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AAP

2012-11-16

A summary of trading in key commodities markets overseas:

ENERGY

Oil prices diverged as traders reacted to Middle East supply concerns and digest a batch of US economic data.

Brent North Sea crude for delivery in December jumped $US1.14 to $US110.75 a barrel in late London deals on Thursday.

New York's main contract, light sweet crude for December, fell 43 cents to $US85.89 a barrel.

Seven Palestinians and three Israelis were killed in a wave of unrelenting cross-border fighting on Thursday as Israel pressed a vast air offensive on Gaza.

Operation Pillar of Defence, Israel's biggest military campaign against Gaza in nearly four years, began on Wednesday with the targeted killing of top Hamas commander Ahmed Jaabari.

PRECIOUS METALS

Gold prices dropped 0.9 per cent on signs that demand for the precious metal is sagging.

Global gold demand fell 11 per cent during the third quarter compared to the previous year, the World Gold Council said.

The gold mining industry body cited an economic slowdown in China, sagging global growth and a lack of inflation.

The latter traditionally spurs gold investing as a way to protect wealth as prices rise.

The most actively traded contract, for December delivery, fell $US16.30, or 0.9 per cent, to settle at $US1,713.80 a troy ounce on the Comex division of the New York Mercantile Exchange.

BASE METALS

Base metals on the London Metal Exchange (LME) closed in a mixture of positive and negative territory, but remain little changed on the day overall amid nervous trade.

At the close of open-outcry trading on Thursday, LME three-month copper had drifted to close flat at $US7,639.50 a metric ton.

Tin, zinc and lead made small gains, likely aided by the euro, which was stronger versus the US dollar at around $US1.278, likely heightening the appeal of the US dollar-denominated base metals to euro holders.

This was despite news that the euro-zone economy is back in recession.

The region's decline in gross domestic product (GDP) was the second straight, and the euro zone has failed to expand for four-straight quarters.