Written by Drew Voros  |

September 20, 2012

Market Wrap: NatGas Rises, Brent Rebounds, Gold Slips On Stronger Dollar & Grains Fall On Rapid Harvest

Details

Brent crude oil and natural gas trade higher, while rest of commodities fall.

Commodities generally traded lower today as more weak economic data dampened demand for commodities. Natural gas rose as the EIA's weekly report on storage came in line with expectations. Brent crude rebounded from its losing streak, but WTI couldn't cross into positive territory.

Economic reports from around the globe continued to confirm that any kind of broad recovery is still far in the distance. HSBC's China Manufacturing PMI for September ticked up from 47.6 to 47.8, but remained in contraction territory for an 11th-straight month. The equivalent gauge for the eurozone ticked up from 45.1 to 46—its 13th-straight month below 50—the level that separates contraction from expansion.

In the U.S., the number of people filing for unemployment benefits fell by 3K to 382K last week.

The U.S. Dollar Index rose 0.56 percent to 79.494.

• Precious metals, except for silver, were pushed down by the stronger dollar. Gold fell $2.43, or 0.14 percent, to $1767.97, while silver eked a gain of $0.03, or .09 percent, to $34.64.
  
  Platinum and palladium fell further as supply pressure lessened with this week's settlement of the violent platinum strike in South Africa. Platinum fell $13.00, or 0.79 percent, to $1627.25 and palladium dropped $7.25, or 1.08 percent, to $664.50.
  
  
• "The general mood is still positive. I think the longer we stall here, the greater the chances of a correction because the U.S. dollar is bouncing back up," said Andrey Kryuchenkov, an analyst at VTB Capital.
  
  
• Crude oil turned in mixed results, with Brent rebounding $1.29, or 1.19 percent, to $109.48, while WTI couldn't cross into positive territory, instead slipping $0.18, or 0.20 percent, to $91.80. However, Brent is still down 6 percent for the week.
  
  "For now this is a pause in the rally, not the start of a correction. Investors are taking a breather. Indexes are testing key support levels, and they are holding," said FXCM analyst Nicholas Cheron.
  
  
• Natural gas rose slightly after the EIA weekly report showed natural gas in storage rose 67 bcf, which came in line with expectations of 64 bcf and 68 bcf, according to a survey by Platts. Natural gas rose $0.03, or 1.23 percent, to $2.796/mmbtu. The energy product remains range-bound between $2.60 and $3.20.
  
  
• The grain complex fell as the harvest season, particularly for soybeans, is accelerating and yields are higher than expected. Soybeans took the biggest fall, dropping $0.50, or 3.01 percent, to $16.19, corn lost $0.1075, or 1.42 percent, to $7.46, and wheat tumbled $0.035, or 0.40 percent, to $8.78.
  
  Weather forecasts should help continue the harvest that is being described as a record-fast start. "All in all it looks like a pretty decent harvest scenario," said John Dee, a meteorologist for Global Weather Monitoring.

• Copper was down on China's Manufacturing PMI report, confirming the ongoing slowdown. The red metal gave up $0.0565, or 1.48 percent, to $3.77 after flirting with highs not seen in more than four months.