We continue to see downside corrections in line with weak economic data, exemplified today by the softening of global equity indices and U.S. jobs and manufacturing data. U.S.- China relations continue to be tested which provide further headwinds to the market. Steven Mnuchin has highlighted that it may be necessary for another round of stimulus into the economy. 2.4million U.S. citizens filed for unemployment benefits last week, the 9th consecutive week over 2m. Manufacturing, services and composite PMIs were all weak, with manufacturing falling below estimates at 39.8 for May.
Activity on the LME was mixed today with only nickel and ali closing higher. Nickel continues to be well bid, but failed above $12,910/t and closed at $12,778/t. Ali was slightly firmer and managed to close just off the day’s highs at $1,521/t. Zinc and lead prices were subjected to strong selling pressure, giving back recent gains and closing on the back foot at $1,983.50 and $1,656/t, both have been sold after the close. Copper broke support at $5,400 and closed at $5,390.5/t.
Energy markets have strengthened today. WTI and Brent trade at $33.83/bl and $36.13/bl at the time of writing. Precious metals corrected to the downside with gold and silver trading $1,724.14/oz and $17.09/oz at the time of writing.