This summary highlights futures positions and changes made by speculators such as hedge funds and CTA’s across 24 major commodity futures up until last Tuesday, September 29.
A week were the S&P 500 took a tumble before ending up by 0.6%. Key drivers were a boost to banks led by HSBC, stronger economic reports from China and continued hopes that U.S. politicians would agree a new fiscal stimulus deal. Elsewhere the dollar traded close to unchanged, bond yields were a tad softer while the Bloomberg Commodity Index lost 1% with all the major sectors trading lower.
Fifteen out of the 24 commodity futures tracked in this report traded lower with two of the recent most popular sectors, grains and HG copper, the hardest hit. Crude oil, gold and silver also traded lower while platinum, RBOB gasoline, cocoa and live cattle were the major exceptions.
Hedge funds responded to these changes by reducing bullish bets across the energy sector and copper while taking the opportunity to add further length to soybeans and corn as prices softened. Gold and silver saw only small changes during what was a relatively quiet week where both metals traded lower. Overall the total net-long held steady at a 28 month high at 1.96 million lots.
The week ahead sees a potential busy week in commodities with oil traders keeping an eye on EIA’s monthly Short-Term Energy Outlook on Tuesday followed by OPEC’s World Oil Outlook on Thursday for its take on global supply and demand. Following the biggest quarterly surge in food commodities since 2016, the market will focus on twin insights from the USDA in its monthly WASDE report on Friday and before that on Thursday, United Nations data on global food prices. It is likely to show another jump after hitting a six-month high in August. Copper rallied strongly on Friday as the threat of strike action over wage talks leading to supply disruptions from Chilean mines continues to grow.