North Korea Launch Spurs A Surge In Oil, Metals
North Korea test launched 7 missiles into the Sea of Japan,
sparking an immediate political and economic response. With Iran already
taking an aggressive position against the US, North Korea’s test launches fueled
demand for safe haven futures, commodities and energies. A privately
released report predicted a low jobless number Friday, which would in turn lead
to more rate hikes by the Fed. US factory orders were up 0.7%, a much
larger spike than what was expected by analysts.
Gold futures for August delivery rose 2.2% to $629.70 after a
North Korean missile launch created a surge in demand in safe haven futures.Â
Silver futures rose 4.5% to $11.41 an ounce, after reaching new month-highs.
Crude oil futures rose on continuing tensions in Iran and the
North Korean missile launch. Crude closed up 1.7% at $75.19 a barrel, the
highest closing price ever recorded for the futures contract
Natural Gas futures dropped over 5% to their lowest levels
since 2004 on news that the US’s gas supply has increased 20% since last year.
The ten-year treasury note fell the most in three weeks after
Automatic Data Processing released a private report, speculating that Friday’s
job report will show a significant increase in jobs. If such an increase
is reported Friday, that would raise expectations that yet another Fed rate hike
will be occur in August.
The softs traded mostly higher across the board, with Orange
Juice standing out up 3.4%, Cocoa up 2% and Sugar up 2.4%.
Grains traded mixed for the day; Corn closed down 1.5%,
Soybeans down 1.1% and Oats were up 1.1%.
Factory Orders Rise Much More Than Expected In May (full
story).
John Patrick Lee