Oil, gold and copper took much of the brunt of selling Friday in commodities as shares wobbled and the US dollar rose.
Oil prices fell more than 3% to $US77 a barrel on Friday, copper lost 2.4% and gold $US6 an ounce.
That reversed the 3% rise on Thursday in the wake of the first reading on US economic growth for the third quarter.
Nymex crude December delivery fell $US2.87 to settle at $US77 a barrel. In London, Brent crude lost $US2.84 to settle down at $US75.20 a barrel.
The fall in US consumer sentiment in October was confirmed, while consumer spending fell sharply, the biggest fall in 9 months and again reminded investors of the precariousness of some stock valuations and the limited good news from the third quarter growth figures.
Rising expectations of growth, the weaker dollar and confidence the markets are still doing well, pushed oil prices up 9% last month after they had spent most of the northern summer trading in a narrow range.
Comments from major oil groups, Exxon Mobil, Shell and ENI (the Italian oil giant) late last week that sluggish economic recovery was weighing on energy demand and prices, was also a factor in the weakness Friday.
But the big drivers were from the concerns that the US growth recovery is not certain (despite the third quarter figures) and that this week’s Fed meeting might reveal plans to take away the punch bowl from the party by revealing a time frame to lift interest rates.
But despite the varying weekly reports on US oil and product stocks, there’s an awful lot of oil and product being stored outside the US, with estimates of 80 million barrels or more in tankers moored in various locations around the US, Europe and Asia.
American markets shrugged off the news Thursday that Saudi Arabia will abandon the Nymex WTI oil contract as a benchmark for pricing most of its crudes.
Comex copper prices fell, dropping 2.6% over the week (and 2.4% on Friday alone).
December copper futures dropped 7.4 cents, or 2.4%, to $US2.9555 a pound.
The weekly fall was the first in four weeks.
But the metal was still up 4.8% for the month.
But copper prices are still up more than 100% this year on China’s strong buying.
Copper stocks in warehouses monitored by the Shanghai Futures Exchange rose 7.1% last week to 102,835 tonnes, a whisker away from September’s 5 year high.
On the London Metal Exchange, three month copper dropped $US184.50, or 2.8%, to $US6, 480 a ton ($US2.94 a pound).
The prices for nickel, aluminum, lead, zinc and tin prices also fell on the LME.
Gold dropped on Friday. But the $US6 an ounce drop still left it up 3.8% for October and more than 18% for the year so far.
It was the metal’s first weekly losses since September 25, following four consecutive weeks of gains.
US December gold futures settled down $US6.70 at $US1040.40 an ounce on the COMEX division of the New York Mercantile Exchange.
Spot gold was $US1040.85, down around $US4 an ounce.
December gold finished at $140.40 in New York, down $US6.40 an ounce.
Holdings of the world’s largest gold-backed exchange-traded fund, New York’s SPDR Gold Trust, were unchanged on Thursday after three days of falls.
Sugar prices fell despite the Indian government’s attempt to boost supply by promising higher prices for farmers to try and retain them in the industry.
Sugar prices in India are more strictly controlled compared to rice, which many sugar farmers have switched to in the last two years.
Over the week, ICE March raw sugar lost 2.8 % to 22.47 US cents a pound, while Liffe December white sugar fell 1.9% to $US572.2 a tonne.
Both closes are still very high compared with prices earlier in the year and a year ago.
