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Daily Base Metals Report

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Authors
Daria Efanova

Daria Efanova Head of Research

Viktoria Kuszak

Viktoria Kuszak Research Associate

Contact research Contact Industrial Commodities

US stocks opened lower today, mirroring the decline in European markets following a wave of corporate earnings reports. The final S&P Global US Manufacturing PMI confirmed a contraction in factory activity in July with a reading of 49.6. Both initial and continuing jobless claims came in higher than expected for the weeks ending 27th July and 20th July, respectively. Yesterday’s Fed statement confirmed investors’ expectations of an interest rate cut in September. The 10-year US Treasury yield plunged below 4.0% today, settling at 3.97%. Meanwhile, the Bank of England cut interest rates for the first time in this monetary cycle by 25bps to 5%. In the Eurozone, the unemployment rate edged slightly higher in June, rising to 6.5% YoY. The dollar strengthened against other major currencies, recovering from yesterday’s losses, and stood at 104.3.

Base metals started today on the front foot, following from yesterday’s strength. However, in line with our expectations mentioned in the previous report, the market lacked the strength to close another day higher. Still, with prices defending the new support levels, we expect the downside from now on to be limited. Copper tested prices above the $9,300/t level before softening back to $9,052.50/t; the support at $9,000/t is holding firm. Aluminium is once again retesting the $2,300/t level, closing at $2,296/t. The rest of the complex followed suit; nickel held above $16,000/t at $16,282/t, while lead and zinc tested the $2,100/t and $2,700/t levels, respectively.

After rising yesterday, gold remained broadly unchanged today, trading just below $2,450/oz, while silver decreased to $28.5/oz. Oil prices traded flat, with WTI and Brent crude at $77.25/bbl and $80.4/bbl, respectively.

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All price data is from 01.08.2024 as of 17:30

Disclaimer

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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.

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