【Fujitomi】The recovery of overseas crude oil finally shows a rebound on short-covering profits

（NY Precious Metals）
On the 5th, New York gold briefly recovered from its decline but then fell from its highs due to souring on the strong U.S. employment data, ending slightly lower. New York gold futures for June delivery settled at 1,226.9 dollars, down 1.7 dollars from the previous day (a total drop of 28.6 dollars over the four days). New York silver futures for July delivery rose 2.5 dollars to 910.2 dollars.
In April, nonfarm payrolls rose by 210,000, beating expectations of 190,000. The much larger than expected increase from the revised 79,000 the prior month boosts the likelihood of a June U.S. Fed rate hike. In the market, expectations for a U.S. rate hike had risen following the Fed statement, and this added momentum to that view. However, rate hikes are already somewhat priced in, and with positions adjusted toward the weekend, the 1200-dollar level was defensible for now. The break below the previous low of 1225.7 dollars was likely, but not a direct plunge to 1200. Yet after a high of 1236.0 dollars, a fall of nearly ten dollars dragged the price into the red again, limiting upside amid rate-hike cautions. Platinum showed only a small gain, remaining around the 900-dollar level, with some sense of achieving near-term targets if it stayed just above 900 dollars. Some voices argued for a continued autonomous rebound, but there were also many who believed that a break below 900 dollars would be only a passing point given the weak fundamentals.

（WTI Crude Oil, NY Oil Products, North Sea Brent）
On the 5th, WTI crude oil rose on late-week short-covering. The nearby June WTI futures settled at 46.22 dollars, up 0.70 dollar from the previous day (a four-day net decline of 2.62 dollars). North Sea Brent for July delivery rose 0.72 dollar to 49.10 dollars (a four-day loss of 2.42 dollars). RBOB gasoline June futures rose 2.34 cents to 150.46 cents, and NY heating oil June futures rose 2.43 cents to 143.66 cents.
It was a rebound from consecutive declines. In Japanese trading hours on the 5th, prices suddenly fell in the afternoon. If June expired below 45.40 dollars, stop-loss selling hit and prices plunged to 43.76 dollars within ten minutes. Falling under 45 dollars seemed to accelerate selling. It later rebounded to 45.90 dollars, but faced renewed downward pressure as strong U.S. employment data tempered expectations for higher rates, sending prices back into the negative but then managing to stay in the 45-dollar range and contributing to the later recovery. Baker Hughes reported an increase of 6 oil rigs in operation in the U.S. as of the 5th, marking the 16th consecutive week of growth, but during the rebound phase this did not become a major bearish signal. The strong U.S. jobs data supported a rebound in U.S. oil products, aiding a recovery in crude oil. In the market, there was talk that 45 dollars could serve as the near-term floor, but given the persistently weak supply-demand balance, the durability of the autonomous rebound remains uncertain.

（CBOT Soybeans）
On the 5th, CBOT soybeans were mixed. The nearby July contract fell 0.50 cents from the previous day (a four-day gain of 4.00 cents) to 973.75 cents, while the new crop November contract rose 2.25 cents (a four-day increase of 3.25 cents) to 967.00 cents.
The previous day’s price drop for the new crop November contract saw a recovery, but nearby contracts were slightly weaker. In the weekend position adjustments, movements remained unsettled. There are no problems with soybean planting in the U.S. Corn Belt, and with progress expected in future planting, the new crop futures are expected to stay under pressure. Today, estimated net selling by funds was 3,000 contracts.

（CBOT Corn）
On the 5th, CBOT corn rebounded with the weekend-related adjustments. The nearby July contract rose 5.00 cents (a four-day net decline of 5.25 cents) to 371.50 cents, and the new crop December contract rose 4.75 cents (a four-day decline of 5.00 cents) to 389.25 cents.
This week showed up-and-down moves, but the weekend appeared to favor a rebound. Weather in the U.S. Corn Belt has been ideal for planting, and in Iowa and Minnesota where planting was behind, sunny conditions are expected to continue next week. Therefore, another round of declines was anticipated at the weekend, but since crude oil markets are rebounding, it seems funds held back from selling. Still, depending on weather after the weekend, another sell-off could occur. Wheat also showed autonomous rebound, but attention will be on the crop conditions released at the start of next week. Today’s estimated net buying by funds was 7,500 contracts.
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