HomeBusinessFive key charts to watch in global commodity markets this week

Five key charts to watch in global commodity markets this week

(Bloomberg) — The London Metal Exchange’s annual LME Week meeting is underway, bringing together traders and analysts amid copper’s latest rebound. Sugar futures are on track for their best month since January. And U.S. utilities are outpacing other industry groups in the S&P 500, thanks in part to demand for AI.

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Here are five notable charts to consider in global commodity markets as the week gets underway.

Copper

Copper has been on a rollercoaster ride this year, with a wave of investment and a big short squeeze in New York pushing prices to a record in May. Investors subsequently raised their horns as doubts about China’s economy came to the fore. The latest positioning data indicates that they are not chasing the rally as hard as last time.

Energy investments

The US is mobilizing so much investment in clean energy that it is now surpassing even the peak of the US fracking revolution in the 2010s. The wave of spending triggered by Joe Biden’s climate law will be the president’s biggest and most lasting domestic achievement. His policies have helped drive about $493 billion in new investments in the production and widespread deployment of solar panels, electric vehicles and other emissions-reducing technology since mid-2022, according to data analyzed by the Massachusetts Institute for Technology and research firm Rhodium Group .

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Natural gas

Europe enters the heating season this week with a huge stockpile of natural gas to protect itself against unexpected gas supply outages. The continent’s sites are about 94% full – above the historical average, but slightly below last year’s levels – enough to keep some traders vigilant as they keep a close eye on the continued build-up of storage before the freezing weather spreads .

Energy suppliers

The utilities sector has outpaced other sectors on the S&P 500 Index over the past three months. Shares of U.S. energy suppliers posted big gains in the third quarter on market giddiness over the prospects of rising electricity demand from AI-enabled data centers. Utilities are on track to take the top spot among the S&P Index’s 11 industry groups as the quarter draws to a close, with gains driven by power plant operators Vistra Corp. and Constellation Energy Corp., which just signed a power supply agreement with Microsoft Corp. notable because it also maintains its position as the best-performing stock in the broader S&P 500 for the year, after shares more than tripled.

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Sugar

Sugar was under pressure in September due to poor prospects from Brazil, the world’s largest exporter. While promising production forecasts in India and Thailand interrupted last Friday’s rally, sugar futures are still on track for the biggest monthly gain since January. The severe drought in Brazil has negatively affected sugarcane yields, raising fears of further cuts in production estimates. Traders will be keeping a close eye on the flow of vessels shipping sugar from the South American country in October, as any easing of exports means global buyers could struggle to find supplies in the final months of 2024.

–With help from Geoffrey Morgan, Doug Alexander, Dayanne Sousa and Alex Tribou.

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