base metals were boosted by China’s interest rate and reserve requirement ratio
cuts, which led to average gains of 1.1 percent, led by a 2.1 percent rise in
copper to $5,056 – the recovery in confidence led to a strong rebound in equity
market, at least initially, but this weighed on bullion prices that saw gold
and silver fall 0.7 percent, platinum off 0.5 percent and palladium drop 5.3
morning, despite a more bullish market in Asia, albeit a volatile one in China,
the base metals are off an average of 0.2 percent, led by 0.7 percent falls in
copper ($5,022) and zinc, aluminium is off 0.6 percent, lead is off 0.2 percent,
while nickel is up 0.2 percent and tin is up 0.7 percent. Volume is stronger at
6,898 lots, indeed it has been stronger all week.
metals are mixed, with bullion off around 0.6 percent with gold at $1,136, the
PGMs are firmer with platinum up 0.5 percent at $981.90, while palladium is up
2.1 percent at $547, having fallen heavily yesterday.
Shanghai, the base metals are for the most part firmer with average gains of
0.6 percent – nickel is the only metal that is lower today, it is down 0.3
percent, while copper is up 1.7 percent at Rmb 39,200 – copper was by far the
strongest metal yesterday too, which again suggests the SRB may be in the
market. Spot copper is up 0.5 percent at Rmb 39,250-39,400, the backwardation
with the October futures is at an equivalent of $30 per tonne, while the
LME/Shanghai arb window is open with the arb ratio at 7.83.
metals are weaker in Shanghai
with gold off 1.8 percent and silver down 1.2 percent – in other metals, steel
rebar is up 0.5 percent and iron ore is steady at $53.45.
had a volatile day yesterday – China’s
rate cut gave markets a boost that saw the Euro Stoxx 50 close up 4.7 percen,
but the Dow was up 2.7 percent at one stage, but then closed down 1.3 percent.
In Asia, the tone is firmer again with the CSI
300 up 3.2 percent, the Nikkei is up 2.8 percent, the Hang Seng is up 0.3
percent, the Kospi is up 2.6 percent and the Australian ASX200 is up 0.6
percent. So if the equities have found a footing then that might calm the fears
in the base metals, at least for a while, and in turn that could see some
bargain hunting emerge – key then will be whether that leads to short-covering.
– the change in recent trends seems to be affecting the currencies too with the
dollar rebounding, last at 94.21 after a low on Monday of 92.56, the euro is
holding below recent highs, last at 1.1487, as is sterling at 1.5705, the yen
is at 119.45, the rouble is at 68.92, but the aussie remains weak at 0.7116.
The yuan is last at 6.4852 after a low yesterday of 6.5050, while the other
emerging market currencies remain weak.
data shows Japan’s Services PPI is firmer at 0.6 percent, later we get UK
mortgage approvals, CBI realised sales and US data includes durable goods,
crude oil inventories and FOMC member William Dudley is speaking at 1:30 BST.
morning the base metals are consolidating yesterday’s gains, the downward
trends dominate and the rebounds are fragile, but if some stability returns to
the broader markets then there may be some relief rallies in the base metals.
Much will then depend on whether short-covering gains momentum. Yesterday’s LME
COTR data showed some short-covering, but it tended to go hand-in-hand with
long liquidation so there was selling and buying, but if fear dies down then
the short-covering could dominate for a while.
rallied on safe-haven buying, if the tide has turned in the other markets then
gold is likely to pull back to consolidate. With emerging market currencies
still weak and in fear of further devaluation then interest in gold may not
fade too much. The more industrial precious metals are also likely to benefit
should markets become less fearful.
BST 06:41:31 +/- +/- % Lots
Cu 5022 -34 -0.7% 3728
Al 1547 -9 -0.6% 1342
Ni 9585 20 0.2% 657
Zn 1725.5 -12.5 -0.7% 999
Pb 1670 -3.5 -0.2% 162
Sn 14200 100 0.7% 10
300 0 0.0%
(BM ex-Steel) -0.2% 6898
Gold 1136 -7.4 -0.6%
Silver 14.58 -0.1 -0.7%
Platinum 981.9 4.9 0.5%
Palladium 547 11 2.1%
Prices 6:45 BST Change %
Cu 39200 650 1.7%
AL 11860 -5 0.0%
Zn 14475 85 0.6%
Pb 13245 165 1.3%
Ni 74940 -250 -0.3%
Sn 101150 310 0.3%
Average change (base metals) 236.5 0.6%
Rebar 1951 10 0.5%
Au 237.1 -4.25 -1.8%
Ag 3361 -41 -1.2%
BST Country Data ACTUAL Expected Previous
12:50am JPY SPPI y/y 0.6% 0.4% 0.4%
9:30am GBP BBA
Mortgage Approvals 46.0K 44.5K
11:00am GBP CBI
Realized Sales 19 21
1:30pm USD Core
Durable Goods Orders m/m 0.3% 0.6%
1:30pm USD Durable
Goods Orders m/m -0.4% 3.4%
3:00pm USD FOMC
Member Dudley Speaks
3:30pm USD Crude
Oil Inventories 1.0M 2.6M
Edited by SHMET