COMMODITIES-Mostly down, nervously eyeing unresolved US budget
* Oil down modestly for the day, up on week and the year
* Gold, copper also down on day but up on the year
* Natgas has biggest year since shale gas revolution of 2007
* Soybeans best performer for 2012; coffee worst
NEW YORK, Dec 28 (Reuters) - Commodities ended broadly lower in nervous trading on Friday as traders and investors followed last-ditch attempts by U.S. politicians to resolve a fiscal crisis before the year-end. Most markets were on tenterhooks as President Barack Obama held a meeting at the White House with congressional leaders from the Democratic and Republican parties to restart stalled talks on the budget. The dollar rose, U.S. Treasury yields hit two-week lows and stocks on Wall Street fell for a fifth straight day as the president and his political rivals sought to avoid $600 billion in tax increases and spending cuts that take effect on Jan. 1. Many economists have warned that failure to reach a deal will tip the U.S. economy over a "fiscal cliff" and into possible recession. Supply-demand factors -- such as the unexpected surge in U.S. gasoline stockpiles in the world's largest oil consumer -- further weighed on prices. Fourteen of the 19 markets on the Thomson Reuters-Jefferies CRB index settled in negative territory -- pushing the broad commodities gauge down half a percent on the day, although it rose slightly on the week due to modest gains in recent sessions. Of the few markets that bucked the trend, wheat hit a 2-year high on soaring U.S. exports of the grain and natural gas ran up on cold weather forecasts over much of the United States over the next 10 days.
WASHINGTON SETS TONE "All eyes are on Washington," said Addison Armstrong, senior director for market research at Tradition Energy, referring to the 11th-hour deliberations over fiscal issue. Oil's benchmark Brent crude in London fell 18 cents to settle at $110.62 a barrel, after it tested a support below the 200-day moving average at $109.94. U.S crude fell 7 cents to $90.80. It dipped below its 100-day moving average after rising as high as $91.49 during the session, the highest front-month price since October. Trading in oil remained thin due to the holiday season. Volume in Brent was 40 percent below the 30-day norm. Activity in U.S. crude was down by around half. Weekly data from the U.S. Energy Information Administration showed U.S. gasoline stocks rose by 3.8 million barrels last week, capping a five-week build of nearly 23 million barrels. Demand for the motor fuel is down 2.8 percent from the same period of 2011. The weekly build in gasoline stocks was larger than analysts had expected.
SOYBEANS BEST PERFORMER FOR 2012; COFFEE WORST Despite its weakened positioned now, oil is still headed for a fourth straight year of gains, although its annual rise itself -- 3 percent -- is the smallest since the rebound from the 2008 financial crisis. Gold prices fell for the day and week as traders priced the market lower while awaiting the outcome of the U.S. budget talks. For the year, gold is up nearly 6 percent, extending its unbeaten run for a 12th year, although its 2012 gain is one of the slimmest in decade. Gold is also having its worst quarter since the middle of 2004. Copper prices fell too in Friday's session, although signs of a recovering economy in top metals buyer China limited losses. Copper is poised to finish the year up 4 percent, rebounding from a 2011 loss. Natural gas, one of the outperformers in Friday's market, was headed for a near 12 percent gain on the year, its best since 2007, just before the revolution in shale gas supply really took off. Soybeans, which rose modestly on the day, is set to be the year's biggest gainer, with a 19 percent annual gain, driven of the soy crop this summer. Arabica coffee, by far, is the worst performer of the year, falling more than 35 percent and headed for a second year of losses due to concerns over record global production.
Prices at 5:18 p.m. EST (2218 GMT)
LAST/ NET PCT YTD CLOSE CHG CHG CHG US crude 90.62 -0.25 -0.3% -8.3% Brent crude 110.38 -0.42 -0.4% 2.8% Natural gas 3.469 0.057 1.7% 16.1%US gold 1655.90 -7.80 -0.5% 5.7% Gold 1655.29 0.39 0.0% 5.9% US Copper 358.95 -1.15 -0.3% 4.5% LME Copper 7887.00 -28.00 -0.4% 3.8% Dollar 79.679 0.059 0.1% -0.6%US corn 694.00 2.50 0.4% 7.3% US soybeans 1424.00 5.25 0.4% 18.8% US wheat 778.75 6.50 0.8% 19.3%US Coffee 146.85 -1.05 -0.7% -35.6% US Cocoa 2249.00 -6.00 -0.3% 6.6% US Sugar 19.42 -0.03 -0.2% -16.4%US silver 29.975 -0.265 -0.9% 7.4% US platinum 1517.40 -14.40 -0.9% 8.0% US palladium 700.30 -8.20 -1.2% 6.7%