For markets, April was like a famous quote from Charles Dickens’ A Tale of Two Cities – “it was the best of times, it was the worst of times” – starting with promise, running up, and then taking a crunching in the final days of the month.
Gold saw an absolute whacking on Tuesday as US wages and employment cost data came in higher than expected and hit sentiment. Wall Street fell sharply as well (ahead of tomorrow’s Fed meeting result), and other commodities were hit.
That added to angst about what the Fed might say in its post-meeting statement at 4 a.m., Sydney time, Thursday, and what Chair Jay Powell might add in his usual media meeting.
There are concerns that the Fed and Powell will go back to a hawkish stance and all but rule out a rate cut for 2024, or make the timing more problematic.
That saw US bond yields rise, which in turn saw equities and commodities fall.
The two-year Treasury note topped 5% and ended above that level at 5.04%, while the 10-year bond closed around 4.68% and up a massive 32 points in April alone.
The US dollar rose on the day and was up 1.4% for the month against major currencies. The Aussie fell back under 65 US cents to 64.73 US cents to be down 0.7% for the month. The Aussie is down 5% in the first four months of the year.
Comex front-month (June) gold lost more than 2.5% on Tuesday to end April at $US2,297 an ounce. That was better than the $US2,281 an ounce it opened up after Easter but down sharply from the all-time high of $US2,413 an ounce and an intraday record of $US2,448 an ounce. It is still up more than 10% in the first third of 2024.
The Aussie price is down around $A3,530 an ounce (according to the World Gold Council) and off around $A200 an ounce from its April peak.
Comex silver fell sharply as well, down nearly 4% to end at $US26.575 an ounce on Tuesday but still up more than 5.3% for the month, while Comex copper lost more than 2.7% on the day to end around $US4.54 a pound but still up a juicy 12% for the month as shortage fears continued to drive sentiment.
Oil lost ground as well, though not as much as gold. US West Texas Intermediate crude fell 1.3% to $US81.56, down 4.5% for April but still up more than 14% for the year.
Brent, the more important marker crude globally, shed 2% over the month but is still up more than 11% in the first four months of the year.
Iron ore stood out with a gain of 15% for April, despite continuing weak demand from China and high stocks of the key steel-making material at Chinese ports.
Newcastle high-quality thermal coal prices jumped more than 5% on Tuesday to $US142 a tonne, up from around $US133 a tonne at the end of March.
US wheat prices ended April lower on Tuesday but still up more than 7% for the month on worries about US, French, and European crops.
Cocoa prices, which have more than doubled so far this year on supply shortages (drought or wet weather in various regions), lost 11% in April as a lot of speculators were forced to sell loss-making positions or took profits.
Coffee prices jumped 12% in April, which was most of the 13% gain for the year to date. Prices fell 1.4% on Tuesday and lost ground in the final week of the month.