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Commodities Retreat as S&P Cut US Rating, Gold Above $1,700

August 8, 2011 at 18:43 by Vladimir Vyun

Most commodities declined today, reacting to the downgrade of the US credit rating by Standard & Poor’s on Friday, while gold posted a new record, rising above $1,700.

All three major agencies (Moody’s Investor Service, Fitch Ratings and Standard & Poor’s) signaled about possible downgrade of the US credit rating in the future, while S&P actually cut the rating one step to AA+ and kept the outlook on “negative”. This move erased any optimism that had remained on markets and caused a drop of most commodities. Gold, on the other hand, took its chance and jumped to yet another record.

The MSCI All-Country World Index of stocks dropped 1.1 percent. The S&P GSCI index of 24 commodities fell as much as 2.8 percent.

December futures for delivery of gold gained $49.90 (3 percent) to $1,701.70 per ounce as of 9:06 on COMEX after earlier it reached the all-time high of $1,718.20. Futures for delivery of corn in December fell 14 cents (2 percent) to $6.8775 per bushel at 10:16 on CBoT. Contract for delivery of soybeans in November went down $0.2025 (1.5 percent) to $13.1575 per bushel. September contract for for delivery of crude oil slipped as much as $3.28 (3.8 percent) to $83.60 per barrel by 11:43 on NYMEX.

If you have any questions and comments on the commodities today, use the form below to reply.

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