Industrial metal prices have retrenched about 15% from their 2012 peaks and are still down a harrowing 25% from where they were last August. We seem close to a new test of key long-term support levels.
The “dogs of the Dow” approach is well known in U.S. large-cap investing, but global traders can find endless ideas picking through the wreckage of the worst-performing emerging market ETFs as well. At the moment, the Global X China Materials fund (CHIM, quote) qualifies as the dirtiest dog at the table.
Talking about shifting planting patterns and China’s hunger for corn is all well and good, but in an environment where the U.S. dollar is riding high, just about all major commodity markets are feeling the pressure. Food is not immune.
If you thought metal prices — and iron ore in particular — were still all about China, you would be right. However, Brazilian monetary policy can make the difference between a profitable miner and one to avoid.
The USDA could give commodity traders an excuse to take profits in soybean contracts this morning — or push the recent bull run to new levels.
Shifting consumption patterns and recovering harvests are giving Russian farmers more wheat and corn to sell overseas, and if Vladimir Putin is on the money, the final export numbers should help make up for drought conditions elsewhere.
The price of natural gas is in a ten-year trough, with the United States Natural Gas (UNG, quote) exchange traded fund down 62.89% for the last year. Based on the economic principle of substitution, the U.S. Oil ETF (USO, quote) should also fall as the need for crude decreases. Why hasn’t that happened yet?
As traders react to the prospect that Poland may actually have 93% less gas-bearing shale than previously expected, the question is how much “phantom” gas elsewhere in the world needs to be taken out of supply calculations — and how much more seriously Russian gas behemoth Gazprom (OGZPY, quote) needs to be taken as a global competitor.