The fact that Democrats won the majority in both houses of Congress in the midterm elections held on November 3 in the USA changed the expectations regarding economic policies and geopolitical developments.
The sales in technology stocks due to concerns that regulations for the artificial intelligence sector may tighten have increased investors' search for a safe haven. While the demand for bonds pulled the yields down, gold also completed the week with an increase.
On the other hand, strong US employment data announced on the last trading day of the week limited the gains in precious metals by supporting expectations that the US Federal Reserve (Fed) may increase interest rates.
OUNCE PRICE INCREASED AGAIN AFTER THREE WEEKS
In precious metals, changing investor expectations following the election results, the course of bond interest rates and employment data announced in the USA were decisive.
The weakening of the dollar and the decline in US bond interest rates in the middle of the week supported purchases by reducing the alternative cost of non-interest-bearing gold. The ounce price of gold rose over 3 percent on Wednesday and reached its highest level since October 22 on Thursday.
A recovery in demand was also observed in the physical market, following the price declines in the previous weeks. While retail purchases strengthened in India before the Diwali Festival, there were signs of recovery in jewelry demand from low levels in China.
According to data released on Friday, non-farm employment in the USA increased by 165 thousand people in October. While average hourly earnings increased by 0.4 percent monthly, the unemployment rate was 4.1 percent.
Following the employment data, pricing regarding the possibility of the Fed raising interest rates in December has strengthened. The intraday rise in dollar and bond interest rates caused gold to give back some of the gains it made in the middle of the week.
Following the fluctuations during the week, the dollar index completed the week at 102.3 with a 0.4 percent increase. Thus, gold rose with the support of the decline in bond interest rates and safe haven demand, despite the dollar's strengthening on a weekly basis.
The ounce price of gold completed the week at $4,070 with a 5 percent increase, ending its three-week series of declines. In the precious metals group, the strongest weekly increase was seen in platinum.
With these developments, prices on an ounce basis in precious metals increased by 7.1 percent for platinum, 5.8 percent for silver, 5 percent for gold and 4.7 percent for palladium.
SUPPLY CONCERNS FROM INDONESIA SUPPORTED NICKEL
A mixed trend was observed in base metals due to concerns about artificial intelligence investments and changing supply conditions on a metal basis.
Nickel prices rose on concerns that actions taken over allegations that some mining companies in Indonesia were operating in forest areas without permission could cause a disruption in supply. Developments in the world's leading nickel producer country have enabled the metal to differentiate positively from the overall group.
Uncertainties regarding artificial intelligence and data center investments in copper suppressed prices.
The fact that copper stocks in Shanghai Futures Exchange warehouses decreased by more than 24 percent during the week to 33 thousand 848 tons kept supply concerns alive and limited losses.
In the over-the-counter market for base metals, prices on a pound basis last week increased by 7.7 percent for nickel, while they decreased by 3.5 percent for copper, 2.9 percent for zinc and 1.4 percent for lead. Aluminum remained flat.
WHILE OIL DECLINED HARD, NATURAL GAS WAS SUPPORTED BY COLD WEATHER EXPECTATIONS
Expectations that the conflicts in the Middle East could calm down and shipments from the region could increase following the election results in the USA were decisive in oil prices.
While the decrease in the geopolitical risk premium led to a sharp decline in oil prices, the continuation of attacks on tankers in the Gulf Region prevented concerns about supply security from completely disappearing.
As for US natural gas, predictions that the weather will cool down towards mid-November in the central and eastern parts of the country have strengthened the expectation that heating demand may increase. The increase in gas flows to liquefied natural gas export facilities also supported prices.
According to data released by the US Energy Information Administration during the week, natural gas stocks increased by 77 billion cubic feet in the week ending October 30. The fact that the increase was above the 5-year average of 61 billion cubic feet limited the upward pressure on prices.
However, while the price of natural gas in British thermal units increased by 5 percent on a weekly basis, the barrel price of Brent oil decreased by 13.4 percent.
WHILE SUPPLY EXPECTATIONS STAND FORWARD IN CEREALS, RICE AND COTTON INCREASED
In agricultural commodities, the harvest in the USA, global supply expectations and weather conditions in producing countries had an impact on pricing.
Expectations that shipping conditions in the Black Sea may improve as Russia and Ukraine increase their exports from alternative routes came to the fore in wheat prices. The increase in shipments of Russian wheat from Baltic ports and Ukrainian grain via Romania and the Danube River eased supply concerns.
Expectations of abundant supply in corn and soybeans increased the selling pressure. Analysts' prediction that soybean production forecasts will be increased ahead of the report to be published by the US Department of Agriculture next week also put pressure on prices.
In rice, evaluations regarding the decrease in US production and concerns that El Niño could harm production in Asia supported prices.
With these developments, prices per bushel on the Chicago Mercantile Exchange decreased by 3.2 percent for soybeans, 2.2 percent for wheat and 1.2 percent for corn, while the price per hundred pounds of rice increased by 2.4 percent.
Sugar prices fell with the rapid start of new season production in India. Data announced during the week, showing that production in the country reached 845 thousand tons from the beginning of the season to the end of October, supported short-term supply expectations.
The expectation that coffee exports from Brazil and the amount of product reaching stock exchange warehouses may increase put pressure on prices. The increase in Brazilian coffee awaiting classification in ICE warehouses indicates that supply may expand, while the low course of certified Arabica stocks limited losses.
The arrival of the main cocoa harvest in West Africa and the excess supply from the previous season were effective. Concerns that the drought in Ivory Coast may negatively affect the harvest in the future were among the factors that supported the prices.
In the US, Intercontinental Exchange prices in pound terms increased by 1.5 percent for cotton, while they decreased by 5.7 percent for sugar and 5.5 percent for coffee. The price per ton of cocoa also completed the week with a decrease of 3.9 percent.
