May 7, 2012 / 8:33 PM / 7 years ago

COMMODITIES-Up after early drubbing on Europe; nickel jumps

* Markets recover after initially diving on Europe elections
    * CRB index ends in positive after Friday's near 3 pct rout
    * Bargain hunting helps oil; bets on China lift copper
    * Nickel jumps 8 pct, extending rally for second day

    By Barani Krishnan	
    NEW YORK, May 7 (Reuters) - Commodities rebounded on Monday
after the huge selloff of the previous session, with nickel
staging a big rally and bargain hunting lifting oil prices from
their lows after investors shrugged off earlier fears about
election outcomes in Europe.	
    Futures of orange juice fell more than fell 3
percent, cotton about 2 percent and soybeans nearly
1 percent, reflecting continued caution in some markets after
Friday's rout that pushed prices to multi-month lows. Closure of
London markets for a holiday also led to thinner trading
    Even so, some key industrial commodities like copper,
aluminum and natural gas closed in positive
    That helped the 19-commodity Thomson Reuters-Jefferies CRB
index climb slightly after its near 3 percent fall in the
previous session -- its sharpest decline in five months.	
    Aside from the thinking that Friday's rout may have been
overdone, markets such copper and nickel were also boosted by
expectations of a turnaround in demand in the second quarter
from top metals buyer China, analysts said.	
    "The uncertainties that have emerged in Europe are going to
contribute to a downside bias to the trading range," Nicholas
Snowdon, an analyst with Barclays Capital in New York, said.  	
    "But ultimately, we are still in a phase where this tension
between current softness in Chinese demand and the expectation
of an ultimate improvement in conditions there in the second
half of the year is keeping us in a relatively range-bound
market for the majority of base metal prices."	
    The outcome from weekend elections in France and Greece
initially sent commodities, stocks and other risk assets
tumbling in Monday's early trade.	
    Socialist Francois Hollande's victory in France's
presidential election signaled a push back against German-led
austerity policies.  	
    In Greece, both the conservative New Democracy and Socialist
PASOK were thrashed as Greeks voted against the two traditional
ruling parties after they imposed austerity in exchange for a
bailout to avert a sovereign default. The winning parties must
now woo support from factions boosted in the election by
opposing the bailout, making it uncertain if they can form
    Copper prices fell about 1.5 percent before reversing
sentiment to close up by a similar percentage. The metal's
most-active U.S. futures contract, July, touched  a
session low of $3.6665 a lb before finishing at $3.7480. 	
    In crude oil, the benchmark Brent contract in London 
fell as much as $2.84 before closing two cents off at $113.16 a
barrel. U.S. light crude in New York tumbled $3.15 before
paring losses to end 55 cents lower at $97.94.   	
    Nickel, a metal used for making stainless steel, was
a star for a second running session, rising more than 8 percent
to stay atop the CRB's list of gainers.	
    Nickel's ascent began on Friday, when it rose 2 percent on
fear that new taxes and curbs on metals shipments by key miner
Indonesia would jack up ore prices. 	
 Prices at 3:42 p.m. EDT (1942 GMT)      
                             LAST/      NET    PCT     YTD
                             CLOSE      CHG    CHG     CHG
 US crude                    98.07    -0.42  -0.4%   -0.8%
 Brent crude                113.30     0.12   0.1%    5.5%
 Natural gas                 2.336    0.057   2.5%  -21.8%
 US gold                   1639.10    -6.10  -0.4%    4.6%
 Gold                      1637.80    -4.25  -0.3%    4.7%
 US Copper                  377.35     5.25   1.4%    9.8%
 Dollar                     79.580    0.081   0.1%   -0.7%
 CRB                       297.460    0.310   0.1%   -2.6%
 US corn                    665.00     2.75   0.4%    2.9%
 US soybeans               1463.50   -11.50  -0.8%   22.1%
 US wheat                   606.25     2.50   0.4%   -7.1%
 US Coffee                  174.15     0.65   0.4%  -23.7%
 US Cocoa                  2357.00    68.00   3.0%   11.8%
 US Sugar                    21.05     0.24   1.2%   -9.4%
 US silver                  30.072   -0.308  -1.0%    7.7%
 US platinum               1530.10    -5.90  -0.4%    8.9%
 US palladium               647.80    -4.35  -0.7%   -1.3%
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