Written Commentary
PRECIOUS METALS
Gold: December gold contracts are sharply higher, rebounding nearly 3% as a drop in the dollar and yields offer favorable buying conditions alongside a fall in oil prices. The Democratic sweep of Congress leaves Congress divided from the White House. Current macro conditions will continue to act as a headwind to prices despite the move higher today. October’s ISM services PMI data will be closely watched for its prices index, as the manufacturing gauge showed input prices remained elevated. A combination of firmer activity without relief from cost pressures will continue to argue for higher rates over the coming months. September’s PCE reading remains too firm to suggest that the Fed’s work is complete. December rate hike odds are priced at 80%. Friday’s payrolls will be central to determining whether labor-market resilience continues to justify another increase.
Gold trading near the $4,000 level offers central banks a cheaper opportunity for further purchasing, which would reflect a trend the market has seen over the last two years. That dynamic is likely to keep gold prices supported against further downside and offers a solid purchasing opportunity for investors. The World Gold Council cut its forecast for gold investment this year from 400 tons to 200 tons, amid weaker demand for bars and coins. However, the WGC raised its estimate for central bank purchases.
Silver: December contracts are up 5.00% to $52.235.
BASE METALS
Copper: LME copper rose 0.4% to $14,093; US prices are little changed at $6.3980. Firm Chinese demand and tight supplies outside the US outweighed initial concerns about the election’s implications for tariffs and AI-related investment. Physical-market conditions nevertheless remained supportive. China’s Yangshan copper import premium held near $200 per ton, its highest level in more than a decade, pointing to strong import demand and tight availability. A weaker dollar and recovering global equities also helped copper reverse its early losses.
Zinc: Zinc rose 1.3% to $3,838.
Aluminum: Aluminum gained 0.9% to $3,073.
Tin: Tin rose 0.7% to $47,775.
Lead: Lead added 0.1% to $1,886.
Nickel: Nickel advanced 2% to $15,650.
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