Commodities: Higher across the board aided by positive sentiment - ANZ

Research Team at ANZ notes that commodities were higher across the board as positive economic data boosted investor sentiment.

Key Quotes

“Crude oil prices were stronger as expectations of a fall in US inventories drove investor sentiment. A Bloomberg survey suggests investors and traders are expecting supplies fell by 150,000 barrels last week. Brent also found some additional support after news of an unplanned shutdown of the Buzzard field. The North Sea field produces approximately 160kb/d. Libya said it was still on track to reached output of 1.1mb/d by August, despite challenges such as salary payment delays and military action in the region.”

“Base metals prices climbed after a report showed US durable goods increased more than expected in February. Copper prices also received a boost from reports that workers at Southern Copper’s Peruvian copper operations are about to start a strike. Workers are seeking a higher share of profits, embolden by the actions of other workers in the region. Prices were under pressure earlier in the trading day after news that Indonesia given approval to Freeport to export copper concentrate. The temporary licence is valid for eight months, with Freeport expected to resume in the coming weeks.”

“Iron ore prices rose slightly but failed to settle above USD80/t. With markets closed in China, physical trading has been relatively subdued. Coking coal prices edged higher, with the physical market taking stock after news on Monday that Queensland coal exports would be heavily curtailed for at least 5 weeks. Reports that mines are back up and running quashed earlier fears of a complete shutdown of the industry. Port stocks are also expected to buffer some of the impact of the shutdown of the rail network.”

“Gold was relatively unchanged as investors looked ahead to minutes from the Fed later today and Friday’s US payrolls report.  However, political uncertainty continues to provide some underlying support, with French presidential candidates gather to debate their policies.”

“Agriculture markets were weaker, with corn leading the market lower as investor buying continued to dry up. Soybean also remained under pressure, with estimates of the Brazilian crop continuing to get larger.”