Commodities Post Worst Run Since 2008, Erasing Gains for Year

The Standard & Poor?€™s GSCI Spot Index of 24 commodities lost as much as 2.6 percent to 628.11, the lowest since January, and was at 643.92 by 12:38 p.m in London. The gauge headed for a weekly loss of 6.1 percent, the worst since May. Zinc led the drop, sliding as much as 4.3 percent in London. Oil fell as much as 4.3 percent in New York and was set for its biggest weekly loss in three months. Copper fell to the lowest since June and gold gained 1.1 percent.

?€œThe game is now one of liquidation,?€ Dennis Gartman, the economist who correctly forecast 2008?€™s commodities slump, said in his daily Gartman Letter today. ?€œLiquidate first and ask questions later are the orders of the day.?€

U.S. consumer confidence slid last week to the lowest level in more than two months, a report showed yesterday. More than $4.4 trillion has been cut from equity market values in a seven- day sell-off that drove the MSCI All-Country World Index down more than 10 percent from this year?€™s high. The U.S. added 85,000 jobs last month, leaving the 9.2 percent unemployment rate unchanged, said economists surveyed before data today that cap a week of reports showing the U.S. recovery is slowing.

Industrial production in Germany unexpectedly decreased in June, declining 1.1 percent from May led by drops in construction output and in investment goods such as machinery, the Economy Ministry said today. Economists had forecast a gain of 0.1 percent.

Crude, Copper

Crude oil for September delivery dropped 0.4 percent to $86.29 a barrel on the New York Mercantile Exchange after slumping to $82.87, the lowest level for the most active contract since November. The price fell 5.8 percent yesterday.

Gold for immediate delivery increased 1.1 percent to $1,664.30 an ounce. Bullion, which touched a record $1,681.72 yesterday, is up 2.2 percent this week, set for the longest run of weekly advances since the five weeks to March 4.

?€œGold is supported on many fronts and we remain bullish,?€ said Yang Shandan, a trader at Cinda Futures Co. ?€œThere?€™s fear spreading across all markets,?€ said Yang, ranked second in a Futures Daily and Securities Times poll of China gold analysts.

Copper for delivery in three months fell as much as 2.3 percent to $9,143 a ton, the lowest intraday price since June 29, and a 10 percent plunge from its record $10,190 a ton in February. The metal traded at $9,199.75 a ton and has been supported by a strike at BHP Billiton Ltd.?€™s Escondida copper mine in Chile. The workers at the mine, the world?€™s largest, voted for a package of benefits to end a strike at the world?€™s biggest copper mine as soon as today.

Wheat for December delivery dropped as much as 2.1 percent to $7.10 a bushel on the Chicago Board of Trade before trading at $7.1825. Corn for December delivery declined 0.9 percent to $6.9525 a bushel after falling 1.6 percent yesterday.

--With assistance from Maria Kolesnikova in London, Ben Sharples in Melbourne, Glenys Sim in Singapore and Sungwoo Park in Seoul. Editors: Sharon Lindores, Claudia Carpenter

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Authors: Commodities - Yahoo! News Search Results

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