Iron ore prices surged back over $US70 a tonne as Chinese futures hit four month highs yesterday, ending a month that was generally solid for most investors, helped by the weakness in the US dollar.
Iron ore was the best performed commodity – jumping 20% in the month – from $US61.77 at the end of June to a close last night of $US73.70 a tonne.
No wonder the big iron ore companies – BHP, Rio and Fortescue has a solid day yesterday and for the month.
BHP hit a five-month high, closing up 2.3% at $25.85, which was a gain of more than 11% in July. Rio Tinto also finished the session up 2.3%, but its July gain was a more sedate 3.4%, while Fortescue Metals closed up 4.3% yesterday and 9% for the month.
The wider local market rose 0.3% yesterday, but finished July with a tiny loss, unlike Wall Street where it was another solid month’s performance where the three main gauges have now risen in 8 of the past 9 months.
Our market though will start trading today flat after a modest night on the futures market.
But the weakness of the US currency was the big news from July – as was the rise in the value of the Aussie.
The Aussie dollar rose around 4% in July, touching 80 US cents overnight Monday to end just shy of that level, while the greenback fell around 2.7% according to an index of the major trading currencies.
The dollar again fell against the euro overnight Monday, closing above $US1.18. Bloomberg said it was the worst first 7 months of the year performance by the greenback for 31 years.
The weakness of the greenback helped push commodity prices higher.
US oil futures erased an early loss, surging into the closing bell as traders finished out July with the biggest monthly percentage gain since April of last year.
In New York, West Texas Intermediate crude for delivery in September rose 46 cents, or 0.9%, to $US50.17 a barrel, its highest close since May 24. For the month, WTI jumped 9%.
September Brent crude futures in London rose 13 cents, or 0.3%, to settle at $US52.65 a barrel and to be9.9% higher, its largest monthly gain since December.
Comex December gold which has become the most active contract, fell $US1.90, or 0.1%, to settle at $US1,273.40 an ounce in New York after earlier touching $1,277.30, an intraday seven-week high. Gold saw a 2.5% gain in July, according to FactSet.
Comex September silver rose around 9 cents, or 0.5%, to end at $US16.70 an ounce. Silver rose around 1.3% in July.
Comex September copper advanced around a cent to $US2.89 a pound and was up around 6.7% for the month. On Wall Street, the Dow closed at a record on Monday up 61 points, or 0.3%, to 21,891 on the day and 2.6% over July.
The S&P 500 eased 1.7 point to 2,470, a fall of less than 0.1%, but 2% higher over the month.
The Nasdaq fell 0.4%, or 26.5 points, to 6,348, but was the best performed of all, rising 3.4%.
