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Daily Base Metals Report

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Last night's Federal Reserve meeting was at the centre of today's trading across financial assets. The Fed is suggested that they will not increase interest rates until the end of 2023, and monetary policy will not be tightened until inflation rises above 2%.  They also outlined plans to increase their purchasing of treasury securities and mortgage-backed securities at least at the current pace in order to maintain accommodative conditions. Risk assets were weaker today and this included European and American stock markets, as the S&P 500 declined for the second day in a row. Treasuries have gained, but the dollar index gave back last night's gains and holds above 93 at the time of writing. Cable weakened after the BOE indicated they are exploring negative rates, however, the currency pair rallied after Ursula Von Der Leyen said she is convinced an EU-UK trade deal is possible. 

On the LME, after some choppy trading overnight we saw some metals recover, however only lead managed to close up on the day. Copper was supported around $6,675/t, prompting a recovery and close at $6,780/t. Cash to 3s tightened into $25.75/t back. Nickel suffered the strongest selling pressure today, after failing above $15,155/t to close on the back foot at $15,084/t. Ali struggled above $1,795/t and closed at $1,779/t and cash to 3s widened slightly to -$39.75/t. Lead was higher on the day and closed at $1,910/t, and Zinc weakened to close at $2,514/t. SGX Iron Ore 62% fe reversed the previous day's trading to close at $119.16/t and still remains below key resistance at $120/t. The Yuan remains on-trend and this is helping to support metals prices.

Oil prices continue to edge higher with WTI breaking back above $40/bl and now trades at $40.88/bl with Brent trading at $43.23/bl. Reports suggest this is largely to do with the fallout between Saudi and OPEC+ over the compliance with production cuts. PRevious metals were softer today with gold trading at $1944.60/oz and silver at $26.89/oz at the time of writing. 

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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.

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