US stocks erased earlier gains on the back of stronger yield performance across the market today, with volumes remaining thin in the final week of the year. Overall, the market sentiment remains downbeat as economists anticipate a recession at some point next year, while the energy uncertainty in Europe is driving the accelerated decline in the region’s performance. While the consumer sector remains resilient, the housing market data is once again pointing to continued weakness, with pending home sales falling by 4.0% m/m in November, the sixth consecutive decline, whilst also marking the second lowest level on record. The dollar remained unchanged at 104, and the 10yr US Treasury yield strengthened to 3.87%.
China has scrapped some of its tough pandemic curbs rules in recent days, hence boosting the prospects for metals demand in 2023. Iron ore futures strengthened on the back of positive news, reaching the July highs of $113/mt. Most metals opened higher following the Christmas break, however some gave back their gains to close lower on the day. Aluminium fell back below the $2,400/t level to settle at $2,381/t; cash to 3-month settled at -$29.50/t. Likewise, lead sold off in the latter part of the day to close at $2,218/t. Other metals managed to maintain their strength, with nickel remaining above $30,000/t for the first time in a month, closing at $30,431/t and copper settling higher at $8,443/t. Zinc closed at $3,005.50/t.
Oil futures weakened after the markets digested the news that Russia will ban export for those buyers that choose to comply with the G7 price cap. WTI and Brent weakened into $78/bl and $82/bl. Precious metals were also seen weaker, with gold and silver softening into $1,800/oz and $23.60/oz, respectively.
All price data is from 28.12.2022 as of 17:30