COM: Gold in positive territory, copper, crude oil recover
Spot Gold prices traded in the positive territory in today’s trading session as the dollar weakened marginally, reflecting signs of some recovery in the markets. The dollar index rally came to a halt after climbing to its highest level in seven months.
Gold prices had slipped drastically towards the end of last week due to unfavorable economic data in US and the concerns of crisis in the Eurozone which in turn made the dollar more attractive. The European Finance ministers meeting over the weekend to help Greece tackle their fiscal deficit has evolved some positive sentiments among the investor class.
Copper prices opened in the green today after suffering badly in the previous week. Inventories of copper on the LME decreased marginally by 50 tonnes to touch 541100 tonnes today. Commodity prices had suffered earlier owing to weak economic conditions coupled with rising concerns of economic recovery and weak demand from China, which is the largest consumer of metals.
Copper rebounded as a decline in the U.S. unemployment rate last week and G-7 vows to keep economic stimulus measures improved investor confidence about the global economic recovery. However, prices could trade sideways as Chinese celebrate their New Year towards the end of this week. The demand for commodities usually weakens during this time. Copper prices would further take cues from 1) movement in the dollar and 2) Strength of the global economic recovery.
Crude Oil prices gained marginally today after falling in the previous week amidst the strengthening dollar. The Nigerians rebels attack on the Royal Dutch Shell Plc. Pipeline provided some upside movement in prices of crude. However concerns over the Eurozone crisis may derail the recovery in prices of crude oil. Lower demand is expected from China which is the second largest consumer of energy in the coming week as they celebrate their New Year. Crude oil prices will take cues from movement in dollar, demand and economic announcements.
Outlook
There is no economic data to be released from the US today. Prices would trade sideways owing to concerns of global recovery and less demand. Prices could also feel pressure if dollar starts strengthening. News from the Eurozone and US would be influential in providing further direction to prices.
