Monthly Commodity Outlook - September 2016

For a change, nothing much happened this past month in the markets, certainly nothing of the vacation-disrupting, phone-checking, hair-pulling kind that has torpedoed many August vacations in years past, summoning legions of traders and assorted market junkies back to their desks. In fact, trading ranges in some markets like the S&P-500 barely spanned a 50-point range all month, a percentage move that was the lowest since 1970! Other markets, like the ten-year bonds, were equally restrained, trading within a 20-basis range. Commodity markets were just as comatose on an aggregate basis. We note from the boxed-in area of our Thomsom-Reuters CRB index chart below that prices rallied during the first two weeks of August only to roll back their gains during the last two to essentially finished unchanged. We wonder if all this inactivity is the “calm before the storm” or if it is just “market calm”. Let’s hope for the latter, although as commodity brokers, we would not mind to see a bit of the former either.