COMMODITIES-Mixed readings as investors sort out need for risk

Thu Apr 11, 2013 5:48pm EDT

* Gold's gains may not last, crude oil's losses may continue

* Natural gas gains 1.8 pct, up for second day as inventory draws

* TRJ CRB's 19 component markets nearly spit between gainers, losers

By Carole Vaporean

NEW YORK, April 11 (Reuters) - Commodities came in mixed on Thursday, even within sectors, as markets like gold and copper were lifted by a weaker dollar and natural gas by falling inventories, while easing demand forecasts pressured crude oil prices.

As economic readings continue to improve, investors have been reassessing their need to seek the additional returns provided by alternative investments like commodities.

As a result, some markets like COMEX silver, down 0.3 percent, and sugar, off 0.4 percent, got sold after gaining in recent sessions.

The Thomson Reuters-Jefferies CRB index, the commodities bellwether that tracks 19 markets, was down 0.29 percent with losers and gainers almost evenly spit.

The unexpectedly large decline in the number of people filing new unemployment claims in the United States last week, helped boost equity markets and drew some money away from commodity markets.

The drop in initial jobless filings could ease fears of a deterioration in labor market conditions after a surprise stumble in job growth in March. Claims are now back at the lower end of their range for this year.

"This data is especially welcome on the heels of last week's jobs report, and it just adds to the tremendous demand that there continues to be for equities," said Leo Grohowski, chief investment officer at BNY Mellon Wealth Management in New York.

Earlier this week, minutes from the Federal Reserve's last meeting showed that a few policymakers were looking to end some stimulus measures by the end of the year provided the U.S. labor market and growth prospects continue to improve.

"Regardless of Fed policy, there are many more attractive assets to profit on than gold right now. It looks like the trade right now is buy S&P and sell gold," said Mihir Dange, COMEX gold options floor trader for Arbitrage LLC.

Meanwhile, central banks in other regions are taking measures to simulate their economies, which brightens potential demand prospects for those regions.

Japan's aggressive monetary easing, indications last week that the European Central Bank may cut rates, and signs of a growing recovery in China also lifted equity markets, with the Dow Jones and S&P 500 stock indexes setting new closing record highs.

While gold has benefited from the Bank of Japan's pledge last week to inject around $1.4 trillion into its economy to battle deflation, its ability to strengthen on that news is not expected to last long.

Gold rose 0.4 percent to $1,564.10 an ounce by 2:26 PM (1826 GMT), having rebounded from a one-week low of $1,553.10 an ounce.

An improving U.S. economic outlook and rallies in the equity markets, however, could pressure bullion prices in the near term, analysts said.

Copper gained 0.4 percent on dollar declines and improved demand prospects from biggest consumers China and the U.S.

Three-month copper on the London Metal Exchange closed up 0.46 percent at $7,610 a tonne, bouncing from a session low of $7,510.

"Looking ahead, investors are focused on economic data out of China, including GDP numbers, which will be a major driver for base metals prices," said Daniel Briesemann, analyst at Commerzbank.

China's annual economic growth is likely to have nudged higher in the first three months of 2013 over the last quarter of 2012, with fixed asset investment and factory output growth in double digits, a Reuters poll showed.

Supply and demand factors moved energy markets, with crude oil prices down after the International Energy Agency (IEA) trimmed its forecast for energy demand growth this year. It was the third top forecaster in the world to do so at a time of growing oil supplies.

Brent crude oil fell below $105 per barrel, not far above an eight-month low, after analysts cut forecasts for global oil demand growth and U.S. crude oil stocks increased to their highest in more than two decades.

London's Benchmark Brent futures LCOc1 for May delivery settled down $1.52 at $104.27 a barrel. U.S. crude futures fell $1.13 to settle at 93.51 a barrel.

Meanwhile, natural gas rose 2 percent, ending higher for a second straight day, with the front-month contract posting a 20-month high even though a government report showed a weekly inventory withdrawal below expectations.

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