Summary
- Tech-led optimism lifts risk sentiment ahead of the Trump–Xi summit.
- Copper surged past $11,000/t to a record high, driven largely by speculative momentum amid prevailing concerns over supply tightness.
- Precious metals stabilise.
Macro
US equities opened higher on Wednesday, led by another surge in technology stocks after Nvidia jumped more than 4%, becoming the world’s first $5 trillion company. The milestone underscored the continued dominance of AI in market leadership, as robust data-centre demand and optimism over possible looser Chinese export restrictions lifted the sector. Still, the rally comes amid an increasingly narrow breadth, with tech gains masking underlying caution across cyclicals. Investor focus has now shifted to the Trump–Xi meeting in South Korea, where discussions are expected to centre on easing tariffs, reopening parts of the tech supply chain, and rebuilding some degree of trade cooperation. While we see a scope for tactical easing on tariffs or licensing restrictions, a structural thaw remains unlikely. Even limited progress, however, could boost short-term risk appetite further and ease supply-chain anxiety across global manufacturing. Meanwhile, the dollar index held steady around 98.8 and the 10-year Treasury yield remained below 4%, reflecting a balanced risk tone as investors positioned for potential progress at the summit and awaited clearer guidance from the Fed.
Base Metals
Base metals continued to gain momentum, led by copper, which broke the key $11,000/t resistance level to reach a record high of $11,193/t by the end of the day. The key driver behind these moves appears to be speculative in nature, as markets closely monitor the tightness in the physical copper market. The situation at Grasberg, which declared force majeure in September, has shifted the perception of a fragile market surplus into a deficit. According to our estimates, we now anticipate around 200,000t of refined copper deficit this year; however, this shortage may be partially offset by an increase in scrap supply. Looking ahead, the refined market balance is expected to return to a healthier surplus by 2026, driven by ongoing supply expansion, with significant material deficits unlikely to emerge until 2028.
Nonetheless, we believe that the prevailing market sentiment of a material shortage will continue to dominate near-term momentum. This outlook is likely to drive copper higher in the event of any additional supply vulnerabilities, followed by a modest correction that should help maintain an overall upward trend.
Other metals followed suit, with zinc closely behind, strengthening towards $3,100/t – a high not seen since December last year. Meanwhile, the cash-to-3-month spread continued to narrow, dropping from $150/t to $140/t backwardation. Aluminium prices tested and rejected prices above the $2,900/t level, hovering just below at $2,893/t. Lead is trading at $2,030.50/t, while tin edged higher to $36,320/t.
Precious Metals and Oil
Precious metals rebounded today, with gold trading below $4,000/oz mark after struggling to establish that support level, while silver rebounded to above $48.2/oz, making up Monday’s drop. The pull-back in both metals suggests that momentum-driven positions continue to be trimmed amidst stabilising yields, but the underlying macro risks and safe-haven demand continue to keep interest alive. Oil prices edged higher with WTI around $60.9/bbl and Brent near $65.2/bbl.
All price data is from 30.10.2025 as of 17:30