US stocks strengthened today, despite the BOJ’s decision to loosen the grip on yields, as another round of data bolstered risk-on sentiment. Further optimism was stoked by key gauges of inflation pointing to continued easing. This, in line with yesterday’s GDP release, is reinforcing the market belief that the economy remains resilient in the face of aggressive monetary policy tightening. Both the headline and core PCE indices rose by 0.2% m/m in May, marking the slowest pace of expansion in more than two years. The dollar held on to yesterday’s gains. Meanwhile, Euro area economic confidence slowed by more than expected, highlighting the divergent performance between the two regions. This comes despite the German data pointing to a faster slowdown in inflationary pressures.
Base metals gained ground today, supported by overall market confidence. Aluminium traded slightly higher at $2,222/t, while copper shot back above $8,600/t to close at $8,662.50. Meanwhile, zinc is seen regaining some of the loss that we saw earlier this month, testing resistance at $2,500/t; still, the momentum was not strong enough to breach the recent highs, and the metal closed at $2,497.50/t. Lead remained broadly unchanged at $2,158.50/t.
Oil futures remained broadly unchanged, and precious metals edged higher after yesterday’s losses, with gold and silver now trading at $1,961/oz and $24.40/oz, respectively.
All price data is from 28.07.2023 as of 17:30