US stocks reversed the earlier gains today following the lacklustre economic data release. Powell's speech provided clues for the next meeting this month, with a softer rate-hike at 50bps now being priced in by the market. The softer hawkishness was, however, later offset by US data suggesting the first monthly contractionary manufacturing performance in more than two years as the economic backdrop sours and new orders continue to fall. At the same time, the core PCE measure came in lower than expected, growing by 0.2% m/m, vs 0.5% during the previous month, marking the slowest increase so far this year. Employment data also pointed to slowing momentum, with US initial jobless claims jumping to February highs of 225,000 in the week ending November 26th. The dollar continued to weaken, and the 10yr US Treasury yield is seen falling towards 3.50%.
The bullish sentiment prevailed today across the base metals sector, but momentum slowed in the afternoon. Softer US data helped to prop up the prices today. Meanwhile, Chile's economic activity unexpectedly rose in October, as the highest copper production this year boosted overall performance. This marks another sign of growing copper production in the economy in recent months. Copper fluctuated, testing support below $8,250/t before settling higher at $8,336/t. Aluminium continued to edge slightly higher today, close to $2,485/t. Nickel saw another day of robust gains, breaking above the $27,500/t resistance to settle at $27,601/t. Lead and zinc closed higher at $2,173.50/t and $3,079.50/t, respectively.
In the meantime, the EU is closing in on an oil price cap for Russian exports, with $60/bl being cited as the most likely outcome. WTI and Brent are seen trading at $82/bl and $88/bl. Precious metals were all seen higher, with gold and silver strengthening into $1,800/oz and $22.59/oz, respectively.
All price data is from 01.12.2022 as of 17:30