1. Reports
  2. Daily Base Metals Report
Non-independent Research

Daily Base Metals Report

Read disclaimer

The US market is closed today for a national holiday. The index futures rebounded slightly as the bearish sentiment cooled somewhat from last week’s sell-off. The dollar gauge edged lower. European stocks were higher, whilst the French equity benchmark weakened after President Macron lost his absolute majority in parliament, adding uncertainty to the reform agenda. Meanwhile, the cable settled at around 1.250 as the country continues to battle rising inflation and labour strikes over the week.

Metals on the LME highlighted the concerns felt about global growth; however, the sentiment reversed in the later hours, with some moderate gains seen across the complex. Copper fell below the support level of $9,000/t, the level not breached since October 2021, falling down to trade at $8,979/t. Aluminium found support at $2,480/t before gaining footing to $2,536.50/t. Alumina exports out of China soared in May, with 190,000t being shipped primarily to Russia as shortages in the country persist. This equates to a growth of nearly 1,000% year on year. At the same time, imports of steel products fell to the lowest level since 2000. Lead and zinc closed marginally higher at $2,068.50/t and $3,517.50/t, respectively. Iron ore fell by 7% d/d, erasing this year’s gains to close at $110.94/mt; support at that level caused the metal to edge higher the next day. Chinese banks kept their lending rates unchanged today, given the lacklustre recovery from covid restrictions and tighter monetary policy environment elsewhere. The market remains in a wait-and-see mode as they await improvement from both economic and fiscal standpoints; however, with the reimposition of lockdown measures in big cities, the recovery will take longer than originally anticipated.

Oil fluctuated as investors weighed on the global demand outlook. WTI and Brent trading at $110/bl and $113/bl. Precious metals were mixed, with gold and silver edging slightly lower into $1,837/oz and $21.59/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 20.06.2022 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.

Sign-up to get the latest Non-independent research

We will email you each time a new report has been published.

You might also be interested in...

Daily Report FX

A morning report covering fundamentals and technicals for USD, EUR, GBP, JPY, and CHF.

Daily Report Softs Technical Charts

Technical analysis and charts for the key sugar, cocoa and coffee contracts.

Weekly Report FX Options

Our FX Options Report contains commentary and analysis covering OTC currency option pricing, volatility and positioning. This week’s focus is on EURCHF following the surprise rate hike from the Swiss central bank last week. 

Quarterly Metals Report – Q2 2022

Our analysts provide an in-depth analysis of the metals market and current macroeconomic conditions. Central Banks are raising rates to curb inflationary pressures and the cost of living crisis in the Euro area and the UK. Economic data and consumer demand are weakening and market sentiment has been impacted accordingly. This, in conjunction with lockdowns in China, has caused demand for metals to soften and shift the Chinese market into surplus, but supply chain logistics have tightened the European market. The easing of lockdowns will boost sentiment and prompt a rally in the near term, but the market is moving into selling rallies as opposed to buying dips.

FX Monthly Report May 2022

Monthly commentary covering the FX markets, providing insights on recent developments on select currency pairs. This month we look at the current inflation outlook across LATAM, Europe, U.S. and U.K. and gauge if central banks will slow their rate hikes. Economic data is weakening and China's poor growth and woeful demand could impact policy makers' decisions.