From the physical side, as prices for key commodities soar, demand retrenchment – if not outright destruction – materializes. We see this sign most clearly in the Chinese physical markets, which have turned extremely quiet of late in light of the steep price run-ups. That’s particularly the case in copper, nickel, and aluminum.
We saw solid gains in most markets this past week, but intraday swings were massive as high volatility persists. In base metals, tin was the biggest winner for the week (up almost 13%) followed by nickel (up by 5.2%). Copper and aluminum rose by about 4% each, followed by lead (2.1%) and zinc (up by 1%). The cash to-three month spreads moved into a backwardation for both copper and aluminum. But contangos were evident in the rest of the group.
Markets pushed higher last week, with both commodities and equities enjoying decent runs. But energy sat things out for a third consecutive week. In the US equity complex, investors waded back into mega-cap and AI names after Micron's blowout Q3 earnings sparked buying in the general chip space. For the week, the S&P 500 ended up 0.1%, the Dow finished down by 0.7%, but NASDAQ tacked on 0.5%.
Base metals ended mostly lower last week as many complexes were quite overbought and arguably due for a correction.
It was a generally more positive week for most markets as a better tone in US equities ushered in a measure of stability. The bitcoin/crypto sell-off eased somewhat as well. Some of the battered AI-related names also recovered. The likelihood of another December Fed rate cut this week also helped sentiment.
So much for Thanksgiving being an uneventful week for the markets as the last few days defied conventional thinking. Most markets came roaring back, ignoring the fact that US investors were AWOL – busy gorging on turkey. Stocks The most notable advance occurred in the US equity markets. All three major averages reclaimed their 50-day […]
For a third week in a row, there was intense volatility in the US equity markets that spilled over into metals, bitcoin, and energy. Bitcoin is now trading at a seven-month low while some of the other cryptocurrencies have rolled back pretty much their entire yearly advance in just the last three weeks. A stronger dollar – now at a six-month high – contributed to the general selling.
It was another volatile week in the markets as wild gyrations in US equities rocked the commodity space as well. By week's end, both complexes went their separate ways. Stocks closed mixed, while commodities ended lower based on a general index that we follow.
Aluminum finished down by 1.25%. But there is no easing in physical premiums, which continue to climb in both the US and Europe.
Bullish sentiment remained in place in US equity markets this past week as a de-escalation in US-China trade tensions and strong earnings reports from several "Mag-7" names offset the rather hawkish remarks on interest rates made by Fed Chair Jerome Powell on Wednesday. For the week, the NASDAQ Composite gained 2.2%, while the S&P 500 and the Dow each were up by about .7% in what has been an incredible run.