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Daily Base Metals Report

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US stocks gained ground today as dip-buying continued. Treasury Secretary Yellen stated that it is the Fed’s job to prevent any wage-price spiral and is not seeing signs of it exacerbating at the moment. US initial jobless claims remained low at 222,000 for the second week in a row, a sign that an unexpected drop last week might not be temporary, and we might see lower unemployment for longer. The payroll data is out tomorrow and is forecast to reach 550,000, marginally higher than in October. The dollar fluctuated, and the 10yr US Treasury yield found support at 1.40%. Russian inflation jumped to the highest level since July, a day after the central bank raised a possibility of another strong rate hike in the upcoming meeting.

Aluminium weakened during the day after a jump in inventories brought into question the demand for the metal but managed to find support above $2,600/t and closed at that level. Zinc and lead were also seen lower, closing at $3,146/t and $2,256.50/t, respectively. Copper found the resistance of $9,500/t in the second half of the day and closed marginally lower at $9,496/t; cash to 3-month spread tightened sharply into $20.50/t. Nickel fluctuated, closing in line with the previous day levels at $19,953/t.

Oil futures whipsawed after the OPEC+ agreed to go on with the planned supply hike of 400,000 bl/d in January despite the concerns of a softer demand outlook. The cartel did state that it might change its decision if it sees the impact of the new variant persevere. WTI and Brent traded at $66.73/bl and $69.83/bl. Precious metals fluctuated, with gold falling down to $1,765.33/oz, while silver remained supported above $22.30/oz.

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

LME metals price and volume

All price data is from 02.12.2021 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.

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