Written Commentary
SILVER
December silver futures are higher despite a rally in the U.S. dollar and rising U.S. Treasury yields. Silver prices are higher even though there are perceived slightly easing geopolitical tensions in the Middle East.
Investors are looking forward to the National People’s Congress meeting scheduled for November 4-8, anticipating possible announcements regarding debt and fiscal policies from Beijing. Data released over the weekend indicated industrial profits in China have fallen at their fastest rate since the pandemic in the first nine months of the year. This reflects weak demand for metals from the world’s largest metals consumer.
GOLD
December gold futures declined on Monday due to slightly reduced geopolitical tensions in the Middle East. However, there is underlying support in light of increasing probabilities that the Federal Open Market Committee will lower its key interest rate by 25 basis points at its November 7 policy meeting.
Lower interest rates decrease the opportunity cost of holding non-interest-bearing gold.
Uncertainties surrounding the U.S. election and potential easing of credit conditions by other major central banks continue to support gold prices.
COPPER
December copper futures are steady and remain in a broadly based congestion pattern. December copper futures have traded within inside trading periods on the daily chart for last two days.
Selling pressure earlier in October was linked to a stronger U.S. dollar and rising U.S. Treasury yields. In addition, some of the pressure earlier this month was attributed to expectations that the Federal Reserve will not be aggressively easing interest rate policies, although it is likely that lower interest rates will be announced this year and also well into 2025 from the U.S. central bank. In addition, other major central banks are likely to continue on a path of accommodation, which will underpin copper prices.
Interested in more futures markets? Explore our Market Dashboards here.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
