“Investors pared bullish commodity bets on signs of slowing growth in China and as Goldman Sachs Group Inc. cut its recommendation on raw materials.
Hedge funds and other money managers reduced combined net- long positions across 18 U.S. futures and options by 1.8 percent to 1.14 million contracts in the week ended March 27, Commodity Futures Trading Commission data show. Bullish wagers on hogs fell the most, dropping 31 percent to the lowest since June, while those on gold had the biggest gain, rising 15 percent, the largest increase since the end of January.
The Standard & Poor’s GSCI Spot Index of 24 raw materials tumbled 2.1 percent last week, paring this year’s advance to 6.8 percent. Goldman cut its three-month recommendation on March 28, warning that the economy will “soften” this quarter. Societe Generale SA said March 27 that Chinese corporate profits won’t grow at all this year, and Federal Reserve Chairman Ben S. Bernanke said two days later that the pace of the U.S recovery has been “extremely sluggish.”
“The story over the near term is probably one of weakness,” said Anthony Valeri, a market strategist at LPL Financial in San Diego, which oversees $330 billion of assets. “There are some renewed concerns over China’s economic growth. That’s been the negative for commodities.”
If you enjoy the content at iBankCoin, please follow us on Twitter
