Metals, energy prices gain ground as stocks rally
NEW YORK — Metals and energy prices moved higher Thursday, buoyed by a surge of buying in the stock market.
Many traders took the rise in stocks as a sign that some optimism about the economy had returned to the market, which benefited economically sensitive commodities like oil and copper.
Stocks rallied as a handful of companies reported upbeat earnings reports. Investors also applauded steps by the Federal Reserve to remove a number of emergency lending programs it launched last fall, indicating some healing in the financial system.
As the Dow Jones industrials rose 172 points in afternoon trading, September copper futures gained 3.5 cents, or 1.5 percent, to $2.3160 a pound. Aluminum rose 1.7 percent.
Elsewhere on the New York Mercantile Exchange, gold for August delivery rose $5.10 to $939.50 an ounce, while September silver rose 9 cents to $14.0320 an ounce.
July platinum jumped $23.10 to $1,191 an ounce.
Both stocks and commodities have seesawed in recent weeks after a sharp jump in prices this spring that had been driven by improving economic data and a weaker dollar. Believing that the economy would soon turn around and that a steady decline in the dollar could lead to inflation, investors snatched up commodities, pushing prices higher.
Economic data has sent the market mixed messages in recent weeks, however. Some reports have beat expectations, while others continue to show pain in the economy. Analysts warn that prices may have gotten ahead of themselves, and don’t reflect actual prospects for improved demand.
Analysts expect prices to waver until investors have a better grasp on where the economy is headed.
“We’re getting a lot of indecision across the board regardless of what market you’re following,” said Rob Kurzatkowski futures analyst with OptionsXpress.
Oil prices jumped back above $70 a barrel Thursday, supported by the gains in the stock market. Crude prices have fallen off in recent weeks after peaking above $73 a barrel earlier this month as the dollar strengthened.
Light, sweet crude for August delivery rose $1.56 to $70.23 a barrel.
In other Nymex trading, gasoline futures rose 5.58 cents to $1.8983 a gallon, while heating oil gained 3.82 cents to settle at $1.7763 a gallon.
Natural gas for July delivery advanced 8.3 cents to $3.8440 per 1,000 cubic feet.
Grain prices were mixed on the Chicago Board of Trade.
September wheat futures fell 6.25 cents to $5.6150 a bushel, while corn for September delivery dipped 5 cents to $3.90 a bushel.
July soybeans added 11 cents to $11.96 a bushel.
Other soft commodities like cotton, cocoa and coffee also rose.
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