- Dollar volatile on dovish Fed signals
- Oil dips as Ukraine talks drive sentiment
Base metals traded negative on the London Metal Exchange (LME), with copper and zinc edging higher as prices rose 0.11% to $11,630/t and 0.19% to $3,099/t, respectively. Aluminium declined 0.90% to $2,867/t, while nickel fell 1.21% to $14,740/t. Lead saw the sharpest drop, easing 1.49% to $1,988/t.
LME warehouse inventories reflected a similarly diverse trend. Zinc stocks recorded the strongest build, rising 7.99% to 59,800 t. Copper inventories increased 1.49% to 164,975 t, while nickel stocks remained largely flat, down just 0.01%. Aluminium inventories fell 1.42%, and lead stocks declined 3.28%, indicating tightening availability in the lead segment.
Domestic market overview
In Indias non-ferrous markets, BigMint assessed copper armature scrap at INR 992,000/t ex-Delhi, stable d-o-d. Aluminium Tense scrap prices remained stable w-o-w, stood at INR 193,000/t ex-Delhi and INR 188,000/t ex-Chennai, stable d-o-d.
Dollar stays volatile as dovish Fed and risk-off mood weigh
The US dollar remained choppy on Thursday, pressured by a softer-than-expected Fed outlook and a sharp pullback in global risk sentiment after weak corporate earnings hit equities and crypto markets. While risk aversion offered some support, Powell’s dovish tone fuelled bets on more rate cuts, pushing the euro and sterling to multi-week highs and keeping the dollar subdued. Cryptocurrencies and risk-linked currencies fell sharply, and markets were further surprised by the Fed’s move to begin Treasury bill purchases to manage liquidity.
Oil dips as market shifts focus back to Ukraine peace efforts
Oil prices edged lower on Thursday as traders refocused on ongoing Russia-Ukraine peace negotiations and assessed the implications of the US seizure of a sanctioned tanker near Venezuela. Brent and WTI both slipped around 0.8%, reversing some of the previous sessions gains that were driven by supply concerns following the tanker seizure. Analysts noted that while the incident has not yet disrupted flows, any escalation could heighten crude price volatility. Market sentiment remains cautious as investors track diplomatic progress, with recent geopolitical tensions including reported attacks on Russia’s shadow fleet providing some support to prices. A divided US Federal Reserve’s decision to cut interest rates and a smaller-than-expected draw in US crude stocks also influenced the market, though overall direction remains tied to peace-talk developments.
US aluminium premiums hit record highs on tariffs and tightening supply
Aluminium premiums in the United States have surged to record levels as steep import tariffs and a global supply squeeze tighten availability. The hike in duties raised to 50% earlier this year has sharply increased costs for buyers, pushing the US Midwest premium to an all-time high and significantly inflating spot procurement prices. Falling domestic inventories, expectations that tariffs will remain in place, and the absence of exemptions for Canada historically the biggest supplier to the US have further intensified competition for metal. Meanwhile, constrained output due to China’s production cap and declining supply outside China have deepened the global deficit, leaving US consumers facing one of the tightest aluminium markets in years.
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