Base metals on the London Metal Exchange pushed higher during morning trading on Wednesday November 7, supported by a strong bounce in global equity markets, while the US dollar index lost ground after gains by the Democrats in the US midterm elections.
Overnight, US midterm election results indicated a majority win for the Democrats in the House of Representatives, with US president Trump's administration losing full control of Congress despite the Republican Party tightening its control in the Senate by gaining seats. As a result, investors hoping for continued fiscal stimuli retreated over the morning trading period, prompting the US dollar to fall below 96, allowing base metals prices to edge higher. Climbing 1.7% over the morning, the three-month lead price recovered losses made at Tuesday's close, consolidating at around $1,950 per tonne after falling to its lowest level of the month on Tuesday at $1,905 per tonne. "One of the headwinds for base metals has been the dollar being strong and that's partly the result of the extra stimulus...