COMMODITIES-Markets defy strong dollar in broad rally
* Fifteen of CRB's 19 markets end up on own fundamentals * US crude on track for 5 pct gain for quarter and year * Corn futures hit 7-week high as ethanol stocks tumble * Gold moves above $1,600/ounce By Barani Krishnan NEW YORK, March 27 (Reuters) - Commodities staged one of their broadest rallies of the year on Wednesday as market fundamentals drove up oil, metals and agricultural futures despite a stronger dollar, which usually tends to weigh on prices. Crude oil futures in New York settled up for a fourth straight day after being pressured initially by government data pointing to higher stockpiles of oil in the United States, the world's largest consumer of the commodity. On the agricultural side, corn futures hit seven-week highs in Chicago as inventories for ethanol -- the corn-derived biofuel -- fell to a 15-month low. Raw sugar climbed slightly in New York, from near a 2-1/2-year bottom on Tuesday. Copper futures also edged higher in New York after the benchmark three-month contract in London ended down on concerns over the euro zone after this week's bailout of Cyprus's banks. GOLD RISES EVEN AS DOLLAR UP VS EURO Gold also rose, to above $1,600 an ounce, ignoring the dollar's surge to a four-month high against the euro. A stronger dollar usually weakens demand for dollar-denominated commodities from holders of the euro. Gold typically moves opposite to the dollar. The euro sank on a weak Italian bond auction and concerns that the rescue deal for Cyprus could become a template for future bailouts in the euro zone. The worries over Europe triggered safe-haven demand for gold, traders said. With the Cyprus situation, "People don't know how things will unfold and that uncertainty helps gold," Bernard Sin, senior vice president at MKS Capital in London, said. While the day's gain on the Thomson Reuters-Jefferies CRB index was modest at just about half a percent, the session was set apart by the number of markets that closed up. Fifteen of the CRB's 19 markets settled in positive territory, making the rally one of the broadest for this year. US CRUDE RALLIES MORE THAN BRENT In oil, U.S. crude rose 24 cents to settle at $96.58 a barrel, after touching a five-week high at $96.84. The market is on pace to finish both March and the first quarter up by about 5 percent. London's benchmark Brent crude rose 33 cents to settle at $109.69 a barrel, after testing resistance near its 200-day moving average of $109.90. Brent was on target to close March down about 3.6 percent and the quarter 1.2 percent lower. "One of the reasons why (U.S.) crude has been rallying versus Brent was because of the trend of supplies falling at Cushing, but this build in Cushing is weighing now," said Phil Flynn, an analyst at Price Futures Group in Chicago. After trending lower in earlier weeks, U.S. crude inventories rose 3.26 million barrels last week, according to data from the Energy Information Administration that tracks stockpiles at the delivery point for U.S. crude in Cushing, Oklahoma. The build is nearly five times above the 700,000 barrels increase expected by analysts in a Reuters survey. CORN JUMPs AS ETHANOL STOCKS AT 15-MONTH LOW In grains markets, corn futures notched a seven-week high after the ethanol stockpile plunged to a December 2011 low. Corn on the Chicago Board of Trade for May finished up 5 cents at $7.35-1/4 per bushel. Government data showed production of ethanol declined while stocks of the grain-based biofuel dropped 5.5 percent in the largest drawdown since July, which indicated strong corn demand among blenders who mix ethanol into nearly every gallon of gasoline sold in the United States. The corn rally also came ahead of a closely watched crop report due from the U.S. Department of Agriculture on Thursday. The USDA will release estimates of U.S. spring plantings three hours before trade halts for a three-day long weekend. Prices at 5:28 p.m. EDT (2128 GMT) LAST/ NET PCT YTD CLOSE CHG CHG CHG US crude 96.69 0.24 0.3% 5.3% Brent crude 109.76 0.40 0.4% -1.2% Natural gas 4.068 0.077 1.9% 21.4% US gold 1606.20 10.50 0.7% -4.2% Gold 1604.95 6.36 0.4% -4.1% US Copper 343.25 0.00 0.0% -6.0% LME Copper 7606.00 -19.00 -0.2% -4.1% Dollar 83.202 0.319 0.4% 8.4% US corn 735.25 5.00 0.7% 5.3% US soybeans 1453.75 6.00 0.4% 2.5% US wheat 736.75 5.25 0.7% -5.3% US Coffee 136.60 -1.00 -0.7% -5.0% US Cocoa 2150.00 4.00 0.2% -3.8% US Sugar 17.85 0.07 0.4% -8.5% US silver 28.612 -0.067 -0.2% -5.3% US platinum 1579.80 13.80 0.9% 2.7% US palladium 768.30 6.90 0.9% 9.2%
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