Summary
- Weak US payrolls lifted equities, but the 10-year yield’s recovery towards 5.25% kept the dollar close to 102.
- Chinese demand concerns weighed on copper, while aluminium and zinc remained vulnerable near weekly lows.
- Gold and silver surrendered their post-payroll gains as elevated yields continued to outweigh lower near-term Fed tightening expectations.
Macro
US equities opened higher on Friday after September payrolls rose by only 29,000, well below the 90,000 expected, while previous months were revised lower. Unemployment increased to 4.2% and monthly wage growth slowed to 0.1%. The report reduced expectations of an October rate increase, initially pulling the US 10-year yield lower, although much of the move was subsequently reversed as the yield returned towards 5.25%. DXY edged lower but remained close to 102.0.
The payrolls release capped a volatile week in which softer PCE inflation contrasted with resilient spending and activity. Weekly claims remained low, manufacturing continued to expand and the ISM prices-paid index rose sharply, keeping inflation concerns and Treasury yields elevated. Today’s weaker employment report has moderated the immediate case for further tightening, but we see the recovery in yields after the release as evidence that markets remain reluctant to price a sustained decline in rates while inflation remains above target.
Falling energy prices provided some relief, with Brent trading around $100/bbl and WTI near $90/bbl. Lower oil prices supported equities and reduced some of the near-term concern around energy-driven inflation, although crude remains elevated enough to keep the inflation outlook uncertain. We expect the dollar to remain comparatively firm despite weaker payroll growth, while equities could stay supported if yields remain below this week’s highs.
Base Metals
Base metals closed the week mixed, with concerns over Chinese industrial demand continuing to weigh on copper. Prices recovered from an intraday low near $14,250/t but surrendered part of the rebound to trade at around $14,295/t. Lead edged up above $1,860/t. Aluminium extended its decline to around $3,105/t, zinc slipped to $3,705/t and tin fell sharply into the close below $53,905/t. Nickel remained subdued at $15,630/t.
The softer US payroll report offered only temporary relief, as Treasury yields recovered and the dollar remained close to 102. We expect Chinese demand concerns to remain a constraint when mainland markets reopen, although slower refined-copper production and persistent concentrate tightness could provide underlying support. Copper needs to regain $14,400/t to rebuild upward momentum, while aluminium and zinc remain vulnerable near their weekly lows.
Precious Metals
Gold initially rallied above $4,220/oz following the weak payroll release, but the move reversed sharply as the US 10-year yield recovered towards 5.25%, leaving the metal near $4,140/oz. Silver followed a similar pattern, briefly testing $62.00/oz before falling back to $60.2/oz. The reversal indicates that lower October rate-hike expectations were insufficient to offset the continued pressure from elevated yields and late-session profit-taking.
We expect yields to remain the principal driver next week. Gold must recover above $4,180/oz to stabilise the near-term outlook, while a break below $4,140/oz could expose the recent low around $4,110/oz. Silver remains vulnerable around $60.00/oz after failing to retain its payroll-driven gains.
All price data is from 02.10.2026 as of 17:30