Thankfully we have started the week with a resolution to the Federal election which combined Australia’s longest campaign with the longest count duration.
Elsewhere uncertainty remains in Europe with Brexit, and the LME commodity markets continue to drift along sidewards until the political and economic situation becomes clearer…
The AUD/USD is currently trading at 75.36 which is its highest level in 3 weeks. This is putting downwards pressure on non-ferrous prices.
* * * DJCopper Prices Rise on China Stimulus Hopes – By Katherine Dunn and Stephanie Yang * * *
Copper prices traded higher Monday following a strong day of equities trading in Asia and rising expectations of government stimulus in China, the world’s top consumer.
Japan’s Nikkei Stock Average saw its best trading day in months on Monday, rising 4% after Prime Minister Shinzo Abe’s ruling coalition won more seats in the upper house, making it easier for policy makers to approve a bigger fiscal stimulus package this autumn. Markets in China also climbed higher, building on a rally in the U.S. last week after a better-than-expected jobs report from the U.S. Labor Department.
According to Commerzbank AG, metals prices were getting a boost from a fall in China’s monthly inflation figures, released earlier Monday, which raised hopes of further government stimulus.
Despite copper’s gains, some analysts warn that the market remains oversupplied and will likely remain under pressure.
“While the recent macro-driven rally in base metals has disrupted the bear market, we still foresee downside to copper prices from a fundamental perspective in the coming quarters,” analysts at J.P. Morgan wrote on Friday.