NEW YORK — Natural gas futures hit seven-month highs on Wednesday after cold weather forecasts bumped up expectations for heating demand in the United States, while U.S. crude prices tumbled on a report showing a build in gasoline inventories.
Copper rose for a fourth straight session in London, hitting a one-month high together with zinc.
But gold edged lower after a three-day rally, as a tentative U.S. budget deal supported expectations for an earlier reduction in the Federal Reserve’s monetary stimulus.
The mixed outcome in the energy and metals markets sapped at the strength of the broader commodity complex, tracked by the Thomson Reuters/Core Commodity CRB index.
The 19-commodity CRB ended up just 0.1 percent after the tumble in U.S. crude oil, the index’s main component, offset gains in natural gas and 11 other commodities.
U.S. crude settled down 1 percent at $97.44 per barrel in New York after data from the U.S. Energy Information Administration showed domestic gasoline inventories posting a 6.7 million barrel build in the week to Dec. 8, their largest since January.
Europe’s Brent crude ended up 0.3 percent at $109.70 in London, after following U.S. crude oil down earlier in the session.
Natural gas outperformed all of the CRB, rising 2.3 percent, after weather reports that forecast colder weather in the United States than previously expected.
The front-month contract for U.S. natural closed at $4.337 per million British thermal units, versus Tuesday’s $4.237. The contract has gained more than 9 percent this month.
“The market may be overbought ... (but) it moved up today with the colder weather model. There’s more cold expected next week,” said Aaron Calder, analyst at Gelber & Associates in Houston.
The latest National Weather Service six- to 10-day outlook issued on Tuesday called for below-normal temperatures across consuming regions in the Northeast and Midwest and above-normal readings in the western half of the nation and in Florida.
Benchmark copper in London closed up nearly 1 percent at $7,220 a tonne, its highest since Nov. 4. Over the past week, the market has gained nearly 4 percent.
Copper has also broken above its 200-day moving average, a key technical signal for those who examine chart patterns.
The copper market is “beginning to wake up to the fact that Chinese demand has been improving,” Barclays analyst Gayle Berry said. “It has been improving since the second quarter, and the pace of consumption has continued to pick up.”
U.S. gold futures for February delivery settled down $3.90 at $1,257.20 in New York, with trading volume about 30 percent below its 30-day average, preliminary Reuters data showed.
In crop markets, robusta coffee dropped nearly 3 percent in New York, recoiling from Tuesday’s 3-1/2 month highs. Corn firmed on in subdued trade in Chicago, after fund short-covering and strong domestic ethanol production.
Yen firmer as Wall Street comes under pressure
SYDNEY — The yen held firm in Asia on Thursday, having risen broadly on the back of a slump on Wall Street as expectations grew the Federal Reserve could scale back stimulus as early as next week.
News that Congress has reached a bipartisan budget deal that would end three years of impasse and fiscal instability was seen clearing a potential hurdle for the Fed to taper its massive bond-buying program.
The selloff in risk assets prompted a squeeze on short yen positions, a very crowded trade recently. That saw the euro slip to 141.20 yen, pulling further away from a five-year peak of 142.19 set on Tuesday.
The dollar fetched 102.46 yen, down from a seven-month high of 103.40 touched on Tuesday. Commodity currencies, as well, lost ground against the yen.
The Aussie, often sold in times of heightened risk aversion, fell more than 1 percent against the greenback. It last stood at $0.9034 and could stay pinned down ahead of domestic jobs data due 0030 GMT.
Analysts polled by Reuters expect the Australian economy to have generated 10,000 jobs, not enough to keep the jobless rate from edging up to 5.8 percent. Any disappointment could see investors push the Aussie towards its recent low of $0.8989.
“If job growth falls short of market expectations ... the ongoing weakness in the labour market may prompt the Reserve Bank of Australia to adopt a more dovish tone for monetary policy,” said David Song, currency analyst at DailyFX.