Following yesterday’s weakness in oil prices which saw WTI fall below $49 per barrel on renewed oversupply concerns, other commodities started to experience a selloff, namely copper prices which fell to 6-year lows. The sheer amount of production capacity added over the last few years coupled with a slowing Chinese housing market have contributed to steeper losses in the base metal after it was revealed that supply outstrips demand by a wide margin. Quickly following overnight was the weakness in natural gas catching down to the softness in crude oil prices. However, most notable was the crash in gold prices which briefly breached the very important $1080 level on the downside. Just after 02:00 GMT gold prices smashed approximately 0.50% lower before recovering modestly and experiencing another wave of selling after 03:00 GMT which saw gold give up another $6 points.
Commodity Rout Continues
Daily Analysis - 24/07/2015