The Yellow Metal and Oil Have a Good Day in Asia

Talking points to consider in this article:

• Gold prices calmed down as buyers came out during Asian market hours.
• WTI Oil prices bounced back even though inventories continue to rise.
• Copper prices also rose in early trading.

Asian markets opened earlier today and the buyers were in a cautious but buying mood. Regional stock indices made some attempts to move higher and off yesterday’s lows. We also saw this happen in commodities universe as WTI Crude rose to 28 and Copper returned to a price point around where it was on Tuesday.

Gold: The yellow metal rose a bit in early trade to around $1,100 per ounce. Safe haven assets, like the yen, saw a bit of a retreat. Buyers continue to add gold to their portfolios at a slow rate. This comes despite of imminent US Fed rate hikes this year. Gold is a good security bet when there is regional and global risks. Exchange traded funds, for gold, were also up and stable demand should help the price continue to show a bit of strength.

WTI Crude: settled below $27 yesterday (at $26.55) for the fist time in 16 years. There was a lot of volatility in February futures contracts. March contracts go into play today. Oil seemed to stabilize around $29 per barrel. Do not mistake this for a recovery for the black gold as there is a global supply gut and higher production. Later in the day we will get more data from the EIA which will include inventories. This should cause volatility in the market. Inventories are expected to be higher again.

Copper Price: this metal also saw a bit of a recovery today. Prices have bounced back to the level near Tuesday’s high. Its dependence on other asset classes makes it hard to judge the strength of the bounce higher. There is still an ongoing weakness stemming from metal producers trying to cope with falling prices.