Commodities : Wednesday, July 15, 1987 : Futures Markets Rattled

A larger-than-expected U.S. trade deficit sent sharp reverberations through financial futures markets Wednesday.

Precious metals and most foreign currencies posted strong gains, while interest rates futures retreated.

In other markets, energy futures surged ahead; pork was sharply higher; most grain and soybeans were lower.

The trade deficit for May widened to $14.4 billion, the Commerce Department reported Wednesday morning. This was not only a reversal from the previous two months, but also far a larger gap than many economists expected.

Major foreign currency futures on the Chicago Mercantile Exchange, with the exception of the Canadian dollar, responded immediately with sharp gains.

The gains in foreign currencies were ultimately limited by concerns that that central banks would intervene to support the weakened dollar.

Energy futures posted strong gains in a stampede of buying on the New York Mercantile Exchange, with the nearby August contract settling above $22 a barrel for the first time since Jan. 17, 1986.