Written Commentary
BASE METALS
Copper: LME copper rose around 0.6% to $13,853; US prices are up 1.51% to $6.3315. The dollar’s retreat and exceptionally tight physical supply in China return to focus. Physical-market indicators remain supportive. The Yangshan import premium reached a record $230 a ton, while SHFE inventories fell more than 24% last week to 33,848 tons, their lowest since January 2024. Reduced domestic smelter output, raw-material constraints and limited seaborne arrivals have tightened cathode availability despite subdued Chinese demand growth.
The squeeze also reflects a pronounced geographic imbalance in inventories. Expectations for US tariffs on refined copper have drawn metal into American warehouses, leaving less readily available elsewhere. COMEX holds nearly 70% of copper stocks monitored by the three major exchanges; including US-based LME stocks brings the US share close to 90%. That leaves copper exposed to competing forces. Tight Chinese availability supports physical premiums, but uncertainty over US tariff plans could weaken the incentive for further US stockpiling. Concerns that tighter data-center regulation could slow AI-related investment also remain a headwind. Monday’s rebound therefore does not yet establish that last week’s correction has run its course.
Zinc: Zinc rose 0.3% to $3,722.
Aluminum: Aluminum 0.1% to $3,059. Low visible inventories and geopolitical supply risks offer near-term support, but potential Indonesian-led supply growth and subdued demand challenge the outlook for next year.
Tin: Tin fell 0.6% to $46,195.
Lead: Lead edged up 0.1% to $1,888.
Nickel: Nickel gained 0.3% to $16,395.
PRECIOUS METALS
Gold: December gold contracts are recovering from Friday’s selloff as the dollar and oil prices eased. Expectations for a potential de-escalation in the Iran conflict are helping reduce energy-driven inflation concerns, although continued attacks on shipping near the Strait of Hormuz leave the outlook uncertain. The immediate test comes from Tuesday’s CPI report, followed by producer prices Friday. Stronger-than-expected employment data lifted the market-implied probability of a December Fed hike to roughly 81%, underscoring the risk that persistent inflation could push yields and the dollar higher again. A softer inflation reading would offer bullion further support, while an upside surprise could interrupt the rally by reinforcing expectations for additional tightening. Central-bank buying provides a separate source of support. According to to World Gold Council data, China added approximately 25.8 metric tons to its gold reserves in October, its largest monthly purchase in three years.
Silver: December contracts are up 1.4% to $52.680.
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