The metals opened lower on Monday in the shadow of the Greek ‘no’ vote but ended the day mixed with average losses of one percent – tin and lead ended the day slightly higher, while the rest closed off 1.6 percent on averaqge with copper down 3.2 percent at $5,567.
Precious metals closed down 0.7 percent on Monday, with gold holding value at $1,169.20, silver was little changed at $15.69, while the PGMs were weaker with platinum off 1.9 percent and palladium off 0.9 percent.
This morning, the base metals are weaker again by an average of 0.6 percent with aluminium and zinc off the least, but an average of 0.3 percent, while the rest are down 0.6 to 0.9 percent with copper off 0.7 percent at $5,527.50. This means copper has now given back 85 percent of its January to May gains compared with 118 percent across the rest of the complex, with only lead the other metals not to have given back all its gains yet.
Precious metals prices are little changed with palladium up 0.3 percent at $681.70, while gold is at $1,168.20.
In Shanghai, the base metals are down an average of 0.9 percent with copper off the most with a 2.5 percent fall to Rmb 40,200 and nickel off 2.2 percent, while zinc and lead are slightly higher – see table below for more details.
Spot copper in Changjiang is down 2.2 percent at Rmb 41,150-41,450, the backwardation has ballooned to an equivalent of $200 per tonne, which suggests a concentration of selling on the futures (with open interest rising on Monday that suggests fresh shorting). The LME/Shanghai copper arb ratio is at 7.38 for the cash month, which means the arb is probably open for some traders.
Precious metals in Shanghai are off slightly with gold down 0.1 percent and silver off 0.3 percent.
Equities – yesterday the Euro Stoxx 50 closed down 2.2 percent and the Dow closed off 0.2 percent, but Asia is mixed this morning with the Nikkei up 1.3 percent, the Hang Seng is off one percent, the CSI continues to fall, it is off 1.6 percent and the Kospi is off 0.7 percent.
Currencies – the dollar is bid with the dollar index at 96.50, the euro is holding up remarkably well at 1.1027, sterling is holding around 1.5568, as is the yen at 122.73, the aussie is weak at 0.7490, which suggests Australia’s outlook for China is not optimistic, the rouble is weak at 57.08 and the yuan is last at 6.2092.
The economic agenda includes German industrial production that was flat, later we get UK industrial and manufacturing production data, there is a Eurogroup meeting and Euro summit and US data includes the trade balance, JOLTS job opening and IBD/TIPP economic optimism – see table below.
Today the base metals are getting off to a weak start as the uncertainty prevails in Europe and the sell-off in China’s stock market continues. At the start of writing this report prices were off an average of 0.6 percent they are now down one percent on average. The markets could be in for a relief rally before too long as these lower prices are likely to attract bottom of range buying, but it may take some positive development over Greece for that. As such, we would run with the price weakness for now, but be ready for a rebound.
Gold is holding above lows, so it is holding its value for now as it has since Thursday, silver is following suit, as is palladium, while platinum has been nervous and has shown signs of fresh weakness.
| Overnight Performance | ||||
| BST | 07:20 | +/- | +/- % | Lots |
| Cu | 5527.5 | -40 | -0.7% | 5111 |
| Al | 1691 | -4 | -0.2% | 572 |
| Ni | 11545 | -100 | -0.9% | 1416 |
| Zn | 2008.5 | -8.5 | -0.4% | 1307 |
| Pb | 1758 | -11 | -0.6% | 208 |
| Sn | 14160 | -115 | -0.8% | 8 |
| Steel | 300 | 0 | 0.0% | Total |
| Average (BM ex-Steel) | -0.6% | 8,622 | ||
| Gold | 1168.2 | -1 | -0.1% | |
| Silver | 15.69 | 0 | 0.0% | |
| Platinum | 1062.1 | 0.1 | 0.0% | |
| Palladium | 681.7 | 1.7 | 0.3% | |
| Average PM | 0.0% | |||
| SHFE Prices 06:36 BST | Change | % Change | |
| Cu | 40200 | -1020 | -2.5% |
| AL | 12480 | -60 | -0.5% |
| Zn | 15270 | 10 | 0.1% |
| Pb | 12830 | 35 | 0.3% |
| Ni | 85460 | -1930 | -2.2% |
| Sn | 107110 | -770 | -0.7% |
| Average change (base metals) | 236.5 | -0.9% | |
| Rebar | 1987 | -78 | -3.8% |
| Au | 236.5 | -0.15 | -0.1% |
| Ag | 3439 | -9 | -0.3% |
| Economic Agenda | |||||
| BST | Country | Data | ACTUAL | Expected | Previous |
| 7:00am | Germany | German Industrial Production m/m | 0.0% | 0.1% | 0.6% |
| 9:30am | UK | Manufacturing Production m/m | 0.1% | -0.4% | |
| 9:30am | UK | Industrial Production m/m | -0.2% | 0.4% | |
| Tentative | UK | 30-y Bond Auction | 2.86|1.6 | ||
| All Day | EU | Eurogroup Meetings | |||
| All Day | EU | Euro Summit | |||
| 1:30pm | US | Trade Balance | -42.5B | -40.9B | |
| 3:00pm | UK | NIESR GDP Estimate | 0.6% | ||
| 3:00pm | US | JOLTS Job Openings | 5.33M | 5.38M | |
| 3:00pm | US | IBD/TIPP Economic Optimism | 48.9 | 48.1 | |
The post Base metals under pressure on Greek and China uncertainty appeared first on The Bullion Desk.
No comments:
Post a Comment