I. Precious Metals
Gold
Gold closed down 0.27 percent at $1,243.81 an ounce, but held above the 200-day moving average. Chicago Federal Reserve Bank President Charles Evans who is a voter this year on the central bank's rate-setting committee, said on Tuesday he is increasingly concerned about inflation after two rates hikes this year. He said it may be worthwhile for the Fed to wait until year-end to decide on another rate hike.
Investors, however, doubted that the central bank will raise rates again in September  after the Federal Reserve raised interest rates in June and said it would begin cutting its holdings of bonds and other securities this year. Market expectations for a hike in September and December are just 13 percent and less than 50 percent, according to the CME Group's FedWatch tool.
Investors will continue to focus on U.S. economic data, but shall keep an eye on market risks after the S&P 500 bounced off highs to close at 2,437.03.
On technical front, gold was supported at the 61.8 percent retracement level and the 200-day moving average, and is expected to consolidate at the level without big events. Market bulls shall wait for more signs of stabilization.

Silver
Silver tracked gold, turning down 0.55 percent to $16.4692 on Tuesday. The RSI index that located near oversold range pointed to some rebounding demand in the near term. On trading strategy, investors may follow gold.

II. Commodities
Crude Oil
Oil fell about 2 percent on Tuesday, with Brent settling at $46.91 and U.S. crude at $43.51. In a monthly report, the Organization of the Petroleum Exporting Countries said its output rose by 336,000 barrels per day (bpd) in May to 32.14 million bpd, the largest increase since last December. The news kept oil under pressure, extending losses started since May 24. Without signs of stabilization, investors shall stay on the sidelines.
On technical front, the RSI index that located near oversold range pointed to a rebounding demand. Investors shall turn their attention to the report on U.S oil stockpiles, and may long oil in case of large drawdown in inventories.

Copper
LME copper ended 1.2 percent weaker at $5,657 a tonne. A steady stream of news has encouraged the bulls recently, including a talk of a market deficit, an expected strike in major producer Peru and declining inventories. But monetary tightening in China has stoked worries about the appetite for industrial metals in its biggest market. The global world refined copper market showed a 164,000 tonnes surplus from January to March, the International Copper Study Group (ICSG) said in its latest monthly bulletin. On trading strategy, investors are recommended to keep range-bound trading.

Soybean
U.S. soybean futures fell on improving U.S. crop weather, coupled with broad weakness in other commodities including crude oil. CBOT July soybeans fell 10 cents at $9.27-3/4 a bushel. The U.S. Department of Agriculture late Monday rated 67 percent of the U.S. soybean crops in good to excellent condition, up 1 percentage point from the previous week. The USDA also said that 96 percent of the nation's soybean crop is in the ground, better than 93 percent over the previous five years.

Dealing Room, ICBC Beijing Branch
Qin Gang