Oil Drags Commodities Lower After Trump’s Positive Virus Test, , on October 2, 2020 at 10:23 am

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On October 2, 2020
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(Bloomberg) — Oil and copper dropped while gold edged higher after President Donald Trump said that he tested positive for Covid-19 with just one month left until the U.S. presidential election.Brent crude slipped as much as 4.8%, slumping sharply for a second day. The global crude benchmark helped drag raw materials lower, with copper touching a seven-week low and crop futures falling. A Bloomberg gauge of commodity spot prices had already fallen about 4% from an early September peak amid a pickup in virus cases around the world, and Trump’s positive result fuels more uncertainty over the election.“The market will be trading nervous today,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. “The immediate result was a flight to safety with the dollar, gold and bonds all receiving a bid while stocks, oil and copper sold off.”Brent fell below $40 a barrel, to the lowest since mid-June. U.S. benchmark West Texas Intermediate also slumped about 5%, marking a second day of heavy losses. Crude volatility climbed to its highest level since June.Trump contracting the virus has sharpened focus on how the outcome of the election could impact oil markets, said Bjarne Schieldrop, chief commodities strategist at SEB AB. A win for Democrat Joe Biden could lead to a renewed nuclear deal with Iran and restrictions on fracking, Schieldrop said, potentially curbing future U.S. crude output.Crude demand has been struggling to recover amid a resurgent coronavirus, while supply from the Organization of Petroleum Exporting Countries and its allies continues to rise. Russia raised its crude and condensate production last month, while Saudi Arabia’s oil exports jumped to a four-month high in September. Although, total output from the oil-producer group was steady last month as the United Arab Emirates pulled production back sharply in atonement for recent months of oversupply.Metals and CropsSpot gold was steady at $1,907.33 an ounce, paring an earlier jump after Trump’s announcement. Silver was little changed.Bullion has rallied this year as central banks pumped vast amounts of stimulus into economies to curb the damage from the pandemic. While prices have fallen from August’s record high, the precious metal is still being supported by low interest rates, a resurgence in Covid-19 cases in some parts of the world, and the heightened uncertainty heading into the U.S. elections.Copper fell 0.8% to $6,334.50 a ton on the London Metal Exchange, after earlier touching the lowest since mid-August. Prices have come under pressure in recent weeks as rebounding exchange stockpiles soothed concerns that robust Chinese demand is fueling a supply shortage.In grains markets, corn and wheat retreated about 1% in Chicago, and soybeans also fell. Still, corn futures are heading for their biggest , WTy advance since August after crop stockpile data this week from the U.S. Department of Agriculture trailed analyst estimates.Investors are also awaiting the monthly non-farm payrolls data due Friday. Bloomberg Economics analysts don’t expect the September report — the last national tally released before Americans head to the polls — to be consequential enough to tilt the election outcome.“Trump and the coronavirus news, along with the setback to the talks on the U.S. stimulus package, are just triggers and they’re serving as a reminder that the global economy is in trouble at least for the next six months,” said Vandana Hari, founder of Vanda Insights in Singapore.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.,

Oil Drags Commodities Lower After Trump’s Positive Virus Test(Bloomberg) — Oil and copper dropped while gold edged higher after President Donald Trump said that he tested positive for Covid-19 with just one month left until the U.S. presidential election.Brent crude slipped as much as 4.8%, slumping sharply for a second day. The global crude benchmark helped drag raw materials lower, with copper touching a seven-week low and crop futures falling. A Bloomberg gauge of commodity spot prices had already fallen about 4% from an early September peak amid a pickup in virus cases around the world, and Trump’s positive result fuels more uncertainty over the election.“The market will be trading nervous today,” said Ole Hansen, head of commodity strategy at Saxo Bank A/S. “The immediate result was a flight to safety with the dollar, gold and bonds all receiving a bid while stocks, oil and copper sold off.”Brent fell below $40 a barrel, to the lowest since mid-June. U.S. benchmark West Texas Intermediate also slumped about 5%, marking a second day of heavy losses. Crude volatility climbed to its highest level since June.Trump contracting the virus has sharpened focus on how the outcome of the election could impact oil markets, said Bjarne Schieldrop, chief commodities strategist at SEB AB. A win for Democrat Joe Biden could lead to a renewed nuclear deal with Iran and restrictions on fracking, Schieldrop said, potentially curbing future U.S. crude output.Crude demand has been struggling to recover amid a resurgent coronavirus, while supply from the Organization of Petroleum Exporting Countries and its allies continues to rise. Russia raised its crude and condensate production last month, while Saudi Arabia’s oil exports jumped to a four-month high in September. Although, total output from the oil-producer group was steady last month as the United Arab Emirates pulled production back sharply in atonement for recent months of oversupply.Metals and CropsSpot gold was steady at $1,907.33 an ounce, paring an earlier jump after Trump’s announcement. Silver was little changed.Bullion has rallied this year as central banks pumped vast amounts of stimulus into economies to curb the damage from the pandemic. While prices have fallen from August’s record high, the precious metal is still being supported by low interest rates, a resurgence in Covid-19 cases in some parts of the world, and the heightened uncertainty heading into the U.S. elections.Copper fell 0.8% to $6,334.50 a ton on the London Metal Exchange, after earlier touching the lowest since mid-August. Prices have come under pressure in recent weeks as rebounding exchange stockpiles soothed concerns that robust Chinese demand is fueling a supply shortage.In grains markets, corn and wheat retreated about 1% in Chicago, and soybeans also fell. Still, corn futures are heading for their biggest , WTy advance since August after crop stockpile data this week from the U.S. Department of Agriculture trailed analyst estimates.Investors are also awaiting the monthly non-farm payrolls data due Friday. Bloomberg Economics analysts don’t expect the September report — the last national tally released before Americans head to the polls — to be consequential enough to tilt the election outcome.“Trump and the coronavirus news, along with the setback to the talks on the U.S. stimulus package, are just triggers and they’re serving as a reminder that the global economy is in trouble at least for the next six months,” said Vandana Hari, founder of Vanda Insights in Singapore.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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