US stocks began the week on the front foot as energy prices continued to climb. Us factory output fell by the most in seven months in September, with the weakness in motor vehicle manufacturing being most prevalent. The dollar was marginally weaker, and the 10yr US Treasury yields shot up above 1.60%. UK 2yr Gilt surged by more than 13 basis points to 0.723% after the BoE amplified the need to respond to continued price pressures. Elsewhere, Chinese economic growth slowed in Q3 2021, growing by 4.9% y/y, down from 7.9% in Q2.
A mixed day on the LME market yesterday, as the metals traded near recent highs. Lead was the big mover, climbing above the previous session’s resistance level of $2,360/t and closing at $2,378/t. Aluminium was mostly range-bound, fluctuating around $3,200/t level, but closed lower at $3,167.50/t. Copper slid after last week’s rally as it found resistance at $10,400/t to close at $10,196/t; the cash to 3-month spread, however, shot up to $900/t during the day to close $1,053.50/t. Zinc erased earlier gains in the second half of the day to test the $3,700/t level and closed at $3,696.50/t. Tin closed at $37,814/t.
Oil futures were mostly unchanged on the day, losing most of the early session’s gains in the second half of the day, with WTI and Brent trading at $82.45/bl and $84.72/bl. OPEC+ failed to meet supply targets in September, and Russia reversed its decision to supply more fuel to Europe. Precious metals softened, with gold and silver softening to $1,767.76/oz and $23.24/oz.
For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.
All price data is from 19.10.2021 as of 17:30