US stocks declined yesterday after a lacklustre release of corporate earnings results. US initial jobless claims fell to March 2020 lows of 290,000, a sign of continued labour market recovery. Meanwhile, previously-owned home sales in the US rose to the highest level in almost a year in September. The dollar strengthened marginally during the day, and the 10yr US Treasury yield topped 1.67%; 5yr yield tested 1.20% for the first time in more than a year, supported by strong beliefs of Fed tightening monetary policy.
Base metals on the LME retreated yesterday on the back of rising pressures on the Chinese economic growth.
Aluminium saw the strongest loss, falling as much as 7.3% during the day to $2,900/t, closing higher at $2,910.50/t. A similar decline was felt by zinc, which fell after a marginal recovery seen the previous day, closing below the $3,500/t level at $3,429.50/t. Copper broke through the support level of $10,000/t to close lower at $9,831/50; cash to 3-month spread weakened further into $295.75/t. LME copper inventory levels rose marginally, still remaining near the lows. Meanwhile, SHFE copper managed to hold the nerve just below CNY74,000/mt and closed at CNY73,882/mt. Nickel failed above the $21,425/t level and sold off to close at $19,930/t. Lead closed at $2,400/t.
Oil prices contracted; WTI and Brent fell to $81.28/bl and $83.74/bl. Precious metals weakened marginally, with gold and silver trading down to $1,782.32/oz and $24.16/oz.
For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.
All price data is from 21.10.2021 as of 17:30