I. Precious Metals
Gold
Gold prices fell 0.7 percent on Tuesday, as investors shrugged off heightened political risk following a deadly suicide attack in Britain. A suicide bomber killed 22 people, including children, in an attack on American singer Ariana Grande’s concert in Manchester. Countries from the United States to Japan and Singapore are considering tightening security ahead of major theatre and sports events following the suicide bomb attack in Britain that killed at least 22 people. Such events are expected to spur investors to buy in safe-haven assets like gold, though market remained quiet after the bombing. The U.S. dollar rebounded from 6-1/2-month lows, weighing on gold.
On technical front, the dollar can hardly reverse the losing momentum. Gold is taking a breather once again, struggling to make it out of this $1,245-$1,265 range.

Silver
Silver tracked gold, down 0.4 percent at $17.05 an ounce. The white metal can hardly buck the trend due to strong guidance from gold. But it may underperform gold once market morale is reversed.
On technical front, silver held around the 30-day moving average of $17, and is expected to test high again if gold could retain its steam.

II. Commodities
Crude Oil
Oil prices settled a bit higher on Tuesday as expectations of an extension to OPEC-led supply cuts overshadowed a White House proposal to sell half of U.S. petroleum reserves.
Brent crude settled up 28 cents at $54.15 per barrel. U.S. light crude was up 34 cents at $51.47. On Thursday the Organization of the Petroleum Exporting Countries (OPEC) meets in Vienna to consider whether to prolong cuts to reduce a global glut of crude. OPEC and other producing countries including Russia have cut output about 1.8 million barrels per day in the first half of 2017.
OPEC's de facto leader, Saudi Arabia, favors extending the output curbs by nine months rather than the initially planned six months, hoping to drain the crude glut and keep oil prices at or above $50 per barrel.
Delegates from Kuwait, Algeria, Ecuador and Mexico stated support for extended output cuts. Kuwait's oil minister, Essam al-Marzouq, said, "We agree on the need to do whatever is necessary to restore balance to the oil market."
Early in the session oil prices fell following news of a White House plan to sell half the 688 million-barrel U.S. oil stockpile from 2018 to 2027. The sale aims to raise $16.5 billion and help balance the federal budget. Rising supply from U.S. will capped oil’s gains.

Copper
London Metal Exchange benchmark copper ended 0.2 percent lower at $5,714 after dipping to an intraday low of $5,666, suffering from profit-taking after hitting a three-week high. The global world refined copper market showed a 93,000 tonnes surplus in February, compared with a 55,000 tonnes surplus in January, the International Copper Study Group (ICSG) said in its latest monthly bulletin. Oversupply still weighed on copper prices. In the medium and longer term, China’s economic recovery will provide a solid floor to the base metal. We maintain our bullish view on copper in the medium and longer term.

Soybean
U.S. soybean futures fell on Tuesday, dampened by technical selling and favorable U.S. planting progress. July soybeans ended down 8-1/4 cents at $9.48-1/4 a bushel. The USDA estimated that U.S. soybean plantings were 53 percent complete, above the five-year average of 52 percent. Soybean futures drew underlying support from a USDA announcement that private exporters in the last day sold 126,000 tonnes of old-crop U.S. soybeans to unknown destinations. The trading volume of soybean, soymeal and soyoil stood at 130,317 lots, 87,376 lots and 78,112 lots respectively.

Dealing Room, ICBC Beijing Branch
Cheng Yu