Funds cut bullish gold positions on Fed outlook

Paring Assets

Precious-metals assets under management fell to $130 billion in September from $137 billion in August, and commodity assets fell to $343 billion from $353 billion, Barclays said Nov. 6.

The CFTC report was the first to be released at the regular time since Sept. 27. Three weeks of data were delayed by the 16- day federal government shutdown that ended Oct. 17

Bullish bets on crude oil fell 4.1% to 233,850 contracts, the lowest since June, the CFTC data show. West Texas Intermediate was little changed for the week, down 1 cent to $94.60 a barrel amid signs of expanding inventories.

U.S. supplies of crude oil increased 1.58 million barrels to 385.4 million in the week ended Nov. 1, the most since June 21, the Energy Information Administration reported on Nov. 6.

Investors cut bullish copper holdings by 52% to 4,954 contracts, CFTC data show. Futures slid 1.3% in New York last week to $3.254 a pound on the Comex.

Agriculture Holdings

A measure of net-long positions across 11 agricultural products plunged 17% to 362,520 futures and options, according to the CFTC. The S&P’s Agriculture Index of eight commodities tumbled 19% this year.

Money managers held a net-short position of 178,720 contract in corn, down from a record 180,627 a week earlier. Investors have bet on lower prices since June as the U.S. government forecast the biggest domestic crop ever. Farmers will collect a record harvest 13.989 billion bushels of corn this year, the U.S. Department of Agriculture said on Nov. 8.

Cotton holdings fell 37% to 9,545 contracts, the lowest since Dec. 11 and down 88% from this year’s peak on Aug. 20.

“Commodities will struggle to find a balance with supplies rising as demand remains stable and, in some cases, falling,” said Paul Christopher, the St. Louis-based chief international strategist at Wells Fargo Advisors LLC, which manages $1.3 trillion. “We are advising clients to reduce their long-term allocation to commodities.”

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