Action in the Commodities Sector - ANZ

Action in the Commodities Sector - ANZ

21 April 2016, 06:03
Roberto Jacobs

Action in the Commodities Sector - ANZ

Analysts at ANZ noted that the Energy was stronger overnight and rounded up the action across the commodities sector.

Key Quotes:

"Crude oil turned around early losses after data showed US output continued to fall. Kuwait’s oil workers ended their strike, bringing back online over 1mb/d of capacity that had been curtailed since Saturday. However, EIA data showed that US output fell to 8.95mb/d and inventory rose by a less-than-expected 2mb to 538.6mb."

"Precious metals were weaker. The slightly stronger USD saw gold prices tread water. ETF holdings reflect the lack of investor interest, falling nearly 8,500 ounces on Wednesday."

"Bulks were stronger. Stronger Chinese steel prices and further positive supply side news continued to push iron ore prices higher. Following on from Rio’s cut to guidance for iron ore output, BHP announced it produced 229mt in fiscal 2015-16. This is down 8mt from its previous guidance. Japan’s iron ore imports rose strongly in March, climbing 10% m/m to 11.33mt."

"Industrials were stronger. Positive gains on equity markets combined with stronger oil prices provided some support for base metal markets. Data from the World Bureau Metal Statistics showed the copper market was in surplus to the tune of 120mt in January-February 2016. Aluminium was largely balanced while nickel was in deficit."

"Agriculture was stronger. Unfavourable weather in South America and improved demand outlook in the US boosted sentiment in agriculture markets. With concerns over crops in Brazil and Argentina, buyers are turning to the US. This increased demand is being magnified by fears of a drought as the likelihood of a La Nina pattern later this year increases."

(Market News Provided by FXstreet)

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