China’s rate cuts and those encouraging words from Mario Draghi of the European Central Bank gave embattled oil and gold markets a lift on Friday.
Coming with better trading earlier in the week, both commodities ended a string of weekly losses.
But for how long remains moot as the rebound on Friday had the look of relief rallies by gunshy investors.
If anything, the Chinese rate cut is bad news for commodities (and well as containing some encouragement) tells us that the world’s biggest buyer of commodities sees the need to boost a slowing economy – and slowing economies consumer less, and that means weaker world prices, as we have seen this year.
Copper, a favourite metal in relation to Chinese trading and purchases, also had a solid day Friday.
Comex gold for December delivery settled at $1,197.70 an ounce in New York, up, $US12.10 or 0.6% on the day. But despite trading above the $US1,200 and failing to remain there during official trading, after hours dealings saw gold close at $US1,202.20
As a result, Comex December gold rose more than 1% over the week, its best performance for weeks.
Silver was also boosted and it jumped 26 cents or 1.6% on Friday to end at $US16.40 in official trading. It added 0.2% for the week.
Comex copper for December delivery climbed one cent, or 0.3%, to settle at $US3.03 a pound, after also losing most of the large intraday gain. The contract lost 0.7% for the week.
In other metals trading on Friday, January platinum in New York rose $US21.70, or 1.8%, to settle at $US1,227.30 an ounce, while December palladium surged $US27.75, or 3.6%, to settle at $US794.90 an ounce.
And crude-oil future rebounded solidly on Friday after as well and Nymex West Texas Intermediate type crude jumped $USZ1.47, or nearly 2%, to $US77.33 a barrel, but came back in late trading to end up 1.15% at $US76.72.
In London, January Brent crude on surged $US1.79, or 2.3%, to $US81.12 a barrel. It later closed lower than that level at $US80.36.
Both were up around 1% over the week, a rare gain lately.
Oil markets are now focusing on the Opec meeting on Friday night our time. No decision to cut production will prices slump.
Brent oil prices are down 27% so far this year, US West Texas type crude prices are down 23%.
