I. Precious Metals
Gold
Gold rose to a seven-week high on Wednesday, as the dollar dropped and Treasury yields fell after U.S. President-elect Donald Trump spoke in his first formal news conference just days before taking office. Spot gold was up 0.4 percent at $1,192.61 an ounce, after a choppy session that traded from $1,176.94 to $1,198.40. At the lows of the session, gold received a much-needed 'Trump bump' when the president-elect triggered an equity and dollar selloff. U.S. stocks lost ground in choppy trading, led by drug stocks after Trump said pharmaceutical companies were "getting away with murder" by charging high drug prices. Trump's timely intercession allowed gold to rally to new highs of the move at $1,198, which is expected to rebound further in the first quarter as market concerns over uncertainties within the year. Elections over the course of the year in France, the Netherlands and Germany are likely to create political tensions in the European Union and support gold. The uncertainty surrounding Brexit could lead to independence referendum in Scotland, adding to the already intensified risks in the euro zone and providing a floor to gold.

Silver
Silver was up 0.5 percent at $16.70, but still lower than Thursday’s peak at $16.90. Technically, the metal fell sharply yesterday during one point, but turned positive later on as the U.S. dollar and U.S. stocks pulled back sharply and U.S. Treasury yields rose after President-elect Donald Trump disappointed dollar bulls. Silver prices steadied above the 50-day moving average and are expected to rise further as yesterday’s lower shadow line consolidated the support below.

II. Commodities
Crude Oil
Oil prices jumped more than 2.5 percent on Wednesday, their biggest daily rise in more than a month, lifted as the U.S. dollar weakened following a news conference by U.S. President-elect Donald Trump and on news that Saudi Arabia cut exports to Asia. The U.S. Stocks edged down as Trump's remarks, which disappointed investors, did not elaborate on his economic policy agenda. Brent futures rose $1.46 at $55.10 a barrel, while U.S. West Texas Intermediate crude gained $1.43 to $52.25 per barrel.
Oil rose yesterday because some in the market focused more on a 579,000 barrel crude draw from the Cushing, Oklahoma storage hub last week, rather than the bigger-than-expected 4.1 million barrel overall U.S. inventory build in the U.S. Energy Information Administration's (EIA) petroleum report. That 4.1 million barrel build topped both the 1.2 million barrel build that analysts forecast. Saudi Arabia, the world's top oil exporter, told some Asian customers that it will reduce their crude supplies slightly in February. Still, there is plenty of oil to fill gaps left by OPEC. European and Chinese traders are shipping a record 22 million barrels of crude from the North Sea and Azerbaijan to Asia this month. U.S. crude production was projected to rise by 110,000 barrels per day in 2017 to 9 million bpd, according to EIA data. Last month’s forecast is an annual drawdown of 8 million barrels.

Copper
Copper slipped on Wednesday after U.S. President-elect Donald Trump gave little guidance on new infrastructure spending at a press conference in New York, disappointing some who had hoped for a clearer view on policy. Three-month copper on the London Metal Exchange closed down 0.8 percent at $5,714 a tonne on Wednesday, off an earlier peak of $5,788.50, its highest since Dec. 13. The metal, used in construction, surged more than 10 percent in the month following Trump's election to the U.S. presidency on Nov. 8, as his pledge to boost spending unleashed a wave of investment in industrial commodities. Copper remains up more than 3 percent so far this year after Chinese and global economic data fuelled expectations for firm demand in 2017. Further underpinning the metal are rising concerns over supply disruptions. Workers at Chile's Escondida copper mine - the world's biggest - have already rejected a wage offer from BHP Billiton, raising the prospect of a strike.

Soybean
U.S. soybean futures declined on Wednesday with the most active CBOT March soybeans falling 2-1/4 cents at $10.11-1/2 a bushel. March soymeal futhres also dropped, while March soyoil closed up boosted by stronger Malaysian palm oil and soyoil on China's Dalian Commodity Exchange. But traders are expecting higher soy production in South America, especially in Brazil, adding pressure to the market. U.S. Department of Agriculture is expected to revise up its forecast on soy crop in 2016, but cut its estimate on U.S. carried-over inventories in 2016/17. March soymeal fell $2.6 to $214.9 a tonne. March soyoil rose 0.36 cents to 36 cents. Traded volumes of soybean, soymeal and soyoil were expected to stood at 133,283 lots, 69,072 lots, and 83,639 lots respectivly.

Dealing Room, ICBC Beijing Branch
Lv Yan