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Daily Base Metals Report

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The US rose for the second day straight after positive labour data came out today, suggesting a strong base for the Fed to continue hiking aggressively. Two of the Fed’s most hawkish policymakers backed another 75bps hike in July, dismissing recession fears. US employers added 372,00 in June; and whilst softer month-on-month, the level is still robust. The unemployment rate remained unchanged at 3.6%. Meanwhile, a drop in the participation rate highlights the worker shortage complaints in recent months and employers still struggling to fill positions, which could lead to sustained wage pressures. The dollar softened for the first time in 5 days, and the 10yr US Treasury yield jumped back above 3.00%.

Metals continued to soften today after the Chinese stimulus failed to keep sentiment elevated. Copper edged lower, but support at $7,650/t forced the metal to edge higher to close at $7,805.50/t. Likewise, tin declined, falling to close at $25,364/t. Lead and zinc both closed lower at $1,917.50/t and $3,099/t, respectively. Aluminium fluctuated before slipping into positive by the end of the day to close at $2,436.50/t. Aluminium processing enterprises’ operating rates have fallen marginally to stand at 66.5%, with only wire and cable seeing increases week on week, as companies rushed to complete the shipping process on the back of potential fears of renewed lockdown restrictions in Wuxi.

Oil futures closed higher on the day at $104/bl and $107/bl. Gold and silver fluctuated between gains and losses to settle at $1,743/oz and $19.29/oz, respectively.

For more in-depth analysis of base and precious metals, our Q2 2022 Quarterly Metals report is out now!

All price data is from 08.07.2022 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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