Bullions demonstrated a range bound trading session with a positive biasness. Gold climbed back above $941 an ounce today, helped by a retreat in the dollar as stock markets extended gains at the end of the first half of the year. The main driver of gold at the moment is the U.S. dollar and its impact on spot market and currencies. A weaker dollar is supportive for bullion as investors view gold as insurance against the falling value of their dollar-denominated portfolios. Net-long positions in New York gold futures decreased by 5% in the week ended June 23, according to U.S. Commodity Futures Trading Commission data.
Crude Oil started the day on an upside note but started to fall during the afternoon on back of some profit booking after the rally which continued since yesterday. Nigeria is still driving the prices as militant attacks in Nigeria curbed supply from Africa’s largest producer. Royal Dutch Shell Plc shut a field yesterday after an assault by Nigerian rebels. Shell, Europe’s biggest oil company, shut its Estuary oil field in Nigeria’s southern delta region after a militant attack. The strike targeted two well clusters in the western Niger River delta. China, the world’s secondbiggest energy consumer also raised domestic fuel prices by 11% to encourage refiners to produce more fuels amid higher crude costs.
Base metals showed an upward trend on optimism a global economic recovery may revive demand for the metal used in construction and automobiles. The metal has surged 68% this year which is the biggest six month gain since the second half of 1987, as Chinese buyers boosted imports to records to replenish stockpiles. Japan's domestic demand for ordinary and specialty steel in the third quarter of 2009 is forecast at 14.65 million mt, down 26.2% year on year as per the Ministry of Economy, Trade and Industry. The automotive industry is destocking plus public infrastructure projects are expected to increase, the ministry said, which will have a positive impact on the steel industry.
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