Written by Sumit Roy  |

October 12, 2012

Week In Review: NatGas Surges 5% To New High, Brent/WTI Spread Widest This Year, Gold & Silver Sag

Details

We examine the latest developments in commodity markets and the week's performance.

Commodities were mixed this week, as persistent growth concerns offset solid economic data. Natural gas, oil, corn and wheat outperformed, while precious metals, soybeans and copper underperformed.

Macroeconomic Highlights

The World Bank cut its forecast for economic growth in China from 8.2 to 7.7 percent. Growth is anticipated to pick up to 8.1 percent next year, but that's down from an earlier estimate of 8.6 percent.

Meanwhile, the International Monetary Fund downgraded its forecast for global growth this year and next, to 3.3 and 3.6 percent, respectively. Growth of 3.3 percent this year would be the slowest rate since 2009, and down from 4 percent in 2011.

The U.S. Department of Labor said that the number of people filing for unemployment benefits in the U.S. plunged last week by 30K to 339K—the lowest level since February 2008.

The figures are the latest indication that the labor market may be improving. Last week, the Bureau of Labor Statistics said that the unemployment rate fell from 8.1 to 7.8 percent—the lowest rate since January 2009.

The corporate earnings season kicked off this week with profit reports from Alcoa, JPMorgan and Wells Fargo, among others. Thus far, the stock market is unimpressed; the S&P 500 fell 2.4 percent on the week, bringing its year-to-date gains down to 13.4 percent.


Commodity Wrap