Market Commentary
Oil Heads for Longest Run of Weekly Gains Since 2004 on Economy.
Oil headed for the longest run of weekly gains in more than eight years in New York before a report that may show the U.S. added jobs last month, signaling an economic recovery in the world’s biggest crude consumer. West Texas Intermediate futures were little changed, and were poised for an eighth weekly advance, the most since August 2004. U.S. employers probably added 165,000 workers last month after a 155,000 increase in December, according to a Bloomberg News survey before Labor Department data today. Prices slid for the first time in four days yesterday as separate reports showed consumer confidence slipped and jobless claims rose. Crude for March delivery was at $97.61 a barrel, up 12 cents, in electronic trading on the New York Mercantile Exchange. Futures slid 45 cents to $97.49 yesterday. Prices are up 1.8 percent this week. Brent for March settlement climbed 65 cents to $115.55 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark grade closed at a premium of $18.06 to WTI futures.
Gold Falls Most in Four Weeks on Signs of Tame Inflation.
Gold futures posted the biggest drop in almost four weeks as U.S. inflation concerns waned, eroding demand for the metal as a hedge against rising consumer prices. A government report today showed an index of inflation tied to spending patterns was unchanged in December from November. Excluding food and energy costs, prices climbed 1.4 percent in 2012, compared with a 1.9 percent increase in the previous year. Inflation “has been running somewhat below the committee’s longer-run objective, apart from temporary variations that largely reflect fluctuations in energy prices,” the Federal Open Market Committee said yesterday. “Deflation is probably a greater risk now than inflation, and the concern is that the deflationary forces may be more than central banks can handle,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview. “Every time gold rallies, those deflationary forces keep batting it down.” Gold futures for April delivery dropped 1.2 percent to settle at $1,662 an ounce on the Comex in New York, the biggest decline for a most-active contract since Jan. 4. This month, the price dropped 0.8 percent, the fourth straight decline and the longest slump since May.
Copper Falls as Jobless Claims, UPS Earnings Cloud Outlook.
Copper fell for the first time this week as a jump in U.S. jobless claims and a disappointing earnings forecast by United Parcel Service Inc. (UPS) signaled the recovery is making uneven progress. Filings for unemployment benefits rose 38,000 last week, the most since Nov. 10, government data showed today. Atlanta- based UPS, the world’s largest package-delivery company, said earnings this year will be $4.80 to $5.06 a share, below the $5.13 estimate of analysts surveyed by Bloomberg. Copper rose 2.7 percent the previous three days on signs of economic growth in the U.S. and China. Copper futures for delivery in March slipped 0.5 percent to settle at $3.732 a pound on the Comex in New York, paring the monthly gain to 2.2 percent. Investors use UPS as a gauge of the economy because it handles goods as varied as auto parts and pharmaceuticals. Copper also fell as industrial production in Japan, the world’s fourth-biggest consumer, rose less in December than economists forecast. China is the largest buyer of the metal, followed by the U.S. and Germany. On the London Metal Exchange, copper for delivery in three months was 0.7 percent lower at $8,165 a metric ton ($3.70 a pound). Nickel, tin, aluminum, zinc and lead also declined on the LME.
Oil Heads for Longest Run of Weekly Gains Since 2004 on Economy.
Oil headed for the longest run of weekly gains in more than eight years in New York before a report that may show the U.S. added jobs last month, signaling an economic recovery in the world’s biggest crude consumer. West Texas Intermediate futures were little changed, and were poised for an eighth weekly advance, the most since August 2004. U.S. employers probably added 165,000 workers last month after a 155,000 increase in December, according to a Bloomberg News survey before Labor Department data today. Prices slid for the first time in four days yesterday as separate reports showed consumer confidence slipped and jobless claims rose. Crude for March delivery was at $97.61 a barrel, up 12 cents, in electronic trading on the New York Mercantile Exchange. Futures slid 45 cents to $97.49 yesterday. Prices are up 1.8 percent this week. Brent for March settlement climbed 65 cents to $115.55 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark grade closed at a premium of $18.06 to WTI futures.
Gold Falls Most in Four Weeks on Signs of Tame Inflation.
Gold futures posted the biggest drop in almost four weeks as U.S. inflation concerns waned, eroding demand for the metal as a hedge against rising consumer prices. A government report today showed an index of inflation tied to spending patterns was unchanged in December from November. Excluding food and energy costs, prices climbed 1.4 percent in 2012, compared with a 1.9 percent increase in the previous year. Inflation “has been running somewhat below the committee’s longer-run objective, apart from temporary variations that largely reflect fluctuations in energy prices,” the Federal Open Market Committee said yesterday. “Deflation is probably a greater risk now than inflation, and the concern is that the deflationary forces may be more than central banks can handle,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview. “Every time gold rallies, those deflationary forces keep batting it down.” Gold futures for April delivery dropped 1.2 percent to settle at $1,662 an ounce on the Comex in New York, the biggest decline for a most-active contract since Jan. 4. This month, the price dropped 0.8 percent, the fourth straight decline and the longest slump since May.
Copper Falls as Jobless Claims, UPS Earnings Cloud Outlook.
Copper fell for the first time this week as a jump in U.S. jobless claims and a disappointing earnings forecast by United Parcel Service Inc. (UPS) signaled the recovery is making uneven progress. Filings for unemployment benefits rose 38,000 last week, the most since Nov. 10, government data showed today. Atlanta- based UPS, the world’s largest package-delivery company, said earnings this year will be $4.80 to $5.06 a share, below the $5.13 estimate of analysts surveyed by Bloomberg. Copper rose 2.7 percent the previous three days on signs of economic growth in the U.S. and China. Copper futures for delivery in March slipped 0.5 percent to settle at $3.732 a pound on the Comex in New York, paring the monthly gain to 2.2 percent. Investors use UPS as a gauge of the economy because it handles goods as varied as auto parts and pharmaceuticals. Copper also fell as industrial production in Japan, the world’s fourth-biggest consumer, rose less in December than economists forecast. China is the largest buyer of the metal, followed by the U.S. and Germany. On the London Metal Exchange, copper for delivery in three months was 0.7 percent lower at $8,165 a metric ton ($3.70 a pound). Nickel, tin, aluminum, zinc and lead also declined on the LME.
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