The below summary highlights futures positions and changes made by hedge funds across commodities, forex and financials up until last Tuesday, June 8. A week where U.S. equities climbed within a whisker of their all-time highs and Treasury yields continued their decline led by lower inflation expectations (breakevens) falling to a five-week low. This after the monthly job report missed expectations, thereby supporting the view the Fed is unlikely to have their hand forced when it comes to the timing of tapering. The dollar traded close to unchanged while the Bloomberg Commodity spot index, led by strong gains in energy, reached a six-year high.
The commodity sector saw net buying for a second week, but once again the increase was solely driven by the energy sector with net selling hitting both metals, both precious and industrial as well as agriculture. Overall the combined long across 24 major commodity futures rose 2% to 2.42 million lots, representing a nominal value of $149 billion. Since hitting a record high in the week to May 11 at 2.53 million lots the energy sectors percentage of the total long has risen from 44% to 49%, metals have stayed unchanged at just 9% while the agriculture sector has gone from 47% to 42%.
As mention, most of the buying was concentrated in energy led by natural gas (+31.4k), WTI (+27.9k) and Brent (23.5k) with biggest reductions seen in corn (-14.3k), sugar (-6.1k) and platinum (-4.4k).