Why Are Commodities Weak Early on September 15?
After a failed attempt to move higher last week, crude oil regained its strength this week and rose higher. Crude oil rose in the first four trading days this week. It appears that crude oil will likely close the week with gains. On Friday, crude oil started the day on a mixed note and traded with strength above the opening prices as the day progressed.
Interested in GLD? Don't miss the next report.
Receive e-mail alerts for new research on GLD
Last week, crude oil attempted to move higher as refineries restarted operations after Hurricane Harvey. However, warnings about Hurricane Irma at the end of last week took the shine out of crude oil. After Hurricane Irma’s downgrade at the beginning of the week, crude oil regained its strength and started to move higher. Crude oil’s increased demand outlook amid the International Energy Agency’s monthly report added to the upward momentum. Despite the build in inventories reported by the American Petroleum Institute and U.S. Energy Information Administration this week, crude oil prices are rising due to increased demand expectations.
The market is looking forward to the release of Baker Hughes’s oil rig count at 1:00 PM EST today. At 7:20 AM EST on September 15, the West Texas Intermediate crude oil futures contracts for October 2017 delivery were trading at $49.91 per barrel—a rise of ~0.05%. The Brent crude oil futures contracts for November 2017 delivery rose 0.09% and traded at $55.51 per barrel. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) closed at $31.85 after rising 0.5% on September 14.
After pulling back at the end of last week amid profit-booking, copper started this week on a stable note. However, copper didn’t maintain its strength. Copper fell as the week progressed amid profit-booking and funds’ selling. China’s weaker-than-expected industrial production and fixed asset investment data raised concerns about China’s economic outlook and weighed on copper. Since China is the largest copper consumer, China’s economic outlook influenced copper’s demand and price trends.
Gold (GLD) and silver (SLW) are mixed in the early hours. On Friday, gold started on a stable note amid North Korea’s missile launch over Japan. Gold lost strength as the day progressed as global markets shrugged off North Korea concerns. Precious metal commodities are looking forward to the release of US economic data at 8:30 AM EST. Platinum is weak and palladium is stable in the early hours on September 15.