Commodities Watch - Stronger Demand

Price of crude oil comes back above US$50 per barrel after staying below it for a few days. Price of light sweet crude oil in the futures exchange is currently traded at US$53 per barrel. The effort took by the new US economic team to tackle current economic woes boosts a little confidence in the market.


1 year weekly chart as at 25 November 2008 using NextVIEW Advisor

Price of Gold has risen sharply in the past few days. Gold futures in CBOT is currently traded at US$827. Just 2 days ago, it was trading at US$740. Uncertainty in the financial markets and economy prompts investors to continue to invest in gold. In Thailand, the Thailand Gold Association said that gold were limited to customers on a daily basis because of short supply.

Soft Commodities continue to decline because of fear that demand for these commodities may worsen amid slower economy. Price of Rubber futures in TOCOM has declined heavily after report shows slowdown in vehicle sales in the west that caused major automakers in the US to face severe financial problems. Price of RSS3 is currently at $138. Two days ago, price was about $173. The current price is traded at year 2005 level. Price of rubber peaked in July this year at $350.


1 year weekly chart as at 25 November 2008 using NextVIEW Advisor

Crude Palm Oil futures has started to ease after strong decline in the past four months. The 3rd month futures contract traded in Bursa Malaysia is currently trading at MYR$1,488. The price of Crude palm oil peaked at MYR$4,000 in March this year before falling to a low of MYR1,400 in October this year. Price has been above this level for a month and therefore a technical rebound is expected.

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