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Crude Oil and Copper Are Stable, Gold Is Weaker on December 9

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Dec. 9 2016, Published 9:09 a.m. ET

Crude oil

After recovering on December 8, crude oil prices are stable in the early hours on December 9. At 5:00 AM EST on December 9, the West Texas Intermediate crude oil futures contract for January 2017 delivery was trading at $51.21 per barrel—a rise of ~0.71%. The Brent crude futures contract for February 2017 delivery rose ~0.61% to $54.22 per barrel.

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Doubts about market rebalancing

OPEC agreed to cut its production by 1.2 MMbpd (million barrels per day) to 32.5 MMbpd to support weaker crude oil prices and rebalance the market. However, the market is skeptical about the possibility of the market rebalancing with the output cuts. Russia is a non-OPEC producer. It agreed to cut its output gradually by 300,000 barrels per day in the next year. The market is looking forward to the meeting between OPEC and non-OPEC producers this weekend. They will discuss the details of the supply cuts. The PowerShares Dynamic Energy Exploration & Production Portfolio (PXE) and the SPDR S&P Oil & Gas Exploration & Production (XOP) rose 0.79% and 1.1% on December 8.

Copper

After falling for three consecutive trading days, copper prices are stable in the early hours on December 9. China’s better-than-expected trade data along with consumer price index data extends support to copper prices. According to trade balance data, Chinese imports rose 6.7% in November, while exports rose 0.1%. The consumer price index for November rose 2.3% year-over-year. It’s better than the market’s expectations of 2.2% growth. At 5:00 AM EST on December 9, the copper futures contract for March 2017 delivery was trading at $2.65—a gain of 0.76%. The PowerShares DB Base Metals (DBB) fell 0.7%, while the SPDR S&P Metals & Mining (XME) rose 0.24% on December 8.

Precious metals

In the early hours on December 9, gold (GLD) is flat and silver is stable. At 5:00 AM EST on December 9, the COMEX gold futures contract for February 2017 delivery was trading at $1,172.55 per ounce—a gain of ~0.02%. The silver futures contract for March 2017 delivery rose ~0.25% to $17.14 per ounce. China’s better-than-expected trade data and consumer price index data extended support to gold. The platinum futures contract for January 2017 delivery was trading at $938.45 per ounce—a gain of ~0.57%. After posting moderate gains on December 9, palladium is stable in the early hours. At 5:10 AM EST, the palladium futures contract for March 2017 delivery was trading at $742.73 per ounce—a rise of ~0.5%.

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