Three-month base metals prices on the London Metal Exchange were up during morning trading on Monday August 24, with market optimism over a Covid-19 vaccine rising after US regulators approved the use of convalescent blood plasma as a treatment option, while continued weakness in the US dollar index also provided support.
Total coronavirus deaths in the United States have now surpassed 175,000 according to the Centers for Disease Control and Prevention, with the Americas remaining the worst-hit region globally. The World Health Organization estimates confirmed cases out of the Americas are now at more than 12 million.
With the economic fallout of the virus still being felt globally, this morning's uptick across Asian equities has filtered through to LME base metals, with the MSCI Asia-Pacific index pushing 0.8% higher over the morning and consolidating close to a six-month high.
Topping the LME base metals complex over the morning, the three-month copper price was recently trading at $6,553 per tonne, pushing firmly above nearby resistance at $6,500 per tonne after Friday's trading saw the red metal dip below the mark, to close at $6,490 per tonne.
Turnover was thin over the morning, with LME copper's 3,500 lots topping the complex as of 10am London time. Stock declines continue for the red metal over August, with some 5,575 tonnes removed out of LME-registered warehouses in Kaohsiung, New Orleans and Rotterdam.
LME on-warrant copper stocks now stand at 53,250 tonnes, with total stocks now down to 97,900 tonnes, while the metal's benchmark cash/three-month spread continues to trade in backwardation, recently at $16.75 per tonne.
"The only observation on the metals prices this morning is that usually when there is nothing going on prices tend to drift lower but so far today all the metals are currently in positive territory," Kingdom Futures director and chief executive Malcolm Freeman said in a morning note.
"There is certainly evidence of more investment money entering the metals markets no doubt aided by the fact that investors saw share dividends collapse in Q2 and are seeking yields elsewhere, and with so many articles in the press in recent times predicting a boom in metals prices over the next two years it is hardly surprising," he added.
Other highlights
Elsewhere in the complex, the three-month nickel price was 1.1% higher over the morning, recently trading at $14,930 per tonne, with the metal's underlying price now testing resistance at the $15,000-per-tonne level. Meanwhile, aluminium futures were 0.4% higher over the morning, recently trading at $1,775.50 per tonne, while a fresh cancelation of some 13,125 tonnes of material out of warehouses in Port Klang could see queue waiting times for the removal of primary aluminium lengthen. In other commodities, Brent crude oil futures were down by 1.31%, recently trading at $45.17 per barrel.The West Texas Intermediate (WTI) was recently at $42.60 per barrel, a rise of 0.90%. Meanwhile, the US dollar index remained in negative territory, recently trading at 93.04.