US stocks remained broadly unchanged ahead of the discussion at Washington on whether the debt ceiling is to be raised. US retail sales increased by 0.4% in April, underlining consumer strength in the face of the deteriorating global environment and high borrowing costs; the gains in sales excluding autos and gasoline topped expectations. At the same time, homebuilder confidence jumped to the highest level in 10 months as limited supply continues to drive potential buyers towards new construction. The dollar bounced back above 102.50 after earlier losses, and the 10yr US Treasury yield strengthened. The 30yr yield hit the high of 3.90%, levels not seen since the banking crisis earlier in March.
The slower-than-expected recovery in manufacturing activity brought another round of weakness to the base metals market today, driving metals to settle lower. Copper saw protracted declines to the $2,100/t support, the level not seen since November last year; the metal closed at $8,121.50/t. Aluminium held relatively supported above $2,250/t to settle at $2,259.50/t. Nickel and zinc continued to test new lows on the back of lacklustre demand from the stainless steel sector, with the latter breaching the November 2020 levels; zinc closed at $2,492/t. Lead also declined, but the longer-term ranges remain intact, causing the metal to close at $2,045.50/t.
Oil futures held steady as US strength helped offset the softness coming from China today. WTI and Brent now trade at $70/bl and $74/bl. Gold and silver weakened to test the robust support levels of $2,000/oz and $23.70/oz, respectively.
All price data is from 16.05.2023 as of 17:30