Commodities plunge again on China worries
On another sell-almost-everything day in financial markets, commodities are leading the way down -- reacting, once again, to fears that China’s voracious appetite for raw materials will slow as the government tries to rein in inflation.
The Reuters/Jefferies CRB index of 19 commodities was down 9.04 points, or 3%, to 296.98 at about 10:45 a.m. PST, the fourth drop in five sessions. The index now has fallen 6.9% from its two-year high reached Nov. 9.
If commodities were a bubble just a week ago, a lot of air has definitely come out of many prices. Besides concerns about China, the rebounding dollar also has undercut raw materials.
Cotton is down 3.7% to $1.29 a pound Tuesday. It has fallen 12.2% from its record high of $1.47 on Nov. 9.
Copper, which hit a two-year high of $4.04 a pound on Nov. 9, is down 5% for the day to $3.73, bringing the decline from the peak so far to 7.8%.
Gold, off $29.30, or 2.1%, to $1,339 an ounce Tuesday, is down 5% from its record high of $1,409, also set on Nov. 9.
U.S. blue-chip stock indexes, by contrast, are down less than 5% from their recent highs. The Dow Jones industrial average was off 185 points, or 1.7%, to 11,016 at about 10:45 a.m. PST. It has fallen 3.7% since reaching a two-year closing high of 11,444 on Nov. 5.
-- Tom Petruno