Commodities Daily Update

Oil & Gas ETFs

Oil-focused ETFs led the commodity complex higher as crude prices surged on escalating Middle East tensions. Leveraged crude fund UCO gained 6.3%, followed by USO at 5.5%, BNO at 5.1% and DBO at 4.5%; inverse crude fund SCO consequently fell 6.1%. Exploration and production equities also advanced, with IEO and XOP gaining approximately 2.0%, while broad energy-sector ETFs rose between 1.0% and 1.7%. Natural-gas products recorded more modest gains: UNL rose 1.2%, BOIL added 1.0% and UNG increased 0.4%, while inverse fund KOLD declined 1.2%. Despite the strong oil rally, investors withdrew $106.7 million from USO and $11.1 million from UCO, while SCO attracted $69.6 million—suggesting some positioning for a potential pullback.

Metals ETFs

Metals ETFs declined broadly as higher bond yields and a firmer dollar pressured both precious and industrial metals. Gold funds GLD, IAU and AAAU fell approximately 2.8%, while silver products SLV and SIVR declined about 3.7%. Platinum lost roughly 2.8%, and palladium was the weakest physical-metal product, falling 4.4%. Mining shares experienced even steeper declines: GDX fell 3.9%, GDXJ dropped 4.4%, and silver-miner ETF SIL declined 3.7%. Industrial and strategic-metals funds were also lower, with COPX down 3.9%, SETM off 3.0%, CPER falling 2.3% and REMX declining 1.7%. Uranium ETFs participated in the selloff, as URA lost 3.4% and URNM fell 3.8%. Flows were mixed: GLD attracted a sizable $627.7 million, but GDX lost $222.0 million and GDXJ saw $64.1 million of withdrawals.

All Other Commodity ETFs

Broad commodity ETFs generally advanced, benefiting from their energy exposure. COMT gained 2.5%, GSG rose 2.4%, PDBC added 2.1% and DBC advanced 2.0%, while BCI and DJP gained about 1.3%. Broad natural-resource equity funds were less consistent, with GUNR up 0.4% and GNR nearly flat, while materials-sector funds such as XLB, VAW, IYM and FMAT fell between 1.2% and 1.4%. Agricultural ETFs were uniformly higher: SOYB led with a 2.0% gain, MOO rose 1.7%, CORN added 1.1%, and DBA and WEAT gained 0.6% and 0.7%, respectively. Agricultural momentum remains strong over the longer term, particularly in wheat and corn, although elevated RSI readings suggest several products may be approaching overbought territory. Broad commodity flows remained constructive, including $38.1 million into DBA, while PDBC attracted $133.0 million over the past week and $460.5 million during the past month.

Commodities Overview

Commodity markets were mixed Wednesday morning as escalating tensions in the Middle East continued to support energy prices, while a firmer U.S. dollar and rising global bond yields pressured precious metals. Oil benchmarks eased after Tuesday’s sharp rally but remained well above week-ago levels amid attacks on commercial vessels, U.S. strikes against Iranian targets and reduced shipping traffic through the Strait of Hormuz. Industrial metals were mixed, with aluminum and zinc advancing while nickel declined. Investors are monitoring U.S. petroleum inventory data, employment indicators and the Federal Reserve’s Beige Book for additional direction.

Oil & Gas

WTI crude declined 0.8% to $89.47 per barrel and Brent slipped 0.5% to $94.11, consolidating after gains of 4.6% and 5.2%, respectively, during the prior session. Oil prices remained supported by the continued escalation between the United States and Iran, including attacks on tankers, Iranian threats against regional targets and U.S. strikes on approximately 100 Iranian sites. Shipping activity through the Strait of Hormuz remained depressed, with only four commodity vessels crossing Tuesday, compared with 10 on Monday. Supply concerns were partly offset by higher Iraqi exports and expectations for steady Chinese refined-product shipments. U.S. inventory data also pointed to a 2.6-million-barrel crude draw, although gasoline stocks increased modestly. Natural gas rose 0.8% to $2.928 per MMBtu, while European TTF gas climbed 2.5% to €74 per MWh as Middle East disruptions raised concerns about LNG flows. RBOB gasoline edged up 0.1%, while ULSD fell 1.6% following Tuesday’s 6.1% surge.

• Oil & Gas:
  • Pricing
    • WTI (0.8%) to $89.47 (Oct)
    • Brent (0.5%) to $94.11 (Nov)
    • Natural gas +0.8% to $2.928 (Oct)
    • RBOB +0.1% to $3.138 (Oct)
    • ULSD (1.6%) to $4.605 (Oct)

Metals

Metals traded unevenly as a slightly stronger dollar and elevated bond yields weighed on precious metals. Gold declined 0.5% to approximately $4,374 per ounce and silver fell 0.9% to $64.77, extending some of Tuesday’s losses, although both remained firmly higher for the month. Copper was nearly unchanged at $6.60 per pound and remained up more than 16% year to date. Aluminum gained 1.2% to $3,261 per metric ton and zinc advanced 1.1% to $4,115, while nickel dropped 3.0% to $16,350. Mining equities showed tentative signs of stabilization after Tuesday’s selloff, with Newmont, Agnico Eagle and Freeport-McMoRan all indicated higher before the opening. Strong drilling results from several junior gold and silver companies also highlighted continued exploration activity, but near-term metals sentiment remains sensitive to dollar movements, interest rates and developments in the Middle East.

• Metals Snapshot:
  • Gold (0.51)% to $4374/oz, Monthly +6.5%, YTD +0.76%:
  • Silver (0.92)% to $64.765/oz, Monthly +12.08%, YTD (8.27)%:
  • Copper (0.01)% to $6.6/lb, Monthly +2.08%, YTD +16.16%:
  • Aluminum +1.21% to $3261/mt, Monthly +0%, YTD +0%:
  • Nickel (2.97)% to $16350/mt, Monthly +0%, YTD +0%:
  • Zinc +1.11% to $4115/mt, Monthly +0%, YTD +0%:
  • VanEck Gold Miners ETF +0% to $94.67, Monthly +27.76%, YTD +10.38%:
  • VanEck Junior Gold Miners ETF +0% to $122.28, Monthly +28.19%, YTD +7.47%:
  • US Dollar +0.11% to $99.786, Monthly (0.13)%, YTD +1.49%:
  • CBOE Volatility Index (0.07)% to $17.24, Monthly (4.78)%, YTD +4.28%: