Equities Beat Commodities by Steepest Ratio in 4 Years

Bloomberg goes on the report that supplies will outpace demand for 12 of 18 metals and agriculture commodities, causing the slump. Citing Barclays and Rabobank International, it adds that at the same time, low global interest rates and stimulus from central banks have boosted company earnings, sending the Dow Jones Industrial Average to a record last week.

Production will exceed demand in aluminum, copper, lead, nickel and zinc this year, Barclays forecast in a Feb. 15 report. Surpluses are also expected in cotton and sugar, according to Rabobank International. Crude-oil stockpiles in the U.S., the world's biggest consumer, are at the highest since the end of June, a government report showed March 6. Oil futures are little changed in New York this year.

"Equities are benefiting the most from the availability of cheap money as the growth story has been getting some traction," Ole Hansen, the head of commodity strategy at Saxo Bank in Copenhagen told the news service. "The reason why commodities are not following is due to the fact the supplies are currently ample to meet increased demand."