July 2018

Outlook July Broad Commodities - A Dip in the Trend (Bloomberg Intelligence) -- The worst month for the Bloomberg Commodity Index (BCOM) in two years should pan out similar to the 5% decline in July 2016 that was just a dip in an early recovery. Likely in a nascent bull-market stage, the near-perfect storm at 1H's end will pass, allowing favorable demand vs. supply conditions to prevail. The best quarter for most dollar measures in years is poised to stall or reverse. A sharp crude-oil decline is a primary risk, but it's more likely the most significant commodity acts as a broad-market springboard. Priced for about the best of summer-production prospects and worst from trade tension, agriculture should have the most potential to revert higher. Metals, the most dollar sensitive and also pressured on trade, remain fundamentally strong and have dropped back into good bull-market support zones.