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Daily Base Metals Report

Ceasefire Doubts Rebuild Risk Premium

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Authors
Viktoria Kuszak

Viktoria Kuszak Senior Research Analyst

Contact research Contact Industrial Commodities

Summary

  • Early optimism fades quickly, with markets rebuilding risk premium as ceasefire uncertainty returns.
  • Base metals remain reactive to macro, with copper reversing alongside oil and aluminium supported by tighter spreads.
  • Oil firms on disruption risks, while precious metals weaken, continuing to track macro rather than geopolitics.

Macro

US equities opened higher but quickly reversed, giving back gains within the first two hours as optimism faded. With the ceasefire nearing expiry and no clear extension in place, markets are once again reassessing the durability of de-escalation. The initial reaction to the reopening of the Strait is being unwound, with uncertainty returning to the forefront.

The dollar index moved higher towards 98.4, while the US 10-year yield climbed back to 4.3%, retracing the earlier decline seen on the reopening headlines. Oil also pushed higher, reflecting renewed concern around disrupted flows and the risk of escalation. The pattern remains unchanged, with markets quick to price in positive developments but equally quick to reverse as doubts emerge.

Base Metals

Base metals were muted, with price action turning more reactive to macro moves.

Copper briefly moved above $13330/t before reversing sharply, dropping below $13250/t in line with the move higher in oil. The reaction reinforces copper’s role as a macro proxy, with price direction increasingly dictated by shifts in broader risk sentiment rather than metal-specific fundamentals.

Aluminium hovered around $3550/t on low volumes, with the cash-to-three-month spread widening to around 45 backwardation. The move in the spread suggests some renewed tightness in the nearby structure, even as outright price action remains contained.

Lead remained highly volatile, rising to $1985/t before reversing sharply below $1965/t. The move appears driven by short covering, with positioning data showing funds reducing their net short exposure, although positioning remains negative overall. This suggests that while the rally has been flow-driven, the underlying structure of the market has not fully shifted.

Overall, the complex remains supported but lacks conviction, with macro volatility continuing to drive short-term price action.

Precious Metals

Precious metals moved lower, trading in inverse correlation with oil. Gold fell below $4750/oz, while silver tested support near $77/oz. The move highlights the continued dominance of macro drivers, with bullion reacting more to shifts in yields, the dollar and oil than to geopolitical risk itself.

Oil prices moved higher again, with WTI above $93/bbl and Brent approaching $98/bbl, as uncertainty around the ceasefire and disruption to flows persists.

Looking ahead, the key dynamic remains headline-driven. With the ceasefire nearing expiry and no clear resolution, markets are likely to remain volatile, with rapid shifts in positioning driven by changes in the narrative.

All price data is from 21.04.2026 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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