Commodities Slide Across the Board

Ivaylo
18 Jul, 2007
New York City

Commodities saw a broad decline on Tuesday with oil futures retreating from gains made earlier. The weakness in the energy market extended into the precious metals market. Gold futures ended down, following first the dollar and then oil prices. Copper prices dipped as tensions arising from strike action seem to fade. Corn and soybeans gave up gains in Chicago.

[R]5:30AM Commodities mostly decline Tuesday with gold dipping on weakness in oil futures.[/R]

Gold settled slightly lower on the Nymex after following initially the U.S. dollar and later from oil prices. In early trading, gold advanced to $668 an ounce as the dollar lost against the euro. August gold lost 40 cents to settle at $665.90 on the Nymex. Silver for September delivery tracked gold lower and fell 4.7 cents to end at $13.018 an ounce.

Copper prices retreated as well as strike action seemed to fade, and the London Metal Exchange reported a second day of inventory inflows. Nymex copper for September delivery lost 9.5 cents to $3.5525 a pound.

Lead surged nearly 4% on the LME to another record high after the second-largest lead refiner in the world, Doe Run Co., posted sharp production reductions at a Missouri refinery that suffered an explosion on Friday.

Crude oil briefly reached an 11-month high on Tuesday per barrel, then lost as some investors took profits and gasoline futures also retreated. Oil prices gained further, hitting $75.35 on speculative buying. Crude reached its highest levels since August 2006.

Crude oil for August delivery closed the session down 13 cents to $74.02 on the New York Mercantile Exchange. Gasoline futures inched down 2.55 cents to settle at $2.1007 a gallon and August heating oil shed 2.24 cents to end at $2.0332 a gallon.

In Chicago, corn and soybeans lost further after futures for both stocks slid on Monday to the daily limit of 20 cents and 50 cents, respectively. Heavy rains in the Midwest were expected to shower the corn crop with the moisture needed during its important pollination period.

December corn lost 11.75 cents to end at $3.3675 a bushel, while November soybeans shed 38.25 cents to $8.605 a bushel.

Wheat prices rose initially, then dipped along with the other agricultural stocks 0.5 cent lower to $6.0125 a bushel.