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Daily Base Metals Report

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US stocks edged higher today, up from the worst week since March 2020, ahead of the outcome of the presidential election in the US. According to the Fed, Tuesday’s election will not affect the monetary policy direction. The main event this week will remains the presidential election, however, virus developments in Europe add uncertainty to market sentiment. The US manufacturing expanded to 59.3, the fastest pace since 2018. The 10yr US Treasury yields softened out to 0.8350% and the dollar picked up to 94.155, a one-month high. In China, manufacturing activity improved, rising to 53.6 in October, the highest level since 2011.

Activity on the LME was mixed today ahead of the US presidential election, with only lead closing lower on the day at $1,798/t. Aluminium prices were well supported in the second half of the day and tested resistance at $1,870/t to close just off the highs at $1,866/t. SHF aluminium was also higher on the day, closing at CNY14,665/mt, breaking record highs (Dec20 contract). Copper was well bid, testing the resistance level of $6,810/t, before closing below at $6,762/t. Copper cash to 3-months spread tightened further to $10.00/t contango. Nickel consolidated, closing at $15,160/t. Zinc was on front foot, closing just below the key resistance level of $2,565/t at $2,540.50/t.

Oil futures trended higher on the news of Russia, a key supplier, possibly postponing a planned output hike in January. At the time of writing, WTI and Brent trend at $35.94/bl and $38.10/bl. Precious metals were all higher today, with gold and silver edging up to $1,891.27/oz and $23.87/oz respectively.


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