Stocks opened the week on the back foot, driven by Asian equity weakness as the markets digested the news of the Credit Suisse acquisition. Any upside momentum during the day struggled to hold up, and we saw US stocks settle pretty much unchanged on the day. The dollar edged slightly lower after the Fed and five other central banks boosted liquidity in US dollar swap arrangements. At the same time, the ECB reaffirmed the statement that financial instability would not translate into price instability, further reaffirming their decision to increase interest rates by 50bps last week. All eyes are on the Fed on Wednesday and whether the banking sector woes will translate into a pause in the monetary policy tightening path. The 10yr US Treasury yield broke lower to test the support of 3.30% before bouncing back to 3.50%.
Metals remain a derivative of the overall market and the risk, and the complex managed to settle slightly higher as risk-on sentiment improved by the end of the day. Given the absence of micro moves, sentiment remains to be macro-driven, and bearish energy momentum should further weigh on base metal performance. Aluminium fluctuated around the $2,280/t level, settling slightly higher on the day at $2,274.50/t. Copper bounced from the day’s lows of $8,550/t before gaining momentum back to $8,697.50/t. Lead and zinc both closed unchanged on the day at $2,118/t and $2,885.50/t, respectively. Nickel continued to break lower, testing the lows of $22,780/t once again.
WTI and Brent weakened once again as banking sector fears triggered a strong sell-off amid risk assets; futures settled at $65/bl and $72/bl. Gold and silver, on the other hand, struggled to gain momentum, with the safe haven run exhausted today.
All price data is from 20.03.2023 as of 17:30