Commodities: Pyongyang outlines plans for launch demonstration, gold rallies as rhetoric builds
(ShareCast News) - The latest rhetoric from North Korea has been to outline a plan for a launch demonstration, simulating an attack on US Pacific territory Guam.
Thanks to these latest comments, safe haven flows continued to pour into gold on Thursday, taking the precious metal from its day lows of $1,278, to day highs of $1,288 by 1500 BST.
In his statement, General Kim Rak Gyom described how four missiles would be launched, crossing over Hiroshima and Koichi prefectures of Japan to land in waters 30 to 40 kilometers away from Guam.
Oil markets saw a snap back on Thursday with the October brent contract down 0.5% to $52.48 a barrel by the London close, and the September WTI contract was down 0.85% to $49.14 a barrel.
Prices fell on lingering concerns of global oversupply as Russia considered a future output resumption and OPEC boosted it's July production numbers, as well as profit-taking after recent rallies.
This came in spite of OPEC (Organisation of Petroleum Exporting Countries) boosting estimates of demand for crude this year and next due to rising global consumption
Currently crude near term prices are trading at a premium to future contract prices, a market condition known as "backwardation", illustrating investors turning more optimistic about the pace at which oil supply and demand are rebalancing.
In agricultural news, the US Department of Agriculture (USDA) forecasts for soybean and corn production were at the high end of market forecasts.
This helped push soybean futures lower 3.27% on the day to trade at $9.43 a bushel, while corn was down 2.89%.
The base metal market saw copper retreat further from a two year high $6,510 per metric tonne as profit taking took hold, pushing the price 0.06% lower on the day to close at $6,396.