Commodities Drop to 10-Month Low as Slowing Global Growth May Crimp Demand
Commodities fell to a 10-month low on increasing concern that stagnant global growth will crimp demand for metals, energy and agriculture.
The Standard & Poor’s GSCI Spot Index dropped 5.38, or 0.9 percent, to close at 585.62, after touching 580.22, the lowest since Dec. 1. The gauge tumbled 12 percent in the third quarter, the most since the final quarter of 2008.
Global equities slumped on concern that Europe’s debt crisis will worsen and derail expansion. The GSCI Index has lost more than 20 percent since reaching an almost three-year high in April as slowing growth reduced the chances of shortages for raw materials. Money managers cut bets on a commodity rally 26 percent in the week to Sept. 27, the most in almost three years, government data show.
“People are worried about a global slowdown and a double dip,” Donald Selkin, the chief market strategist at National Securities Corp. in New York, said today in a telephone interview. “Funds are selling.”
Investors withdrew $1.08 billion from commodity funds in the week ending Sept. 28, the most in more than a month, according to data from EPFR Global, a Cambridge, Massachusetts- based research company.
Declines in crude oil, coffee and gasoil lead losses in commodities today.
Crude-oil futures for November delivery fell $1.59 to $77.61 a barrel on the New York Mercantile Exchange, the lowest settlement since Sept. 28, 2010. Prices have dropped 15 percent this year.
Arabica coffee for December delivery dropped as much as 4 percent to $2.198 a pound on ICE Futures U.S., the lowest since Dec. 17.
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