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Daily Base Metals Report

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Authors
Daria Efanova

Daria Efanova Head of Research

Contact research Contact Industrial Commodities

Today marked another day of gains in the US equity market, with the S&P 500 fluctuating near record highs. Housing data from the world’s largest economy pointed to a revival in residential real estate, with housing starts increasing by more than expected to 1560k in November – the highest level since May 2022. In 2023, the long period of elevated mortgage rates discouraged potential home buyers, but declining rates will likely change this trend as we step into 2024. Elsewhere, the final Eurozone CPI prints confirmed expectations of softening inflation, with the November reading at 2.4% YoY, marking the lowest level since July 2021. The euro strengthened against the dollar, with the currency pair EURUSD appreciating to 1.10. The dollar index edged lower and stood at 102.18 while the 10-year US Treasury yield declined below 3.9%.

Base metals continued the recent days’ trend, suggesting the macro uncertainty had little impact on prices today. Zinc continued to pare strong gains, supported by diminishing stocks on the LME, settling at $2,581.50/t. The cash to 3-month spread is now marginally backwardated at $2.50/t. Likewise, copper jumped higher, attempting to test the robust resistance of $8,610/t that it struggled to breach this month. Aluminium, on the other hand, weakened following the last couple of days of robust gains; the losses, however, have been marginal, and prices have come back in line with the longer-term average of $2,250/t. LME stocks remained elevated above 0.5m tonnes.

The market optimism regarding possible monetary policy easing next year continued to drive precious metals higher, with gold and silver surging to $2044/oz and $24.11/oz, respectively. Security issues in the Red Sea led the oil prices to stay elevated, with WTI rising to $73.07/bl and Brent appreciating to $78.67/bl.

Lme Metals Price And Volume 19122023

All price data is from 19.12.2023 as of 17:30

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