Written Commentary
BASE METALS
Copper: Copper prices fell, as a rise in available inventory in exchange stockpiles weigh on supply worries, while news of China’s plan to boost stockpiles has been shrugged off. Benchmark three-month copper on the LME was down 1.1% at $13,328. Available stocks in LME-registered warehouses rose to 155,725 tons, their highest since March, after 12,750 tons were put back on warrant in Taiwan and South Korea. China announced plans to boost stockpiles of copper, though several traders have cautioned against over-interpreting the remarks. Currently, there are no details on the planned size of the reserves, scale of purchases, or timeline. China’s Lunar New Year holiday in mid-February will also bring industrial activity to a standstill in the country which consumes more than half of global copper production estimated at around 26 million tons this year.
In the US, ISM Manufacturing PMI data surprised to the upside, with the index rising to 52.6 in January from 47.9 the previous month to mark the fastest pace of growth in the manufacturing sector since 2022. The reading also marked the first time the sector experienced an expansion in growth in 12 months. New orders, production, employment, supplier deliveries, and inventories all expanded, though employment remained in contraction. Despite the positive reading, the increase in activity is attributed to cyclical factors regarding the start of the year. January is a reorder month, and the buying was likely an effort to get ahead of expected price increases. Factory activity in some parts of the world expanded in January, offering policymakers some assurance the hit from higher tariffs has run its course for now, but the growth was from a low base and followed months of shrinking activity.
Zinc: Zinc rose 0.5% to $3,356.
Aluminum: Aluminum fell 1% to $3,075.
Tin: Tin lost 2.1% to $49,050.
Lead: Lead was down 0.2% at $1,959.
Nickel: Nickel ticked 0.1% lower to $17,435. Goldman Sachs and Macquarie lifted their average 2026 nickel price forecasts above $17,000 on Tuesday, citing tighter supply from top producer Indonesia.
PRECIOUS METALS
Gold: Gold prices continued higher alongside a rise in silver as bulls continue to buy the recent dip in prices. Following Friday’s selloff and the recovery in prices this week, gold could be set to enter a consolidation range barring any geopolitical surprises. On the geopolitical front, Iran and the US are set to hold talks in Oman on Friday, even as tensions remain elevated after the US military shot down an Iranian drone approaching a US aircraft carrier on Tuesday.
The January jobs report will not be released on Friday because of the partial government shutdown the Bureau of Labor Statistics said on Monday. Data collection is already finished, but the shutdown has nonetheless forced a delay in the schedule. The new release date is still pending following the end of the partial shutdown.
On the monetary policy front, markets are friendly to a July cut and are fully priced in for a cut in September, after expectations shifted slightly to later in the year following the strong ISM manufacturing data. Services data will be out later in the morning and is set to provide an update on economic momentum and price pressures.
Friday’s volatility was brought on after the CME increased margin requirements for the metal, which forced selling among retail investors due to a lack of liquidity to maintain margins. Additionally, strong selling in China initially triggered institutional selling as banks were forced to protect gains. Still, structural support for gold persists as central banks continue diversifying away from the dollar, reducing FX reserves and increasing gold purchases—a trend expected to provide ongoing support through 2026.
Silver: Silver futures are up nearly 7% to $89.30, continuing its rapid price swings from Monday. Friday’s extreme selloff saw the metal fall 31% as profit-taking and a collapse of the FOMO rally created a frenzy. Friday’s selling was linked to an unwinding of ETF and options positions. The silver, platinum and palladium markets are small relative to gold, making them vulnerable to speculative inflows. This dynamic has presented the risk that prices have become detached from physical demand conditions. Additionally, record high prices could be poised to limit industrial demand.
Platinum: Platinum is up 3.5% to $2,289.
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