COMMODITIES-Ends down again on Fed anxiety, mixed US jobs report
* Oil, metals slip again on worries over Fed's direction * Dollar's strength weighs further on commodities * Soybeans hit 6-week bottom, cocoa 8-1/2 month lows * Mixed US jobs report comforts some, worries others By Barani Krishnan NEW YORK, Jan 4 (Reuters) - Oil and metals prices fell for a second straight day on Friday as investors weighed the possibility of the U.S. Federal Reserve ending its highly stimulative monetary policy and as data showed anemic jobs growth in the country. The dollar's rally to a six-week high against other major currencies also made it costlier for investors using other currencies to acquire dollar-denominated commodities such as crude oil, gold and copper. Crop prices were down too, but more due to supply and demand factors. Soybeans hit a six-week bottom in Chicago on prospects for a bumper harvest of South American soy and China's cancellation of U.S. soybean orders. Cocoa plumbed 8-1/2 month lows in London before recovering; raw sugar a 3-week trough in New York. The 19-commodity Thomson Reuters-Jefferies CRB index ended down 0.5 percent for the session, and 0.2 percent lower in the first week of 2013. Silver futures notched the CRB's sharpest decline of the day, settling 2.5 percent lower. Gasoline futures led declines on the energy front, closing down 1.2 percent. "The focus now turns back to the U.S. fiscal issues that are left outstanding, and the surprising minutes from the Fed," said Edward Meir, commodities analyst at Intl FC Stone. The Fed's December policy meeting minutes, released on Thursday, showed several officials of the central bank considering a slowdown or stop of asset purchases that investors have figured into their economic outlook. The Fed's balance sheet of nearly $3 trillion risks instability with further expansion, the officials had reasoned. The news jolted markets that had just emerged from weeks of nervous trading caused by the U.S. fiscal crisis, which was only partially resolved on Dec. 31 with a deal that averted tax hikes for most Americans in 2013. In Friday's session, sentiment was mixed after a U.S. jobs report for December showed a continued pace of hiring in the No. 1 economy, although employment remained below satisfactory levels. Further clouding the picture was data from the Institute for Supply Management, which showed the U.S. service sector growing at its fastest pace in 10 months in December. "The oil market may be back to a situation where good news is bad news, meaning this morning's good jobs number may cause the Fed to end stimulus sooner," said Phil Flynn, analyst at Price Futures Group in Chicago. Oil's benchmark Brent crude in London finished down 0.7 percent at $111.31. For the week though, Brent was up nearly 1 percent. U.S. crude futures in New York settled 0.2 percent lower at $93.09 a barrel. For the week, it rose 2.5 percent. U.S. RBOB gasoline closed down 1.2 percent while heating oil slipped 0.2 percent after the Energy Information Administration's (EIA) weekly report showed gasoline inventories rising 2.6million barrels last week and distillate stocks 4.6 million barrels. Gold prices closed down but rebounded from a 4-1/2 month low after some investors took the U.S. jobs report to mean the Fed may retain its monetary stimulus in the near term -- something that is bullish for bullion. "Investors think that the payroll report is still not enough to change the Fed's accommodative policy, which is a positive for gold," said Howard Wen, metals analyst at HSBC. The spot price of bullion was down 0.4 percent to around $1,657 an ounce late Friday afternoon in New York after falling more than 2 percent earlier to a session low of around $1,625. Prices at 4:22 p.m. EST (2122 GMT) LAST/ NET PCT CLOSE CHG CHG US crude 93.10 0.18 0.2% Brent crude 111.45 -0.69 -0.6% Natural gas 3.287 0.089 2.8% US gold 1648.90 -25.70 -1.5% Gold 1657.30 -5.65 -0.3% US Copper 369.35 -2.35 -0.6% LME Copper 8085.00 -79.00 -1.0% Dollar 80.481 0.097 0.1% US corn 680.25 -9.00 -1.3% US soybeans 1389.00 -14.00 -1.0% US wheat 747.25 -8.25 -1.1% US Coffee 147.35 0.85 0.6% US Cocoa 2220.00 -36.00 -1.6% US Sugar 18.85 -0.25 -1.3% US silver 29.946 -0.774 -2.5% US platinum 1555.20 -21.50 -1.4% US palladium 688.50 -8.65 -1.2%
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