The market kept its attention focussed on sanctions and the commodities once again, with US stocks facing another day of moderate losses. Oil futures saw an inflow of volatility after a barrage of sanctions coming from the US and the UK, as the countries moved to ban the import of Russian oil. Shell is one of the latest companies to pull out of Russia, stating they will not make any new Russian oil and gas purchases. As a means of retaliation, Russia threatened to cut natural gas supplies to Europe via the Nord Stream 1 pipeline, despite Germany’s recent move to avoid ban on energy imports. On the other hand, we saw China considering increasing their stakes in Russian energy and commodity companies, a move that could provide some relief for Russian businesses. The dollar fluctuated while the 10yr US Treasury yield edged higher above 1.80%.
Nickel outshined other metals as the unprecedented rally that we saw in the last couple of days, and more recently, a jump above $100,000/t overnight caused LME exchange to halt trading of the metal. Aluminium weakened by 7% to close at $3,498/t as a result, with cash to 3-month spread falling to -$27.50/t, the lowest level since June 2021. Copper tested the resistance of $10,700/t before falling lower to close at $10,209/t. Zinc and lead were both marginally higher, closing at $4,135.50/t and $2,497/t, respectively.
Oil futures rallied today as the new wave of sanctions threatens the global supply picture, causing WTI and Brent to jump to $128.57/bl and $132.88/bl, respectively. Precious metals gained ground, with gold and silver now trading at $2,058.04/oz and $26.68oz.
For more in-depth analysis of base and precious metals, please see our Quarterly Metals report.
All price data is from 08.03.2022 as of 17:30
