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Daily Base Metals Report

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US stocks edged higher, continuing to beat the highs once again. The markets are awaiting the Fed meeting tomorrow, which is expected to announce the start of the pullback of asset purchases this month; investors remain divided between the timeline of a rate hike, either next year or early 2023. The dollar strengthened marginally and the 10yr US Treasury yield remained unchanged. Elsewhere, European manufacturing PMI softened once again in October, with Italy posting positive growth on the back of large fiscal stimulus support, as the bloc continued to suffer from high input prices and production delays.

Another day of moderate weakness on the LME market as the market finds its equilibrium, following the decision from China to cap coal prices. Copper softened during the day but managed to find support at around $9,450/t, closing above at $9,495.50/t. China’s biggest copper smelters have decided to export for LME delivery to help ease backwardation; the cash to 3-month backwardation remained high at $275/t. Aluminium was mostly range-bound after hitting resistance of $2,740/t in the first half of the day, closing at $2,692.50/t. Likewise, nickel fluctuated, attempting to breach resistance of $19,784/t twice, however, struggled above that level and closed lower at $19,601/t. Zinc and lead were moderately softer, closing at $3,342.50/t and $2,363/t.

Oil futures fluctuated ahead of the Fed meeting today as well as the OPEC+ meeting this week to set out the policy for total output. WTI and Brent traded at $83.42/bl and $84.46/bl. Precious metals softened, with gold and silver edging down to $1,788.47/oz and $23.44/oz, respectively.

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

All price data is from 02.11.2021 as of 17:30


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