Commodities trade narrowly amid G-20 meeting

AP News
Posted: Oct 22, 2010 4:19 PM
Commodities trade narrowly amid G-20 meeting

Commodities investors seemed reluctant to make big moves Friday ahead of a weekend meeting of G-20 finance ministers and central bank governors that could affect global currencies and trade.

Even commodities considered safer risks, like gold and silver, traded in a narrow range. Gold for December delivery fell 50 cents to settle at $1,325.10 an ounce while silver fell 2.1 cents to $23.118 an an ounce.

Investors and traders appear more comfortable on the sidelines amid the uncertainty about the global economy, the outcome of the G-20 meetings and the upcoming Federal Reserve meeting to determine whether to take steps to stimulate the U.S. economy.

"We're void of any economic data today and I think all markets are kind of licking their wounds and kind of reassessing," Lind-Waldock senior market strategist Rich Ilczyszyn said.

"Right now, nobody really wants to commit to long or short anything as new positions, that is, before this G-20," he said. "We still need some more currency clarity."

The commodities markets have been volatile in recent weeks on the movement of the dollar. Since commodities are traded in dollars, a weaker dollar makes them more attractive to traders who buy with foreign currencies.

During the South Korean gathering this weekend, G-20 finance ministers and central bank governors will examine the issues surrounding countries trying to devalue their currency in an effort to gain an advantage in global trade.

The next major event investors are anticipating is a decision from the Federal Reserve about whether to take steps to stimulate the economy, such as buying financial assets.

Both meetings could affect global trade as well as currencies.

In other metals contracts for December, copper rose 1.55 cents to $3.7970 a pound and palladium rose $4.80 to $591.10 an ounce. January platinum rose $1.70 to $1,675.10 an ounce.

Benchmark crude for December delivery rose $1.13 to $81.69 a barrel.

In other Nymex trading in November contracts, heating oil added 3.71 cents to settle at $2.2516 a gallon, gasoline gained 2.28 cents to settle at $2.0638 a gallon. Natural gas fell 3.6 cents to settle at $3.332 per 1,000 cubic feet.

In grains contracts for December, corn fell 4.25 cents to $5.60 a bushel and wheat rose 2 cents to $6.7075 a bushel. January soybeans fell 1.5 cents to $12.115 a bushel.