Research

Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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Base Metals

11 June 2019 Issue

  • Gold price rises as Middle East tensions escalate

    Free

    18 June 2019

    While generally weak global economic data continues to weigh on sentiment and is keeping base metals prices under pressure, the rise in tensions between the US and Iran has lifted the gold price this morning, Tuesday June 18. The market is also waiting for direction from the US Federal Reserve, which it should get on Wednesday when the FOMC meets and provides its economic projections, issues its statement and holds a press conference.

  • LME base metals prices firmer but global risk sentiment remains fragile

    Free

    17 June 2019

    The global macroeconomic backdrop remains riddled with high amounts of uncertainty this morning, Monday June 17, as the US-China trade conflict drags on while tensions between the US and Iran look set to ratchet up in the coming days. Despite this, LME three-month base metals prices were firmer at the start of a new trading week, but gains have been fairly limited.

  • Haven demand supports gold, caps base metals

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    14 June 2019

    Base metals prices have been mixed so far on Friday June 14, reflecting weak risk appetite following the recent uptick in tensions in the Middle East, while global trade tensions still overhang

  • Aluminium: Tentatively bullish

    11 June 2019

    Although LME aluminium remains oversold, it is still vulnerable to further downside pressure if short-term technical support at $1,765 per tonne gives way. That said, we are tentatively bullish here because a great deal of the bearishness has already been priced in. In addition, global exchange stocks have declined by 19% this year, which is a relatively positive micro-dynamic that remains neglected in the midst of the macro-economic uncertainty.

  • Base metals investment analysis: Speculative bearishness still prevails

    11 June 2019

    Commitment of Traders reports continue to tell largely the same story about speculative positioning in the base metals – that bearishness prevails overall. That is unlikely to change until US-China trade negotiations are back on track or more policy easing is announced to counter the negative effects of the ongoing uncertainty.

  • Copper: Positioning becomes excessively negative

    11 June 2019

    Despite a weaker dollar since the start of June, sentiment toward copper continues to deteriorate as increased US-China trade tensions undermine the forward fundamental picture. As we believe that the market is forming an excessively negative view on the copper fundamentals, we think that copper prices are prone to a robust short-covering rally in the near term. But a (macro or fundamental) catalyst may be needed to trigger this positioning reversal.

  • Demand Indicators: June 11 2019

    11 June 2019

    Demand indicators for the base metals market

  • Downloadable Base Metals Weekly Data June 11 2019

    11 June 2019

    Downloadable data for week June 11 2019

  • Lead: Port Pirie wakeup call

    11 June 2019

    Lead prices rallied strongly last week on the back of an unplanned stoppage at Nyrstar’s Port Pirie smelter in Australia on May 28. Three-month prices leapt $125 to reach a high of $1,918 per tonne on June 6, before consolidating back in the mid-to-high $1,800s. Given low stocks, there is little room for supply disruptions like this, which was highlighted by nearby prices moving into a backwardation.

  • Market Summary: Risk appetite has improved

    11 June 2019

    The fact that the US dropped threatened tariffs on Mexico at the weekend has raised hopes that a deal with China is still doable. That, together with more infrastructure-focused policy easing from China at the start of this week, has improved sentiment in the base metals. Strong rallies are under way and we wait to see how sustainable these moves turn out to be.

  • Nickel: Sentiment better, prices higher

    11 June 2019

    There has been a lot of news flow impacting on nickel prices in recent days, much emanating from Fastmarkets’ conference on nickel itself last week and lithium this week. The fact that nickel prices are back up at around $12,000 per tonne as we write, from the recent low of $11,605 per tonne last week, suggests the net effect of all this news flow has been mildly bullish.

  • Technical analysis: Attempting rebounds

    11 June 2019

    At the moment, many base metals are attempting rebounds, though they are finding plenty of resistance levels that need eroding with persistent buying pressure if further upside progress is to be achieved.

  • Tin: Remaining cautious at the moment

    11 June 2019

    Tin prices have enjoyed a solid rally since the start of June. While a renewed sell-off cannot be ruled out by the end of the month due to the presence of looseness in our real-time fundamental indicators, we believe that tin prices will experience a solid recovery in the second half of the year. The long-term fundamental picture is bullish, but it may take time for the market to metabolize the long-term tightness.

  • Zinc: Struggling for traction

    11 June 2019

    Zinc prices remain under pressure in the short term, with the chart set-up suggesting downside risks remain, which only compounds bearish fundamental factors such as the weakness in the galvanized steel market and ample availability in the zinc concentrate market. But a pick-up in LME warrant cancellations is supportive, as is the limited nature of stock inflows despite the persistently deep backwardation in nearby spreads.