Gold and oil soar as commodity rebound accelerates

Gold and oil soar as commodity rebound accelerates
Last Updated: Wednesday, March 26, 2008 | 5:22 PM ET CBC News

Oil and gold futures surged on Wednesday after a report of U.S. oil inventories and a weaker U.S. dollar sent commodity prices shooting higher.

The U.S. Energy Information Administration said crude oil inventories were unchanged in the past week — surprising analysts, who'd expected supplies would grow by 1.7 million barrels.

Supplies of gasoline and heating oil fell.

Oil futures were up $4.68 to settle at $105.90 US a barrel on the New York Mercantile Exchange.

The TSX energy sub-index was up 2.4 per cent, leading the broader TSX market higher. The benchmark index of the TSX rose 70 points to 13,392 — bringing its gain over the past four trading sessions to almost 700 points.

Talisman Energy rose 88 cents to $17.64; EnCana climbed $1.63 to $76.88; Suncor added $1.25 to $100.14.

Gold futures also gained more ground as the U.S. dollar weakened against a wide basket of currencies. The April contract rose $14.40 to $949 US an ounce as the precious metal continues to rebound from last week's big sell-off.

The TSX gold sub-index gained 2.1 per cent. Barrick Gold moved $2.15 higher to $46.30.

Financial stocks lost more ground Wednesday amid ongoing concerns about the credit market. Oppenheimer & Co. lowered their first-quarter profit forecasts for a number of U.S. banks by an average of 84 per cent.

The TSX financials sub-index shed 1.4 per cent.

The Dow Jones industrial average lost 110 points to 12,423. U.S. stocks slipped as new economic data showed new homes sales fell to the slowest pace in 12 years and sale of big-ticket manufactured goods unexpectedly fell.