The latest set of housing figures was released in the US today, and with the Asian markets – specifically China – struggling to improve the lull witnessed in copper during the last couple of months, they needed something to help move the red metal in a northerly direction. The fact that sales in houses have fallen by less than was expected is good news, although not necessarily what was needed.
Last week saw the markets rocked by comments from the Chinese government, who stated that 7% is the low end of tolerance as far as growth for the economy is concerned. The market has not reacted as positively as was hoped, perhaps partly because the statement is seen as slightly over optimistic. These latest comments, especially the time frame that they have attached, raise more questions than answers and have left the commodity markets confused.
Commodity markets, like equity markets, do feel a downturn in volume when the summer months strike due to the higher number of traders away from their screens, but this lack of volume might see some larger swings in the markets.