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Daily Base Metals Report

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Stocks recovered from earlier losses on positive risk-on sentiment. Despite virus news fluctuating the market in the last couple of weeks, the economists are upgrading the outlooks for this quarter’s growth. The dollar gained ground, and the US Treasury yield shot up to 1.4823%. On the other hand, the Japanese government raised its economic outlook forecast for the first time since last summer, a sign of confidence that the economy will recover despite the spread of the omicron variant. From the virus front, we saw South African tail off, a possible sign that the worst wave the economy has seen may be over.

Base metals group advanced yesterday on continued market tightness and supported demand outlook. China cut borrowing costs yesterday as means of supporting the economy. Copper gained ground to close at $9,534/t; the cash to 3-month spread has traded at -$25.50/t. Aluminium saw strong gains during the day, strengthening to close higher at $2,754/t. Zinc and lead closed at $3,427.50/t and $2,295.50/t, respectively. Additionally, continued production curbs from China and surrounding economic views about the Chinese economic outlook should continue to drive the market performance in the near term.

Oil futures rose in line with broader markets on easing concerns for demand outlook. WTI and Brent traded at $70.83/bl and $73.55/bl, respectively. Energy prices in Europe continue to skyrocket as the bloc’s supply diminishes. Precious metals edged higher in the first half of the day as safe-haven assets drove demand, as investors assessed the implications of booster doses and consequences on tightening of the restrictions. The metals softened afterwards, with gold and silver falling down to $1,788.23/oz and $22.51/oz, respectively.

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

All price data is from 22.12.2021 as of 17:30


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