Metal futures fall on Europe worries

AP News
Posted: Nov 16, 2011 4:51 PM
Metal futures fall on Europe worries

Metals prices closed lower Wednesday on worries that the European financial crisis could deepen and slow global economic growth.

Copper for December delivery dropped 1.7 cents, or less than 1 percent, to close at $3.4845 per pound. December palladium fell $12.60, or nearly 2 percent to close at $654.45 an ounce. January platinum fell $11.50, or nearly 1 percent, to $1,631.20 an ounce.

Traders worried that higher borrowing rates for Italy, Spain and France will mean that those countries will have trouble repaying their debt. If European countries can't stem the financial crisis there, it could hinder economic growth. That would cut demand for metals like copper and palladium, which are used as raw materials in manufacturing.

On Wednesday, the yield on Italy's 10-year bond was just below 7 percent. When Greece's interest payments reached that level, it had to seek a bailout from lenders. Borrowing rates for Spain and France are above 6 percent and 3 percent, respectively.

Corn for December delivery fell 2.75 cents to settle at $6.4275 per bushel Tuesday. December soybeans lost 12.5 cents, or 1 percent, to $11.8775 a bushel. December wheat fell 16 cents, or 2.5 percent, to finish at $6.1675 per bushel.

Precious metals were also down. Gold for December delivery lost $7.90, or less than 1 percent, to settle at $1,774.30 per ounce. December silver fell 63.4 cents, or nearly 2 percent, to close at $33.822 an ounce.

In energy trading, oil prices shot past $100 per barrel for the first time since July. Oil is up 26 percent since the end of September. The price jumped Wednesday after a Canadian pipeline company announced it would ship crude away from a key delivery point in the Midwest.

Benchmark crude oil rose $3.22, or more than 3 percent, to end at $102.59 per barrel on the New York Mercantile Exchange.

Heating oil lost 3.67 cents to finish at $3.1346 per gallon. Gasoline futures rose 4.16 cents to close at $2.6273 per gallon and natural gas fell 5.9 cents to close at $3.483 per 1,000 cubic feet.