GO
Loading...

COMMODITIES-Gold slides but oil, natgas lead most commods higher

Barani Krishnan
Thursday, 19 Dec 2013 | 2:41 PM ET

(New throughout, updates prices, market activity, new byline, changes deateline, previously SINGAPORE)

NEW YORK, Dec 19 (Reuters) - Gold tumbled to a six-month low on Thursday in a delayed selloff to the Federal Reserve's pullback in the U.S. monetary stimulus, while oil, natural gas and a few agricultural markets rose to push commodities broadly higher.

Copper followed gold lower as the dollar rallied on the Federal Reserve's trimming of the U.S. stimulus, weighing on demand for some dollar-denominated commodities from those holding other currencies.

But raw sugar rose, bouncing from technically oversold conditions at 3-1/2-year lows.

Wheat rebounded from an 18-month low and corn edged higher, spurred by a round of bargain buying and short-covering after recent price declines.

The Thomson Reuters/Core Commodity CRB index rose nearly half a percent by 2:00 p.m. EDT (1900 GMT) as the run-up in oil, raw sugar and wheat was joined by rallies in

natural gas, heating oil and gasoline < RBc1> as well.

Twelve of the 19 commodities on the CRB rose, with natural gas climbing 4 percent for the highest gain.

Gold slid nearly 2 percent to $1,196.31 an ounce, its lowest since late June, as the Fed took its first step in winding down the era of easy money that helped drive bullion to record highs.

The Fed on Wednesday modestly trimmed the pace of its monthly asset purchases, by $10 billion to $75 billion. In fresh quarterly forecasts, the U.S. central bank also lowered its expectations for both inflation and unemployment over the next few years.

"A lot of gold investors are anticipating deflation not inflation as a result of the Fed announcement, taking advantage of the downside momentum and shorting gold at least temporarily," said Jeffrey Sica, chief investment officer of New Jersey-based Sica Wealth with over $1 billion in client assets.

In oil, U.S. crude futures rose more than 1 percent, spurred by refiners need for oil to meet robust distillate exports. Traders purchase of contracts to cover short positions also boosted the market.

U.S. crude's front-month contract last traded 75 cents higher at $98.61 a barrel.

Natural gas traded at around $4.43 per million British thermal units in New York, as data showed U.S. gas stockpiles down by a record amount last week after frigid cold boosted heating demand across the country.

Prices at 2:23 p.m. EDT (1923 GMT)

LAST NET PCT YTD

CHG CHG CHG

US crude 98.56 0.76 0.8% 7.3% Brent crude 110.23 0.60 0.6% -0.8% Natural gas 4.468 0.217 5.1% 33.3% US gold 1195.20 -41.10 -3.3% -28.7% Gold 1197.00 -20.62 -1.7% -28.5% US Copper 3.34 -0.02 -0.6% -8.5% LME Copper 7225.50 -44.50 -0.6% -8.9% Dollar 80.639 0.532 0.7% 5.0% CRB 281.324 1.137 0.4% -4.6% US corn 430.50 5.50 1.3% -38.3% US soybeans 1326.00 3.00 0.2% -6.5% US wheat 610.50 -2.00 -0.3% -21.5% US Coffee 113.70 -2.25 -1.9% -20.9% US Cocoa 2795.00 25.00 0.9% 25.0% US Sugar 16.18 0.29 1.8% -17.1% US silver 19.470 -0.009 -4.4% -35.6% US platinum 1318.30 -24.40 -1.8% -14.3% US palladium 696.95 -2.50 -0.4% -0.9%

(Editing by David Gregorio)