Commodities Daily - March 16, 2021

> Oil slides as major EU economies suspend AstraZeneca vaccine shots. This morning, Brent is hovering above $68/bbl, with the WTI's nearest calendar spread slipping into its deepest contango since January, signaling oversupply. Today, investors are eyeing US February retail sales and industrial production data, as well as the weekly API update on US oil inventories. We do not expect Brent to break below $67.9/bbl support today amid likely upbeat US retail sales data, as Americans received $600 stimulus checks in January. Although if Brent breaks below $67.9/bbl support it would be technically exposed to a deeper correction toward the next support at $66.9/bbl. Resistance is at $69.3/bbl, with a break above likely leading to a gain into the $70.1-71.4/bbl range.> Gold gains amid pullback in Treasury yields. Yesterday, gold traded sideways within a $1,720-1,735/oz range as the US 10y Treasury yield slid below 1.6%. During today's trading in Asia, it was quoted near $1,730/oz. The highlights on today's macro calendar are February retail sales and industrial production from the US and the ZEW eurozone economic sentiment survey, while the FOMC meeting remains at the top of this week's agenda for the gold market. We think that the Fed may upgrade its economic forecasts, which could pressure gold prices. Gold may be set for a test of resistance at $1,740/oz today, though we could see a break below support near $1,720/oz if today's US data is surprisingly strong.> Aluminum: New Chinese restrictions on production boosts market. Trading on the LME was upbeat yesterday: base metals rose in price after the publication of good industrial production numbers for China in February. The 3m forward aluminum contract gained 2.16% to $2,218/tonne, copper added 0.65% to $9,146/tonne, nickel 1.26% to $16,214/tonne and zinc 1.94% to $2,259/tonne. Copper and nickel prices managed to break through important resistance levels at $9,000/tonne and $16,000/tonne, respectively. In the copper market in particular, the focus was whether there will be a strike at the Los Pelambres mine (Antofagasta) in Chile, which is scheduled to start on Thursday. Past strikes in Chile have usually led to significant rises in copper prices.