Commodities dropped for a second day to a five-month low, extending the year’s losses, on concern that Greece may leave the euro region, roiling financial markets and dimming the outlook for raw materials demand. The Standard & Poor’s GSCI Spot Index, which tracks 24 raw materials, lost 0.7 percent to 624, the lowest level since Dec. 20, by 1:36 p.m. local time. The gauge is down 3.2 percent in 2012. It dropped 0.9 percent yesterday as the dollar rallied on demand for a haven. The risk of Greece’s possible exit from the currency bloc as the country’s June 17 elections loom helped drive Asian stocks lower today. The dollar rose to a 20-month high against a six-currency basket including the euro before European Union leaders gather in Brussels to discuss how to revive growth. “The instability within the euro zone resulted in a selloff across risk assets, pushing the U.S. dollar higher and commodity prices lower,� said Luke Mathews, an analyst at Commonwealth Bank of Australia. (CBA) Oil retreated for a second day, with the July-delivery contract falling as much as 1 percent to $90.97 a barrel on the New York Mercantile Exchange. June-delivery gold lost as much as 1.4 percent to $1,554.50 an ounce, and was at $1,558.70 on the Comex in New York. The decline in commodity prices triggered a drop in related equities. BHP Billiton Ltd. (BHP), the world’s biggest mining company, fell as much as 1.7 percent and Rio Tinto Group, the third- largest mining company, decreased as much as 1.9 percent. Greek Woes Greece’s former Prime Minister Lucas Papademos said that while it’s unlikely the nation will leave the euro, it’s still a risk, according to a report in the Wall Street Journal yesterday. The European debt crisis has wiped more than $4 trillion from equity markets worldwide this month. The 17-nation euro was 0.2 percent from a four-month low against the dollar. Silver, platinum and palladium declined along with base metals including copper, zinc and lead, as Europe’s debt crisis may hurt global growth and sap demand. “The way I characterize this economy is it’s a triple-B expansion,� Joachim Fels, chief economist at Morgan Stanley, said in a Bloomberg Television interview. “It’s bumpy, it’s below par and brittle and I think central banks will step up and keep the expansion alive. We’re already seeing contagion into global financial markets.� Rubber declined by the most in a week, cotton tumbled to the lowest level in more than two years and soybeans slid to the lowest price since March 30. To contact the reporter on this story: Glenys Sim in Singapore at gsim4@bloomberg.net To contact the editor responsible for this story: James Poole at jpoole4@bloomberg.net

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