US stocks softened marginally today as the market sentiment cooled following a steep 3-day rally. US employment declined by 301,000 in January by most since the start of the pandemic; while it was expected that the spread of the omicron variant would drive the decline, the size of the correction was unexpected. We await Friday's nonfarm payroll data, which should shed more light on January's labour market conditions. The dollar and the 10yr US Treasury yield both softened. Meanwhile, Euro-area inflation jumped to 5.1% y/y, up from 5.0% in December; this is significantly exceeding the market estimates of 4.4%, putting significant pressures on ECB to act.
Metals prices were well supported today as risk appetite improved, based on the Fed inflation and rate hike expectations. Copper was firmer and tested resistance at $9,906/t to close at $9,839.50/t; the cash to 3-month spreads is still backwardated at $33/t. Nickel prices edged higher towards $22,900/t and closed at $22,866/t. Zinc was marginally higher, and so was lead aluminium bucked the trend today, falling back through support at $3,000/t and closing at $2,986/t. Lead and tin were both higher, closing at $2,241/t and $43,050/t, respectively.
Oil futures declined after the OPEC+ agreed to hike output by 400,000 bl/d in March, even as they failed to deliver on that amount before. WTI and Brent now trade at $87.39/bl and $88.57/bl. Precious metals were seen slightly higher, with gold and silver edging up to $1,808.03/oz and $22.74/oz, respectively.
For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.
All price data is from 02.02.2022 as of 17:30
