Funds lifted bets on rising commodity prices to a six-week high after traders snapped up raw materials as alternative assets amid the escalating U.S. debt crisis, according to Bloomberg.
Speculators raised their net-long position in 18 commodities by 10,063 futures and options contracts to 1.27 million in the week ended July 26, government data compiled by Bloomberg show. That’s the highest since June 14. Silver holdings rose for a fourth straight week, and bullish sugar bets climbed to the highest since February 2010.
The Standard & Poor’s GSCI Spot Index climbed 2.6 percent in July, snapping two months of declines. The S&P 500 Index dropped more than 2 percent last month on concern that the U.S. economy will falter as lawmakers remained deadlocked on raising the debt ceiling before a default deadline.
“Investors in many disciplines have been investing commodities and precious metals of late in response to loose and accommodative monetary policy around the world as well as uncertainty surrounding debt and budgetary issues both in Europe and the United States,” Michael Cuggino, who helps manage about $14 billion at Permanent Portfolio Funds in San Francisco, said in a telephone interview.
Read more at this at http://www.bloomberg.com/news/2011-07-31/funds-lift-bullish-commodity-bets-to-six-week-high-as-silver-holdings-jump.html?cmpid=sfc
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