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Daily Base Metals Report

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US stocks continued to gain ground, with S&P 500 strengthening for the sixth straight day, close to an all-time high. The dollar continued to weaken, and the 10yr US Treasury yield softened for the first time in four sessions. UK CPI rose by 3.1% in September, above the BoE target, as global supply chain and energy disruptions pushed up transportation costs; the BoE, however, expects prices to climb above 4% by the end of the year. Elsewhere, China’s total Debt to GDP fell for a fourth straight quarter, as the government continues to prevent financial risks from bubbling over.

Metals on the LME managed to recoup some of the previous days’ losses, only with aluminium down on the day, after the Chinese government announced it would try to rein in power costs if coal prices continued rising. The metal closed at $3,069.50/t SHFE aluminium has fallen by as much as 5.50% on the day, to close at $23,445/mt. Likewise, copper declined in the first half of the day before finding strength above the $10,000/t support level; the metal closed at $10,185.50/t. Zinc saw the highest gains amongst the metal group, but not enough to offset the losses seen in the last couple of days; the metal closed above the $3,600/t level at $3,563.50/t. Nickel broke through the resistance level of $20,800/t, which is the high last seen in May 2014, to close at $20,963/t; cash to 3-month spread strengthened marginally up to $83.00/t. Similar for lead, which broke above the resistance level of $2,400/t to the levels not seen since June 2018, as the metal closed at $2,417.50/t.

Oil futures managed to recoup some of the previous days’ losses after another round of diminishing crude inventories. WTI and Brent edged higher to $83.77/bl and $85.47/bl. Precious metals edged higher once again after the Fed officials downplayed the possibility of an imminent rate hike. Gold and silver strengthened into $1,785.04/oz and $23.34/oz.

For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.

All price data is from 20.10.2021 as of 17:30


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