COMMODITIES-Markets stumble as May begins; Brent back below $100

Wed May 1, 2013 4:55pm BST

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* CRB extends April's 3 pct loss on worrying US, China data
    * Brent crude, LME copper down about 3 pct in session
    * Wheat tanks too on profit-taking

    By Barani Krishnan
    NEW YORK, May 1(Reuters) - Crude oil, gold and copper fell
sharply on Wednesday in their first session for May as renewed
concerns over economic growth in China and the United States
pulled commodities lower in a month historically known for weak
prices.
    Raw materials markets were already carrying losses from
April before Wednesday's trading, with oil and copper down about
7 percent in their sharpest monthly declines in nearly a year.
    The trend deepened in the latest session, with the two
markets slipping another 3 percent after data showing a surprise
drop in Chinese manufacturing orders in April that cast concerns
about growth in one of the world's top commodities consumers.
 
    U.S. manufacturing growth also slowed in April, an industry
report showed, adding to signs that the No. 1 economy cooled as
the second quarter got underway. 
    "It's the same picture of relative slow demand," said
Olivier Jakob, an analyst at Petromatrix.
    Benchmark Brent crude traded out of London returned
below the key $100 a barrel mark as government data showed crude
oil inventories in the United States rose to a record high.
  
    In copper, the three-month contract on the London Metal
Exchange broke the $7,000 a tonne support level. 
    The spot price of gold fell more than 2 percent,
heading for its largest loss in two weeks. 
    Agricultural markets tanked with industrial commodities such
as energy and metals. Wheat, one of April's stronger performers
with a 5-percent gain for the month, fell more than 1 percent on
Wednesday on profit-taking. Soybeans lost more than 2 percent.
 
    The Thomson Reuters-Jefferies CRB index, a
bellwether for commodity prices, shed 1.3 percent by 11:20 a.m.
EDT (1520 GMT), after finishing April about 3 percent lower.
Eleven of the CRB's 19 components were in negative territory,
while few like cocoa and cotton bucked the trend with a rally of
more than 2 percent.
    May has historically been a month for weak performance
across financial markets, as traders go on holiday with the
advent of warmer weather in the United States and other parts of
the northern hemisphere. That weakness is sometimes exacerbated
by concerns about the economy, like now, and how demand for raw
materials would fare.
    The CRB index lost nearly 11 percent in May last year while
in the previous year, it fell almost 6 percent.
    Signs of stagnating growth in China, euro zone debt trouble
and uncertainty about further U.S. economic stimulus led
commodity markets to one of their sharpest sell-offs in
mid-April. Brent crude fell below $100 a barrel the first time
in nine months, gold had its biggest loss in dollar terms and
copper sank to an 18-month low at the height of the tumble. 
    Prices have since recovered but were in a range as investors
tried to figure out if policy makers at the U.S. Federal Reserve
would affirm the central bank's economic stimulus plans in
meetings scheduled this week. Bond-buying by the Fed had fueled
investment activity in commodities for more than two years now. 
    Investors were also looking out for a possible rate cut by
the European Central Bank this week as the ECB tries to shore up
flagging growth in the euro zone.
    
 Prices at 11:36 a.m. EST (1536 GMT)                       
 
                              LAST      NET    PCT     YTD
                                        CHG    CHG     CHG
 US crude                    90.50    -2.96  -3.2%   -1.4%
 Brent crude                 99.21    -3.16  -3.1%  -10.7%
 Natural gas                 4.421    0.078   1.8%   31.9%
 
                              
 Gold                      1443.36   -33.24  -2.3%  -13.8%
 US Copper                  308.60   -10.20  -3.2%  -15.5%
 LME Copper                6819.25  -235.75  -3.4%  -14.0%
 Dollar                     81.566   -0.178  -0.2%    6.3%
 CRB             <.TRJCRB    0.000    0.000   0.0% -100.0%
 
 US corn                    682.25    -1.00  -0.2%   -2.3%
 US soybeans               1436.50   -31.25  -2.1%    1.3%
 US wheat                   713.00    -8.75  -1.2%   -8.4%
 
 US Coffee                  133.30    -1.80  -1.3%   -7.3%
 US Cocoa                  2416.00    48.00   2.0%    8.1%
 US Sugar                    17.58    -0.02  -0.1%   -9.9%
 
 US silver                  23.300   -0.885  -3.7%  -22.9%
 US platinum               1474.90   -32.30  -2.1%   -4.1%
 US palladium               683.00   -14.80  -2.1%   -2.9%
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