US stocks opened the week on the front foot, as Treasury yields settled, and markets have priced in most of the central bank moves in the coming weeks. Jerome Powell is speaking tomorrow at the Congress, but we do not expect his speech to have a big impact on the market sentiment, as the Fed will take a wait-and-see approach until more data is released in the next couple of weeks to reaffirm its rhetoric. The dollar weakened to 104.20, and the 10yr US Treasury yield settled at 3.96%. Factory data pointed to softening in new orders, falling by 1.6% in January, after a 1.8% growth a month before, highlighting continued weakness in the manufacturing and industrial sectors.
Sentiment soured across the base metals today, following China’s NPC releases, pointing to a slower-than-expected growth projection for the year but also below-forecast stimulus support, as the government hopes to stimulate the economy through the consumer segment. Aluminium weakened, testing support at $2,360/t before settling slightly higher at $2,382/t. Copper moves were broadly unchanged as the metal bounced back from the lows of $8,850/t back to $8,920.50/t. Nickel continued to trade under $25,000/t, settling at $24,430/t. The overnight reopening trade on the LME on 20th March should provide more liquidity to the market, and reduce volatility, bringing some arb players back into the market. In the run-up to the event, markets could close their positions, creating some illiquid trading, but the impact of this is likely to be short-lived. Lead and zinc closed at $2,122.50/t and $3,032.50/t, respectively. Iron ore struggled to hold on to its losses, after the metal struggled below $120/mt.
Oil futures struggled to gain momentum today, as WTI and Brent remained unchanged at $79/bl and $85/bl. Precious metals weakened slightly, with gold and silver at $1,850/oz and $21.10/oz, respectively.
All price data is from 06.03.2023 as of 17:30