Commodities: Oil endures tepid session, gold falls on profit taking

Oil futures went through a tepid session on Friday with gains in early morning calls followed by another round of declines, while gold shed some froth as traders booked profits on recent price rises.

At 1556 GMT, the Brent front-month oil futures contract was down 1.21% or 41 cents to $33.34 per barrel, while WTI was down 0.93% or 31 cents at $32.96 per barrel. Both benchmarks made marginal gains in Asian trading briefly recovering from historic 11-year lows, before yet another round of heavy shorting influenced by global oversupply perceptions weighed on proceedings in Europe.

Precious metals led by gold - on a high for much of the week on continual safe haven demand - also headed lower. COMEX gold futures contract for February delivery was down 0.51% or $5.70 at $1,102.10 an ounce, while spot gold in Dubai was down 0.43% or $4.76 at $1104.21 an ounce.

Yann Quelenn, market strategist at Swissquote, said, “The technical structure shows that gold has entered a short-term bullish momentum. In the long-term, the underlying downtrend continues to favour a bearish bias. A break of the resistance at $1,223 is needed to suggest something more than a temporary rebound.”

Elsewhere, COMEX silver was down 3.15% or 31 cents to $14.04 an ounce, but spot platinum was marginally up by 0.31% or $2.68 at $888.43 an ounce.

Selected base metals saw marginally positive trading on the London Metal Exchange. Primary aluminium (up 1.1%), nickel (up 0.1%), tin (up 0.7%) and zinc (up 1.0%) three-month delivery futures contracts headed higher at 1635 GMT. However, lead (down 0.3%) and copper (down 1.2%) contracts registered declines for much of the European session.

Liz Grant, senior account executive at Sucden Financial, said, "Calm descended on Chinese stock markets and prices edged higher after the sharp sell-off and turmoil seen through the week. LME prices were all up on the day but turnover was much reduced and business was in fact fairly quiet.

"However, during the London afternoon session markets began to ease back once again and equity indices along with energy turned negative. The morning rally in LME prices was also eroded and 5pm closes saw copper and lead finish slightly down on the day."

Finally, headline agricultural commodity futures were on a positive patch in early trading calls. CBOT corn (up 1.33%), wheat (up 2.03%), ICE cocoa (up 1.59%), cotton (up 0.37%) and CME live cattle (up 0.66%) futures contracts headed higher.