Commodities across the board hit multi-week and multiyear highs, spurred by reports of positive manufacturing data from across China, the US and Europe and on hopes of an increase in demand as economic recovery gains traction. The Thomson Reuters/Jefferies CRB Index of 19 commodities advanced 1.3 percent to 316.16, the strongest level since Nov. 10. Fifteen of the commodities increased.
Major Headlines
-India s higher economic growth has raised inflation fears according to IMF Chief.
-India s leading commodity exchanges, NCDEX and MCX clocks a record combined average daily turnover of Rs 40, 414 cr in Nov, just 14% short of it counterpart in equities.
-FII inflows touch record $39bn in 2010 in India thereby showing faith in prospects of Indian economy.
-Vietnamese coffee prices have eased nearly 2 percent in the past week as harvesting in the Central Highlands coffee belt gathered pace,
-The FMCG majors dealing in coconut oil are bracing themselves for another round of price hike fuelled by an acute shortage of copra and high demand, particularly in South India.
-India s food inflation fell to single digit for the first time since May 2009, but there was little respite for consumers as the prices of several essential items continued to rise.
-The Reserve Bank of India (RBI) on Friday urged banks to reduce intermediation costs to increase efficiency, helping them cut lending rates, pay more on deposits and foster inclusive and higher economic growth.
-The natural gas market in New York is contracting as prices head for the first three-year drop on record, helping to expand trading in heating oil. Open interest in gas futures and options has fallen to the lowest level in more than five years, while heating oil contracts have jumped to the most in at least 15 years, according to data from the Commodity Futures Trading Commission.
Precious Metals
Precious metals complex was bullish as weakness in US dollar boosted the appeal of precious metals as alternative investments. US Gold futures prices still fell short of the all-time high of $1424.30 posted on November 9, 2010. US Dollar suffered the biggest drop in six weeks after a US government report showed employers added few jobs than forecast in November and the unemployment rate rose to 9.8% suggesting the Federal Reserve will keep pumping money into the financial system to bolster the economy, Bloomberg reported.
In India gold prices soared to an all-time high of Rs 21,000 per 10 gram in New Delhi as marriage season has caused demand to increase from jewellery trade.
Gold futures for February delivery jumped $16.90, or 1.2 percent, to close at $1,406.20 at 2:15 p.m. on the Comex in New York on Friday. For the week, the yellow metal gained up 3.1 percent, the most since late May.
Silver prices soared higher in Delhi to record high level of Rs 43,950 a kg, as demand from industrial units and coin makers went up. Palladium had the biggest weekly gain since 2008. US silver futures for March delivery climbed 69.9 cents, or 2.4 percent, to $29.271 an ounce on Friday. Earlier, the metal reached $29.37, the highest since March 1980. This week, the price jumped 9.3 percent, the most since January. Gold also gained on speculation China, the world s second- biggest buyer, will step up purchases, Bloomberg reported. China s imports jumped almost fivefold in the 10 months ended Oct. 31 from a year earlier on inflation concerns, the Shanghai Gold Exchange said.
Gold has gained 28 percent this year, heading for the 10th straight annual gain and the biggest since 2007. Silver has jumped 74 percent in 2010, heading for the biggest annual increase since 1979. This year, palladium has soared 88 percent, and platinum has climbed 18 percent. The metals are used in jewelry and pollution-control devices in cars. MCX Gold February rose from Rs 20507 to Rs 20798 before hitting a high of 20874 while MCX Silver prices soared from Rs 41, 150 levels to Rs 44261 tracking global cues.
Crude Oil
Weakness in dollar enabled crude oil futures to climb to highest level in 25 months as the dollar tumbled, boosting the appeal of commodities as an alternative investment. On Friday, Oil for January delivery rose $1.19 to settle at $89.19 a barrel on the New York Mercantile Exchange, the highest closing price since Oct. 7, 2008. Futures increased 6.5 percent this week and 12 percent this year.
Oil futures for delivery in March 2012 fell as nearer-term contracts rallied, a sign that participants are reducing bets on the steepness of a price increase in the next few years. The long-term contracts moved into a market structure known as backwardation, Bloomberg reported. U.S. fuel consumption decreased 1.8 percent in the week ended Nov. 26 to 18.5 million barrels a day, the lowest level since the seven days ended Oct. 15, an Energy Department report showed this week. It was the third weekly decline. Oil might climb at $90 levels immediately and by end of 2012, it could advance to $120 a barrel according ot JP Morgan Chase & Co with prices likely to average $93 a barrel next year.
The Organization of Petroleum Exporting Countries may not increase production in the first half of next year unless prices surge through $100 a barrel, the analysts said. OPEC oil ministers meet Dec. 11 in Quito, Ecuador. Brent crude for January settlement on the ICE Futures Europe exchange in London gained 73 cents, or 0.8 percent, to $91.42 a barrel on Friday. Earlier, it reached a two-year high of $91.85 a barrel.
At MCX, Crude oil December contract rose from Rs 3866 to Rs 4035 while January contract rose from Rs 3919 to Rs 4080 tracking global trends.
Base Metals
US copper prices witnessed bullish trends after a report showed U.S. service industries expanded at the fastest pace in six months. Copper prices are expected to rise further towards year-end on weakening dollar. Copper futures for March delivery rose 2 cents, or 0.5 percent, to settle at $3.999 a pound at 1:16 p.m. on the Comex in New York on Friday. The most-active contract gained 6.3 percent this week, the most since late July. arlier, the metal fell as much as 0.8 percent as an unexpected increase in U.S. unemployment damped prospects for the economic recovery.
Copper has jumped 39 percent since July 1 as growth in emerging markets bolstered demand and tightened supplies. On Nov. 11, the price reached a 30-month high of $4.0875. The record high was $4.2605 on May 5, 2008. Some analysts are expected the prices to zoom to $5 by middle of next year on increasing economic growth in China, Brazil and India.
On the London Metal Exchange, copper for delivery in three months added $5 to $8,725 a metric ton ($3.96 a pound). At MCX, December Feb copper prices rose from Rs 381.90 to Rs 400.15 levels on global cues.
Major Headlines
-India s higher economic growth has raised inflation fears according to IMF Chief.
-India s leading commodity exchanges, NCDEX and MCX clocks a record combined average daily turnover of Rs 40, 414 cr in Nov, just 14% short of it counterpart in equities.
-FII inflows touch record $39bn in 2010 in India thereby showing faith in prospects of Indian economy.
-Vietnamese coffee prices have eased nearly 2 percent in the past week as harvesting in the Central Highlands coffee belt gathered pace,
-The FMCG majors dealing in coconut oil are bracing themselves for another round of price hike fuelled by an acute shortage of copra and high demand, particularly in South India.
-India s food inflation fell to single digit for the first time since May 2009, but there was little respite for consumers as the prices of several essential items continued to rise.
-The Reserve Bank of India (RBI) on Friday urged banks to reduce intermediation costs to increase efficiency, helping them cut lending rates, pay more on deposits and foster inclusive and higher economic growth.
-The natural gas market in New York is contracting as prices head for the first three-year drop on record, helping to expand trading in heating oil. Open interest in gas futures and options has fallen to the lowest level in more than five years, while heating oil contracts have jumped to the most in at least 15 years, according to data from the Commodity Futures Trading Commission.
Precious Metals
Precious metals complex was bullish as weakness in US dollar boosted the appeal of precious metals as alternative investments. US Gold futures prices still fell short of the all-time high of $1424.30 posted on November 9, 2010. US Dollar suffered the biggest drop in six weeks after a US government report showed employers added few jobs than forecast in November and the unemployment rate rose to 9.8% suggesting the Federal Reserve will keep pumping money into the financial system to bolster the economy, Bloomberg reported.
In India gold prices soared to an all-time high of Rs 21,000 per 10 gram in New Delhi as marriage season has caused demand to increase from jewellery trade.
Gold futures for February delivery jumped $16.90, or 1.2 percent, to close at $1,406.20 at 2:15 p.m. on the Comex in New York on Friday. For the week, the yellow metal gained up 3.1 percent, the most since late May.
Silver prices soared higher in Delhi to record high level of Rs 43,950 a kg, as demand from industrial units and coin makers went up. Palladium had the biggest weekly gain since 2008. US silver futures for March delivery climbed 69.9 cents, or 2.4 percent, to $29.271 an ounce on Friday. Earlier, the metal reached $29.37, the highest since March 1980. This week, the price jumped 9.3 percent, the most since January. Gold also gained on speculation China, the world s second- biggest buyer, will step up purchases, Bloomberg reported. China s imports jumped almost fivefold in the 10 months ended Oct. 31 from a year earlier on inflation concerns, the Shanghai Gold Exchange said.
Gold has gained 28 percent this year, heading for the 10th straight annual gain and the biggest since 2007. Silver has jumped 74 percent in 2010, heading for the biggest annual increase since 1979. This year, palladium has soared 88 percent, and platinum has climbed 18 percent. The metals are used in jewelry and pollution-control devices in cars. MCX Gold February rose from Rs 20507 to Rs 20798 before hitting a high of 20874 while MCX Silver prices soared from Rs 41, 150 levels to Rs 44261 tracking global cues.
Crude Oil
Weakness in dollar enabled crude oil futures to climb to highest level in 25 months as the dollar tumbled, boosting the appeal of commodities as an alternative investment. On Friday, Oil for January delivery rose $1.19 to settle at $89.19 a barrel on the New York Mercantile Exchange, the highest closing price since Oct. 7, 2008. Futures increased 6.5 percent this week and 12 percent this year.
Oil futures for delivery in March 2012 fell as nearer-term contracts rallied, a sign that participants are reducing bets on the steepness of a price increase in the next few years. The long-term contracts moved into a market structure known as backwardation, Bloomberg reported. U.S. fuel consumption decreased 1.8 percent in the week ended Nov. 26 to 18.5 million barrels a day, the lowest level since the seven days ended Oct. 15, an Energy Department report showed this week. It was the third weekly decline. Oil might climb at $90 levels immediately and by end of 2012, it could advance to $120 a barrel according ot JP Morgan Chase & Co with prices likely to average $93 a barrel next year.
The Organization of Petroleum Exporting Countries may not increase production in the first half of next year unless prices surge through $100 a barrel, the analysts said. OPEC oil ministers meet Dec. 11 in Quito, Ecuador. Brent crude for January settlement on the ICE Futures Europe exchange in London gained 73 cents, or 0.8 percent, to $91.42 a barrel on Friday. Earlier, it reached a two-year high of $91.85 a barrel.
At MCX, Crude oil December contract rose from Rs 3866 to Rs 4035 while January contract rose from Rs 3919 to Rs 4080 tracking global trends.
Base Metals
US copper prices witnessed bullish trends after a report showed U.S. service industries expanded at the fastest pace in six months. Copper prices are expected to rise further towards year-end on weakening dollar. Copper futures for March delivery rose 2 cents, or 0.5 percent, to settle at $3.999 a pound at 1:16 p.m. on the Comex in New York on Friday. The most-active contract gained 6.3 percent this week, the most since late July. arlier, the metal fell as much as 0.8 percent as an unexpected increase in U.S. unemployment damped prospects for the economic recovery.
Copper has jumped 39 percent since July 1 as growth in emerging markets bolstered demand and tightened supplies. On Nov. 11, the price reached a 30-month high of $4.0875. The record high was $4.2605 on May 5, 2008. Some analysts are expected the prices to zoom to $5 by middle of next year on increasing economic growth in China, Brazil and India.
On the London Metal Exchange, copper for delivery in three months added $5 to $8,725 a metric ton ($3.96 a pound). At MCX, December Feb copper prices rose from Rs 381.90 to Rs 400.15 levels on global cues.
