Financial investors have recently expanded their net long positions on commodities in the USA again. There was a slight increase in the net longs on gold and crude oil. Soybean prices rose sharply.
As announced by the Commodity Futures Trading Commission on Friday, speculative financial investors extended their net long positions to twelve commodities traded in the US in the week to October 22 from 26,967 to 77,778 contracts. Wheat and soybeans in particular saw a sharp rise in long positions. For copper, the number of net shorts fell significantly.
The gold price recently passed the USD 1,500 mark again. The still gloomy outlook for the global economy supports the yellow metal. Added to this is the Fed’s interest rate decision, which is due this week. According to FedWatch from the CME Group, market participants see a 90 percent likelihood of a further 25 basis point rate cut. The upside potential for gold is limited by the still firm stock market in the USA. There, the S&P 500 index recently reached a new record high. In addition, China and the US have recently moved closer in the trade dispute. This time, progress has been confirmed not only by the US government but also by China. The number of net longs on gold rose by three percent to 225,930 contracts.
Net long positions in silver rose six percent to 44,110 contracts, net long positions in platinum rose from 13,494 to 29,834 contracts and net long positions in palladium fell one percent to 14,427 contracts.
There was also a slight increase in net long positions in crude oil. Despite the recent rise, however, the long positions remained at a multi-year low. Here, too, the economic outlook is dampening sentiment. In the USA, most crude oil inventories have fallen in recent weeks, and product inventories have also fallen. At the same time, market participants have recently been less critical of the crisis in the Middle East, although the risks to supply in the region remain high. The number of net longs rose by 8.5 percent to 93,856 contracts.
Meanwhile, the net short positions in copper fell by 17 percent to 43,828 contracts. The price has recently been able to work its way back up slightly, supported by hopes of a rapprochement between China and the USA. The risks on the supply side have continued to increase due to the strikes in Chile. Market participants also hope that China will expand its measures to support the economy. If there is a robust rapprochement in the trade dispute, this would also be seen as an important signal for the economy, which should also have a positive impact on the demand for raw materials.
The picture for agricultural commodities was mixed. The number of net short positions on corn rose by 15 percent to 76,055 contracts. In wheat, recent Chinese purchases in the US have helped investors to return to a net long with 12,099 contracts. The number of net long positions on soybeans rose by 40.4 percent to 68,822 contracts.