US stocks were mixed as the dollar’s the upside momentum stalled after a strong weekly streak that pushed the currency to March highs. The greenback strength was brought forward this week as the market began to assess the difference between major economies. Both Europe and China see protracted softness in performance indicators, and while the US economy is also seen slowing, the decline is marginal in comparison, remaining resilient given historical averages. We believe that the dollar will continue to strengthen marginally into Q4, exacerbated by the diverging central bank outlook from respective regions. The 10-year US treasury yield has also softened today.
A respite in dollar gains helped to ease some of the downward pressure felt by the commodity complex. Still, continued yuan weakness, which is now at record lows against the dollar, offset some of that respite and drove metals marginally lower on the day. Aluminium edged slightly lower, as it tested the support of $2,170/t before settling at $2,183.50/t. Copper, on the other hand, saw protracted losses down to the support of $8,200/t; the metals remained above it, closing at $8,242.50/t. Likewise, zinc broke below the robust support of $2,450/t to settle at $2,443.50/t.
Dollar weakness drove both oil and precious metals futures slightly higher, with gold and silver trading at $1,921/oz and $23.00/oz, respectively.
All price data is from 08.09.2023 as of 17:30