Return of positive trend in commodity indices in Jan: DB

Last year, commodities were the worst performing asset class on a total returns basis with returns on the DJUBSCI declining 9.6% for the full year.

LONDON (Commodity Online): After showing a dismal performance in 2013, commodity indices turned positive in January helped by better performance of precious metals and live stock sectors while energy and industrial metals continued to suffer.

Deutsche Bank said in a monthly report that heaviest losses happened in industrial metals and agricultural sectors exposed to general drawdwon in gloabl equity markets as well as financial market weakness across a number of emerign market countries.

In agricultural markets, rising production particularly as it relates to the South American crop is sustaining the decline in agricultural returns as inventories across the complex are rebuilt. However, there have been pockets of strength with US natural gas, heating oil, coffee and cocoa among the strongest performers. Despite the strong gains in parts of the energy complex, helped by extreme cold weather in the US, these have been insufficient to offset losses earlier in the month. 

Last year, commodities were the worst performing asset class on a total returns basis with returns on the DJUBSCI declining 9.6% for the full year. In comparison to other asset classes, the first month of 2014 has been relatively kind to commodities compared to the losses suffered on benchmark equity and EM indices.