COMMODITIES: Crude Extends Losses, Copper Slumps As Trade War Fears Mount
Apr-04 17:20
- Commodities have come under significant pressure Friday, as risk sentiment has deteriorated further amid the historic shift in global trade policy.
- In particular, crude has extending losses, amid concerns for global energy demand and following the surprise OPEC+ announcement to speed up the pace of its voluntary cut unwinding.
- WTI May 25 is down by 7.4% at $62.0/bbl, its lowest level in four years.
- OPEC+ will raise production by a larger-than-expected 411kb/d in May, compared to the 135kb/d initially planned.
- The impulsive sell-off in WTI futures has resulted in the breach of a number of important support levels, signalling scope for a continuation lower. Sights are on $59.39 next, a Fibonacci projection.
- Meanwhile, spot gold has fallen by 2.8% $3,027/oz, taking the pullback from yesterday’s record high to over 4%.
- Next support is seen at $2,999.5, the Mar 21 low.
- Silver has underperformed again, falling by another 7.7% today, taking the gold/silver ratio above 102, its highest level since May 2020.
- Copper has also slumped by 8.6% to $441/lb, leaving the red metal almost 13% lower since Wednesday. The decline extended after China said it would impose reciprocal 34% tariffs on all US imports today.
- The sell-off signals scope for an extension towards $435.37, the 76.4% retracement of the Jan 2 - Mar 26 bull cycle. A break of this level would open $422.80, the Feb 3 low.
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US TSYS: Tsys Dip on US Weighing Auto Tariff Pause on Canada & Mexico
Mar-05 17:03
- Treasury futures retreat after latest headlines US weighing auto tariffs on Canada and Mexico.
- Still off session lows the Jun'25 10Y contract trades -6 at 111-02 after vs. 110-27 low, still well inside technicals: resistance above at 112-01/02 (High Mar 4 / 1.382 proj of Jan 13-Feb 7-12 swing), support below at 110-23/110-00 (Low Feb 28 / High Feb 7).
- Curves still steeper: 2s10s +3.933 at 28.891, 5s30s +3.428 at 52.483.
GLOBAL: US Weighing Month Delay of Canada & Mexico Tariffs on Autos
Mar-05 17:03
- "*US WEIGHS ONE-MONTH DELAY OF CANADA, MEXICO TARIFFS ON AUTOS" (BBG)
- Bloomberg report that "The Trump administration is considering a one-month delay for automakers from newly imposed tariffs on Mexico and Canada, according to people familiar with the matter, as a temporary reprieve following pleas from industry leaders."
- Commerce Secretary Howard Lutnick has hinted in recent days that exceptions to the initial tariffs were under consideration. Earlier today, he stated that Trump was thinking about autos and USMCA-compliant categories for today's plan.
PIPELINE: Corporate Bond Update: $26B Mars 8Pt Jumbo, 8th Largest on Record
Mar-05 16:58
- Date $MM Issuer (Priced *, Launch #)
- 03/05 $26B Mars $2B 2Y +50, $3.25B 3Y +60, $4.5B 5Y +75, $2.75B 7Y +85, $5B 10Y +95, $2.75B 20Y +110, $4.75B 30Y +117, $1B 40Y +127
- 03/05 $1.5B Axon 5NC2, 8NC3
- 03/05 $1B *KommuneKredit WNG 5Y SOFR+44
- 03/05 $750M #Republic of Armenia 10Y 7.1%
- 03/05 $500M Acadia Health 8NC3
- 03/05 $500M Forestar Group 8NC3
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