Industrial metals, the bestperforming commodities sector over the past six months, look set to extend their surge into 2021 as a Chinaled global economic recovery, a weak U.S. dollar and potential supply disruptions continue to lend support.
The SP Goldman Sachs industrial metals index a subset of the widelytracked SP Goldman Sachs Commodities Index SP GSCI has climbed over 38 since June 1. And copper, aluminium, nickel and zinc have all eclipsed price gains made by gold, which scaled alltime highs in August.
The Vshape recovery in China, supported by the countrys strict and immediate lockdown implementation, governmentled stimulus and supportive actions from the Peoples Bank of China, continues to outperform market expectations, said analyst Natalie ScottGray of broker StoneX.
The countrys mammoth manufacturing sector has recovered especially well, benefiting from a global boom in white goods demand as well as rebounding car production.
The last time the industrial metals index topped the annual rankings of the SP GSCI indices was in 2017, when the global economy was expanding at its fastest pace since 2010 and aggressive cuts to excess capacity in top metal producer China fuelled a broad rally in base metals.
Before that, industrial metals notably outperformed other commodities sectors in 2009 as the world economy recovered from the global financial crisis.
So far in 2020, industrial metals are up 21, just behind the precious metals indexs 22 rise, SP data…