INTERNATIONAL COMEX NEWS
- Gold prices held onto gains on Tuesday, as a sell-off in global equities boosted demand for safe-haven assets. Comex gold futures were up 0.11% at $1,338.00 a troy ounce by 08:15 a.m. ET (12:15 GMT). Global equity markets began to plunge on Friday following the release of strong U.S. employment data, which sparked concerns over rising inflation, sending bond yields sharply higher. The Dow Jones Industrials index was particularly hit on Monday, when it recorded its worst daily point drop in history.
- Oil fell for a third day on Tuesday, as a rout in global equities triggered losses across bonds, cryptocurrencies and commodities, although the crude price is in positive territory so far this year. Even with Wall Street stocks posting their largest one-day fall since late 2011 on Monday and measures of volatility spiking to multi-year highs, reflecting heightened investor nervousness, oil has not suffered to the same extent.
- Natural gas futures extended recent losses to hit their lowest level in around six weeks on Tuesday, after weather forecasts showed that temperatures across key parts of the U.S. won’t be as cold as previously expected. Front-month U.S. natural gas futures slumped 4.5 cents, or around 1.6%, to $2.703 per million British thermal units (btu) by 8:55AM ET (1355GMT). It fell to its worst level since Dec. 27 at $2.699 earlier in the session.
- Central London’s “fully valued” commercial property market should be a wake-up call for the sector, the newest member of the Bank of England’s Financial Policy Committee (FPC) said on Tuesday. Elisabeth Stheeman said commercial property is used by small firms to back loans, creating a potentially large source of credit risk for banks and a threat to the wider economy if things go wrong.
- St. Louis Federal Reserve President James Bullard on Tuesday said recent strength in the U.S. labor market may not trigger faster price increases, a view that runs counter to investors’ inflation fears currently pushing the stock market lower. The U.S. stock market has plunged since employment data on Friday showed strong job growth in January as well as surprisingly fast wage increases. Investors now see a higher risk of inflation as well as faster rate increases by the U.S. central bank. But Bullard, who does not have a vote on monetary policy this year although he participates in policy discussions, said inflation could stay low.
- A pick up in currency market volatility over the last few days after years of suppression by central banks’ easy-money policies has prompted some investors to look again at protecting against, or profiting from, sharp moves. To hedge or not is a question that divides asset managers, with some actively buying and selling currency exposure through derivatives to boost or protect returns, and others refusing to spend the money, viewing the long-term impact as neutral.