Morning update

This Morning Base metals are mixed in early Tuesday trade around 07:00 compared with Monday's official close. Tin leads the gains, up 1.4% at $53,295/t, followed by zinc, up 0.6% at $3,539.50/t. Aluminium has added 0.3% to $3,150/t and copper is 0.1% firmer at $13,630/t. Nickel and lead are the laggards, both down 0.7%, at $16,600/t and $1,821/t respectively. Macro & Geopolitics Oil has retreated from Monday's one-month high, with Brent near $88.88/bbl after mediators proposed a 10-day US-Iran ceasefire. However, the threat of a Houthi naval blockade against Saudi Arabia keeps energy and shipping risks elevated. European equity futures remain weaker as higher fuel costs sustain inflation and interest-rate concerns; US markets increasingly expect renewed Federal Reserve tightening this year. Washington has meanwhile introduced reduced aluminium tariffs for companies committing capital to US smelting projects, potentially redirecting investment and trade flows. European attention today turns to UK labour data and German and eurozone confidence surveys ahead of Thursday's ECB meeting. Base Metals Copper is supported by tightening physical availability and Chinese demand, with the Yangshan import premium reaching $103/t, its highest since May 2025. Exchange inventories have declined steadily since May, while the LME cash-to-three-month spread is approaching backwardation. Aluminium is also firmer after global June primary output fell 1.5% year on year, including a one-third decline in Gulf production. China's near-total suspension of sulphuric acid exports may constrain copper leaching in Chile and nickel processing in Indonesia. Zinc has advanced this morning, although analysts expect softer steel demand and improving supply to pull prices back later this year. Tin is outperforming, while lead and nickel remain under pressure. Precious Metals Gold has risen 0.9% to around $4,043/oz as investors balance tentative diplomatic progress with the continuing risk of wider Middle East disruption. Softer oil reduces the immediate inflation threat, but another supply shock could revive expectations of higher interest rates. Silver is outperforming again, gaining 2.2% to $57.67/oz. Platinum and palladium are both 0.8% higher at approximately $1,607/oz and $1,264/oz respectively, benefiting from the broader move into precious metals. Steel Steel signals remain divided across regions. US producer Steel Dynamics reported record quarterly shipments of 3.7 million tons and stronger pricing as tariffs and trade restrictions kept imports near multi-year lows. Closer to Europe, Thyssenkrupp is targeting annual sales growth above 4% for its materials trading division ahead of a planned spin-off. Russian producer Severstal's second-quarter profit fell 74% as weak domestic demand depressed prices. For European scrap traders, protected US demand contrasts with softer conditions in nearby eastern markets. Rare Earth Metals USA Rare Earth is preparing a leadership transition, with Serra Verde chief Thras Moraitis due to become CEO on October 1. The change follows the planned combination of the two companies into an integrated Western mine-to-magnet supplier. Serra Verde operates the only large-scale source outside Asia producing all four critical magnetic rare earths. The development reinforces the push to diversify Western supply chains, although it offers no immediate spot-price catalyst. Forex The euro is trading near $1.1415, slightly weaker as energy-security concerns and firmer US yields support the dollar. That leaves dollar-priced metals marginally more expensive for euro-area consumers than at the start of the week. Sterling has fallen to around $1.344 following Britain's change of government and renewed concern about fiscal policy. The yen remains weak near 162.5 per dollar, keeping intervention risk in focus, while broad dollar strength continues to cap some of the upside in industrial metals. Watch Today UK employment and wage figures are due at 08:00 CEST, followed by July ZEW sentiment readings for Germany and the eurozone at 11:00 CEST. The releases could move sterling, the euro and European rate expectations, with knock-on effects for regional metal purchasing costs.