This morning marks the first day of trading for markets this week, as hurricane Sandy wreaked havoc on much of the east coast and forced U.S. exchanges to close for two days. Commodities markets, however, remained open and trading albeit with much lower than normal volumes. While today’s open won’t mean much for commodities themselves, the funds that track them are bound to be volatile, as they will need to reflect the changes made by their underlying holdings in the last two days [for more commodity news and analysis subscribe to our free newsletter].
Below, we outline three popular commodities and how their movements this week will impact funds that track them upon market open.
Gold Remains Steady
As arguably the most popular commodity, investors will be worried about how gold funds like the SPDR Gold Trust (GLD) will react at the open. Luckily, gold has been relatively steady, losing around 0.2% on Monday and Tuesday, meaning that related funds should have a fairly calm open to Wednesday’s session.
Silver Stays Volatile
Silver contracts continued their volatile trend in the last two days, as prices have seen losses of nearly 1%. Investors will want to watch popular products like the iShares Silver Trust (SLV) as it will likely gap at the open. Leveraged silver products are also very popular among investors, so it should come as no surprise if they are especially volatile throughout today’s session [see also 25 Ways To Invest In Silver].
Natural Gas Takes a Dive
With millions out of power and displaced from their homes, natural gas consumption will almost certainly take a hit. Thursday’s EIA Natural Gas Report (assuming it goes out on time) may very well show higher than expected inventories, hurting NG’s price. Already in anticipation of such a move, natural gas prices have dropped by nearly 1.4% over the last two days. The ultra-popular United States Natural Gas Fund (UNG) is sure to see an active day as far as movement is concerned, though it may be some time before normal trading levels are restored to markets.
Disclosure: No positions at time of writing.