For the third consecutive year, the second quarter has seen noteworthy gains in commodities, with the Bloomberg Commodity Index climbing away from the 17-year lows seen in January 2016.
Saxo Group head of commodity strategy Ole Hansen noted that “strong comebacks” from oil and natural gas helped push a rally in commodities, something further supported by continuing demand for precious metals.
“The strong rally across most commodities attracted renewed demand from hedge funds that more than doubled bullish bets across 20 major commodities to around 1.5 million lots, a two-year high,” he said.
Gold and silver attracted increased interest in particular, and Mr Hansen added that much of this was driven by investors looking for diversification as well as by the recent Brexit vote, which helped drive gold prices up.
“We have maintained a positive view on gold throughout and with the latest developments we have raised our end-of-year forecast to US$1,350 an ounce,” Mr Hansen added.
Mr Hansen pointed out, however, that not all metals followed this trend, noting that “growth-dependent metals such as copper and palladium struggled” as China’s continued growth was met with uncertainty.
All the gains commodities have seen in the past year have been within the second quarter, Mr Hansen added.
Read more:
Bennelong Funds Management adds to board
UK headed for 'shallow recession': NAB
Responsible investment reaches $633.2bn
Investors looking to outperform the market are being urged to look at structural growth, with climate change likely to create the biggest in...
The US investment banking giant has managed to generate its highest annual net revenue in 11 years, despite the COVID volatility. ...
The neobank has transferred its remaining $65,809 worth in deposits to NAB after it declared its exit from the industry. ...
Get notifications in real-time for staying up to date with content that matters to you.
Read More