Hargreaves Lansdown

Sector movers: Commodity stocks, grocers pace gains

Tue 27 June 2017 19:35 | A A A

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(ShareCast News) - Commodity price gains saw miners and Big Oil stocks pace gains as the US dollar dropped sharply, alongside grocers after key survey data showed tills were bursting.

Base metals such as copper were already trading on the frontfoot early on Tuesday after Chinese premier Li Keqiang told an audience at the World Economic Forum that gross domestic product would meet Beijing's goal for growth of 6.5% in 2017.

Yet later in the session a more confident tone from European Central Bank chief Mario Draghi in a speech in Portugal, together with the BoE's decision to hike British lenders' so-called counter-cyclical buffers, set off a wave of selling in the US dollar.

Across-the-board price gains in the commodities space duly followed.

As of 1914, BST the spot US dollar index was down by almost a full percentage point to 96.50. In parallel, September 2017 COMEX-traded copper futures were higher by 0.80% at $2.6595 a pound, while West Texas Intermediate futures were higher by 1.72% to $44.14 on NYMEX.

In the case of oil, traders were also waiting on the latest weekly data on the state of US oil stockpiles from the American Petroleum Institute due out later in the day.

Earlier, all the major base metals outside of zinc had finished the LME trading session higher. Three-month nickel jumped from $9,030 per metric tonne at the start of the day to finish at $9,260 and lead rose from $2,250 a tonne to end at $2,286.

Grocers also put in a good showing, with Tesco and Morrisons leading gains after survey data from Kantar revealed that over the 12 weeks ending on 18 June they had recorded the biggest increase in sales out of the Big Four.

In aggregate, UK grocers saw sales jump 5.0% over that same period on the back of like-for-like grocery inflation running at 3.2%, versus a 0.2% increase during the same period last year.

Heading the other way, the sharp rise in Gilt yields that accompanied the shift in tone from the ECB and BoE hit defensive issues like Gas and Water utilities hard.

Yet the worst performer was Autos & Parts as the wider sector reeled from a profit warning earlier in the day out of Germany's Schaeffler.

Top performing sectors so far today

Mining 14,571.30 +2.83%

Industrial Metals & Mining 2,337.85 +2.19%

Oil Equipment, Services & Distribution 12,185.33 +1.49%

Oil & Gas Producers 7,719.89 +0.91%

Food & Drug Retailers 2,856.58 +0.61%

Bottom performing sectors so far today

Automobiles & Parts 7,743.67 -4.31%

Gas, Water & Multiutilities 6,023.84 -2.03%

Insurance (non-life) 3,037.81 -1.63%

Construction & Materials 6,849.43 -1.52%

Health Care Equipment & Services 8,346.98 -1.47%

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