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AAP

2012-11-29

A summary of trading in key commodities markets overseas:

ENERGY

Oil prices fell as investors focused on key budget talks in the United States, the world's biggest consumer of energy, and react to news of an unexpected drop in US crude inventories.

New York's main contract, West Texas Intermediate (WTI) for delivery in January, closed 69 US cents lower at $US86.49 a barrel.

Brent North Sea crude for January was 32 US cents lower at $109.55 a barrel in late London deals.

PRECIOUS METALS

A flash-flood of selling has washed more than $US25 ($A24.05) from the price of gold in the opening minute of Comex floor trading, sending December futures toward $US1,710 a troy ounce Wednesday.

More than 13,000 contracts changed hands during that first minute of trade on Wednesday - four per cent of Tuesday's entire volume - as falling gold prices triggered automatic selling orders that pushed prices even lower, brokers and traders said.

Known as "sell stops", these orders can act as a safety switch and liquidate positions to limit losses once prices fall too low.

The $US1,730 level was the magic number that the market was watching, said Dave Meger, head of metals trading at Vision Financial Markets.

BASE METALS

Base metals on the London Metal Exchange (LME) have closed mostly lower after a choppy, downbeat day for the metals markets as the US dollar strengthened.

At the close of open-outcry trading, flagship metal copper was down 0.5 per cent on the day at $US7,765 a metric ton.

Nickel prices were buoyant, steadying around the $US17,000/ton mark despite an increase in headline LME warehouse stocks.

Although the metal joined others in negative territory earlier in the session, when base metals tracked gold's tumble to a two-week low, prices soon found their footing once more, to close 0.2 per cent higher on the day at $US16,980/ton.

Tin joined nickel to close in positive territory while lead continued to suffer losses. Trading volumes were subdued except those for nickel, said Leon Westgate at Standard Bank.

Dampened equity markets combined with a weaker euro against the US dollar to weigh on base metal prices.