July 26, 2012 / 9:18 PM / 5 years ago

COMMODITIES-ECB pledge lifts oil, metals; rain pressures grains

* Oil, copper up after ECB vows to save euro zone
    * Grains, coffee, sugar slide as rains boost crops

    By Barani Krishnan
    NEW YORK, July 26 (Reuters) - Oil rose for a third straight
day on Thursday and most other commodities ended up as well
after the European Central Bank pledged to do all it could to
prevent a euro zone collapse.
    Prices of grains and a few other crop commodities fell on
improving weather conditions.
    Chicago-traded soybeans dropped nearly 3 percent after rain
in parts of the drought-stricken U.S. Midwest led to hopes for
improved harvest prospects for a crop stressed by dry soils and
heat for the past month. 
    Raw sugar futures in New York slumped over 5 percent as
rains in India boosted chances for more output from the second
largest producer of the sweetener.
    The Thomson Reuters-Jefferies CRB index, the
commodity market bellwether, settled slightly higher, with 11 of
its 19 components in positive territory by 3:30 p.m. EDT.
    U.    S. crude oil, which accounts for a quarter of the
CRB's weighting, steered the index higher as investors reacted
to the pledge by ECB chief Mario Draghi that eased some worries
about Europe's debt crisis.
    Draghi told a conference in London that tackling high
sovereign borrowing costs comes within the ECB's mandate and
that the central bank will do whatever necessary to preserve the
euro zone. 
    The euro rallied to a two-week high against the dollar on
Draghi's comments, encouraging investors to buy
dollar-denominated commodities which included oil and copper.
    "The comments by Draghi are likely to bring that confidence
back," said Eugen Weinberg, head of commodities research at
Frankfurt's Commerzbank. 
    In New York, crude oil's front-month contract 
settled up 42 cents at $89.39 a barrel, after setting a session
high at $90.47. The market has risen without pause since
Monday's lower close. 
    London's benchmark Brent crude finished up 88 cents
at $105.26 a barrel, after an intraday peak at $106.18.
    In copper, the key three-month futures contract in London
 rebounded from Wednesday's one-month low, ending up $24
at $7,470 a tonne.
    A sharper-than-expected drop in U.S. jobless claims and
stronger orders for long-lasting American-made goods also helped
sentiment in oil and copper.
    New U.S. claims for jobless benefits fell last week by
35,000 to a seasonally adjusted 353,000, near a four-year low,
the U.S. Labor Department said. It was a much bigger drop than
economists had expected. 
    Overall orders for long-lasting U.S. manufactured goods rose
more than expected in June, although, excluding transportation,
durable goods orders dropped 1.1 percent, the biggest decline
since January. 
    The two sets of data overshadowed a third report showing
U.S. pending home sales fell in June as fewer properties came on
the market. 
    A Reuters poll also found that U.S. gross domestic product
likely grew at a 1.5 percent annual rate in the second quarter,
putting it on track for the slowest growth since the second
quarter of 2011, which analysts said could push the U.S. Federal
Reserve to ease monetary policy. 
    U.S. soybean, corn and wheat futures fell for a third time
this week, weighed down by forecasts for rain in parts of the
drought-stricken U.S. Midwest. 
    "The rain across the Midwest has come too late for corn, but
may benefit soybeans in certain areas," Joe Davis, vice
president for commodity sales for Futures International LLC,
said in a research note.
    Soybeans for November delivery closed down 48 cents in
Chicago trading at $15.67-1/2 a bushel. Benchmark wheat futures
 fell more than 2 percent while corn fell about 1.5
 Prices at 4:15 p.m. EDT (2015 GMT)      
                             LAST/      NET    PCT     YTD
                             CLOSE      CHG    CHG     CHG
 US crude                    89.39     0.42   0.5%   -9.6%
 Brent crude                105.38     1.00   1.0%   -1.9%
 Natural gas                 3.105    0.035   1.1%    3.9%
 US gold                   1616.40     7.10   0.4%    3.2%
 Gold                      1615.76    11.88   0.7%    3.3%
 US Copper                  339.35     1.90   0.6%   -1.2%
 Dollar                     82.826   -0.698  -0.8%    3.3%
 CRB                       297.470    0.230   0.1%   -2.6%
 US corn                    773.25    -9.25  -1.2%   19.6%
 US soybeans               1567.50   -48.00  -3.0%   30.8%
 US wheat                   900.25    -9.75  -1.1%   37.9%
 US Coffee                  174.05    -2.25  -1.3%  -23.7%
 US Cocoa                  2316.00    86.00   3.9%    9.8%
 US Sugar                    22.56    -0.80  -3.4%   -2.9%
 US silver                  27.446   -0.020  -0.1%   -1.7%
 US platinum               1406.20     9.30   0.7%    0.1%
 US palladium               569.90     4.65   0.8%  -13.1%

 (editing by Jim Marshall)

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