NEW YORK: Most commodities fell or posted only modest gains on Wednesday, as concerns about Europe's financial woes ahead of Greek debt-restructuring talks overshadowed data indicating US economic strength.
Optimism that the International Monetary Fund may raise additional funds to help tackle Europe's debt problems pushed gold prices higher, along with gains in the euro.
Brent crude oil futures lost ground, hit by a weak demand outlook from the International Energy Agency.
Copper steadied after hitting a 2-1/2-month high in the previous session, with caution over Europe weighing on prices, but the stronger euro offered support.
The IMF is seeking to boost its war chest by $600 billion to help countries reeling from excess debt. But some nations insist Europe must first do more to support ailing members, sources said.
Meanwhile, Greece and its creditors resumed negotiations on the terms of a planned debt swap, hoping to overcome an impasse in talks and stave off a painful default.
"It's too early to get excited about Europe, but the IMF news is clearly a positive and a sign Europe is on its way to stabilizing," said Jerome Heppelmann, chief investment officer at Old Mutual Focused Fund in Berwyn, Pennsylvania.
The euro's advance on the US currency for a second straight session, following reports about the IMF's possible increased lending capacity, also provided a floor for dollar-denominated commodities.
In the United States, news that factory output in December grew at its fastest pace in a year and homebuilder sentiment improved this month, provided further evidence the economy entered the new year on a firmer footing.
The improved outlook for demand, suggested by healthier US growth prospects, helped lift copper and other industrial metals.
Weather hit US corn and soybean futures.
Corn fell to its lowest in nearly a month as rainstorms provided relief to parched crops in Argentina, traders said.
Wheat prices were pulled lower by the weakness in corn and ample global supplies.
Prices plunged to session lows after the latest weather forecasts showed that upcoming rain in South America would be even greater than expected, with as much as 1-1/2 inches falling in Argentina during the weekend.
Comments
Comments are closed for this article.