Rates, FX and Commodities Strategy CFTC Commitment of Traders Report for the Week Ending September 5, 07 Gold specs continued to increase net length this week, with long positioning setting a record for 07 as specs aggressively added longs, which more than offset the modest increase in shorts. The threat of North Korean missiles, along with the growing market consensus that the US central bank will not hike rates helped gold rally to highs not seen since September of last year. However, speculators will need the Fed to provide additional certainty that it will delay the next rate hike before they add to their long exposure and further lift prices from current levels. Silver specs continued to increase net long positioning, as specs aggressively covered their shorts and modestly added to new longs. But, in sharp contrast to the yellow metal, silver specs have plenty of room to grow their long exposure. We continue to expect silver to outperform gold, as the silver metal remains cheap relative to gold, despite the recent strong precious metal sentiment and robust fundamentals. After last week's aggressive reduction in spec positioning, attributed to demand fears induced by Hurricane Harvey, WTI crude specs added back longs lost last week, but the short positions still remain. Investors rushed back into oil after damage and flooding to the refineries was not as bad as anticipated, and a large majority of the Gulf Coast refiners were ready to restart production. On top of eased demand fears, some import shipments from Asia were cancelled while production took a nearly 750k bpd hit, lessening the impact of the reduced demand. This all helped push oil back near the $50/bbl mark but fresh demand fears from a decrease in Chinese imports saw prices fall once again on Friday. However, we expect investor interest will return, and shorts will likely be covered, sending prices toward $50/bbl throughout September, once the impact of Harvey passes through the inventory numbers and we start to see inventories draw once again. Weekly CFTC Commitment of Traders Report (September 5, 07) Net NonCommercial Position Net NonCommercial Position (% of Open Interest) Futures Change Futures & Options Change Futures Change Futures & Options Change WTI + Brent Crude Oil 64,038 3,968 68,344 6,476 WTI + Brent Crude Oil.5% 0.4% 0.% 0.% WTI Crude Oil 36,898 4,84 44,46 7,93 WTI Crude Oil.5% 0.5%.6% 0.% Brent Crude Oil 5,40 (846) 39,98 (,456) Brent Crude Oil 0.3% 0.% 8.3% 0.% Natural Gas 36,76 (4,399) 37,458 (,086) Natural Gas 7.7% 0.% 7.3% 0.% RBOB Gasoline 78,446 0,47 79,36 0,583 RBOB Gasoline 8.8%.0% 8.5%.9% Heating Oil 4,375 9,96 40,666 9,946 Heating Oil 0.0%.% 9.3%.9% Gold 45,98 4,5 64,9 8,48 Gold 43.3% 0.4% 30.8% 0.4% Silver 64,7 0,56 6,43 0,8 Silver 35.0% 5.7% 9.9% 4.% Platinum 37,973,43 38,667,99 Platinum 47.9% 0.3% 47.5% 0.3% Palladium 4,968,499 4,05,46 Palladium 7.4% 4.3% 6.4%.6% Copper 48,865 5,3 48,56 5,48 Copper 4.8%.5% 4.6%.6% S&P 500 (4,08) (73) (3,50) 389 S&P 500 5.8% 0.% 3.% 0.4% Canadian Dollar 53,644 477 54,837 63 Canadian Dollar 6.4%.3%.6%.6% Euro 96,309 9,790 00,437 9,658 Euro 0.7%.3% 7.5%.0% U.S. TNotes, 0yr,806 (6,93) 7,580 (70,537) U.S. TNotes, 0yr 6.5%.4% 5.%.7% Long NonCommercial Position Short NonCommercial Position Futures Change Futures & Options Change Futures Change Futures & Options Change WTI + Brent Crude Oil,87,977 8,544,954,06 (5,35) WTI + Brent Crude Oil,03,939 (5,44),7,68 (,87) WTI Crude Oil 746,79 4,60 74,8 8,330 WTI Crude Oil 383,8 (0,654) 300,35 398 Brent Crude Oil,07,58 (5,66),,745 (3,68) Brent Crude Oil 80,8 (4,770) 97,547 (,5) Natural Gas 749,58 (30,6) 89,695 (4,963) Natural Gas 43,496 (6,3) 458,36 (,877) RBOB Gasoline 43,80 3,99 43,705 3,90 RBOB Gasoline 65,356 3,68 64,343 3,337 Heating Oil 05,898 8,693 05,49 9,075 Heating Oil 64,53 (,3) 64,583 (87) Gold 336,073 7,90 349,60 0,435 Gold 90,775,939 84,689,953 Silver 96,374 3,444 94,,43 Silver 3,03 (7,08) 3,688 (7,695) Platinum 55,834 3,85 55,865 3,45 Platinum 7,86,4 7,98,046 Palladium 9,04 55 9,6 33 Palladium 4,36 (,44) 5,0 (,8) Copper 7,088 5,459 7,857 5,60 Copper 3,3 46 3,96 8 S&P 500 3,47 98 4,698 705 S&P 500 7,75 7 8,8 36 Canadian Dollar 94,73 7,96 9, 5,890 Canadian Dollar 4,088 7,449 36,84 5,77 Euro 94,976 645 9,53 584 Euro 98,667 (9,45) 9,095 (9,074) U.S. TNotes, 0yr 890,78 (38,95) 87,09 (39,697) U.S. TNotes, 0yr 668,975 3,68 654,5 30,840 Contract specifications: Crude Oil 000 bbl; Nat Gas* 0,000 MMbtu; Gasoline 4,000 gal; Heating Oil 4,000 gal; Gold 00 oz; Silver 5000 oz; Platinum 50 oz; Palladium 00 oz; Copper 5,000 lbs; Wheat, Corn Soybeans 5000 Bushels; S&P 500 $50 X S&P 500; Canadian $ C$; Euro 5,000 Note: Positions reflect available data as of Friday. ICE futures data lag NYMEX data by one week; Natural Gas ICE futures (,500 MMbtu) are adjusted :4 to reflect contract size of NYMEX (0,000 MMbtu) Source: Bloomberg, CFTC, TD Securities Disclaimer: This report is a marketing communication. It has not been prepared in accordance with legal requirements, as outlined in the UK FCA s COBS, designed to promote the independence of investment research and is also not subject to any prohibition of dealing ahead of the dissemination of investment research, although as a matter of policy TD Securities requires its employees not to deal ahead of the dissemination of this report.
CFTC Metals Charts 3 COMEX Gold Gold Net Spec Position (lhs) Gold Price (rhs) $UD/oz,700,600,500,400,300,00,00,000 900 COMEX Gold 4 3 Long Gold Short Gold COMEX Silver $UD/oz 35 COMEX Silver 30 5 0 5 0 Silver Net Spec Position (lhs) Silver Price (rhs) Long Silver Short Silver 30,000 0,000 NYMEX Platinum Platinum Net Spec Position (lhs) Platinum Price (rhs) $UD/oz,800,700,600,500,400,300,00,00,000 900 800 NYMEX Platinum 70,000 30,000 0,000 Long Platinum Short Platinum
35,000 NYMEX Palladium $UD/oz,000 NYMEX Palladium 30,000 5,000 5,000 0,000 5,000 900 800 700 600 500 35,000 30,000 5,000 5,000 0,000 5,000 400 Palladium Net Spec Position (lhs) Palladium Price (rhs) Long Palladium Short Palladium COMEX Copper $UD/lb 430 380 330 80 () 30 () () 80 Copper Net Spec Position (lhs) Copper Price (rhs) COMEX Copper Long Copper Short Copper 3
CFTC Energy Charts 700,000 500,000 3 () () () NYMEX & ICE WTI Crude Oil WTI Net Spec Position (lhs) NYMEX & ICE Brent Crude Oil WTI Price (rhs) $UD/bbl 0 0 00 90 80 70 60 50 40 30 0 $UD/bbl 0 0 00 90 80 70 60 50 40 30 0 NYMEX & ICE WTI Crude Oil 900,000 800,000 700,000 500,000 Long WTI Short WTI NYMEX & ICE Brent Crude Oil,,000,000 800,000 Brent Net Spec Position (lhs) Brent Price (rhs) Long Brent Short Brent NYMEX Gasoline $UD/gal 350 NYMEX Gasoline 300 50 00 50 00 50 Gasoline Net Spec Position (lhs) Gasoline Price (rhs) Long Gasoline Short Gasoline Note: Positions reflect available data as of Friday. ICE futures data lag NYMEX data by one week. 4
NYMEX Heating Oil $UD/gal NYMEX Heating Oil 90 40 () 90 () 40 () Heating Oil Net Spec Position (lhs) Heating Oil Price (rhs) 90 Long Heating Oil Short Heating Oil 500,000 () () NYMEX & ICE Natural Gas Natural Gas Net Spec Position (lhs) $UD/MMbtu 6.50 6.00 5.50 5.00 4.50 4.00 3.50 3.00.50.00.50 Natural Gas Price (rhs) NYMEX & ICE Natural Gas,,000,000 800,000 Long Natural Gas Short Natural Gas Notes: Positions reflect available data as of Friday. ICE futures data lag NYMEX data by one week. Natural Gas ICE futures (,500 MMbtu) are adjusted :4 to reflect contract size of NYMEX (0,000 MMbtu) 5
CFTC Agricultural Charts () () () () () () () CBOT Wheat Wheat Net Spec Position (lhs) Wheat Price (rhs) $UD/bsh 850 800 750 700 650 600 550 500 450 400 350 CBOT Wheat Long Wheat Short Wheat CBOT Corn $UD/bsh 850 CBOT Corn 750 500,000 650 550 450 () 350 () Corn Net Spec Position (lhs) Corn Price (rhs) 50 Long Corn Short Corn () () () CBOT Soybean $UD/bsh,700,600,500,400,300,00,00,000 900 800 CBOT Soybean 3 Soybean Net Spec Position (lhs) Soybean Price (rhs) Long Soybean Short Soybean 6
TDS Commodities Forecast Table Commodity Spot 07 08 Annual (Avg of forward month contracts) Price QA QA Q3F Q4F QF QF Q3F Q4F 06 07F 08F Precious Metals Gold $/oz,346,9,57,65,75,300,300,35,35,50,54,33 Silver $/oz 8. 7.4 7. 6.85 7.5 8.50 8.50 9.5 9.5 7. 7.8 8.88 Platinum $/oz,007 979 939 960,000,05,050,075,00 987 970,063 Palladium $/oz 945 767 8 880 900 900 95 95 950 63 84 95 Base Metals #N/A Invalid Security Copper $/lb 3.03.65.57.83.75.75.80.80.84..70.80 $/tonne 6,67 5,838 5,668 6,36 6,070 6,070 6,75 6,75 6,55 4,867 5,953 6,69 Zinc $/lb.37.6.8.33.38.5.5.43.43 0.95.9.47 $/tonne 3,09,778,59,935 3,050 3,350 3,350 3,50 3,50,09,839 3,50 Lead $/lb.0.03 0.98.04.08.0.0.. 0.85.03.6 $/tonne,34,78,56,90,375,646,646,469,469,867,75,557 Nickel $/lb 5.3 4.66 4.8 4.6 4.50 4.50 4.75 5.00 5.00 4.35 4.49 4.8 $/tonne,54 0,65 9,09 0,68 9,9 9,9 0,47,03,03 9,597 9,89 0,60 Aluminium $/lb 0.94 0.84 0.86 0.88 0.88 0.90 0.90 0.9 0.9 0.73 0.87 0.9 $/tonne,07,853,905,950,940,984,984,08,08,604,9,006 Molybdenum 3 $/lb 8.60 7.88 8.07 8.5 8.5 8.50 8.50 9.00 9.00 6.5 8.09 8.75 Iron Ore 4 $/tonne 78 86 63 7 68 65 65 65 65 58 7 65 Ene r gy #N/A Invalid Security WTI Crude Oil $/bbl 48 5 48 49 54 60 60 6 6 43 5 6 Brent Crude Oil $/bbl 54 55 5 5 56 6 6 6 6 45 53 6 Heating Oil (ULSD) $/gal.77.60.5.60.70.85.80.80.90.36.60.84 Gasoline $/gal.65.58.58.60.60.80.95.95.85.40.59.89 NYMEX Natural Gas $/MMBtu.90 3.06 3.4.90 3.00 3.0 3.5 3.0 3.0.55 3.0 3.6 AECO Natural Gas $/MMBtu.56.0.05.95.0.50.55 3.5 3.5.67.05.89 CAD/GJ.55.55.64.48.80 3.6 3. 4.8 4.8.06.6 3.74 Uranium $/lb 4 4 6 6 3 3 6 3 9 New castle Thermal 5 $/tonne 6 8 80 94 88 88 86 86 86 66 86 87 Notes: F = Forecast, E = Estimate, A = Actual;. London PM Fix;. LME; 3. Molybdenum equivalent to moly oxide, FOB USA; 4. CFR China, 6% Fe, dry; 5. Japan CIF steam coal markernewcastle Source: Bloomberg, TD Securities Commodities Strategy Team: Bart Melek Global Head of Commodity Strategy bart.melek@tdsecurities.com + 46 983 988 Ryan McKay Commodity Strategist ryan.mckay@tdsecurities.com + 46 98 586 Daniel Ghali Commodity Strategist daniel.ghali@tdsecurities.com + 46 983 8075 This report has been prepared solely for information purposes and is not intended to provide financial, legal, accounting or tax advice and should not be relied upon in that regard. Information provided in this Report is believed to be accurate and reliable, but we cannot guarantee it is accurate or complete or current at all times and no representation is made in this regard. Conclusions and opinions do not guarantee any future event or performance. It is not an offer, recommendation or solicitation to buy or sell, nor is it an official confirmation of terms. It is based on public information. Changes to assumptions may have a material impact on any returns detailed. Historic information or performance is not indicative of future returns. The information is subject to change without notice. Any views expressed are those of the author and do not necessarily express those of The Toronto Dominion Bank ( TD Bank ). TD Bank or an associated company may have effected or may effect transactions for its own account in the securities described herein. Any transaction entered into is in reliance only upon your judgment as to both financial and suitability criteria. No proposed customer or counterparty relationship is intended or implied between TD Bank or any of its regulated subsidiaries and a recipient of this document where that recipient is not an existing customer or counterparty of TD Bank or one of its regulated subsidiaries. COPYRIGHT 03 by TD Securities Inc. TD Securities is a trademark of the TD Bank, representing TD Securities Inc., TD Securities (USA) LLC and certain investment activities of the TD Bank. The TorontoDominion Bank is regulated by the FSA. 7
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