. Prices are down 3.7 percent this month. Copper for May delivery rose 0.1 percent to $3.572 a pound on the Comex in New York.
