European shares were mixed as Spain declared a state of emergency in Madrid in order to control the rising new cases of COVID-19. Italy's 10-year bond yield fell to a record low of 0.724%. In the UK, new local furlough schemes have been introduced to support jobs in coronavirus hotspots. The UK GDP grew by 2.1% m/m in August, below market expectations and down from 6.4% in July. The yuan strengthened against the dollar as the Caixin service PMI picked up to 54.8, the fifth consecutive month of expansion. The dollar softened into 93.099, and the yield on the 10yr US Treasuries strengthened up to 0.7870%.
LME base metals extended gains today, led by nickel and aluminium, which gained 3.94% and 2.60% on the day respectively. Copper prices edged higher to the resistance level of $6,780/t before closing below at $6,763/t. SHFE copper, however, was down on the day, closing at CNY51,430/mt. Aluminium was well bid, edging up to the $1,860/t level, to close just below the day's highs at $1,841.50/t. Nickel gained the most ground, testing the resistance at $15,250/t and closed at $15,221/; the cash to 3-month spread tightened into -$38.00/t backwardation. Zinc and lead prices were both higher today, testing the $2,440/t and $1,820/t, and closing at $2,434/t and $1,808.50/t respectively.
Oil futures continued to strengthen, as fears surrounding the disruption caused by Hurricane Delta are rising. At the time of writing, WTI and Brent trade at $41.25/bl and $43.41/bl respectively. Precious metals were on the front foot, with gold and silver edging up to $1,922.98/oz and $24.77/oz.
