EUROPEAN COMMODITIES UPDATE: Industrials remain underpinned but off best levels as Chinese markets lose steam

Analysis details (09:16)

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  WTI and Brent futures are firmer intraday but off best levels, with overnight gains fuelled by the broader constructive tone and better-than-expected Chinese activity data. 


• To recap, Chinese Retail Sales and Industrial production topped forecasts, whilst China NBS said the economy saw accelerated demand but added that domestic demand remains insufficient and the foundation of economic recovery needs to be consolidated. Nonetheless, the data backs the notion of increasing demand from the second-largest economy in the world, with analysts cited by Global Times stating "Better-than-expected growth in industrial output and retail sales, among others, in August also presented fresh confidence that the Chinese economy could meet its annual growth target.” Add to that, US Presidential Energy Security Adviser Hochstein said they are seeing record oil production in the US and will continue to refill the SPR, while he added that Libyan floods are impacting oil production there. Meanwhile, the political implications of higher energy prices have been flagged in recent sessions, with US President Biden stating he is going to get gas prices down again. WTI Oct’23 resides north of USD 90.50/bbl after briefly topping USD 91/bbl to trade in a current USD 90.45-91.15/bbl range, while Brent Nov'23 is on a USD 94/bbl handle and between a USD 93.94-94.63/bbl parameter.


• Over to metals, spot gold held onto the USD 1,900/oz handle yesterday despite the gains in the DXY, with the yellow metal climbing north of USD 1,915/oz in APAC trade, and briefly topped its 21 DMA (1,918.55/oz) as it eyes its 200 DMA at USD 1,921.93/oz. Metals are relatively mixed and off best levels after seeing some upside on the aforementioned Chinese data, with 3M LME copper briefly rising above USD 8,500/t before waning alongside the mainland Chinese stock market.

15 Sep 2023 - 09:16- MetalsData- Source: Newsquawk