US stocks opened higher today as investors await the release of the Federal Reserve's meeting minutes, which are expected to provide more insight into the level of consensus among policymakers regarding a potential interest rate cut in September. The first rate cut is now firmly on the table, with forward swaps pricing in over a 30% chance of a 50bps reduction. The dollar remained steady, hovering around the 101.4 level, while the 10-year Treasury yield edged slightly lower, standing at 3.8%.
Base metals held their nerve today as markets cooled their optimism following the recent gains. This is particularly prevalent for aluminium, which posted its 10th consecutive gain, albeit struggling above the $2,500/t mark today. Copper remained broadly unchanged at $9,260/t. Likewise, nickel saw a lack of appetite above the $17,000/t after giving up prices above that level yesterday. On the other hand, zinc continued to gain momentum, supported by talks of potential smelter output cuts in China, prompting the metal to test the $2,850/t level.
Gold retraced yesterday's gains, settling at $2,504/oz, while silver remained relatively unchanged, trading just below $29.5/oz. Although the anticipated September rate cut appears to be priced in, we believe gold still has upside potential. As summer holidays draw to a close, we could see bullion prices reaching new highs. WTI crude experienced a slight decline, trading at $73.3/bbl, while Brent crude saw a modest increase to $77.5/bbl.
All price data is from 21.08.2024 as of 17:30
