Hedge Fund Gold Bets Less Bullish as Paulson Holds: Commodities

Hedge funds got less bullish on gold, cutting their net-long position to a four-month low, before prices capped the biggest weekly retreat since September.

Net holdings in futures and options tumbled 20 percent to 44,291 contracts in the week ended Nov. 19, the lowest since July 9, U.S. Commodity Futures Trading Commission data show. Short bets rose 16 percent to the highest since Aug. 6 and long wagers slid 2.5 percent. Net-bullish wagers across 18 U.S.- traded commodities fell 12 percent as investors became the most bearish on copper since July and cut their silver holdings by the most in five months.

Gold fell 6.1 percent this month, heading for the worst slide since June, when the metal reached a 34-month low. The Federal Reserve signaled Nov. 20 that it may ease stimulus in coming months. Billionaire John Paulson told clients the same day he personally won’t invest more money into his gold fund because it’s not clear when inflation will quicken. The U.S. cost of living declined in October for the first time since April, while wholesale prices fell for a second month.

(Source: Bloomberg)

WTI Oil Trades Near Three-Week High as Jobless Claims Decline

 West Texas Intermediate crude traded near the highest level in three weeks after applications for unemployment benefits dropped to the lowest in almost two months in the U.S., the world’s biggest oil consumer.

Futures were little changed in New York, heading for the first advance in seven weeks. Jobless claims fell by 21,000 to 323,000 last week, the fewest since Sept. 28, according to data from the Labor Department. The median forecast of 47 economists surveyed by Bloomberg News projected 335,000. Negotiators for Iran and world powers weren’t able to reach an agreement on a first-step accord to resolve a decade-old dispute over the Persian Gulf nation’s nuclear program.

WTI for January delivery was at $95.21 a barrel in electronic trading on the New York Mercantile Exchange, down 23 cents at 11:36 a.m. Sydney time. The contract rose $1.59, or 1.7 percent, to $95.44 yesterday. That’s the highest close for a front-month contract since Oct. 31. The volume of all futures traded was about 83 percent below the 100-day average. Prices are up 1.5 percent this week.

Brent for January settlement climbed $2.02, or 1.9 percent, to $110.08 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark crude ended the session at a premium of $14.64 to WTI.

Talks between Iranian Foreign Minister Mohammad Javad Zarif and Catherine Ashton, the European Union foreign policy chief, broke up yesterday after more than six hours of consultations, the EU said in a statement.

(Source: Bloomberg)

Gold Trades Near Four-Month Low After Fed Reserve Signals Taper

 

Gold traded near the lowest level in more than four months after the U.S. Federal Reserve signaled that policy makers may reduce monthly bond purchases in the coming months and investment holdings contracted.

Bullion for immediate delivery fell 0.2 percent and gained 0.4 percent, before trading $4 higher at $1,248.89 an ounce at 9:03 a.m. in Singapore. Prices lost as much as 2.7 percent to $1,241.13 yesterday, the lowest since July 9. Gold for December delivery dropped 0.9 percent to $1,246.80 an ounce on the Comex.

Prices slumped 25 percent this year, heading for the first annual loss since 2000, amid expectations that the Fed will trim its $85 billion in monthly asset purchases as growth picks up. Policy makers expected data would signal further improvement in the labor market and “thus warrant trimming the pace of purchases in coming months,” according to minutes of the Fed’s October meeting released yesterday.

U.S. retail sales advanced 0.4 percent in October, the Commerce Department said yesterday, while sales of previously-owned U.S. homes fell 3.2 percent in October to a 5.12 million annual rate, the fewest since June.

(Source: Bloomberg)