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The S&P Materials index closed this trading week in red, down 1.95%, one of the top losers for the five-day period. The Materials Select Sector SPDR (XLB) also dropped 1.36%.
The commodities market felt some pressure at the start of the week, after China’s economy showed signs of concern as industrial output growth came in weaker than forecasted. Gold (XAUUSD:CUR), silver (XAGUSD:CUR), and copper (HG1:COM) all slide by 1.4%, 2.3%, and 3% respectively.
Gold futures continued to fall for the fifth straight session on Friday, halting the metal’s month-long rally in the wake of a rising dollar and higher Treasury yields. Front-month Comex gold (XAUUSD:CUR) for August delivery settled -2.8% to $1,747.60/oz this week, while front-month silver (XAGUSD:CUR) slumped to its biggest weekly percentage loss since January, -7.8% to $19.058/oz.
Zinc prices jumped to two-month highs on Tuesday after Nyrstar, one of Europe’s largest smelters, said it will halt production from Sep. 1 “until further notice” because of elevated power prices, prompting fears of shortages. Benchmark zinc (LMZSDS03:COM) on the LME traded +6.6% to $3,797.50/metric ton. Other base metals, including aluminum, copper, nickel and lead, also showed gains.
However, majority base metals registered weekly drop, down between 2% and 6% this week. On Friday, LME aluminium price dipped 0.5% at $2,390/ton, lead fell 0.5% to $2,062.50 and tin was down 0.2% at $24,550. Copper prices (HG1:COM) rebounded on Friday but ended the week slightly lower.
Lumber Futures (LB1:COM) dropped ~12% for the week, settling at $520 per thousand board feet. The commodity has been on a losing streak since March amid rising interest rates, cooling housing market and a slowdown in new home construction.
Take a look at this week’s top gainers among basic material stocks ($2B market cap or more):
- Alpha Metallurgical Resources (AMR) +5.83%
- BHP Group (BHP) +5.11%; BHP reported its largest-ever full-year profit on Monday, easily beating the analyst consensus forecast.
- WD-40 Company (WDFC) +4.18%;
- Innospec (IOSP) +3.10%
- Huntsman (HUN) +2.91%
Here are the week’s top decliners:
- Sociedad Quimica y Minera de Chile (SQM) -18.13%; Shares fell after Q2 net earnings soared by nearly 10x but failed to meet analyst expectations.
- Sigma Lithium (SGML) -15.27%
- Hecla Mining Company (HL) -9.96%; Gold and silver miners including Hecla, Gerdau and Pan American Silver were hurt by weakness in metal prices this week.
- Gerdau (GGB) -8.37%
- Pan American Silver (PAAS) -8.35%
Other materials ETFs to watch: iShares Global Timber & Forestry ETF (WOOD), Materials Select Sector SPDR ETF, Vanguard Materials ETF (VAW), iShares Global Materials ETF (MXI), SPDR S&P Metals and Mining ETF (XME), VanEck Vectors Gold Miners ETF (GDX), iShares MSCI Global Gold Miners ETF (RING), Global X Copper Miners ETF (COPX).
Image and article originally from seekingalpha.com. Read the original article here.