By Jacob Bunge, Financial Correspondent
Tuesday, December 04, 2007 6:06:06 PM ET
NEW YORK (HedgeWorld.com)—It was a cold November for most of the commodity classes tracked by the Dow Jones-AIG Commodity Index, as all strategies but grains declined and the index as a whole slid 3% for the month. Year-to-date, the Dow Jones-AIG Commodity Index has returned 6%.
Energy and industrial metals had the worst month, with each subindex declining 8% over the 30-day period. Futures on crude oil made a retreat from their flirtation with the $100 mark, ending the month around $89 after declining almost $9.50 over the last week.
In commentary accompanying the figures, Dow Jones-AIG officials ascribed this move to ongoing fears of economic weakness in the United States, coupled with "mixed signals" from the Organization of the Petroleum Exporting Countries regarding a possible increase in oil production. Year-to-date through November, the DJ-AIG Energy subindex was up 9%.
November's 8% decline in the DJ-AIG Industrial Metals subindex, meanwhile, was not quite as big as it might have been, thanks to a late-month respite courtesy of a growing short-covering rally in zinc and diminishing copper supplies in Shanghai, according to DJ-AIG officials. Industrial metals tracked by the index lost 9% so far in 2008.
Precious metals, while still up 14% for the year through November, saw a 2% decline last month as the dollar began to rally. Gold prices slipped to $783 per ounce to close out the month. Soft commodities were off 3% for the month and 14% year to date, while livestock declined 1% for the month. That subindex was down 13% for the year.
The DJ-AIG Petroleum subindex, while down 4% for November, remained by far the biggest-earning subindex this year with a 32% return. Grains, meanwhile, were the sole commodity class among the DJ-AIG Commodity Index that finished the month with a gain, up 5%. Year-to-date, grain commodities have returned 26%.
The Dow Jones-AIG Commodity Index is a joint effort of Dow Jones & Co. Inc. and AIG Financial Products Corp.
JBunge@HedgeWorld.com
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