Commodities Under Pressure After Jobs Reports (USO, UNG, GLD, SLV, CHK, MRO)

Commodities retreated on Wednesday after a report on private sector job creation was weaker than expected, giving nervous investors another reason to question the strength of the economy. Moreover, In addition, a weaker euro zone report sparked new concerns about the region's fiscal health.

A report from Automatic Data Processing showed that Private-sector employment increased 119,000 in April, the lowest result since September. According to ADP, service-providing employment rose 123,000 in April, while goods-producing jobs fell 4,000. By employer size, small businesses gained 58,000 jobs, medium businesses gained 57,000 jobs, and large businesses gained 4,000 jobs.Also, Orders for goods produced in U.S. factories dropped 1.5% in March, the biggest decline in three years, the Commerce Department reported Wednesday, economists were estimating a fall of 1.6%.’

Crude oil slumped over 1% to $105 after an inventories report showed an increase in crude supplies in line with expectations. The Energy Information Administration reported a rise in crude supplies by 2.8 million barrels. Analysts polled by Platts had expected a rise of 2.5 million barrels. The EIA also reported a decline in gasoline inventories by 2 million barrels, and a decline in distillates supplies by 1.9 million barrels. The Platts analysts had expected gasoline stockpiles down 1 million barrels and distillates supplies down 400,000 barrels.

Gold for June delivery fell $12, or 0.7%, at $1,650 an ounce on the Comex division of the New York Mercantile Exchange. July copper fell 1.60%, to $3.78 per pound. China is a top consumer of copper.Silver for July delivery was down 1.40%, to $30.50 an ounce.July platinum fell $9.60, to $1,562 an ounce while palladium for June delivery declined 1.50% to $670.25 an ounce.

United States Oil Fund LP (ETF)(NYSEARCA:USO) was down 0.26 (-0.65%) at $39.9, SPDR Gold Trust (ETF)(NYSEARCA:GLD) fell 0.96 (-0.60%) to $160.36, iShares Silver Trust (ETF)(NYSEARCA:SLV) slid 0.42 (-1.40%) to $29.64 and United States Natural Gas Fund, LP(NYSEARCA:UNG) lost 0.27 (-1.60%) to $15.63.
Chesapeake Energy Corporation(NYSE:CHK) shares slumped 13.16% after the company reported a sharp decline in its first-quarter loss, but the company’s slid as the results came below analysts’ estimates.
The company reported a loss of $71 million, or 11 cents per share, down from a year ago loss of $205 million, or 32 cents per share. On an adjusted basis, the company would have earned 18 cents a share, missing analysts’ target by 10 cents.Revenue during the quarter grew 50% to $2.42 billion compared with $1.61 billion a year ago, but missed analysts’ estimates of $2.71 billion.Marathon Oil Corporation(NYSE:MRO) lost 4.37% to $28.87 after its adjusted profit of 67 cents a share fell short of the Wall Street target of 88 cents a share.