U.S. crude oil fell Wednesday, retreating from the previous session's five-week high, and many commodities saw subdued trading as investors remained on the sidelines due to Europe's debt crisis.
U.S. stocks closed higher after the Dutch government said it was committed to saving Greece and the euro zone. In a conference call with France and Germany, Athens vowed to implement austerity measures agreed in July.
Commodity markets responded with less enthusiasm than equities to the pledges over Greece and the euro zone.
The 19-commodity Reuters-Jefferies CRB index settled down half a percent, all but erasing Tuesday's gain, as several agricultural marketsfinished lower with oil. Copperand gold also fell.
Trading volume in most commodity futures slipped below the 30-day average, with gold volume falling 40 percent and orange juice volume down nearly 80 percent.
Thursday's session could see more activity as investors react to a surfeit of U.S. macroeconomic data that includes the Consumer Price Index for August, the New York State Manufacturing Index for September and weekly jobless claims.
In Wednesday's trading, the dollar fell against the euro and a basket of currencies, but not as much as in the previous session, to push investors into broadly seeking out commodities as a hedge.
"The market is feeling very ambivalent," said Sterling Smith, futures analyst at Country Hedging in St Paul, Minnesota. "The dollar remains rather mixed and economic questions in broader markets have many traders pushing to the sidelines and not buying as aggressively as they might otherwise."
The front-month crude oil futures contract on the New York Mercantile Exchange settled down 1.4 percent, or $1.30, at $88.91 a barrel, after finishing at a five-week high above $90 on Tuesday.
The losses came despite a report from the U.S. government's Energy Information Administration that showed crude stockpiles in the world's largest energy consumer fell last week twice as much as expected by the market.
Other U.S. data showed that U.S. retail sales growth stalled in August after a spending battle in Congress crushed consumer sentiment, leaving the country perched uncomfortably close to recession. A Reuters poll found economists see a nearly one-in-three chance of the United States re-entering recession.
Copper futures in Londonfell 1.6 percent to finish at just above $8,630 a tonne, coming within 2 percent of its 2011 low, as the poor U.S. macroeconomic data compounded concerns about Western world growth amid Europe's escalating debt crisis. A credit-ratings downgrade of two of France's largest banks added to the pessimistic tone.
Gold fell as increasingly volatile trade in the precious metal during the past month diminished its appeal as a safe-haven. Spot gold, which tracks trades in bullion, was down nearly 1 percent at below $1,820 an ounce.
On the agricultural front, cocoa took the sharpest fall, pressured by a large global surplus in the confection and beverage material for crop year 2010/11.
U.S. cocoa futures for Decemberclosed down $55, or 1.9 percent, at $2,810 a tonne, the lowest settlement since December 2010 for the market's benchmark second position. London's December cocoafinished down 27 pounds, or 1.5 percent, at 1,823 pounds per tonne -- the weakest close since June.
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