‘Commodities to strengthen next year’

CITIGROUP has given a clarion call for commodity bulls, predicting that most raw materials were expected to perform strongly next year. The bank is bullish on oil, copper, zinc, and wheat on a six- to 12-month horizon, with global growth seen at 2.7 percent from 2.5 percent this year, according to an e-mailed report. It is bearish on coal, iron ore, gold and soya beans. Commodities made a comeback this year after sinking to a quartercentury low in January as the oil market shows signs of rebalancing after a glut, and base metals rally on prospects for rising demand. Citigroup has flagged its optimism about raw materials next year since at least July, and other banks have also turned more positive. Last month, Goldman Sachs Group recommended an overweight position for the first time in four years. Citigroup warned that volatility was likely to pick up, as markets rebalanced, and as developments in China shifted prices. – Bloomberg