Nat Gas Prices Jump 1% on Late Winter Weather Concerns

Copper futures posted a two-sided trade on Monday ahead of Federal Reserve Chairman Jerome Powell’s highly anticipated first congressional testimony on Tuesday. The price action basically mirrored the movement in the U.S. Dollar. The return of Chinese traders after the Lunar New Year holiday had little impact on the price action.

Prices were mixed in London, but moved higher on the Shanghai Futures Exchange in reaction to a strong rally in Shanghai stocks.

Some concerns over future demand were raised after the release of a report that showed sales of new U.S. single-family homes fell for a second straight month in January. This suggested to some traders that the housing market is losing momentum.

Gold

Gold prices rose considerably early Monday before giving back most of those gains to finish only slightly better. The market was helped early in the session as a softer U.S. Dollar helped the precious metal rebound from its biggest weekly loss this year. Traders are now awaiting the congressional testimony of Federal Reserve Chair Jerome Powell which could have an impact on the direction of the dollar and gold.

Increased demand for higher-risk assets also helped push gold down from its early highs. This may have been a sign that investors are betting Powell will highlight an intention to steer a steady course on U.S. monetary policy when he addresses lawmakers on Tuesday and Thursday.

Crude Oil

U.S. West Texas Intermediate and international-benchmark Brent crude oil closed higher on Monday, but a little off their highest levels in three weeks.

The markets were supported early in the session by comments from Saudi Arabia that it would continue to curb exports in line with the OPEC-led effort to trim global supplies.

Other factors underpinning prices were bullish comments from the Saudi oil minister, who said the country’s Q1 output should be below the production cap, a powerful quake in Papua New Guinea, which disrupted oil and gas operations, and a force majeure on Libya’s 70,000 bpd El Feel oilfield.

Natural Gas

Natural gas futures continued to climb on Monday, supported by forecasts of a cold spell that could drive up demand for the heating fuel. The rally was likely supported by a combination of speculative buying, short-covering and profit-taking after a prolonged down move put the market into technically bearish territory.

Updated weather forecasting models are showing a return to colder weather over the eastern U.S. during the first week of March.