Commodities Daily - December 13, 2019

> Oil ticks higher on US-China trade news, despite downbeat IEA report. There has not yet been any official confirmation from either side on the phase one deal. In our view, it so far looks as though the US took a resolute step forward in announcing the deal terms, expecting China to go along. We believe confirmation is likely to come later today or over the weekend and note that Brent's next technical resistance level is $65.6/bbl. Today, investors will have a chance to digest November US retail sales data, which we expect to be in line with the consensus (for an m-o-m increase) and supportive for risk assets.> Gold plunges late yesterday amid growing hopes for phase one deal. Yesterday's initial jobless claims data from the US lifted gold to $1,486/oz, but later in the day media reports that US President Donald Trump had given his approval for a phase one trade deal with China brought about a U-turn. Gold prices plunged $21/oz and finished the day 0.3% lower. Today, Chinese Ambassador to the US Cui Tiankai and US Trade Representative Robert Lighthizer are expected to sign an agreement canceling the planned December 15 tariff hike. We expect volatility to remain elevated. As we write, gold is quoted near $1,470/oz.