EUROPEAN COMMODITIES UPDATE: Base metals tilt higher on continued Chinese stimulus hopes but crude and gold eye the next catalyst

• WTI and Brent front-month futures continue with the choppy but horizontal performance seen overnight with prices moving in tandem with the broader risk sentiment. Complex-specific newsflow has been light this morning aside from the release of overall mixed GDP from various EZ nations. To recap French QQ GDP topped forecasts, German QQ GDP stagnated but printed slightly under expectations, while Spain printed in-line in expectations. Thus, energy markets see no clear direction this morning and are on the lookout for a catalyst. WTI September futures oscillate on either side of USD 80/bbl in a relatively narrow USD 0.70/bbl intraday range while its Brent Oct counterpart trades around the USD 83.50/bbl level in a USD 83.14-88/bbl intraday parameter. Participants are still on the lookout for whether Saudi Arabia will opt to extend its voluntary 1mln BPD cuts for yet another month into September after initially announcing the cuts just for July, and then extending it for August, with arguments also present for the Kingdom to taper the voluntary cuts by possibly 250k-500k BPD. Ahead, the Baker Hughes Rig Count later today could inject some short-term impetus in the absence of macro catalysts.


• Over to metals, spot gold was dragged back under its 100 DMA (USD 1,966.76/oz) to levels near USD 1,950/oz yesterday following the hot US economic data, with prices today meandering around the half-round figure and on both sides of the 50 DMA and 21 DMA which today reside at USD 1,946.13/oz and USD 1,946.35/oz respectively. Base metals meanwhile are mostly firmer despite the stronger Dollar amid continued tailwinds from Chinese stimulus. On that note, Bloomberg sources today suggested Chinese brokers proposed stamp duty reduction, whilst the market watchdog reportedly asked brokers for advice to boost stocks.

28 Jul 2023 - 09:51- MetalsData- Source: Newsquawk