ETFS Short Crude Oil (SOIL) sees outflows as the US authorizes Syria intervention. US$12.5mn flowed out of ETFS Daily Short WTI Crude Oil (SOIL), as President Obama authorized lethal military aid to rebel groups in Syria. Oil prices have started to rally as perceived supply risks increase.
A bearish US agriculture report drives funds out of agriculture ETPs. The USDA in its monthly WASDE report kept its supply forecasts for corn and soybean firm, disappointing investors who had expected supply estimates to fall following late planting this year. Outflows from ETFS Grains (AIGG) were the highest since October 2010 (US$18.6mn). Investors also redeemed US$4.5mn of ETFS Longer Dated Grains (GRAF), US$5.3mn of ETFS Corn (CORN) and US$2.1mn of ETFS Soybeans (SOYB). The upcoming USDA Planted Acreage Report on June 28th will give further guidance on planting progress.
Gold ETPs continue to see outflows as US QE tapering expectations set in. Physical gold ETPs saw US$101mn of outflows last week as continued expectations of imminent tapering of US quantitative easing hurt price expectations. Physical demand, which has been a counterweight to falling investor demand, is under pressure from the Indian government seeking to wean consumers off gold. According to the Indian Ministry of Finance, gold imports fell from an average of US$135 million per day in mid-April to just US$36 million per day in early June 2013.
Key events to watch this week. Following strong jobs growth last month, but mixed data elsewhere, investors will be poised for further guidance from the Fed regarding when it will start tapering its bond-buying program.