COMMODITIES-Gold has best gain in 3 months, natgas extends rally

Thu Jan 23, 2014 4:29pm EST

Related Topics

* Gold boosted by sluggish Chinese data, weak equities
    * Natgas futures extends rally on U.S. cold snap
    * U.S. crude futures rise 1 pct
    * Coming up: CFTC Commitments of Traders report Friday

    By Frank Tang
    NEW YORK, Jan 23 (Reuters) - Spot gold surged more than 2
percent on Thursday, lifted by sliding U.S. equities and
disappointing Chinese manufacturing data, while brutal cold in
the United States boosted natural gas futures to a third
consecutive daily rise.
    A nearly 1 percent drop in the U.S. dollar after data
showed strong manufacturing activities in the euro zone broadly
underpinned dollar-denominated commodities. The Thomson
Reuters/Core Commodity Index, a benchmark for global
commodities made up of 19 components, rose 0.3 percent to a
three-week high.
    Bullion investor sentiment received a boost after
manufacturing data in China showed that a mild slowdown at the
end of 2013 in the world's second-largest economy had continued
into the new year. The news sent the Standard & Poor's 500 index
 down 1 percent. 
    "Market participants were ready to sell their equities
holdings and to add to their gold positions on the
weaker-than-expected Chinese data," said Carlos Sanchez, a
portfolio manager and director of commodities and asset
management at CPM Group in New York.
    Spot gold's rose 2.1 percent to $1,262.03 an ounce by
4:09 p.m. EST (2109 GMT), its biggest daily rally in three
months. U.S. gold futures for February delivery settled
up $23.70 an ounce at $1,262.30.
    Among industrial metals, copper fell more than 1 percent on
the weak Chinese data. 
    
    U.S. NATURAL GAS SPIKES
    U.S. natural gas prices rose more than 10 percent on brutal
cold that lifted heating demand and pushed gas to the largest
three-day gain since October 2012.
    The United States is due for another Arctic plunge over the
next five days and is trending even colder over the next six to
10 days, weather forecaster MDA Weather Services said Thursday.
    Front-month natural gas futures on the New York Mercantile
Exchange closed up 4.1 cents, or 0.87 percent, at $4.73
per million British thermal units.
    U.S. crude oil futures also rose, settling up 59
cents at $97.32 per barrel. 
    In agricultural commodities, wheat futures rose to an
eight-day high as cold weather across the U.S. grain belt raised
fears of crop damage and major importers returned to the market
following a recent drop in prices to a 3-1/2 year low. 
    Cocoa futures rallied on technical buying as investors and
funds covered short positions. 

 (Editing by David Gregorio)
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