Singapore, USA

Comments of particular interest are noted with ‘*’.  

Matau’s Comments:

The world’s equity and commodity markets appear to collectively be taking a deep breath.  Conncerns ahead include:

  • The USA election, which many are now believing Biden’s lead is large enough to provide a victory”
    • The 2020 United States presidential election is scheduled for Tuesday, November 3, 2020.  It will be the 59th quadrennial presidential election.  
    • Voters will select presidential electors who in turn will vote on December 14, 2020, to either elect a new president and vice president or reelect the incumbent(s).
    • The constitution does not actually set an election date though historically that has been consistent.  It does specify that the President-elect will be inaugurated on January 20th
  • In the mean time the (“lame duck”) president remains in his post.  That is of some concern to Democrats, and the markets,  if as is thought, Biden wins. 
  • Growing Covid-19 infection numbers (and deaths) in USA, Europe, India and South America (Brazil).  ,
    • The markets widely reacted positively to the renewed prospect of support for a USA recovery, following Trump’s switch to support a stimulus package.  
    • In reality a USA recovery  will take a while. 
  • Gold price fell somewhat this week, in part we believe due to some optimism for recovery stimuli being promoted, and partly a stronger USD (this week).   
    • There are no notable reductions in geopolitical risk, nor any (major) escalations.  
    • UAE & Bahrain appear to be achieving benefits of a local outbreak of peace.
    • Armenia and Azerbaijan have agreed to a cease fire.  
    • Yemen’s warring sides have completed a mass prisoner swap. 
  • Fundamentals for several commodities remain strong.  … with the market largely waiting for a long heralded demand pickup. 

SUMMARY  

*Copper  Copper has been used in medicine for about 5,000 years.  It works.

Cobalt  PM1 plans to build a battery metals refinery in north Qld.  

Nickel  Glencore is close to a Ni offtake deal with Tesla.  Indonesia expects a boom in Ni processing.

Zinc & Lead  Zn:  TC’s falling on tighter concentrate supply.  Pb:  NQ minerals’ Hellyer is going well.  

Tin  AVZ will boost its equity stake in the Manono Li-Sn project in DRC.      

Aluminium  The aluminium market has faced the recent macro turbulence with some resilience.

*Gold  *Gold and USA equities are addicted to the stimulus package. 

Platinum & Palladium  CLQ is launching a deep drilling program to test a dunite below the main laterite Resource.

*Oil  *Governments need to control the pandemic or the oil sector could face further demand destruction. 

Coal  *China’s coal imports fell to the lowest levels since last December. 

Iron Ore  *China’s production of steel is unlikely to be dented much this winter. 

Shipping  Freight price surge in September was short lived.  Cape rates down, but Panamax rates rose.

General 

*Port of Singapore – Shipping:  As an indicator for Asian economic activity, Sept data is mixed.

*USA – Industrial Production – Capacity Utilisation:  Very little good news here.