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Daily Base Metals Report

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Markets have been buoyed today by renewed optimism causing risk assets to rally. Leading equity indices, energy, and metal prices have been well bid. The majority of agriculture markets are higher today at the time of writing.  The renewed optimism was off the back of positive vaccine results from Moderna Inc. Today’s activity comes as lockdown restrictions across the globe continue to be eased but also as Fed Chair Jerome Powell has warned of lengthy recovery and downside risks.

Metals prices were well bid today as risk appetite gripped the market. Copper prices broke through resistance at $5,300/t and closed at $5,317.5/t. Nickel prices also were also well bid and close at $12,250/t. Zinc and lead closed above key resistance as well at $2,017/t and $1,662/t respectively. Ali closed fractionally below key resistance at $1,500/t at $1,497/t. Cash to 3 months spreads tightened slightly with zinc moving into $5.25/t back, while copper and lead tightened to $25.5/t and $17.75/t respectively. Downside risks remain and activity is still within range, but it remains to be seen if strength can be sustained.

Energy prices continue to rise, with WTI and Brent gaining ground today, both assets up around 10% on the day, and trade at $32.76/bl and $35.41/bl respectively. Precious metals prices have had a mixed day today. Gold and silver prices rallied at with risk assets this morning but have pared those gains this afternoon with gold now down on the day at $1,731/oz.

Risk warning

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

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.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

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