US stocks opened lower today, following last week's rally that marked the longest weekly gain of the year. The 10-year US Treasury yield surged, nearing 4.16%, as signs of robust economic performance and softening inflation have led markets to believe the Fed may not need to ease monetary policy as aggressively as previously expected. After last Friday's losses, the dollar index rebounded, rising to 103.8. This week, all eyes are on the upcoming S&P Global Manufacturing PMI data, which will provide insights into factory activity across major economies and help investors assess the strength of the industrial sector globally.
The base metals market followed a similar pattern to last week, with an initial boost in confidence due to China's support measures followed by a decline in the second half of the day. On Monday, Chinese banks lowered their benchmark lending rates following the easing by the PBoC at the end of September. We expect that more easing measures will follow in the coming months. Still, these moves underscore investor scepticism regarding the near-term recovery in the region's construction segment. The complex has not priced in any geopolitical or political risks, thereby placing greater emphasis on China and the decisions its government will make in the coming weeks. In the meantime, aluminium and copper remained largely unchanged day-on-day, at $2,595/t and $9,559/t, respectively. Nickel and tin continued to soften to their averages, closing at $16,705/t and $31,016/t.
Despite the stronger dollar and rising Treasury yields, precious metals managed to advance. Gold set new record highs, climbing to $2,725/oz, while silver briefly rose above $34/oz before settling at $33.7/oz. Oil prices edged up, with WTI and Brent crude trading at $69.9/bbl and $73.7/bbl, respectively.
All price data is from 21.10.2024 as of 17:30