Article by ForexTime

Asian markets softened on Tuesday, following from a lacklustre session from Wall Street and fresh multi-year lows for metals prices. Just before the European market open, Hong Kong’s Hang Seng was down 0.7 per cent, Australia’s S&P/ASX 200 was down 0.5 per cent and Japan’s Nikkei 225 was flat. In mainland China, the Shanghai Composite was down 0.7 per cent and the Shenzhen Composite was flat.

Commodities have been the main focus of the markets in the past few days as prices especially of metals have taken a knock in recent days and weeks as concerns grow over China and the strength of its demand for resources. Meanwhile, the strong US dollar is not helping commodities prices as the likelihood of the Federal Reserve raising interest rates next month keeps pushing the greenback higher.

Gold prices tend to move inversely to the US dollar. The precious metal has been under pressure this year as the greenback has strengthened in response to expectations of a Fed rate hike next month. Gold was 0.2 per cent higher in trade on Tuesday at $1,070.91, recovering about a quarter of its decline in the previous session.

Copper futures fell to their lowest levels in more than six years Monday, due to the stronger dollar. Copper for December delivery, the most actively traded contract, closed down 1.9% at $2.0215 a pound on the Comex division of the New York Mercantile Exchange, the lowest level since May 2009. Prices for the industrial metal, which is heavily used in manufacturing and construction, have lost more than 28% this year and are down almost 57% since their 2011 highs.

Crude oil prices have also been falling but they turned sharply higher on Monday after Saudi Arabia’s official press agency said the country was willing to co-operate with other producing nations to maintain a stable oil market. Saudi Arabia is large oil producer and dominant OPEC member country. Oil prices for WTI (West Texas Intermediate) was 0.7 per cent higher to $42.04 a barrel in Asian trade, following a 3.4 per cent jump in the previous session. Brent crude was 0.6 per cent higher to $45.07 in Asia and eyeing a fifth straight session of gains, which would be its longest run since mid-April.

Article by ForexTime

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