IGI Logo

Commodities steady after last week rally

Comex Gold rose to trade over $2,670 per ounce, with traders monitoring tensions in the Middle East after Israel began “ground raids” in southern Lebanon, and the outlook for US monetary policy. Israel expanded its campaign against the Iran-backed group, after the killing of its leader, Hassan Nasrallah, on Friday. If the hostilities drag in Tehran and lead to a wider war in the Middle East, gold stands to benefit from increased haven demand. The precious metal had fallen on Monday after Federal Reserve Chair Jerome Powell said that the central bank would lower rates “over time,” and re-emphasized the economy remains on solid footing. (Bloomberg) WTI Crude oil down by over 1.60% to trade on near $67 per barrel on Tuesday, reflecting a bearish market sentiment that overshadowed geopolitical concerns in the Middle East. Libya is poised to resume oil production after its warring factions agreed on a central bank leader. This development could boost global crude oil supply. However, tensions in the Middle East, such as Israel's ground raids in Lebanon, continue to pose a threat to stability and could disrupt oil production or transportation in the region. LME base metals edged higher driven by optimism surrounding China's economic stimulus measures and expectations of further US rate cuts. The recent announcement of a significant economic rescue package by Chinese authorities has reignited investor confidence. Beijing became the latest major city to ease curbs on home buying, part of the government’s renewed push to try and rejuvenate the slumping property market. LME Copper is up 0.55% at $9,880 per ton while Aluminium and Zinc is up 1% and 1.25% respectively. European natural gas prices edged lower on Tuesday, ending a four-day rally mainly on weak demand as Europe enters its heating season and the region's inventories are almost 95% full and demand remains muted on the back of subdued economic momentum, particularly in Germany. Benchmark futures fell as much as 2.3% after gaining 10% since the middle of last week.

Above views are of the author and not of the website kindly read disclaimer