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Daily Base Metals Report

Markets Close Week on a Calm Note

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Authors
Daria Efanova

Daria Efanova Head of Research

Viktoria Kuszak

Viktoria Kuszak Research Associate

Contact research Contact Industrial Commodities

Summary

  • US consumer sentiment improves to highest level since January
  • Japan contracts in Q1 as exports weigh on growth
  • Base metals finished the week on the back foot; however, the speculative sentiment remains constructive overall.
  • Gold slips back below 3,200/oz as yields remain elevated

Macro

US equities opened slightly higher on Friday, with investors digesting a varied mix of global macro data. In the US, housing activity picked up modestly, with starts rising to 1.361 million and building permits reaching 1.412 million. Still, a 4.7% monthly drop in permits pointed to ongoing caution in new construction. Consumer sentiment improved, with the University of Michigan index rising to 53.4, its highest since January. The dollar index firmed above 101.0, while the 10-year Treasury yield edged lower but remained above 4.4%.

In Japan, the economy contracted more sharply than expected in Q1, with GDP down 0.2% QoQ and the annualised pace falling 0.7%. It marked the first contraction in a year, driven by flat household consumption and a sharp drag from net exports. Inventories provided a modest lift, while business investment surprised to the upside, rising 1.4%. March industrial production offered some support, rising 1.0% YoY.

Base Metals

Base metals started the week on the front foot, gaining moderate momentum and breaking through near-term resistance levels that had previously capped upside moves. This occurred in the absence of a strong fundamental or a macroeconomic driver, suggesting that the speculative sentiment towards base metals remains constructive overall. 

Towards the end of the week, however, this upward momentum began to fade, as the moderate risk-on appetite began to wane. Despite the lack of a clear catalyst for a significant breakout in the meantime, we maintain a cautiously bullish outlook. Copper, in particular, was seen hovering around the $9,500/t mark – a level we to solidify as the near-term support. This could offer a more stable foundation for prices to continue testing new highs, albeit in a cautious manner.  

In the meantime, aluminium weakened below the $2,500/t. Lead and zinc also weakened below their key levels of $2,000/t and $2,700/t, respectively. 

Precious Metals and Oil

Gold slipped back to 3,174/oz, giving back Thursday’s gains, while silver also fell to 32.00/oz. Oil traded broadly flat, with WTI and Brent holding at 62.2 and 65.0/bbl respectively at the time of writing.

All price data is from 16.05.2025 as of 17:30

Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

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.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

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