London 04/04/2012 - Base metals consolidated in choppy trading yesterday, on average at the days highs they saw gains of 0.9 percent, at the lows losses were 0.7 percent and they closed unchanged.  Copper prices peaked at $8,702.75, which went well into the range of overhead supply that lies between $8,660 and $8,765, but prices once again failed to break higher.

At the close copper prices were still within striking distance of the breaking higher, but whether they can muster the strength remains to be seen. Aluminium remains the weakest looking metal with prices extending on the downside yesterday.

This morning the metals are down an average of 1.1 percent with volume higher than yesterday at 3,979 lots, which is still light as China remains on holiday. Tin, lead and nickel are down between 1.6 and 1.4 percent, copper is down 1.1 percent at $8,520, zinc is down 0.8 percent at $ 1,996 and aluminium is off 0.6 percent at $2,115.

The weakness follows the market’s disappointment last night that the FOMC meeting minutes from March showed the Fed was less likely to further stimulate the economy and that means the equity and commodity markets might have to live without another boost from quantitative easing. This sent equities and bullion prices lower last night and the base metals have followed overnight.

Equities initially suffered yesterday as Spain’s debt situation fell into the spotlight and that led to a 1.7 percent drop in the Euro Stoxx 50 yesterday and then the Dow went on to close down 0.5 percent, having earlier been down 1 percent. The weaker tone has flowed through to Asia where the Nikkei is off 2.1 percent, the MSCI Asia Apex is down 0.6 percent and South Korea’s Kospi index is down 1.5 percent - Hong Kong and China were closed.

The dollar rebounded following the FOMC Minutes with the dollar index rising to 79.47, the euro fell to 1.3210, the pound is weaker at 1.5895, the aussie is down at 1.0290 and the yen is at 82.65. Gold and silver dropped too with gold and silver last at $1,643 and $32.45.

The economic calendar is busy, with UK house prices, German factory orders and EU retail sales, plus services PMI data out in UK, Europe and the US. We also get the ECB’s interest rate decision and press conference, US ADP non-farm employment change and crude oil inventories. Plus Treasury Secretary Geithner and FOMC Williams are speaking – so a busy day, see table on right for more details. Also noteworthy was US total vehicle sales disappointed in the US, coming is at 14.4 million units (mu) on an annualised basis in March, down from 15.1 mu in February and an expected rate of 14.6 mu.

With concerns over Spain’s debt bringing the EU debt crisis out of slumber and with investors less confident now that QE3 may turn out to be wishful thinking, the markets look set to give back some of their recent gains.

The fact some equities have recently been at multi year highs suggests there may well be room for a meaningful pull back and if the markets move into risk-off mode again then that may well see some of the metals retest their support levels. Indeed ahead of the Easter weekend and Friday’s US employment report we would not be surprised to see a pick-up in book squaring, although today’s data may cause some gyrations along the way.

• Wall Street all in on further gains for gold, Main Street grows more bullish for next week’s price action   (2024-10-19 10:12:59)
• Gold shines as ultimate safe-haven asset, set to hit $3,000/oz by 2025 – Bank of America   (2024-10-19 10:07:32)
• Gold and silver to rally through the end of 2024, copper likely to lag – Prosper’s Scott Bauer   (2024-08-15 06:23:01)
• Wall Street experts see gold gaining on renewed recession fears, Main Street bullishness not far behind   (2024-08-04 16:15:53)
• Phố Wall chứng kiến ​​đà tăng giá vàng mới vào tuần tới, tâm lý lạc quan của Phố Main tăng lên   (2024-07-27 17:29:24)
• Wall Street sees renewed momentum for gold prices next week, Main Street’s bullish sentiment increases   (2024-07-27 17:26:59)
• Wall Street is balanced and cautious on gold next week, Main Street remains optimistic about price gains   (2024-07-20 08:49:41)
• September rate cut and Trump policies are boosting gold demand – FX Empire’s Ali   (2024-07-19 05:12:10)
• Gold price will average $2,500 per ounce in Q4 2024 as bull case remains intact despite sharp gains – JPMorgan   (2024-07-18 11:18:51)
• Wall Street sees green lights for gold next week; Main Street jumps back on the bullish bandwagon   (2024-07-06 04:25:55)