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Monthly commodities update

Invesco monthly commodities update

Key drivers of commodity returns

Although broad commodities performed well in April, with the Bloomberg Commodity Index returning 2.7%, it was primarily industrial and precious metals that contributed to the positive return, with lacklustre performance from the energy and agricultural sectors. While gold hit new all-time highs once more last month, breaching $2,400 per ounce for the first time, industrial metals were the star performers with that sector up by almost 14% for the month. 

Commodity sector returns April 2024
Commodity sector returns April 2024

Source: Bloomberg, Invesco as at 30 Apr 2024

Longer term histories for oil and gold

Although the gold future ended the month just 2.5% higher than at the end of March, it spiked to an intraday high of $2,432 in the middle of April, mainly due to geopolitical tensions in the Middle East. For a deeper dive into the performance of gold, please see our monthly gold article.

Gold price ($/oz)
Gold price ($/oz)

Source: Bloomberg, Invesco as at 30 Apr 2024

After rallying early in the month, the oil price faded in the second half of April as geopolitical tensions eased slightly. Overall, oil prices remain close to the average seen over the last 12 months.

Oil price ($/barrel)
Oil price ($/barrel)

Source: Bloomberg, Invesco as at 30 Apr 2024

  • Energy

    Having rallied early in the month on the back of heightened geopolitical tensions in the Middle East as Iran launched missiles and drones at Israel, oil prices faded during the second half of the month as there was little retaliation or additional hostility after that event. Natural gas prices bounced on some short covering along with warmer weather forecasts that could see demand rise over the summer.

    Energy – April 2024
    Energy – April 2024

    Source: Bloomberg, Invesco as at 30 Apr 2024

  • Precious metals

    Although gold hit the headlines as it reached new all-time highs during April, Silver was the best performing precious metal over the month. Central bank demand for gold has remained high, particularly from China and appears to be one of the main drivers along with ongoing geopolitical risks with gold ETP flows remaining negative as investors trim positions at the current elevated price levels.

    Precious metals – April 2024
    Precious metals – April 2024

    Source: Bloomberg, Invesco as at 30 Apr 2024

  • Industrial metals

    Industrial metals had a very strong month. Both the US and UK issued fresh sanctions on Russian copper, aluminium and nickel while data indicated that the Chinese economy may be improving which could see higher demand at a time when output is being cut.

    Industrial metals – April 2024
    Industrial metals – April 2024

    Source: Bloomberg, Invesco as at 30 Apr 2024

  • Grains, softs & livestock

    Agricultural commodities had mixed fortunes over the month with performance impacted by concerns about supply and disruptions to transport chains. Coffee was the standout performer over the month, largely driven by supply tightness due to the weather. Meanwhile sugar and cotton both performed poorly during April.

    Grains, softs & livestock – April 2024
    Grains, softs & livestock – April 2024

    Source: Bloomberg, Invesco as at 30 Apr 2024

  • Commodity ETP Flows

    The pace of outflows from commodities ETPs (-$4.0bn) increased in April, driven by heavy selling of precious metals. Gold ETPs experienced outflows of $3.6bn with a further $0.6bn coming out of Silver ETPs. Other single commodity ETPs (-$0.6bn) didn’t escape the negative investor sentiment with sales of Brent Crude (-$0.5bn) and Copper (-$0.3bn) leading the outflows. However, broad commodities (+$0.4bn) and Smart Beta commodity ETFs (+$0.3bn) did see some buying interest during April.

    Commodity ETP flows – April 2024
    Commodity ETP flows – April 2024

    Source: Bloomberg, Invesco as at 30 Apr 2024

Investment risks

  • The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.

Important information

  • This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security, or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.

    Data source Invesco/ Bloomberg as at 30 April 2024 unless otherwise stated

    Views and opinions are based on current market conditions and are subject to change.

    Israel: This document may not be reproduced or used for any other purpose, nor be furnished to any other person other than those to whom copies have been sent. Nothing in this document should be considered investment advice or investment marketing as defined in the Regulation of Investment Advice, Investment Marketing and Portfolio Management Law, 1995 (“Investment Advice Law”). Neither Invesco Ltd. nor its subsidiaries are licensed under the Investment Advice Law, nor does it carry the insurance as required of a licensee thereunder.

    EMEA3592280/2024