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Daily Base Metals Report

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US stock performance reversed on disappointing corporate earnings results released today. The Fed meeting is due next week, and the policymakers are expected to start lifting rates in March. On the other hand, in Europe, Lagarde continues to reinforce the position that the ECB will not be withdrawing stimulus at the same rate as the US, as the inflation criteria are not yet satisfied. The dollar softened, and the US 10yr Treasury yield declined for the third day. UK retail sales underperformed in December, falling by 3.7% m/m, the biggest decline since January 2021, when the economy was under tough lockdown restrictions.

Metals sentiment was mixed today as nickel, tin, and lead rallied, but zinc copper and aluminium were weaker. The cash to 3-month spread for nickel stands at $281/t back, but the spread is weaker than yesterday. Nickel broke above $24,00/t and tested $24,340/t as the squeeze continues to close at $24,028/t. Tin is still rallying and closed at $43,955/t. Aluminium weakened but struggled to break support at $3,000/t, closing at $3,040.50/t. Likewise, copper was seen marginally lower, closing at $9,941/t.

Today, oil futures were lower as markets digested the news of an unexpected rick up in crude stockpiles. The White House stated it could accelerate the release of strategic reserves. WTI and Brent were at $84.91/bl and $87.59/bl. Precious metals were mostly on the back foot, with gold and silver falling to $1,833.52/oz and $24.32/oz, respectively.

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

All price data is from 21.01.2022 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.

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.

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