Commodities run turns to stampede
The upward march in commodity prices picked up even further pace overnight as a combination of geopolitical tensions over Iran, supply concerns, fund diversification and sheer momentum drove prices higher across precious, base metal and oil markets.</ />
New York gold futures closed above the psychologically important $US600 an ounce level for a third straight session - the highest level in a quarter century - although spot prices stopped just short of there. The precious metal has risen 16 per cent this year and more than 40 per cent in the past 12 months.
Gold's breath-taking ascent gave further impetus to silver, which jumped 4 per cent to settle at a 23-year high at $US12.56. Silver is also being sought on expectations that the first silver exchange-traded fund will be launched soon, with the potential to boost metal demand sharply.
In the energy markets, US crude oil futures prices gained 2 per cent on supply concerns related to tensions between Washington and Tehran over Iran's nuclear ambitions.
"Geopolitics is playing a key role in pension/mutual funds' motivation to invest in oil. They perceive geopolitics not as trading opportunities but as risks," analysts at SG CIB said.