Spot Gold Performance Chart (25/02/10 11:00)
| Daily % Chg |
-0.49% |
|
3 months
|
-7.24% |
| 1 week |
-1.47% |
|
6 months |
15.21% |
| 1 month |
-0.47% |
|
1 year |
13.48% |
Details
| Prev close |
1097.75 |
|
52 week high |
1226.56 |
| Last trade |
1092.40 |
|
52 week low |
864.97 |
| High |
1101.30 |
|
Low |
1088.50 |
Bloomberg Median Forecasts
| Q1 2010 |
1100.00 |
|
Q3 2010 |
1160.50 |
| Q2 2010 |
1124.00. |
|
Q4 2010 |
1195.00 |
|
|
|
Commentary
Gold fell to a two-week low on Thursday
morning, as fears of a Greek debt-rating downgrade left EUR/USD
vulnerable to selling pressures. The ‘lower gold price is dictated by
the weakness in the euro,’ said Bayram Dincer of LGT Capital Management.
‘Short term, higher risk aversion will not benefit gold, as this risk
premium is already incorporated in the gold price,’ he explained. [2] A
Greek debt-rating downgrade would increase the country’s bond yields
further, making it more expensive to replenish the health of the Greek
economy. Tetsuya Yoshii, the vice president for derivative products with
Mizuho Corporate Bank believes that gold may continue to drop on the
back of additional dollar strength. ‘Investor money looking for safe
assets should be the factor’ driving gold lower, said Mr Yoshii. Bullion
‘might have a $20 to $40 correction on the downside,’ he suggested. [3]
Anthony Grech, London
Forward Month Nymex Performance Chart (25/02/10 11:00)
| Daily % Chg |
-0.49% |
|
3 months |
3.77% |
| 1 week |
0.70% |
|
6 months |
9.93% |
| 1 month |
5.78% |
|
1 year |
112.01% |
Details
| Prev close |
80.00 |
|
52 week high |
83.95 |
| Last trade |
79.61 |
|
52 week low |
33.55 |
| High |
80.32 |
|
Low |
79.42 |
Bloomberg Median Forecasts
| Q1 2010 |
74.90 |
|
Q3 2010 |
80.00 |
| Q2 2010 |
77.00 |
|
Q4 2010 |
84.00 |
|
|
|
|
|
Commentary
Crude fell marginally on Thursday morning after hitting $80 a barrel
on Wednesday evening, when the Federal Reserve Chairman Ben Bernanke
described the US economy as being in ‘nascent’ recovery and said that
interest rates need to remain low for an extended period. This
development helped revive risk appetite, fuelling gains across equities
and exerting pressure on the US dollar, which in turn increased the
appeal of crude oil. ‘The equities correlation is starting to pick up
again,’ said Carl Larry, president of Oil Outlooks & Opinions LLC.
‘As the Dow goes up, the oil goes up, and as the Dow goes down, the oil
goes down.’ [1] In the meantime, an important inventory report from the
US Energy Department revealed that crude oil inventories climbed 3.03
million barrels last week to 337.5 million barrels, the highest level
since November. This was substantially higher than expectations for a
1.9 million barrel increase and suggests that demand for the crude oil
was substantially weaker than feared. This also contrasts sharply with
the report from the American Petroleum Institute, which showed crude oil
inventories falling by 3.14 million barrels last week. The government
report showed an unexpected drawdown in gasoline inventories, however.
Gasoline supplies fell by 900,000 barrels over the period, confounding
analysts who were anticipating a 500,000 barrel build up. News
indicating further arctic weather conditions may also have boded well
for crude oil on Wednesday, but fears over a Greek debt-rating downgrade
on Thursday sparked a run back to the safety of the dollar, trimming
the commodity’s progress. Anthony Grech, London
March Copper (COMEX) Performance Chart (25/02/10 11:00)
| Daily % Chg |
-0.68% |
|
3 months |
2.55% |
| 1 week |
-2.18% |
|
6 months |
16.15% |
| 1 month |
-5.28% |
|
1 year |
97.85% |
Details
| Prev close |
323.60 |
|
52 week high |
354.40 |
| Last trade |
321.40 |
|
52 week low |
147.00 |
| High |
326.90 |
|
Low |
319.95 |
Bloomberg Median Forecasts
| Q4 2009 |
322.00 |
|
Q2 2010 |
295.00 |
| Q1 2010 |
300.00 |
|
Q3 2010 |
300.00 |
|
|
|
|
|
Commentary
Copper, an industrial metal used in the construction industry,
declined nearly 2.2% over the week following bleak housing data. A
report released by the Commerce Department on Wednesday indicated that
sales of newly built single-family homes unexpectedly fell to a record
low in January, tumbling 11.2% to an annual rate of 309,000. This was
the lowest reading since records started in January 1963. With the Fed’s
incentive programme nearing an end it seems as if there’s more pain to
come for the beleaguered US housing market. Chinese policy-tightening
concerns have also weighed on the metal. China, the largest user of the
metal, has raised the bank reserve ratio for a second time in February,
with the higher rate taking effect today. Anthony Grech, London
Notes: Source: [1] Bloomberg News (24 February 2010)
[2][3] Bloomberg News (25 February 2010). Chart data sourced from
Bloomberg. Bloomberg Median Forecasts are produced by Bloomberg by
taking the median level from rates forecast by a number of contributors.
These contributors consist of leading banks and security firms.
Disclaimer: IG Index provides an execution-only
service. The material above does not contain (and should not be
construed as containing) investment advice or an investment
recommendation, or a record of our trading prices, or an offer of, or
solicitation for, a transaction in any financial instrument. IG Index
accepts no responsibility for any use that may be made of these comments
and for any consequences that result. This communication must not be
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