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Daily Base Metals Report

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US stocks gained ground once again on the back of vaccine optimism. The S&P 500 traded higher today after AstraZeneca released the news that the vaccine stops on average 70% of participants from falling ill. US business activity picked up in November at the fastest pace since 2015. The Trump administration is close to banning 89 Chinese firms, a move that could escalate tensions between two countries as Biden prepares to step into the office. The dollar fell to 2018 lows before rising in the second half of the day to 92.580, and the 10yr yield on US Treasuries strengthened up to 0.8504%. Elsewhere, according to Ireland’s premier, the outline of a Brexit deal is to be clear by the end of the week as negotiations continue.

Metals prices were weaker today as economic woes and rising lockdown restrictions pose risks for another economic contraction. Copper prices sold off to test appetite at $7,150/t, falling from its 2-year high, but support at that level triggered a close at $7,177.50/t. Zinc saw the strongest selling today, down 2.15%, closing at the day’s lows at $2,729.50/t; cash to 3-month spread widened out -$6.25/t. Aluminium remained under pressure, especially in the second half of today, closing at $1,973.50/t. Nickel tested the $15,900/t level to close near day’s lows at $15,935/t.

Oil futures hit 12-week highs on vaccine hopes bolstering demand. At the time of writing, WTI and Brent trade at $42.94/bl and $45.87/bl respectively. Precious metals were all down today, with gold and silver edging down to $1,837.58/oz and $23.53/oz respectively.


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