MethodologyContact usLogin
The dollar index gained ground on Thursday after the US Federal Reserve’s latest Beige Book report that overall economic activity in the United States expanded at a “modest to moderate” pace.
The index stood at 96.27 as at 9.33am Shanghai time after a low of 95.90 on Wednesday.
Sentiment in the base metals market has also been dented by a wave of selling that hit Asian stock markets on Thursday morning following a sell-off in western markets on Wednesday that wiped out top US indices’ entire gains for 2018.
“The [Dow Jones Industrial Average] saw a 600-point loss as the new home sales numbers came in way below expectations and the tech sector wobbled once again… Asian equities have followed along this morning with the main indexes down between 1.5-3% – pretty much mirroring the Dow’s drop of 2.5%. The injection of liquidity funds and bonds by the [People’s Bank of China] has not had time to make effects felt and the Shanghai Composite is also following along at a more modest-1.4%,” Malcolm Freeman of Kingdom Futures said.
“To put it bluntly, no news is the current news and until there is actual real news that markets can react to and companies make long-term decisions, we will continue to exist in this volatile non-net directional state that the metals have been in for some months,” Freeman added.
Copper prices fell heavily on the SHFE this morning, with the red metal’s most-traded December contract falling to 49,420 yuan ($7,119) per tonne as at 9.30am Shanghai time, down by 910 yuan per tonne from Wednesday’s close.
SHFE copper prices are contending with the additional headwinds of rising stock levels and elevated import volumes into China.
Deliverable copper stocks at SHFE sheds rose by 15,089 tonnes or 12% to 140,789 tonnes in the week ended October 19.
“China’s unwrought copper and copper products imports reached 521,000 tonnes in September, according to preliminary Chinese customs data – the highest since March 2016. Total imports for the January-September period increased by 16.1% year on year to 3.99 million tonnes,” Fastmarkets analyst James Moore said.
Lead was the sole metal on the SHFE to record a gain this morning, outperforming its peers against the backdrop of supply tightness in China, with the metal’s most-traded December contract up by 75 yuan per tonne to 14,180 yuan per tonne as at 9.30am Shanghai time.
“In China, [lead] smelters are struggling due to environmental inspections as well as limited growth in raw material supplies. Chinese authorities have announced a 10% import tariff on lead concentrate from the United States amid increasing trade tensions,” Moore added.
Lead stocks in SHFE warehouses, at 11,081 tonnes as of October 19, are down by 73.5% from the 41,816 tonnes stored at the beginning of the year.
Base metals prices
Currency moves and data releases