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Daily Base Metals Report

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US stocks fluctuated once again today as the markets assessed the prospects of higher interest rates from the Fed next week. Indeed, the 2- and 30-year yields between US Treasuries are now the most inverted they have been since 2000. Likewise, mortgage rates in the US have now topped 6.0%, the level not seen in 14 years as markets price in further rate hikes from the Fed. US sales rose by 0.3% in August after a 0.4% drop in July, while the spending by category was more mixed – non-store retailers saw declines. US initial jobless claims fell for the fifth straight week, down to 213,000 in the week ending September 10th, suggesting ample demand for new hires. The dollar was range-bound, and the 10yr US Treasury yield edged slightly higher into 3.44%. Meanwhile, the PBoC refrained from taking any easing steps, holding key policy interest rates steady and draining liquidity from the banking system that is overflowing with cash. Further PBOC easing would put more pressure on the depreciating yuan,

Metals continued their decline today as the risk-off sentiment intensified. Nickel sold off sharply, falling below the $23,600/t support level to $23,127/t, erasing this week’s worth of gains. Copper was also weaker, as it fell below the support level of $7,750/t to $7,729.50/t. Lead and zinc closed lower at $1,916.50/t and $3,186.50/t, respectively. Only aluminium managed to gain a footing today above $2,300/t to $2,307.50/t. Iron ore futures have tested the $100/mt once again but struggling to gain any upside momentum in recent months; the metal closed at $100.70/mt. Vale stated that the iron ore market has now stabilised with the impacts of China’s covid lockdowns and property market weakness priced in, suggesting that it can only get better from now on.

Oil futures fell after the US stated that no price trigger is needed to begin refilling the reserves. WTI and Brent now trade at $85/bl and $90/bl. Precious metals continued the decline amid the hawkish Fed expectations, with gold and silver falling to $1,68/oz and $19.22/oz, respectively.

For more in-depth analysis of base and precious metals, our Q3 2022 Quarterly Metals report is out now!

Lme Metals Price And Volume (124)

All price data is from 15.09.2022 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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