Commodities: oil drags but metals take-off - ANZ

Analysts at ANZ explained that commodities were led lower by another large fall in oil prices but with industrial metals surging higher.

Key Quotes:

"The optimism that oil producers would reach an agreement on a freeze in production is quickly evaporating. This was exacerbated by the bigger than expected build in inventories in the US. The rest of the complex received a boost from the unexpected rise in the official Chinese PMI.

The reading of 50.4 in August saw base metals push higher across the board. News that workers in copper-rich Chile are about to strike failed to gain much interest, with copper only marginally up on the day. Dalian iron ore futures were also supported by the strong manufacturing data in China; however this failed to flow into the physical market, with the spot index edging lower. An unexpected contraction in US manufacturing activity saw the USD weaken and gold prices push higher."