Commodities Tumble on Rush by Investors into Cash


Worries about futures positions of three big commodity trading houses involved in Wall Street's historic restructuring sent U.S. crude plunging below $95 per barrel and trounced prices of metals.

A rush by investors into cash and other safe-haven alternatives, like gold and government bonds, helped precipitate the exit of funds from raw materials markets that included coffee  and sugar On the agricultural front, commercial grains traders saw opportunity from cheap wheat, corn and soybean prices, buying into these markets as they fell and helping them trim losses or even close higher."Focus will be on the economic environment," Barclays Capital analyst Gayle Berry said, referring to the outlook for commodities in the aftermath of the shake-up on Wall Street."The prices are very susceptible to potentially more downside in the short term given the current sentiment," the base metals analyst said.


Reuters, Trading Economics
9/15/2008 6:53:47 PM