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Daily Base Metals Report

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US stocks rose today on hopes that the Fed will maintain its ultra-loose policy stance as it aims to lift the economy out of the recession. US homebuilder optimism rose to a record of 83 in September, as low mortgage rates drove the housing demand. US retail sales rose 0.6% m/m in August, below estimates. Meanwhile, the House Speaker Nany Pelosi doubled down on her effort to get the White House to agree on a $2.2trn package. The dollar edged lower to 92.987, and the yield on 10yr US Treasury softened into 0.6691%. In the UK, Boris Johnson stated that labs do not have enough capacity to cope with testing demand; however, promised to set appropriate measures soon.

LME metal prices were on the front foot today, apart from lead, which closed lower on the day at $1,894/t. Zinc prices were well supported and tested resistance at $2,540/t and closed just off the highs at $2,528/t. Tin was well bid in the second half of the day, testing the resistance level of $18,335/t, before closing below at $18,275/t. Copper prices remained supported above $6,740/t before closing at $6,777/t; the cash to 3-month spread tightened to $16.50/t. SHF copper prices, however, softened, closing at CNY51,810/mt. Nickel and aluminium were range-bound but closed higher on the day at $15,226/t and $1,795.50/t respectively.

Oil futures rose today as shrinking US stockpiles offset the concerns of oversupply. At the time of writing, WTI and Brent trade at $39.88/bl and $42.02/bl. Precious metals climbed as investors awaited the news from the Fed, with gold and silver edging up to $1,965.23/oz and $27.32/oz respectively.

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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.

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