The market and investors will be very happy to use Friday's rebound in gold and copper prices as an opportunity to move back into commodity stocks
Thanks to the weak US dollar, gold jumped 3.3% on Friday, ending its biggest weekly gain since July 2006 while silver also rose as the US fell to another record on Friday (before a small recovery) and rising energy costs sparked fears about inflation.
Gold is up 30% this year, and the dollar is down 10% against a basket of six currencies including the euro and the yen. The dollar index touched 74.484 Friday, the lowest ever as crude oil traded above $US98 a barrel for a third straight session, and heating oil climbed to a record in US markets.
December gold on Comex rose $US26.10 to $US824.70 an ounce on Friday, a rise of 4.8% over the week and the biggest one day gain since February 21 for the most active Comex futures contract.
Trading volumes were thin, which magnified the price movements, a situation repeated in the platinum market where prices also rose, thanks to a planned strike in South Africa on mine safety issues after shaft closures due to accidents boosted prices near to record highs hit earlier this month.
The US markets were in holiday mode the day after Thanksgiving while it was a national holiday in Japan on Friday.
Gold hit a 28-year high early this month at $US845.50, just shy of a record $US850 hit in January 1980 (and an intra day high of $US873).
The euro set fresh record highs versus the dollar, moving closer to the landmark $1.50 level as investors punted on another interest rate cut in the US next month by the Federal Reserve.
The Australian dollar finished at 87.78 USc on the weekend in the US, up slightly from the local close on Friday around 87.60 USc.
Platinum prices were boosted by the news that South Africa's National Union of Mineworkers (NUM) will ask members to strike on December 4 to protest against a spate of deaths in the country's mines.
The price rose to $US1,468/1,473 an ounce from $US1,466/1,471 quoted late in London on Thursday, closing in on the record $US1,484 seen earlier this month.
The pressure for a strike is understandable given the appalling safety record in platinum mining.
More than 180 workers have been killed so far this year in rock-falls, explosions or buried underground during earth tremors in mines owned by some of the world's biggest mining firms. About 200 workers died in accidents in 2006.
January Nymex crude oil rose 99 UScents to $US98.18 after touching $US98.25. The contract reached $99.29, the highest ever, on November 21. Heating oil climbed to a record $US2.7181 a gallon on Friday.
December silver futures climbed 31.5 UScents, or 2.2%, to $US14.735 an ounce. The metal is up 14% so far this year.
Meanwhile copper recovered on Friday after a sharp and surprise fall in Chinese stocks of the metal.
After rising for a number of weeks, stocks monitored by the Shanghai Futures Exchange dropped 21% to 44,855 tonnes last week, marking the biggest decline in inventories since late January.
Copper jumped back over the $US3 a pound mark in New York on Friday with the March contract (the most active on Comex) rising 9.95 UScents, or 3.4%, to $US3.0295 a pound.
Copper also rose as US share markets rebounded Friday in the thin, holiday trading.
Despite Friday's optimism, copper prices still shed 5.3% in value over the week because of continuing fears about the strength of the US economy.
News of the sharp fall in Chinese stocks came as a welcome relief to those fears about the US.
Copper has dropped 20% since reaching an 11-month high on May 4.
On the London Metal Exchange, three month copper rose $US144, or 2.2%, to $US6,709 a ton ($US3.04 a pound) on Friday.
Meanwhile among agricultural commodities, grain and oil seeds stood out late in the week with solid gains across the board. Soybeans surged to the highest in 34 years as China lifted purchases of falling US supplies.
But soybeans stood out as they hit 34 year highs in Chicago as they surged above $US11 a bushell.
The rise came on news exporters reported sales of 1.81 million tonnes last week, up 39% from the previous week and the second straight high in the crop year that began September 1.
According to the figures from the US Department of Agriculture China, the biggest importer accounted for 66% of last week's total exports, another bullish sign.
Soybean futures for January delivery rose 16.75 UScents to $US11.0075 a bushel on the Chicago Board of Trade after earlier reaching $US11.0325, the highest for a most-active contract since July 1973.
Bloomberg said that before Friday's rise, soybean futures had risen 61% over the last year thanks to the smallest level of US plantings in a dozen years and soaring demand from China for soybeans and soybean products, such as meal and oil.
The USDA says America's reserves of the oilseed will fall 63% this year. That forecast, earlier this month, means US stocks have shrunk dramatically in the past three to four months.
The USDA forecasts a 13% fall this crop year (starting September 1), meaning that the current high level of shipments, especially to China where there's a huge shortage and rising prices, is unsustainable.
There's also speculation China will extend temporary cuts on taxes and duties on imports of soybeans and their products into next year. China cut import duties on soybeans for the three months to the end of next month because of the sharp rise in food costs this year which saw the inflation rate hit 6.5% in October.
The USDA believes China's soybean output may fall 12% this year to the lowest level since 1999, because of drought and lower plantings. The agency believes China will consume 20% more oil made from soybeans, cottonseed, rapesee
