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Daily Base Metals Report

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Authors
Viktoria Kuszak

Viktoria Kuszak Research Associate

Contact research Contact Industrial Commodities

Summary

  • US Leading Index signalled economic softness, while Eurozone sentiment improved slightly.
  • The dollar weakened sharply against the yen amid speculation of a potential Bank of Japan rate hike.
  • Gold reached another record high, while base metals rallied, led by strong gains in aluminium and nickel.

 

US stocks declined at the opening as investors assessed macroeconomic developments. The US Leading Index, a composite measure that tracks key economic indicators such as employment trends, new orders, and financial conditions, declined by 0.3% in January. This continued contraction signals weakening economic momentum and raises concerns about potential headwinds for growth in the coming months. In the Eurozone, preliminary consumer confidence for February improved more than expected, rising to -13.6, suggesting a slight rebound in sentiment despite lingering economic uncertainty. The dollar depreciated against major currencies, including the euro, sterling, and yen. The decline against the yen was particularly sharp, pushing USDJPY below the 150 level after a former Bank of Japan official suggested that the central bank could raise rates as early as May if domestic political instability worsens or if President Trump's tariff policies disrupt global trade. The dollar index dropped to 106.6, while the 10-year US Treasury yield edged lower, hovering around 4.5%.

Base metals saw a strong session today, with all major contracts posting gains. LME copper climbed to $9,563.50/t, extending its recent rally, though resistance near $9,600/t could limit further upside. Aluminium continued its upward trend, breaking above $2,727.50/t, supported by tightening supply conditions. Nickel surged to $15,660/t, marking one of the day's biggest moves, as buying interest returned to the market. Tin also posted strong gains, rising 2.3% to $33,450/t, maintaining its recent bullish momentum. Zinc edged higher to $2,914/t, while lead did not manage to hold above $2,000/t.

A weaker dollar supported gold, pushing it to another record high, trading above $2,944/oz. Silver followed, rising above $33/oz. Oil extended its rally, with WTI and Brent climbing to $72.8/bbl and $76.7/bbl, respectively, as supply concerns continued to underpin prices.

21022025

All price data is from 21.02.2025 as of 17:30

Disclaimer

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A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

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