Wednesday 4 May 2011

Silver’s Biggest 3-Day Drop Since 1983 Leads Commodities Lower

http://noir.bloomberg.com/apps/news?pid=20601087&sid=aczMxRyEQZKQ&pos=6


May 4 (Bloomberg) -- Silver had its biggest three-day drop since March 1983, crude oil tumbled to a two-week low and gold, copper and grains fell after money managers made near-record bets on high commodity prices in April.


Silver plummeted 19 percent since April 29 as increases in Comex margin requirements drove investors away, and oil declined after a U.S. report showed supplies surged. A drop in a gauge of U.S. service industries and lower-than-forecast jobs growth damped economic optimism. Twenty-two of 24 commodities in the Standard & Poor’s GSCI Total Return Index fell. Treasuries rose



Margin Requirements
CME Group Ltd., Comex’s owner, this week raised the minimum amount of cash that must be deposited when borrowing from brokers to trade silver futures to $16,200 per contract from $14,513, effective at the close of business yesterday, the second increase in less than a week. A year ago, the margin was $4,250. Silver futures rallied 57 percent this year through April.

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