Written by Sumit Roy  |

June 27, 2012

Market Wrap: NatGas Nears $3 Before Backing Down, Oil Rises On Strong U.S. Data, Wheat At 10-Month High

Details

Commodities mostly rose today.

Commodities and stocks rose broadly today after a batch of better-than-expected economic reports in the U.S. eased economic concerns. But markets remained wary of the debt crisis in the eurozone ahead of an EU Summit on Thursday and Friday.

In U.S. economic news, durable goods orders in the U.S. rose by 1.1 percent in May, beating the 0.5 percent expectation. Meanwhile, pending home sales jumped 5.9 percent in May, better than the 1.5 percent increase that was anticipated.

Ahead of this week's EU summit, Spanish and Italian bond interest rates rose slightly. Yields on the respective 10-year bonds were last trading up by 5 basis points and 2 basis points to 6.93 percent and 6.20 percent.

The U.S. Dollar Index was last trading up by 0.27 percent to 82.6.

• Precious metals were mixed today, as gold rose, while the other metals sold off. The yellow metal was last trading up by $3.77, or 0.24 percent, to $1576.70/oz, while silver shed $0.13, or 0.49 percent, to $26.98.
  
  Platinum lost $17.50, or 1.23 percent, to $1409.75 and palladium fell by $18, or 3.01 percent, to $579.25.
  
  "Bullion could still suffer from a relatively stronger U.S. currency, as gold's safe-haven appeal is failing to attract enough followers as players are going for the dollar or Treasuries," said analysts at VTB Capital.
  
  
• Crude oil prices rose after today's Weekly Petroleum Status Report from the EIA. U.S. crude oil inventories decreased by 0.1 million barrels, gasoline inventories increased by 2.1 million barrels, distillate inventories decreased by 2.3 million barrels and total petroleum inventories increased by 2.6 million barrels last week, according to the agency.
  
  Brent was last trading higher by $0.38, or 0.41 percent, to $93.40, while WTI added $0.85, or 1.07 percent, to $80.23.
  
  
• Natural gas prices surged to the highest level since January early in today's session, before backing down to trade slightly higher. The ongoing heat wave in the U.S. is spurring higher demand for electricity, and in turn, natural gas.
  
  Prices were last trading up by $0.03, or 0.9 percent, to $2.79/mmbtu after reaching as high as $2.95.
  
  
• The rally in corn and soybeans continued today amid fears that hot, dry weather in the U.S. growing regions will damage crops. On Monday, the USDA said the corn crop was already in the poorest condition in 24 years.
  
  "The number of bushels being subtracted daily from the U.S. crop is running over any worries about a decline in demand," said Marty Foreman, an economist at Doane Agricultural Services. "Until we see significant and widespread rain in the Midwest, no one knows how far yields can fall this year."
  
  Corn was last trading up by $0.04, or 0.58 percent, to $6.49/bushel, while soybeans rallied by $0.13, or 0.88 percent, to $14.84. Wheat was last trading at $7.36, a gain of $0.07, or 0.99 percent, and the highest level in 10 months.
  
  
• Copper rose by $0.03, or 0.95 percent, to $3.34/lb on Comex, as the industrial metal benefited from broad-based buying in financial markets.