Energy and Metal Review

Jun 1 • Market Commentaries • 1303 Views • Comments Off on Energy and Metal Review

Gold traded little changed after bouncing from a key support level at $1,530 announce in the previous session, as investors remained focused on Spain’s struggle with its finances and frail banking sector. Spot gold lost more than 6 percent on the month. Spot Gold is currently trading at $1561.60. Comex Silver is currently trading at $27.90.

The SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, is holding 1,270.26 tonnes as per latest available data on their website.

After slumping more than any other industrial metal, analysts and traders say the worst may be over for nickel as restrictions on shipments from Indonesia, the biggest producer, diminish a worldwide glut. Indonesia banned some ore exports from May 6 and imposed a 20 percent tax on the remainder to spur the development of its refining industry. The nation’s output will drop for the first time in four years in 2013, slashing global supply growth to 0.2 percent, from 4.9 percent in 2012, Morgan Stanley estimates. Prices will average $20,000 a metric ton in the fourth quarter, an increase of 23 percent.

The euro fell to the lowest level in almost two years against the dollar as Spain struggled to rescue its troubled banks, adding to signs the European debt crisis is spreading to the region’s larger economies. The euro slid versus the yen, the longest losing streak in four months, after Italy sold less than its maximum target at a debt auction. The yen and dollar strengthened as investors sought safer assets after a European report showed economic confidence dropped more than economists estimated in May.


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Oil entered a bear market in New York as it headed for the biggest monthly drop in more than three years on speculation Europe’s worsening debt crisis and a slowing U.S. economy will reduce fuel demand. Oil for July delivery traded at $87.70 a barrel, down 12 cents. WTI Crude Oil is currently trading at $87.51 per barrel.  The EIA delays its weekly crude oil inventory due to the US holiday. The inventory is expected to be released later today. Markets expect to see a slight rise in inventory, but the report should be market neutral.

Also the ADP payroll report is due in the US today, a leading indicator of what to expect in tomorrow’s Non Farms payroll report.

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