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Daily Base Metals Report

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US stocks advanced today on positive risk-on sentiment, with tech stocks paving the way. Positive momentum has been largely supported on the hopes of additional stimulus as well as vaccine roll out later this year. In the meantime, the House is moving closer to impeaching Trump for the second time, a week before Biden takes office. The US core consumer price index increased marginally in December as muted labour market conditions cooled the inflationary pressures. The dollar strengthened, and the 10yr US Treasury yield weakened out to 1.0934%. In Europe, the central bank stated that they would keep an easy stance on interest rates for as long as necessary.

LME metal prices were on the front foot today, apart from aluminium, which closed lower on the day at $2,013/t. Lead prices were well supported and tested resistance at $2,054/t and closed just off at the highs at $2,051/t. Copper was well bid in the first half of the day, testing the resistance level of $8,050/t, before closing below at $8,009/t; the cash to 3-month spread widened out to -$13.00/t. SHFE copper prices, however, softened, closing at CNY58,840/mt. Nickel prices remained marginally supported above $17,500/t before closing at $17,678/t. Zinc was range-bound but closed higher on the day at $2,773.50/t.

Oil futures fluctuated on news of falling US crude stockpiles and a weaker dollar. At the time of writing, WTI and Brent trade at $52.98/bl and $56.15/bl. Another day of losses for gold and silver, which edged down lower to $1,857.60/oz and $25.47/oz respectively.

Disclaimer

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.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

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