Crude oil rallied to a 2-week high at 77.41 after the US reported strong rise in pending home sales. The front-month contract ended the day at 77.23, up +3.8%. Heating oil and gasoline also rose but the latter's rally was more prominent, by +4.4%, as MasterCard Inc reported an increase of +0.5% (weekly basis) in gasoline demand in the week ended January 29. Today in Asian session, energy prices pull back on profit-taking. Moreover, API's report showing higher-than-expected stock-builds damped sentiment. Pending home sales surged +1% mom in January, following a -16.4% fall a month ago. Although the market felt excited by the report, the sales index stays low and suggests existing home sales has not recovered much in January. MasterCard Advisors estimated gasoline demand averaged +9.419M bpd in the week ended January 29, up from 9.372M bpd in the prior week. Motor fuel consumption surged +3.5% on annual basis. After market close, the industry-sponsored API reported crude oil inventory rose +4.7 mmb in the week ended January 29 after dropping -1.8 mmb in the previous week. Gasoline and distillate stockpiles drew as refiners reduced production. The US energy Department will probably report +0.4 mmb increase in crude oil inventory and +1.4 mmb rise in gasoline inventory. For distillate, stockpile is expected to have dipped -1.15 mmb. Gold also soared Tuesday, in tandem with other commodities and as USD's rally halted. The benchmark contract gained +1.2% to 1118, following a +2% rise Monday. PGMs continued to outperform with platinum and palladium surging +2.5% and +3.8% respectively. Anglo American, the world's largest producer of platinum, said that South African miners need to face a +35% annual increase in power price over the next 3 years. This once again unveiled the power constraint issue the mining companies are facing. We believe power outage as well as recovery in global demand will tighten PGM markets and hence push prices higher.

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