Commodities: Oil and gold drop amid US dollar strength, partial Saudi ceasefire in Yemen
Commodity prices were lower across the board at the start of the week amid ongoing concerns around global demand and ongoing strength in the US dollar, with investors brushing off better than expected readings on Chinese factory sector activity and some positive news on global trade.
Two surveys of Chinese manufacturing sector activity in September printed ahead of forecasts, but economists voiced skepticism.
The Caixin factory Purchasing Managers' Index came in at 51.4 for September, up from 50.4 in August and well ahead of expectations of 50.2.
Despite that, Freya Beamish at Pantheon Macroeconomics told clients: "On our reading of the industrial profits data in recent months, private firms appear to be recovering while state-owned enterprises remain in the doldrums.
"We aren’t convinced, however, that the private sector recovery is sustainable yet; monetary conditions remain too tight."
Against that backdrop, as of 1830 BST, the US spot dollar index meanwhile was 0.27% higher at 99.38 while the Bloomberg commodity index was down 0.45% to 77.99, although for the month the latter was 1.3% higher despite the strength in the Greenback.
Meanwhile, front month Brent crude oil futures were down by 1.70% at $60.86 a barrel on the ICE and December gold on COMEX was falling 2.22% to $1,473.0/oz. on NYMEX.
News of a partial ceasefire between Yemen and Saudi likely influenced both moves.
Three-month LME copper also finished the Monday session lower, ending the day at $5,725 per metric tonne after opening at $5,770.
Grains on the other hand were wanted with December corn on CBoT jumping 3.77% to $3.8550 a bushel and similarly-dated wheat adding 2.46% to $4.9925/bushel.