The Overnight Report: Copper & Silver New Highs

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This story features INSURANCE AUSTRALIA GROUP LIMITED, and other companies.
For more info SHARE ANALYSIS: IAG
The company is included in ASX50, ASX100, ASX200, ASX300 and ALL-ORDS

S&P500 and Dow Jones reached new record highs with gold rallying and copper/silver reaching new record highs as crude and tech stocks slipped (blame Oracle).

After a positive session yesterday, ASX200 futures are pointing to a strong start boosted by higher metal prices.

Good Morning,

The Australian share market reversed a three-day losing streak on Thursday.

The ASX200 rose 13pts pr 0.15% to finish at 8,562. Five of eleven sectors rose, led by miners and property.

Tech and healthcare lagged.

What happened overnight, NAB Markets Today Research

The S&P500 and Dow Jones close at record highs.

The S&P500 ended at a new record high, up 0.21% to 6,901  after falling by -0.77% at the start of the NY session. The fall the start of the day was triggered by a -12% fall in Oracle shares after the company revealed US$12bn in quarterly capital expenditure, up from US$8.5bn in the previous quarter, and against expectation of US$8.25bn.

Sales increased 34% to US$7.98bn, while revenue in the company’s closely watched infrastructure business gained 68% to US$4.08bn. Both numbers fell just short of analysts’ estimates. Meanwhile, a measure of Oracle’s credit risk reached a fresh 16-year high.

Looking at the S&P sector performance, materials and financials extended their post FOMC gains, up close to 2% while IT, Energy and Communications Services fell.

The Dow Jones rose 1.34% and the Nasdaq slipped -0.26%, after falling by -1.46% during the first hour of trading. Earlier in Europe, the Eurostoxx600 closed 0.55% higher while the FTSE100 climbed 0.49%.

US Initial jobless claims increased by 44k to 236k in the week ended Dec. 6, this was the biggest jump since March 2020 and followed the lowest level of applications in more than three years in the previous week, which included Thanksgiving.

Claim figures can be quite volatile around this time of the year with seasonal impacts from holidays. The overnight print is at the top end of readings seen in 2025.

Our friends at Pantheon economics note the latest WARN and Challenger data on planned layoffs point to a further incremental rise in claims at the start of next year, while Bloomberg also noted companies like PepsiCo and Hewlett Packard have laid out plans to reduce headcount in recent weeks, and nationwide layoffs in October were the highest since early 2023.

Looking at the four-week moving average in claims, in order to smooth out the weekly volatility, at 216.675, the moving average remains within the range of 215 to 220k, so not yet a cause for alarm.

Sticking with US data releases, the trade deficit shrank to US$52.8bn in September, from US$59.3bn in August, well below the consensus, US$63.1bn.

This means trade made likely made decent contribution to the US Q3 GDP figure (close to 1.5%), but it doesn’t say much in terms of what to expect for Q4. The decline in the September deficit was almost entirely due to a large increase in gold bullion exports, which is expected to unwind in Q4.

UST treasury yields are down a couple of bps across the curve with the 10yr down -2bps to 4.12%. Earlier in the European session, Bunds and Gilts also edged lower with the 10yr Bund down -1bps to 2.84% while 10yr UK Gilts eased by -2bps to 4.48%.

The Australian 10yr Bond Future is the notable mover down -9bps (now at 4.73%) relative to levels this time yesterday, the decline was triggered by softer than expected job figures released during our trading session yesterday.

Australia’s Employment fell -21k in November driven by a fall in full-time positions. The unemployment rate was steady at 4.3% compared with the consensus estimate of an increase to 4.4% as the participation rate fell. The gradual easing in the labour market is seen as decreasing the pressure for a near-term hike by the Reserve Bank of Australia.

The US dollar is broadly weaker against G10 currencies, continuing the move lower from after the FOMC.  The AUD is -0.19%, but this reflects a decent bounce from yesterday’s decline recorded after the underwhelming AU labour market report. 

Yesterday the AUD started the day at 0.6676, falling to an intraday low of 0.6627, only to recover during the overnight session, and now trades at 0.6664.

Bloomberg reports Ukraine President Zelenskiy floated the prospect of allowing Ukrainians to vote on whether to hand Donbas region to Russia as Kyiv comes under mounting pressure to agree to terms of an emerging US peace plan.

ANZ Bank, Australian Morning Focus, Commodities extract

Crude oil extended recent losses amid a risk off tone across markets. Sentiment wasn’t helped by a more subdued outlook for the oil market. OPEC expects oil supply and demand in 2026 to be relatively balanced.

This is a sharp reversal from outlooks earlier this year which pointed to tighter markets. It expects it will need to produce an average of 43mb/d next year to balance the market. Key OPEC-Plus nations acknowledged the fragile state of the market but announced recently that it would pause production hikes in the first quarter of 2026. This offset concerns of supply disruptions emanating from Venezuela.

Earlier this week, US forces intercepted and seized a sanctioned oil tanker off the coast of Venezuela. Reuters reported the US is preparing to intercept more ships transporting Venezuelan oil.

It suggests it will target ships that may have also transported oil from other countries targeted by US sanctions, such as Iran. The Office of Foreign Assets Control announced the US Treasury Department has sanctioned another six crude oil tankers and their related companies.

It marks an escalation of tension between the two countries and threatens up to 560kb/d of crude oil exports. Shippers may become reluctant to load Venezuelan cargo.

North Asia LNG prices couldn’t follow European markets higher due to a lack of follow up buying from smaller importers that emerged earlier this week.

Copper climbed to another high, as easing monetary policy boosted sentiment. The Fed delivered a widely expected cut and upgraded its growth forecast for the US economy. It now expects growth to hit 2.3% next year, up from its previous target of 1.8%.

The combination of lower interest rates and stronger economic growth should boost copper demand. This comes as the new demand centres emerge. Traders remained concerned supply may be impacted by the ongoing pull of metal into the US, driven by concerns about a US tariff on refined metal following a review of the sector.

Gold advanced, as traders shrugged off a slightly hawkish Fed. The central bank’s dot plot signaled only one more cut in 2026. Instead, traders appeared to take comfort from policymakers leaving the door open for more easing next year. Markets are still pricing in two cuts in 2026.

Meanwhile silver hit a fresh record high of US$64/oz. It’s gained 116% this year, as investors have looked for alternatives in the precious metal sector. This has been exacerbated by tightness in the physical market and dislocation across major trading hubs.

Iron ore futures edged fell despite signs of lower supply. Iron ore shipments from Australia total 7.4mt in the week of 28 November, down from 9.6mt the previous week.

Three tailwinds shaping the global investment outlook for 2026, Nigel Green, deVere Group

Global investors looking toward 2026 are beginning to see a set of structural forces that are grounded in observable economic reality rather than optimism alone.

The year ahead  is defined by three credible tailwinds.

Markets reward evidence over enthusiasm, and as 2026 approaches, investors are increasingly distinguishing between stories and substance.

The first tailwind is the persistence of global economic growth that is broader than in recent years, even if it remains uneven. Current projections continue to point toward expansion rather than contraction, with resilience in the US, gradual improvement across Europe, and ongoing structural growth in parts of Asia. 

Large-scale fiscal spending linked to infrastructure, defence, supply-chain security and strategic industrial policy continues to filter through economies with long lags, providing a steady underpinning for activity.

This environment doesn’t require rapid growth to support markets which respond to durability. When growth proves persistent rather than fragile, earnings expectations stabilize and capital becomes more willing to take risk. Broader participation across regions matters far more than headline growth rates.

This backdrop historically supports equities, selective credit and globally exposed companies, while reducing the over-concentration risk seen when returns rely on one dominant region.

The second tailwind is the transition of AI and automation from hype to hard numbers. 

After an initial phase dominated by capital spending and valuation expansion, 2026 is shaping up as a period where scrutiny intensifies. Investors are increasingly focused on profit checks, cash flow contribution and operational delivery, rather than future promise alone, and this shift is critical.

Markets are demanding proof and companies talking about AI without showing returns will struggle. Those that can demonstrate margin improvement, cost reduction or revenue scalability will attract capital. 

AI adoption is no longer confined to a small group of technology leaders. Productivity gains are beginning to emerge across healthcare, logistics, manufacturing and financial services, where automation, data optimization and intelligent systems are improving efficiency and decision quality.

This phase favours execution and businesses that integrate tech into core operations, rather than showcasing it, are the ones that will stand out. Hype fades quickly when profit delivery is absent.

Even modest but widespread productivity gains can accumulate into meaningful economic support over time, strengthening profitability without relying on excessive pricing power or leverage.

The third tailwind is the return of diversification as a meaningful contributor to performance. For much of the past decade, global returns have been dominated by a narrow segment of US assets, diminishing the effectiveness of diversified portfolios. 

This dynamic is beginning to change. Valuations across regions are less stretched, real yields in parts of fixed income are more compelling than in recent years, and commodities and other real assets are regaining relevance amid geopolitical tension and industrial re-shoring.

Diversification does not imply uniform gains as dispersion is increasing and some assets will perform well, others will not. Investors who rely on broad exposure alone may be disappointed. Selectivity becomes critical.

There is also growing importance of currency movements in a less concentrated global environment. When growth becomes more distributed, currencies begin to matter again as a source of return and risk,

These tailwinds do not eliminate risk. They provide structure. Growth resilience, measurable innovation and renewed diversification are beginning to align.

Investors who approach 2026 with realism, global awareness and disciplined analysis are better positioned than those chasing narratives.

Corporate news in Australia

-The ACCC has blocked Insurance Australia Group’s ((IAG)) -$1.4bn takeover of RAC insurance over competition concerns. IAG will seek approval under the new merger rules.

-BGH Capital is reported as “eyeing” Webjet Group’s ((WJL)) $110m in cash in $357m takeover bid.

-HomeCo Daily Needs REIT ((HDN)) asset valuations rose $219m and management reconfirmed FY26 outlook.

-Amart Furniture has hired Jarden and Jeffries for a $1bn ASX listing.

-Disney invests $1bn in OpenAI, licenses 200-plus characters for Sora AU videos.

-Singapore-listed Sembcorp has signed a deal to buy Alinta Energy for $6.5bn.

-ASX-listed Hearts & Minds Investment fund has written off its stake in Corporate Travel Management ((CTD)) to zero.

On the calendar today:

-DALRYMPLE BAY INFRASTRUCTURE LIMITED ((DBI)) ex-div 6.125c

-METCASH LIMITED ((MTS)) ex-div 8.5c (100%)

-NATIONAL AUSTRALIA BANK LIMITED ((NAB)) AGM

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

The Australian share market over the past thirty days…

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

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