Written Commentary
COPPER
With the copper market rejecting the spike down trade on Wednesday and registering a high to low setback from this week’s high of $0.08 the market may have found some value or is merely temporarily oversold. Exchange inventory data overnight favored the bear camp with LME copper warehouse stocks barely changed and Shanghai weekly copper stocks increasing by 4,852 tons. Weekly Shanghai copper warehouse stocks last week were at the lowest levels since early September 2022 and that combined with a decline in “social inventories of copper in China’s major copper trading markets” (per Bloomberg) down 3900 tons versus the prior week that leaves general supply side support in the market. In a minimally supportive development but already known threat against supply, protests have halted supplies flowing to a First Quantum Minerals LTD copper mine in Panama. This morning’s focus will now shift to the S&P’s PMI releases which are expected to come in slightly softer in the manufacturing and services components.
GOLD / SILVER
Obviously, the gold market is tracking higher and is pulling silver up with it because of the noted weakness in the dollar with the currency index into the low overnight now down 56 ticks from this week’s high. Unfortunately for the bull camp, global interest rates ticked higher overnight with a particularly hawkish comment from the Bank of England. Overnight economic news showed weakness in the German economy global equity markets were generally lower which leaves concerns of global slowing in place from earlier in the week. In a longer-term supportive development Russia has indicated their gold production is likely to peak at the end of the decade and then begin to decline. Surprisingly gold prices were higher in the overnight session as the cease-fire has brought down temperatures especially with Hamas preparing to release hostages, but a lower Dollar probably glossed over those bearish overnight developments. With German economic indicators coming in soft overnight, gold might have benefited but rising bond yields almost completely offsets the lower.
Interested in more futures markets? Explore our Market Dashboards here.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
