Metals Daily

This Morning At around 07:45 CET on Monday, base metals were mixed against Friday’s official closes. Tin was the clear leader, rising 0.9% to $55,700 a tonne, while copper gained 0.4% to $14,130. Nickel fell 0.4% to $16,740; lead and zinc each eased 0.1% to $1,840.50 and $3,703.50, respectively. Aluminium was effectively unchanged at $3,279. Macro & Geopolitics Weak U.S. employment data reduced expectations of a September Federal Reserve rate increase, with futures assigning roughly a 45% probability, down from 67% a week earlier. Attention now shifts to Wednesday’s U.S. consumer-price report, where forecasts point to monthly increases of 0.1% overall and 0.2% for core inflation. Energy remains a complication: Brent traded near $84 as shipping through the Strait of Hormuz stayed severely restricted. Iran said a deal with Oman defining new shipping lanes was in its final stages, but reiterated that the waterway would reopen only after the United States met additional conditions. European equity futures were subdued amid uncertainty over oil prices and the Gulf negotiations. Base Metals Copper remained above $14,000 after its strongest weekly advance since May, although supply anxiety surrounding the Democratic Republic of Congo’s copper-concentrate export ban moderated. Goldman Sachs expects little effect on the global balance, while Chinese physical indicators weakened: the Yangshan import premium fell to its lowest since July 20, domestic premiums declined and exchange stocks recorded their first weekly increase since early June. Chinese unwrought copper imports were also 11.5% lower year on year in July. Elsewhere, tin outperformed in early Monday trade, while nickel retreated. Aluminium was steady. Saudi Arabian Mining Company reported robust aluminium prices in the quarter and said there was no change to its aluminium production guidance. Precious Metals Gold eased 0.3% to about $4,330 an ounce as traders took profits following a gain of more than 7% last week and Friday’s seven-week high. The softer U.S. rate outlook continued to underpin bullion, although this week’s inflation releases could quickly alter expectations. Silver rose 0.3% to $63.77 and platinum added 0.2% to $1,748.80, while palladium fell 1% to $1,364.55. Perth Mint’s July sales showed stronger demand for its gold and silver products: gold sales reached a three-month high, while silver sales rose more than 65% from June. Steel Turkish steel-pipe producer Borusan Boru reported second-quarter net profit of 1.5 billion lira, up from 882.3 million lira a year earlier, as revenue increased to 25.2 billion lira. Saudi wire and casting producer Maadaniyah nevertheless posted a 2 million-riyal quarterly loss. The company cited delayed imported raw materials and reduced finished-goods availability, alongside a 21% decline in drawn-wire sales and a 46% fall in axle and spare-parts sales. Rare Earth Metals Australia tightened restrictions on shareholders ordered to sell stakes in Northern Minerals, developer of the Browns Range heavy rare-earth project. Certain disposals will now require confirmation that prospective buyers are not associated with the sellers, reinforcing government scrutiny of Chinese-linked investment in strategic minerals. Separately, Lindian Resources said the mining licence for Malawi’s Kangankunde rare-earths project remained valid and in good standing, and that there was no evidence of unauthorised mining. Lindian also agreed to acquire the remaining 49% of the Sareco processing facility for $20 million, giving it full ownership. Forex The dollar remained under pressure after weak U.S. payrolls lowered near-term Federal Reserve tightening expectations. The euro traded near $1.1553, close to a seven-week high, reducing the dollar cost of metals for European buyers. Dollar-yen rose to around 158.35, although intervention concerns limited further pressure on the Japanese currency. For euro-area scrap traders, Wednesday’s U.S. inflation report is the next major currency risk: a firm reading could revive rate expectations and reverse part of the euro’s recent advantage. Watch Today August’s euro-area Sentix investor-confidence reading will provide an early indication of regional demand sentiment. Federal Reserve Bank of Cleveland President Beth Hammack is also scheduled to speak, while Chinese credit and money-supply figures are due during the European morning.