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Broadly Defined Commodities Up Last Week

Broadly defined commodities rose last week, posting the strongest advance for the major asset classes, based on a set of exchange-traded products.

 

By James Picerno

 

The increase is an outlier during a week when most markets fell.

The iPath Bloomberg Commodity (DJP) jumped 1.0% for the five trading days through Oct. 27. US equities – the number-two performer – also posted a gain, edging up 0.2%. The rest of the field was in the red last week

“Markets are rebalancing with strong demand driving most commodities(NYSEARCA:DBC),” saysJodie Gunzberg, global head of commodities and real assets at S&P Dow Jones Indices. She adds that industrial metals are “dominating the gains from bullish expectations about Chinese demand growth.”

Last week’s biggest weekly decline for the major asset classes: foreign inflation-indexed government bonds. SPDR Citi International Government Inflation-Protected Bond (NYSEARCA:WIP) slumped 1.8%, leaving the ETF at a three-month low.

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For one-year results, stock markets around the world continue to lead, headed by US equities. Vanguard Total Stock Market (VTI)’s total return is currently a strong 23.9% for the past 12 months.

The second- and third-strongest gains for the major asset classes for the past year: foreign stocks in developed markets (Vanguard FTSE Developed Markets ETF (NYSEARCA:VEA)) and equities in emerging markets (Vanguard FTSE Emerging Markets ETF (NYSEARCA:VWO)), respectively.
The bottom performer in the one-year column: inflation-indexed Treasuries. iShares TIPS Bond (TIP) is off 0.3% for the 12 months through last week’s close.