Heavy snow, bone-chilling cold and forecasts for a week of wintry weather in parts of the country Monday sparked a buying binge in crude oil and energy futures.
On other markets, precious metals futures fell sharply, stock index futures advanced, grain and soybeans climbed higher and livestock and meat futures gained.
In addition to the frigid weather, energy futures on the New York Mercantile Exchange were buoyed by indications that OPEC had reduced its crude oil production to 15 million barrels a day, less than the production quota oil cartel members set at a meeting last month, said Peter Beutel, an analyst in New York with Elders Futures Inc.
"I don't know if I'm convinced it's true, but it gave the market a psychological push," he said. "Then, technical factors took over along with the cold weather."
Crude oil futures had plummeted last month on doubts that members of the Organization of Petroleum Export Countries would abide by their production quotas. But the February contract advanced nearly $1 a barrel Monday.
A heaping helping of snow along the east coast and sub-zero temperatures across much of the Plains and Midwest boosted buying in heating oil futures, all of which settled up the 2-cent-a-gallon limit for daily trading.
Most unleaded gasoline futures also settled limit up.
West Texas Intermediate crude oil settled 73 cents to 99 cents higher, with the contract for delivery in February at $17.69 a barrel; wholesale heating oil was 2 cents to 2.77 cents higher, with February, on which the 2-cent limit has been removed due to the contracts pending expiration, at 52.76 cents a gallon; wholesale unleaded gasoline was 1.90 cents to 2.29 cents higher, with February at 46.11 cents a gallon.
Gold and silver futures on New York's Commodity Exchange ignored the supportive influence of higher crude oil prices and plunged on the dollar's new strength against foreign currencies, analysts said.
"The metals got creamed on a rising dollar and concerted central bank intervention on behalf of the dollar," said John Norris, chief metals trader for Citibank in New York.
Gold settled $8.10 to $9.40 lower, with January at $478.10 an ounce. Silver was 21.2 cents to 23.2 cents lower, with January at $6.47 an ounce.
Stock index futures advanced sharply on the Chicago Mercantile Exchange as investors began the new year in a bullish mood.
"There was a lot of cash that had been on the sidelines waiting for the New Year to get in," said Don Selkin, an analyst in New York with Prudential-Bache Securities Inc. "Last year, we started out with a bang in January."
Selkin said the stronger dollar and strong credit markets supported the stock futures. He said both the Standard & Poor's 500 index and the Dow Jones industrial index were poised to break through technically important levels last seen just before the stock market's October collapse.
The S&P 500 contract for March delivery settled 10.65 points higher at 257.40. The underlying cash index settled at 255.95 points.
Bullish attitudes and dry Brazilian weather pushed soybean futures sharply higher on the Chicago Board of Trade. Grain futures also closed higher.
Dry conditions in soybean growing regions of southern Brazil provided the main support for soybean futures, which gained as much as 13 3/4 cents a bushel, said Victor Lespinasse, a trader for Dean Witter Reynolds Inc.
Commodity funds, which invest in a wide range of agricultural and financial futures, were heavy buyers of grains across the board, he said.
Wheat settled 2 cents to 4 3/4 cents higher, with the contract for delivery in March at $3.1425 a bushel; corn was 2 cents to 5 3/4 cents higher, with March at $1.875 a bushel; oats were 2 1/2 cents to 3 cents higher, with March at $1.8825 a bushel, and soybeans were 9 cents to 13 3/4 cents higher, with January at $6.1625 a bushel.
Frigid weather helped boost livestock and meat futures on the Chicago Mercantile Exchange, traders said.
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