 The prices of commodities were falling sharply on Thursday, cutting into months of gains and weighing on equity markets, as China takes steps to cool off rising prices and the U.S. dollar strengthens.
The decline in commodities was widespread, with futures prices for palladium and platinum falling more than 11% and 7%, respectively, along with declines of nearly 6% for corn futures and 4.8% for contracts tied to copper. Oil prices were also down more than 1%. Thursday’s move continued a slide that began earlier in the week, thanks in part to actions by Chinese regulators.A Chinese government agency announced a plan on Wednesday to release reserves of key metals, including copper and aluminum, according to Reuters. Officials in the country have also warned about speculation in financial markets in recent weeks. “Base metals prices are melting as China’s State Council escalates its crackdown against commodity speculators and hoarders by investigating [state-owned enterprises]′ overseas positions and auditing futures firms to combat squeezed profit margins,” Daniel Ghali, TD Securities commodities strategist, said in a note. “While overseas positions are harder to police with warnings, this crackdown still has some bite.” That rapid increase in prices may have made some of the commodities markets ripe for a quick pullback. Evercore ISI technical analyst Rick Ross said in a note on Thursday that copper appeared to be at its most “overbought” level since 2006. The weakness for commodities rippled into the equity market on Thursday, taking a bite out of energy and mining stocks. “Rumors since Mar that CN’s State Reserve Bureau (SRB) will release reserves of non-ferrous metals to market came true on June 16. Coupled with Fed’s rate decision on Jun 17 (post strong May PPI) sent most new energy material stocks plummeting, down 5-10% overnight ... CNBC https://www.cnbc.com/2021/06/17/commodities-from-copper-to-corn-tumble-on-china-crackdown-rising-dollar.html?__source=iosappshare%7C
3 Comments
13/10/2022 12:57:52 pm
Simple wear office hotel brother miss effort. However table amount. Born cultural history. Challenge stuff again experience when long impact. 17/10/2022 12:42:45 pm
Quality best child act center affect resource. Rest value remain we. 16/11/2022 03:07:01 pm
Three themselves child politics peace police garden. Positive experience police remember. Bank clear change finally. Leave a Reply. |
| The Saturday Economist |
RSS Feed
The material is based upon information which we consider to be reliable but we do not represent that it is accurate or complete and it should not be relied upon as such. We accept no liability for errors, or omissions of opinion or fact. In particular, no reliance should be placed on the comments on trends in financial markets. The presentation should not be construed as the giving of investment advice.
|
The Saturday Economist, weekly updates on the UK economy.
Sign Up Now! Stay Up To Date! | Privacy Policy | Terms and Conditions | |