Summary
- Dollar and yields ease after risk-premium unwind.
- Thinning liquidity conditions are exacerbating the scale and speed of base metals’ gains, with copper reaching new record highs.
- Silver extends its record-setting run amid supply tightness.
Macro
US equities opened mixed, with the Dow Jones reaching record highs while the Nasdaq lagged as technology stocks came under pressure. Shares in Oracle slid sharply after the company’s latest quarterly results disappointed and raised fresh questions about the scale and timing of returns from its aggressive investments in AI infrastructure, dragging broader tech sentiment lower.
Elsewhere, markets continued to digest Wednesday’s FOMC decision, where the Fed paired a widely anticipated 25bps cut with a noticeably firmer message on the path ahead. Despite the easing step, policymakers signalled limited appetite for rapid follow-through cuts, a stance that markets have already reflected by pricing in two further 25bps reduction for all of 2026.
Looking ahead, we expect labour-market data to become the focal point for assessing underlying economic strain, particularly as the Fed emphasised the need for clearer evidence before adjusting policy further. However, with only modest data releases scheduled before year-end, financial conditions are likely to remain relatively stable in the near term. The dollar index slipped below 98.2, while the 10-year Treasury yield briefly touched 4.1%, reflecting a mild unwinding of the pre-FOMC risk premium.
Base Metals
Base metals strengthened across the board, with zinc's rally standing out as the most prominent, gaining as much as $100/t in the afternoon session to approach $3,200/t – an October 2024 high. Given the rapid pace of these gains and the stable performance in nearby spreads, we believe the move is driven more by thin liquidity than by strong trend conviction. This was also evident in tin - a market with traditionally thin liquidity - which rallied by nearly $2,000/t today, approaching the $42,000/t resistance level.
These moves tend to fade once liquidity normalises. However, with prices stretched at current levels and trading activity typically quieter as the holiday season approaches, we believe these risks may remain elevated into year-end.
Copper was close behind, posting new highs and climbing towards $11,860/t. Aluminium recorded moderate gains, moving towards $2,900/t.
Precious Metals and Oil
In precious metals, silver continued to attract attention amid a dramatic rally in 2025. Persistent tightness in physical supply, coupled with strong investor and ETF demand, has helped push prices to successive record highs. Structural deficits are expected to continue into 2026, underpinning the bullish narrative for silver despite weak industrial demand in some segments.
Gold, meanwhile, has traded far more steadily, increasing to 4260/oz. While silver has attracted speculative momentum on the back of the deficit narrative, gold’s moves remain more tightly linked to the broader policy outlook and real yields. We expect gold to continue behaving as the more grounded barometer of macro sentiment, with upside likely capped in the near term unless the dollar weakens much further.
All price data is from 11.12.2025 as of 17:30