Good Related News - Oct 23, 2015 - 8:04 AM GMT
by Will Adams
The precious metals rebounded yesterday with average gains of 0.8 percent, led by a 1.6 percent rise in palladium to $684, while gold prices were little changed at $1,166.20. This morning bullion prices are firmer with silver up 0.3 percent at $15.87 and gold prices up 0.2 percent at $1,169, while the PGMs are little changed. The prospects of the ECB extending and increaseing its monetary stimulus in Europe has helped market sentiment, although more so the equities than metals, but that is because of the dollar strength.
The pullback in the base metals ran its course on Wednesday and started to recover yesterday but the rebounds did run into resistance and overhead selling. The exception has been aluminium that has just seen weakness in recent days with prices establishing a fresh multi-year low this morning at $1,479. The rest of the base metals this morning are mixed, lead is off one percent at $1,742, zinc is off 0.5 percent at $1,743.50, while the rest are little changed with copper at $5,233.Volume has been average at 4,815 lots.
In Shanghai, the metals are mixed, aluminium’s 2.4 percent drop to Rmb 10,520 is the main mover, tin is also weaker by 0.3 percent, while the others are firmer between 0.4 percent for nickel and 0.9 percent on copper at Rmb 39,400. Spot copper in Changjiang, is up 0.8 percent at Rmb 39,500-39,630, the backwardation between the spot and futures is at an equivalent of around $35 per tonne and the LME/Shanghai copper arb window is around parity with the ratio at 7.50.
In other metals in China, gold and silver are up around 0.4 percent, steel rebar is off 0.7 percent – this despite a slowdown in the declines in Chinese new home prices. In September, new home prices rose month-on-month in 39 cities against 35 in August and climbed in 12 cities year-on-year compared with 9 cities in August. Teir-1 cities continue to see strong gains, with prices in September up 8.3 percent compared with a year ago. Iron ore prices continue to ease, last at $52.18.
Equities were bolstered yesterday by ECB talk of boosting stimulus, the Euro Stoxx 50 climbed 2.5 percent and the Dow closed 1.9 percent – the markets are still hooked on easy monetary policy. The boost has flowed through to Asia too where the Nikkei is up 2.1 percent (Japan’s flash manufacturing PMI also jumped to 52.5 from 51), The Hang Seng is up 1.4 percent, the CSI 300 is up one percent (Chinese leading indicators rose 1.6 percent after a prior rise of one percent), the ASX 200 is up 1.7 percent and the Kospi is up 0.9 percent. Given the gains in equities we are surprised it has not boosted base metals more, but again that is the dollar factor.
Currencies – the dollar leapt higher yesterday with the dollar index jumping to 96.50 from around 95, it is last at 96.27, conversely the euro dropped to 1.1070, sterling is consolidating, last at 1.5407, the aussie is strengthening today, last at 0.7280 and the yen is weaker at 120.65. The emerging market currencies weakened yesterday, with the yuan at 6.3820, but the rupiah, rupee, rand, real, ringgit are finding some strength today. So the rebound in the dollar seems to be more to do with euro weakness, rather on the back of wider concerns.
The economic agenda is focused on flash manufacturing and services PMI. Japan’s beat expectation, later we get data out in France, Germany, the EU and US. In addition, we get Italian retail sales – see table below.
The base metals generally look as though they will test higher again, which given the strong dollar is a sign of strength, but as discussed above the dollar strength is more to do with euro weakness than being more widespread. For the most part it looks as though metal have been correcting the ‘Glencore-rally’ in recent days, so it will be interesting to see if the rebounds now have any strength and see follow through buying. Nickel looks well placed to continue higher, we do feel that metal has turned the corner now. Zinc has had a sharp pull-back, but it did rally some 11 percent on the Glencore cutback news so may have over-reacted on the upside, which has now been corrected.
The precious metals’ rallies have also paused in recent days, the pause looks like a bout of consolidation and prices look well placed to continue with their rebounds, especially gold prices.
Overnight Performance
BST 07:03 +/- +/- % Lots
Cu 5233 -1 0.0% 1454
Al 1483 -2.5 -0.2% 2421
Ni 10415 30 0.3% 165
Zn 1743.5 -8.5 -0.5% 595
Pb 1742 -17.5 -1.0% 170
Sn 15840 -10 -0.1% 10
Steel 300 0 0.0% Total
Average (BM ex-Steel) -0.2% 4,815
Gold 1169 2.8 0.2%
Silver 15.87 0.05 0.3%
Platinum 1008.7 0.7 0.1%
Palladium 683.5 -0.5 -0.1%
Average PM 0.1%
SHFE Prices 07:15 BST Change % Change
Cu 39400 340 0.9%
AL 10520 -260 -2.4%
Zn 14085 100 0.7%
Pb 13210 40 0.3%
Ni 78790 280 0.4%
Sn 97980 -310 -0.3%
Average change (base metals) 236.5 -0.1%
Rebar 1796 -12 -0.7%
Au 239.75 0.7 0.3%
Ag 3432 18 0.5%
Economic Agenda
BST Country Data ACTUAL Expected Previous
2:35am Japan Flash Manufacturing PMI 52.5 50.6 51
3:00am China CB Leading Index m/m 2% 1%
8:00am France French Flash Manufacturing PMI 50.2 50.6
8:00am France French Flash Services PMI 51.9 51.9
8:30am Germany German Flash Manufacturing PMI 51.8 52.3
8:30am Germany German Flash Services PMI 54 54.1
9:00am EU Flash Manufacturing PMI 51.8 52
9:00am EU Flash Services PMI 53.6 53.7
10:00am Italy Italian Retail Sales m/m 0.3% 0.4%
2:45pm US Flash Manufacturing PMI 52.8 53.1
Check the Bullion Desk gold price charts for the latest Gold Prices.
Will Adams
About Will Adams
William Adams has been involved in the metals markets since 1982 – he has experience in many areas of the market from researching to trading and has worked in London, New York and Tokyo.
@willxadams
View all stories by Will Adams »
« Read previous story
Gold up after ECB keeps rates steady Read next story »
Gold price climbs 0.7 pct, ECB’s dovish stance helps sentiment
- See more at: http://www.bulliondesk.com/gold-news/metals-m...QEX5c.dpuf
by Will Adams
The precious metals rebounded yesterday with average gains of 0.8 percent, led by a 1.6 percent rise in palladium to $684, while gold prices were little changed at $1,166.20. This morning bullion prices are firmer with silver up 0.3 percent at $15.87 and gold prices up 0.2 percent at $1,169, while the PGMs are little changed. The prospects of the ECB extending and increaseing its monetary stimulus in Europe has helped market sentiment, although more so the equities than metals, but that is because of the dollar strength.
The pullback in the base metals ran its course on Wednesday and started to recover yesterday but the rebounds did run into resistance and overhead selling. The exception has been aluminium that has just seen weakness in recent days with prices establishing a fresh multi-year low this morning at $1,479. The rest of the base metals this morning are mixed, lead is off one percent at $1,742, zinc is off 0.5 percent at $1,743.50, while the rest are little changed with copper at $5,233.Volume has been average at 4,815 lots.
In Shanghai, the metals are mixed, aluminium’s 2.4 percent drop to Rmb 10,520 is the main mover, tin is also weaker by 0.3 percent, while the others are firmer between 0.4 percent for nickel and 0.9 percent on copper at Rmb 39,400. Spot copper in Changjiang, is up 0.8 percent at Rmb 39,500-39,630, the backwardation between the spot and futures is at an equivalent of around $35 per tonne and the LME/Shanghai copper arb window is around parity with the ratio at 7.50.
In other metals in China, gold and silver are up around 0.4 percent, steel rebar is off 0.7 percent – this despite a slowdown in the declines in Chinese new home prices. In September, new home prices rose month-on-month in 39 cities against 35 in August and climbed in 12 cities year-on-year compared with 9 cities in August. Teir-1 cities continue to see strong gains, with prices in September up 8.3 percent compared with a year ago. Iron ore prices continue to ease, last at $52.18.
Equities were bolstered yesterday by ECB talk of boosting stimulus, the Euro Stoxx 50 climbed 2.5 percent and the Dow closed 1.9 percent – the markets are still hooked on easy monetary policy. The boost has flowed through to Asia too where the Nikkei is up 2.1 percent (Japan’s flash manufacturing PMI also jumped to 52.5 from 51), The Hang Seng is up 1.4 percent, the CSI 300 is up one percent (Chinese leading indicators rose 1.6 percent after a prior rise of one percent), the ASX 200 is up 1.7 percent and the Kospi is up 0.9 percent. Given the gains in equities we are surprised it has not boosted base metals more, but again that is the dollar factor.
Currencies – the dollar leapt higher yesterday with the dollar index jumping to 96.50 from around 95, it is last at 96.27, conversely the euro dropped to 1.1070, sterling is consolidating, last at 1.5407, the aussie is strengthening today, last at 0.7280 and the yen is weaker at 120.65. The emerging market currencies weakened yesterday, with the yuan at 6.3820, but the rupiah, rupee, rand, real, ringgit are finding some strength today. So the rebound in the dollar seems to be more to do with euro weakness, rather on the back of wider concerns.
The economic agenda is focused on flash manufacturing and services PMI. Japan’s beat expectation, later we get data out in France, Germany, the EU and US. In addition, we get Italian retail sales – see table below.
The base metals generally look as though they will test higher again, which given the strong dollar is a sign of strength, but as discussed above the dollar strength is more to do with euro weakness than being more widespread. For the most part it looks as though metal have been correcting the ‘Glencore-rally’ in recent days, so it will be interesting to see if the rebounds now have any strength and see follow through buying. Nickel looks well placed to continue higher, we do feel that metal has turned the corner now. Zinc has had a sharp pull-back, but it did rally some 11 percent on the Glencore cutback news so may have over-reacted on the upside, which has now been corrected.
The precious metals’ rallies have also paused in recent days, the pause looks like a bout of consolidation and prices look well placed to continue with their rebounds, especially gold prices.
Overnight Performance
BST 07:03 +/- +/- % Lots
Cu 5233 -1 0.0% 1454
Al 1483 -2.5 -0.2% 2421
Ni 10415 30 0.3% 165
Zn 1743.5 -8.5 -0.5% 595
Pb 1742 -17.5 -1.0% 170
Sn 15840 -10 -0.1% 10
Steel 300 0 0.0% Total
Average (BM ex-Steel) -0.2% 4,815
Gold 1169 2.8 0.2%
Silver 15.87 0.05 0.3%
Platinum 1008.7 0.7 0.1%
Palladium 683.5 -0.5 -0.1%
Average PM 0.1%
SHFE Prices 07:15 BST Change % Change
Cu 39400 340 0.9%
AL 10520 -260 -2.4%
Zn 14085 100 0.7%
Pb 13210 40 0.3%
Ni 78790 280 0.4%
Sn 97980 -310 -0.3%
Average change (base metals) 236.5 -0.1%
Rebar 1796 -12 -0.7%
Au 239.75 0.7 0.3%
Ag 3432 18 0.5%
Economic Agenda
BST Country Data ACTUAL Expected Previous
2:35am Japan Flash Manufacturing PMI 52.5 50.6 51
3:00am China CB Leading Index m/m 2% 1%
8:00am France French Flash Manufacturing PMI 50.2 50.6
8:00am France French Flash Services PMI 51.9 51.9
8:30am Germany German Flash Manufacturing PMI 51.8 52.3
8:30am Germany German Flash Services PMI 54 54.1
9:00am EU Flash Manufacturing PMI 51.8 52
9:00am EU Flash Services PMI 53.6 53.7
10:00am Italy Italian Retail Sales m/m 0.3% 0.4%
2:45pm US Flash Manufacturing PMI 52.8 53.1
Check the Bullion Desk gold price charts for the latest Gold Prices.
Will Adams
About Will Adams
William Adams has been involved in the metals markets since 1982 – he has experience in many areas of the market from researching to trading and has worked in London, New York and Tokyo.
@willxadams
View all stories by Will Adams »
« Read previous story
Gold up after ECB keeps rates steady Read next story »
Gold price climbs 0.7 pct, ECB’s dovish stance helps sentiment
- See more at: http://www.bulliondesk.com/gold-news/metals-m...QEX5c.dpuf
