US stocks weakened today as markets grappled with the idea of stronger inflation for longer alongside interest rate hikes from major economies. The spread of omicron continues to sour sentiment, however, we have seen limited implementation of lockdown restrictions, and many schools in the US have already begun shifting to in-person teaching this week. The opposite, however, is true in China, where authorities began to tighten restrictions on entry into Shenzhen as the number of cases began to grow in the area. The dollar gained ground, and the 10yr US Treasury yield continues to test the 1.80% area. The CPI is out this Wednesday and is expected to grow by 7.0% y/y in December, another consecutive month of strong growth, with domestic data out Friday.
Another day of mixed performance on the LME. Iron ore futures jumped higher today after Vale, one of the major producers, partially halted production due to heavy rainfall; the metal closed at CNY798/mt. Aluminium was marginally stronger, trading close to $3,000/t once again as soaring power costs are causing producers to halt production, causing the metal to close just below at $2,931.50/t. Likewise, nickel fluctuated, supported above $20,700/t but closed higher on the day at $20,799/t. Copper softened, closing at $9,563.50/t; cash.
Oil futures fell after production woes in Libya eased, and the country increased supply to 900,000 b/d after maintenance was complete. WTI and Brent traded at $78.40/bl and $81.80/bl. Precious metals fluctuated amid a stronger dollar, with gold and silver at $1,794.30/oz and $22.38/oz, respectively.
For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.
All price data is from 10.10.2022 as of 17:30
