Commodities: WTI pulls back after early gains, gold continues to slide

Commodities edged higher on Monday against the backdrop of a dip in the US dollar, even after crude oil futures surrendered early gains on the back of continued verbal sparring between Tehran and Washington at the weekend.

As of 1735 BST, the US dollar spot index was down by 0.07% at 83.62 and the Bloomberg commodity index up by 0.12% to 94.593.

West Texas Intermediate crude oil futures were heading lower after the close, erasing 0.69% to change hands at $67.79 a barrel on the NYMEX.

Earlier they had traded as high as $69.31 a barrel, after Iranian President Hasan Rouhani told Washington not to "play with the lion's tail". In response, US President Donald Trump warned Tehran to never threaten his country.

Losses in WTI also materialised despite the results of Baker Hughes's latest rig count survey, for the week ending on 20 July.

The survey, published on Friday, showed a drop of five rigs to 858.

Other energy futures were mostly lower too, with NYMEX natural gas losing 1.34% to trade at $2.72/MMBtu.

Gold futures were continuing to be weighed down by strength in the Greenback, despite the headlines on the geopolitical front, with August gold on COMEX slipping 0.54% to $1,224.40/oz..

It was a similar story for base metals, with COMEX copper slipping 0.25% to $2.7490 a pound.

Commenting on the red metal's fortunes at the start of the week, traders at Sucden Financial pointed out that "there is a focus on copper to Wednesday where Escondida union will be deciding on whether to strike, but also not that ICSG reports that cu showed a January –April surplus of 50K and US home sale disappointed."

In the background, economists at UBS revised down their projections for Chinese GDP growth in 2018 and 2019 from 6.6% and 6.4% to 6.5% and 6.2%, respectively, on account of the expected hit to the country's growth from US tariffs on trade.

Linked to the above, the yuan was again trading on the back foot versus the US dollar.

Agriculture futures on the other hand were mostly higher, save for three-month ICE-traded cocoa, which was giving back 1.08% to $2,297 per metric tonne.