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Daily Base Metals Report

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US stocks turned lower once again today, on the back of lingering virus concerns across the country and elsewhere. The $2.3tr stimulus bill package is now being passed onto President Trump for approval. US consumer confidence fell to 88.6 in December, a 4-month low on the back of surging COVID-19 cases. Meanwhile, US existing home sales declined in November for the first time in six months, as surging prices and low supply constrained demand. The dollar strengthened, and the 10yr US Treasury yield fell to 0.9213%. European stocks advanced today, after one of the steepest declines this year. The UK is looking at the pandemic support programme to help out businesses in the event of a no-deal Brexit.

Activity on the LME was mixed today, with lead closing higher. Nickel was subject to strong selling pressure, falling below the key support level of $16,800/t and closing at $16,614/t. Nickel cash to 3-month spread widened out to -$67.50/t. Copper and aluminium prices were softer, due to virus fears, closing at $7,746.50/t and at $1,995.50/t respectively. Tin was mainly range-bound but closed lower on the day at $20,000/t. Lead was supported above $1,930/t and closed at $1,964.50/t. Iron ore prices softened to close at CNY1,089.50/mt, falling from record highs.

Oil futures slipped for a second day, with the new strain of the virus threatening demand. At the time of writing, WTI and Brent trade at $47.23/bl and $50.29/bl. Precious metals were lower on the day, with gold and silver edging down to $1,867.34/oz and $25.39/oz respectively.

Happy holidays to everyone, the base metals commentary will resume after Christmas.


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COVID cases are rising across the globe as the delta variant spreads, this is causing some nervousness in financial markets, especially with the higher inflation rhetoric. Commodity prices have fallen since the Fed changed their tune inflation, the dollar has stabilised which has also been a headwind to prices. The summer months are traditionally quieter for metals demand which could prompt metals to consolidate. If the delta variant continues to spread, we may see higher levels of stimulus for longer. As things stand stimulus levels are set to be tapered and this could be brought forward if inflation remains high. We expect markets to remain volatile but on lower volume through the summer months.