Summary
- Market sensitivity to tech-sector guidance remains elevated, with Nvidia’s outlook likely to set the tone for broader risk appetite through the remainder of the week.
- Base metals rebounded mostly as recent selling pressures appear to have stabilised.
- Precious metals were highly sensitive to intraday dollar swings.
Macro
US equities are rebounding today as attention turns to Nvidia’s earnings report, which is expected to be the focal point for market sentiment. While the chipmaker is set to deliver another strong quarter, we expect that the results may struggle to fully satisfy a market that has grown accustomed to exceptional AI-driven performance. The sector has enjoyed extraordinary momentum this year, but the pace of expansion will inevitably moderate as the initial wave of AI enthusiasm matures.
The dollar index pushed above 100.0 today, with the move driven more by tightening USD liquidity conditions than by shifts in rate expectations. Despite steady 10-year yields and limited changes in Fed pricing, elevated overnight funding costs, reflected in GC repo trading above the top of the Fed’s target range, suggest reserves are approaching the lower bound of what the Fed views as “ample.” Year-end balance-sheet constraints and a mild funding squeeze have reinforced the dollar through the liquidity channel, offering a clearer narrative for its strength than macro drivers alone.
Tomorrow’s Nonfarm Payrolls report will be closely watched, though the September reference period limits its relevance for real-time policymaking. We continue to expect the Fed to remain on hold in December.
In the UK, inflation slowed for the first time since May, easing to 3.6% in October from 3.8% in September. The data provide timely support ahead of next week’s Budget and reinforce expectations for a December rate cut. We expect a 25bps reduction from the BoE next week.
Base Metals
Base metals rebounded modestly today as recent selling pressures appear to have stabilised. Despite a stronger dollar, sentiment is tracking equity markets, with key technical levels in major indices still intact. This suggests the current move is more likely a short-term unwinding of positions rather than a continuation of a deeper risk-off trend. Copper remained above the $10,500/t mark, trading at $10,762/t at the time of writing. Aluminium recovered slightly but faced resistance above the psychological $2,800/t level. Similarly, zinc held steady but struggled to break above $3,000/t.
The support and resistance bands for aluminium, copper, and zinc appear well-defined. With little fundamental changes expected into year-end, we anticipate these metals will trade within their established ranges. Lead is also returning to previous levels, as the market has now largely discounted the impact of a recommendation to add lead to the Critical Minerals list. We view $2,040/t as a well-established resistance for lead through year-end.
Precious Metals and Oil
Precious metals gained earlier in the session, but the stronger dollar erased much of the move, leaving gold back below $4,080/oz and silver under $51.0/oz. The intraday reversal highlights how sensitive the complex remains to shifts in USD liquidity rather than changes in rate expectations alone. Looking ahead, we expect precious metals to trade in a choppy range this week, with upside potential limited unless the dollar eases or tomorrow’s data provide a clearer signal of labour-market cooling.
Oil prices extended their decline, with WTI at $59.4/bbl and Brent at $63.5/bbl as traders reassessed near-term demand prospects.
All price data is from 19.11.2025 as of 17:30