US stocks opened higher today, with the Nasdaq and S&P 500 hitting record highs. Newly released US CPI data for April showed that headline inflation softened from 3.5% YoY to 3.4% YoY, while core inflation eased from 3.8% to 3.6%. This development fuels optimism that the Fed might lower interest rates in September. Additionally, US retail sales data for last month came in unexpectedly flat, with higher gasoline prices diverting consumer spending from other goods, indicating a slight pullback in consumer activity. Following these reports, the dollar index fell, trading below 104.5, and the 10-year US Treasury yield dropped to 4.35%.
Base metals opened on the front foot, led in large by copper, as it responded to the tightness seen on the Comex exchange. The July contract jumped to an intraday high of $5.02 per pound yesterday, creating a large premium with the LME contract. This appetite might prompt copper prices to remain elevated in the near term. As of today, copper opened higher to test the $10,400/t but erased those gains in the latter half of the day back below the robust resistance of $10,260/t. Likewise, aluminium strengthened, but a lack of appetite above the $2,600/t resistance prompted prices to return to settle below this level. Lead and zinc remained elevated.
The drop in Treasury yields helped propel prices of precious metals upward, with gold nearing a record high at $2,380/oz and silver advancing to $29.35/oz. Oil prices, however, softened, with WTI and Brent trading at $78/bl and $82.4/bl, respectively.
All price data is from 15.05.2024 as of 17:30
