Scarcity Warnings In Physical World Send Commodities To 14-Year High, Threatening Stock Rally

A commodity rally tied to increasing “scarcity” in the physical economy is reaching multi-year highs and is starting to worry investors about equities, according to strategists cited in the report. The Bloomberg Commodity Index has climbed to levels last seen in 2012, while the Quantix Commodity Index hit a record high. Bloomberg strategist Simon White warns that rising commodity prices—now described as a broad-based inflation shock beyond oil—could squeeze corporate margins and household spending, reducing how long stocks can absorb the pressure. Since early August, gains span European gas (+34%), gasoline (+22%), metals like zinc and copper, and soft commodities such as sugar, cocoa and corn, with limited weakness among a small set of futures-traded products.