The biggest event in the global commodity futures market last week was that of the halt in trading in crude and refined products after gasoline futures hit the lower circuit after having dropped 25 cents in one day?s (Wednesday?s) trading.

This event overshadowed everything else last week because it was for the first time since the financial crisis of 2008 that circuit breakers (mechanisms put in place by exchanges to contain excess volatility by halting trading for a few minutes) had been hit.

The steep decline in gasoline futures was attributed to in the main to news of rise in gasoline inventories in the US. The other important news for the crude oil complex was the rise in margin on Monday for crude futures by the Chicago Mercantile Exchange (CME).

CME raised the margin on crude futures on Monday for the fourth time since February as price volatility soared. The effect of this was immediately seen on NYMEX crude (WTI) which fell by 0.4% on Tuesday.

However, on a weekly basis both the WTI and Brent crude registered gains of 1.56% and 2.95%, despite the strengthening of the dollar against the euro, mostly in reaction to positive macroeconomic news coming out from the euro zone. The latest quarterly data show that GDP in the euro region grew by 0.8% from 0.3% in the previous quarter and higher than a forecast of 0.6%.

Despite the positive news on the growth front concerns about euro zone (especially Greece, Ireland and Portugal) have still not completely disappeared from the markets as the dollar strengthened against the euro by almost 1.8% over the week.

Another source of concern for the market was the hike in cash reserve last week by China (to contain inflationary pressures); the immediate effect of which on the market was an expectation of a slower growth in demand for raw materials causing copper to tumble by 1.53% during the trading session, though by the end of the trading session (on Thursday) copper regained the losses. On a weekly basis, copper futures virtually saw no gain or loss.

The lack of movement in copper is an indication of the tentativeness of the markets as copper is a bellwether indicator of markets expectations of macroeconomic conditions.

The other news that came out of China was that of higher inflation at 5% exceeding the government?s target of 4%. Markets cling to gold the moment they see inflation rearing its head.

However, inflationary conditions did not seem to have weighed too much on the market sentiment as near month gold and silver futures fell by 0.2% and 1.9% respectively over their open prices at the beginning of the week.

The strong dollar could have aided this fall as well. Other commodities that fell in the global commodity futures markets during the week were wheat and corn which are said to be in a correction mode.

Sugar futures registered a gain of more than 4% mostly in reaction to news about a fall in Brazil?s sugar output between mid-March and end April compared with same time last year.

In the Indian commodity futures markets chana futures gained during the week with near month futures having risen by around 2.40% during the week.

This was mostly attributed to pick up in demand in the spot market combined with restricted supplies. In the grains complex near-month maize futures came down by around 1.4% during the week, overseas sentiments being one of the factors that caused this downward movement.

Potato futures too came down during the week amidst reports of adequate stock position and subdued demand in the spot market.

* The writer is senior economist, NCDEX. The views expressed are her personal