Volumes have been average with 5,356 lots traded as of 0707 London time.
This follows a day of weakness on Thursday when the complex closed down by an average of 1.1%, with nickel prices falling by 2.4%, having risen by 2.6% on Wednesday.
Gold and silver spot prices are down by 0.3% with gold at $1,298.99 per oz and silver remaining relatively high at $17.12 per oz, with the gold/silver ratio falling to 1:76, down from 1:82 earlier in the year. Platinum and palladium prices are little changed with prices trading sideways.
In China, base metals prices on the Shanghai Futures Exchange are down across the board with prices down by an average of 0.7%, with the most traded August copper contract price off by 0.5% at 53,510 yuan ($8,338) per tonne.
In other metals in China, the most-traded September iron ore contract price on the Dalian Commodity Exchange was off by 0.4% higher to 470.50 yuan per tonne. Meanwhile on the SHFE, the most-traded October steel rebar contract price fell by 0.1%, while the December gold and silver contract prices were up by 0.5% and 1.2% respectively.
Spot copper prices in Changjiang were down by 0.5% at 53,010-53,170 yuan per tonne and the LME/Shanghai copper arbitrage ratio was higher at 7.48.
In wider markets, spot Brent crude oil prices were off by 0.05% at $75.84 per barrel this morning. The yield on US 10-year treasuries has weakened to 2.9296%, as has the German 10-year bund yield to 0.4100%.
Equity markets in Asia were split on Friday: Nikkei (+0.50%), ASX 200 (+1.29%), Hang Seng (-0.01%), CSI 300 (-0.65%) and the Kospi (-0.65%). Further concerns about a United States trade war are likely to weigh on markets. There was a mixed performance in western markets on Thursday, where in the US the Dow Jones closed down by 0.10% at 25,175.31, and in Europe where the Euro Stoxx 50 closed up by 1.37% at 3,527.11.
The dollar index surged yesterday and is firmer this morning at 95.04, taking it to the highest since November 2017, when it peaked at 95.15. Conversely, the other major currencies have weakened: euro (1.1564), sterling (1.3239), the yen (110.85) and the Australian dollar (0.7458). The yuan has fallen to 6.4158 and most of the emerging market (EM) currencies we follow are weaker, the exceptions being the ringgit and rupiah.
On the economic front, data already out in Europe showed Germany’s wholesale price index climb 0.8%, having previously been up 0.5%. Data out later includes EU CPI, trade balance and UK leading indicators, with US data including Empire State manufacturing index, industrial production, capacity utilizations, University of Michigan consumer sentiment and inflation expectations and treasury long term purchases (TIC).
Copper, zinc and tin prices are giving back more of their recent gains, lead and nickel prices are consolidating and aluminium prices continue to edge lower.
The stronger dollar is a headwind for the metals as is the overall concern over US trade policy. Economic data remains mixed, Chinese data earlier in the weak was disappointing, but US data out yesterday was constructive with retail sales rising by 0.8%. As such, the climate is not particularly bullish and the market may not see follow-through buying until stronger concerted economic data is seen.
Gold prices got some lift following the FOMC rate rise on Wednesday, but the stronger dollar has pulled prices back to the $1,300 per oz level. The pick-up in US trade wars is a concern for the broader markets and may well lead to some pick-up in safe-haven demand. Silver is looking particularly strong with prices back above $17 per oz.
|SHFE Prices 07:07 BST||Yuan||Change||% Change|
|Average change (base metals)||-0.7%|
|Iron Ore (DCE) Sep'18||470.5||-2||-0.4%|
|3:41am||Japan||Monetary Policy Statement|
|3:41am||Japan||BOJ Policy Rate||-0.1%||-0.1%||-0.1%|
|7:00am||Germany||German WPI m/m||0.8%||0.3%||0.5%|
|7:28am||Japan||BOJ Press Conference|
|10:00am||EU||Final CPI y/y||1.9%||1.9%|
|10:00am||EU||Final Core CPI y/y||1.1%||1.1%|
|10:00am||EU||Trade Balance (in euros)||20.2 bln||21.2 bln|
|1:30pm||US||Empire State Manufacturing Index||19.1||20.1|
|2:15pm||US||Capacity Utilization Rate||78.1%||78.0%|
|2:15pm||US||Industrial Production m/m||0.2%||0.7%|
|2:30pm||UK||CB Leading Index m/m||-0.2%|
|3:00pm||US||Prelim UoM Consumer Sentiment||98.5||98|
|3:00pm||US||Prelim UoM Inflation Expectations||2.8%|
|9:00pm||US||TIC Long-Term Purchases (in $)||58.5 bln||61.8 bln|