• Asian-Pacific equities and major western pre-market equity index futures were stronger this morning

Base metals
Three-month base metals prices on the LME were up across the board by an average of 0.9% this morning, led by a 2.2% rise in tin ($22,455 per tonne), which is the highest it has been since 2014. Lead ($2,069.50 per tonne) was also up strongly with a 1.1% rise, while the rest of the complex was up by an average of 0.5%, with copper up by 0.3% at $8,006.50 per tonne.

The most-traded base metals contracts on the SHFE were also for the most part stronger this morning, the exception was March aluminium that was down by 0.2%, while the rest were up by an average of 1.6%, also led by March tin’s 3.6% rise, with March lead up by 2.9%. March copper was up by 0.1% at 59,080 yuan ($9,107) per tonne.

Precious metals
Spot gold was down by 0.2% at $1,852.88 per oz this morning, silver ($25.49 per oz) was up by 0.1%, platinum was up by 0.3% at $1,103.50 per tonne and palladium was up by 0.1% at $2,362 per oz.

Wider markets
The yield on US 10-year treasuries is not moving much; it was recently quoted at 1.10%, compared with 1.11% a similar time on Friday.

Asian-Pacific equities were stronger this morning: the Kospi (+2.18%), the ASX 200 (+0.36%), the CSI (+1.01%), the Nikkei (+0.67%), the Hang Seng (+2.37%).

The US Dollar Index was consolidating this morning and was recently quoted at 90.10, this after 90.16 at a similar time on Friday.

The other major currencies were also consolidating this morning, albeit slightly on a front footing: the euro (1.2182), the Australian dollar (0.7738), sterling (1.3718) and the yen (103.69).

Key data
Key data out on Monday includes German Ifo business climate and Chinese leading indicators.

In addition, European Central Bank president Christine Lagarde is scheduled to speak twice today.

Today’s key themes and views
Once again we see that dips in the metals prices attract buying; on Friday the base metals closed down by an average of 0.3% and this morning they are firmer again, but it is only tin and nickel that have pushed the envelope on the upside in recent days, the rest have lost upward momentum.

Although we remain long-term bullish toward the base metals, we have to be prepared for some counter trend moves along the way. We have seen some weakness emerge in zinc and aluminium in recent days, but follow-through selling has not materialized, suggesting sentiment remains supportive overall for now.

Gold prices rallied in the middle last week but ran into resistance ahead of the upper boundary of their down channel that is at $1,880 per oz. Overall, we see the yellow metal continuing to consolidate its September 2018 - August 2020 bull run and it would take a move back above $1,880 per oz and then $1,965 per oz to suggest the uptrend is resuming.