Commodities climb after fiscal cliff aversion

<p>Copper and oil have both gained after the US avoided the fiscal cliff.</p>

Commodities have climbed significantly following news that the US has avoided the fiscal cliff.

Barack Obama revealed he is to sign into law a bill that will undo tax increases for more than 99 per cent of households in the country, while it is hoped the decision not to implement spending cuts will result in America's economic recovery not being threatened.

Following the signing of the agreement, copper gained almost four per cent, while oil increased by nearly two per cent.

In addition, the Standard & Poor's 500 Index climbed 2.1 per cent and the Stoxx Europe 600 Index leapt two per cent to reach its highest level since February last year.

James Paulsen, chief investment strategist at Wells Capital Management, told Bloomberg that manufacturing in the US is returning to a level seen before the fiscal cliff drama took hold.

Mr Paulsen stated: "We're re-valuing the market based on what's closer to the underlying economy and most of the economic reports have been pretty good."

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