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Daily Base Metals Report

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US stocks declined yesterday after the latest release of corporate earnings results. US home prices surged once again, beating the 30yr highs, as shortage of available homes and low mortgage rates fuel the market. US consumer confidence rose for the sixth straight month in July to a fresh pandemic high as the economy grows more optimistic about the future. The dollar weakened, and the 10yr US Treasury yield fell down to 1.23% levels once again. The Fed meeting is today, and markets believe that the interest rate will remain unchanged, with the focus shifting to bond purchases. In China, the yuan fell to April lows, and the bonds sold off as unconfirmed rumours showed that the US funds plan to offload China and Hong Kong assets.

Sentiment on the LME has been predominantly negative, and prices slipped on the downside. Copper was weak and traded towards support at $9,650/t; the market closed at $9,758.50/t. Nickel was the subject to strong selling pressure testing the support at $19,200/t to close at $19,357/t. Aluminium was also weaker as well and tested appetite around $2,480/t, support at this level prompted a close at $2,490/t; cash to 3-month spread widened out to -$3.50/t. Lead and zinc closed lower on the day at $2,338.50/t and $2,982.5/t, respectively.

Oil futures steadied yesterday, as the spread of the delta variant weighs on near term demand. WTI and Brent traded at $71.78/bl and $74.58/bl. Silver sold off to test $24.62/oz, and gold was up marginally, edging up to $1,802.04/oz.

 

All price data is from 27.07.2021 as of 17:30

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.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

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