US stocks advanced after another labour data survey pointed to a softness in the hiring pace, adding 103,000 last month. While this should act as a tailwind to the Fed cutting cycle next year, we expect that the pace of labour market softness is too marginal to cause a significant shift in monetary policy perspective in H1 2024, and rates should remain higher for longer into Q2 2024. The trajectory of activity, such as consumer and business behaviour, would be a better indicator of the economic outlook. Still, Friday’s jobs report could add to market volatility this week. The dollar fluctuated around 104, and the 10-year US Treasury yield is now at an August low of 4.12%.
Another day of moderate losses was seen in the base metals complex following Moody’s announcement of the nation’s credit outlook. As a result, risky assets declined sharply, and the government ramped up its support for the yuan to reinstall confidence in the market. Still, aluminium continued to fall, breaching the October low of $2,158/t and falling to $2,148.50/t; the next robust support stands at $2,130/t – the level that has firmly supported prices so far this year. Copper continued to erase previous weeks’ gains but struggled to break the $8,300/t level, closing at $8,286/t. Lead showed no signs of trend reversal, falling to October lows of $2,029/t and settling there. Zinc remained unchanged at $2,428.50/t.
Oil futures sold off, with WTI and Brent now trading at $69/bl and $74/bl. Gold and silver remained unchanged at $2,003/oz and $23.99/oz, respectively, as the recent downside slowed.
All price data is from 07.12.2023 as of 17:30