1. Reports
  2. Daily Base Metals Report
Non-independent Research

Daily Base Metals Report

Read disclaimer

Tech stocks edged lower yesterday, causing the S&P 500 and NASDAQ to weaken on the day. However, energy, financials, industrials, and materials were strong, limiting the losses. The dollar has given back some of the previous day’s gains, but the index remains above 96 and trades at 96.25. The U.S. 10yr yield has rallied and pushed towards 1.70 and trades at 1.68%. ISM data today in the U.S. shows that prices paid declined in December to 68.2, down from 79.3, new orders were unchanged at 60.4, with manufacturing at 58.7, down from 60 the previous month. 

Metals were stronger yesterday, with copper pushing back towards $6,800 after as risk appetite was stronger, we saw reports that suggested Escondida production was down, with reports suggesting it was the lowest in years. Does this mean that output may weaken in 2022 after sustaining high supply levels during COVID? Too early to tell. Aluminium was firmer and closed at $2,839/t, spread at $9.25 contango. Stocks for the metals remain low, and while we expect Chinese output to improve following the Chinese New Year and the Winter Olympics, there is still a backlog in the supply chain, and the lack of output from Europe will cause European prices to remain elevated. European gas prices are rising and will continue as stocks are lower than usual and cold weather is expected in January and February. Nickel prices continued to rally $21,137/t, and the spread remains backwardated at $123/t. Lead was softer, closing at $2,298/t, while zinc gained ground at $3,604/t, with the cash to 3month spread at $51.75/t. 

Energy prices were gained ground today, with Brent trading at $80.08/bl with WTI at $77.17/bl; OPEC+ have indicated that they will increase output by 400,000 a day from February, as tightness in the market is expected to be tighter than previously thought. Precious metals were stronger today, with gold pushing towards $1,815/oz and silver trading at $23.05/oz.

All price data is from 04.01.2022 as of 17:30


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.

This report is not subject to any prohibition on dealing ahead of the dissemination of investment research. Accordingly, the information may have been acted upon by us for our own purposes and has not been procured for the exclusive benefit of customers. Sucden Financial believes that the information contained within this report is already in the public domain. Private customers should not invest in these products unless they are satisfied that the products are suitable for them and they have sought professional advice. Please read our full risk warnings and disclaimers.

Sign-up to get the latest Non-independent research

We will email you each time a new report has been published.

You might also be interested in...

Daily Report FX

A morning report covering fundamentals and technicals for USD, EUR, GBP, JPY, and CHF.

Daily Report Softs Technical Charts

Technical analysis and charts for the key sugar, cocoa and coffee contracts.

Weekly Report FX Options

Our FX Options Report contains commentary and analysis covering OTC currency option pricing, volatility and positioning. 

Quarterly Metals Report – Q3 2022

Our analysts provide an in-depth analysis of the metals market and current macroeconomic conditions. The environment has weakened significantly as growth fears rise amid persistent high inflation. Central banks are data-dependent, which could mean they slow rate hikes as growth starts to slow. This has meant a downside to the US 10yr yield, but also we see a downside to rate hikes in Q4. Europe will likely enter a recession before the US and take longer to recover, but material availability is significantly lower, shown by low inventories.

FX Monthly Report June 2022

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. This month we look into the JPY and the pressure the BOJ is under to change their monetary policy as JPY continues to weaken against major currencies. Economic data is weakening and inflation is less of a problem in Japan, but yields continue to test the cap.