Hong Kong based Equity Researcher, The Woo Group reports gold futures are rising as the dollar declines, while oil futures are falling due to softening global demand. Silver futures have nearly bottomed out and copper is down as well.
Seeking Alpha - Jul. 30, 2013 - HONG KONG -- Gold futures for August and December continue to rise, doubling last week’s gains. Gold for August delivery is up $11.60, to $1,330.10 an ounce and December gold is up $11.50 to $1,334.40 an ounce. The jump in futures is most likely the result of a falling US dollar. Gold prices are dominated by the dollar; a drop in its value makes the metal more attractive to holders of other currencies. Speculative net long positions have reached their highest level in six weeks, and have almost tripled in the last three weeks, in our opinion this is what has caused the $100 increase in gold in the last two reporting periods. We expect the futures to remain stagnant until Wednesday, when the Federal Open Market committee makes its announcement.
September crude oil futures continue to fall after dropping 79 cents to $104.70 a barrel on Friday, on Monday they fell 52 cents to $104.18 a barrel. Before Friday´s loss oil futures had gained nearly 15% in the previous month over concerns about the Suez Canal in Egypt and disruptions in supply from Iraq and Nigeria. We believe that geopolitical and short term supply issues are supporting oil prices in the short term, but we are more cautious over the long and medium terms. Non-OPEC suppliers continue to produce at a good pace and weakening global demand will cause a period of lower prices for the second two quarters of this year and into next year.
September silver futures are up 31 cents to $20.75 an ounce, we believe that it has nearly reached or is at the bottom. Futures are down 34% this year. Copper delivery for September is also down a cent to $3.10 a pound. Last week the metal lost 1% over concerns about risks from coppers biggest consumer, China.
About The Company
The Woo Group is privately owned and funded by the Woo family here in Hong Kong; we have no shareholders or investors.
The Woo Group was established in 2002 by the founding fathers Jon and Jason Woo, of the Hong Kong Woo family, whose enormous wealth and expertise in the financial industry ensured immediate success, which The Woo Group continues to enjoy today.
In its infancy The Woo Group employed only 15 members of staff, a number that has now grown to over 800 making The Woo Group the largest, not to mention most prestigious equity research house in Hong Kong.
Commodities Watch - Week 31 2013