METALS: Copper - Looking to Build Momentum Above 500.00
The range overnight for the HGU5 contract was 509.25 - 521.20, Asia is currently trading around 518.
- The LME cash market closed overnight around 10109.20. LME Copper 3MO has drifted below 10000 this morning.
- (Bloomberg) -- Copper rose above $10,000 a ton as market players look to take advantage of price gaps between London, New York and Shanghai. A record amount of copper arrived in the US this year due to expectations of an import tariff, fueling a stronger rally in Comex copper prices.
- “What could be attributed to easing trade tensions and receding recession risks is, in our view, (almost) all about trade tariffs,” Julius Baer’s Carsten Menke said in a note.“To put the surge in US imports into perspective, they seem big enough to turn a well-balanced market into a tight one – at least on paper,” according to Menke.”
- “The market is also affected by a supply disruption in Peru, where artisanal miners are staging blockades, impacting copper transport from some operations.”
- This decline in inventories and an acceleration in USD weakness has seen Copper accelerate above the 500.00 area and.
- This looks like it could start building some momentum higher now and you could expect dips to be well supported back to the 500.00 area.
Fig 1 : Copper(HGN5) Hourly Chart
Source: MNI - Market News/Bloomberg
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JGBS AUCTION: Poll: 10-Year JGB Auction
*JAPAN 10Y GOVT BOND AUCTION MAY HAVE 98.95 LOWEST PRICE: POLL– BLOOMBERG
JGBS AUCTION: 10Y Supply Faces A Higher Yield But A Similar Curve
The Japanese Ministry of Finance (MoF) will today sell Y2.6tn of 10-year JGBs. The MoF last sold 10-year debt on 8 May 2025. This month’s auction offers an outright yield 25bps higher than last month and approximately 10bps below the recent cyclical high of 1.596% reached in late March, just prior to President Trump’s announcement on reciprocal tariffs.
- However, the 2s/10s and 7s/10s yield curves are around a similar level to last month.
- Notably, investor sentiment toward longer-dated global bonds has weakened since early May, albeit having improved slightly over the past week.
- Bank of Japan Governor Ueda, speaking in parliament, said the BoJ will review its bond tapering plans at the next policy meeting on June 17, taking into account feedback from bond market participants. Additionally, he pointed out that sharp movements in long-term yields could influence short-term rates.
- Against this backdrop, it remains to be seen whether the current 10-year yield level will be sufficient to draw strong demand in today’s auction.
- Results are due at 0435 BST / 1235 JT.
JGBS AUCTION: PREVIEW - 10-Year JGB Auction Due
The Japanese Ministry of Finance (MoF) will today sell Y2.6tn of 10-year JGBs. The MoF last sold 10-year debt on 8 May 2025: the auction drew cover of 2.5440x at an average yield of 1.274%, an average price of 101.10, a high yield of 1.294%, a low price of 100.92, with 44.9598% of bids allotted at the high yield.
- Last month’s auction revealed weak results, with the low price falling short of expectations, according to the Bloomberg dealer poll. Moreover, the cover ratio decreased to 2.5440x from 3.1475x, and the tail lengthened to 0.18 from 0.11.
- This performance came with an outright yield 10-15bps lower than the prior month and approximately 30bps below the recent cyclical high of 1.596% reached in late March, just before President Trump's announcement on reciprocal tariffs.
- Results are due at 0435 BST / 1235 JT.
