Sector movers: Commodity plays pace gains

9th Apr 2024 14:18

(Sharecast News) - Commodity plays were on Tuesday again doing best, led by precious metals miners on the back of fresh gains in gold and silver futures.

If the previous session's advance was linked by many to news that the People's Bank of China was continuing to conduct purchases of the yellow metal, come Tuesday the spotlight was on increasingly bullish hedge fund positioning.

As of 1626 BST, front dated gold futures on COMEX were adding 0.58% to $2,364.70/oz., although they were increasingly pushing into so-called 'overbought' territory.

In parallel, similarly-dated silver futures were up by 0.3% to $27.89/oz..

Meanwhile, earlier in the session, three-month copper futures had moved above $9,400 per metric tonne to $9,485 - their January 2023 highs.

Analysts at SP Angel noted that the second quarter of each year was traditionally the strongest seasonally for the metal each year, due to the restart of construction in China.

They also pointed out how analysts were continuing to raise their price forecasts on expectations for AI-related copper demand going forwards.

Stocks in the oil patch were also catching a bid despite a dip in crude oil futures.

The latter was linked by Axel Rudolph at IG to reports that Hamas was reviewing Israeli proposals for peace talks although the terrorist group had reportedly already said that they failed to meet their demands.

Aerospace and Defence names meanwhile fared worst amid profit-taking.

"Amid the prospect of interest rate cuts potentially being pushed back until later in the year, investors are no doubt taking a good hard look at their portfolios and seeing where they can lock in any profits for fear of a market pullback," said Dan Coatsworth, investment analyst at AJ Bell.

"It's natural to top slice any winners, particularly a sector where the gains have been achieved fast and hard. We then see a snowball effect where others become aware of the sell-off and it gets worse. That could be in play with defence stocks."

Top performing sectors so far today

Precious Metals and Mining 10,518.30 +2.68%

Industrial Metals & Mining 6,744.57 +1.43%

Automobiles & Parts 1,242.16 +1.16%

Chemicals 9,270.59 +1.16%

Oil, Gas and Coal 9,432.02 +0.82%

Bottom performing sectors so far today

Aerospace and Defence 10,517.01 -4.23%

Medical Equipment and Services 11,001.00 -1.49%

Non-life Insurance 3,571.28 -1.42%

Real Estate Investment & Services 2,207.55 -1.42%

Household Goods & Home Construction 12,603.00 -1.05%