The Federal Reserve has recently stirred the financial landscape as several policymakers signaled their willingness to consider further interest rate cutsHowever, a feeling of caution lingers among some members regarding the timing and impact of such movesIn the midst of these discussions, a noteworthy development surfaced: the Institute for Supply Management (ISM) reported that the U.Smanufacturing Purchasing Managers' Index (PMI) for November stood at 48.4, surpassing market expectationsThis figure, although indicative of a contraction in manufacturing activity (with anything below 50 signaling a decrease), played a crucial role in providing support for the U.SdollarAs a result, the precious metals market found itself in a state of equilibrium, with both bullish and bearish forces exerting their influence—leading to a phase of price volatility and consolidation.

When examining the sectoral performance within the stock index futures market, it becomes clear that there were significant disparities among various industries

The top-performing sectors included comprehensive services, which boasted a robust 4.91% increase, followed closely by retail trade at 3.4% and the automotive industry, which climbed 3.09%. In stark contrast, the underperformers were primarily the oil and petrochemicals sector, at a mere 0.81%, food and beverage, which increased modestly by 0.74%, and the banking sector that saw a decline of 0.34%. A closer look at the basis— the difference between futures prices and spot prices—indicated slight strengthening for the IH and IF contracts, with annualized basis rates pegged at 1.2% and -0.3%, respectivelyConversely, the IC and IM contracts were observed in a slight backwardation, with annualized basis rates of -6.1% and -8.4%.

Entering December, market dynamics suggest a heightened anticipation surrounding key political meetings that may influence policy directionThis upcoming period of critical discussions hints at a potential reevaluation of the current economic strategy, setting the stage for an intricate interplay of market expectations and reality

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With this in mind, investors are urged to focus on the underlying effects of policy stabilizations and the indices’ support levelsA prudent strategy may involve utilizing long strategies with stock index futures, allowing for positioning in anticipation of potential mispricing during the valuation recovery phaseMoreover, given the pronounced backwardation in the IC and IM contracts, it may be timely for short positions to retain contracts in the later months of 2503 or 2506, as hedging strategies solidify.

In the metals market, copper prices displayed resilience in the overnight session, with the Shanghai copper futures slightly climbing to 74,060 yuan, while London copper remained stable around the $9,000 markAmid a macroeconomic context that leans slightly towards optimism, statements from several Federal Reserve officials advocating for sustained easing measures coexist with lingering inflation concerns

The strong dollar has cast a shadow over any significant rebound in copper pricesNotably, there are glimmers of supportive data emerging domestically: China's Caixin manufacturing PMI for November exceeded expectations, elevated to 51.5, the highest expansion in three years for new ordersCopper stockpiles also show signs of contraction, with the Shanghai Futures Exchange reporting a reduction of 1,573 tons while LME copper inventories fell by 275 tons to 270,000 tonsIn a forward-looking perspective, barring the emergence of new negative external factors, copper prices are likely to experience a slow recoveryExpectation for the Shanghai copper range today is positioned between 73,400 and 74,600 yuan per tonA tactical approach may involve reducing short positions on dips, cautiously entering long positions, and encouraging end-user enterprises to build their inventories judiciously.

Turning to the ferroalloy market, current consumption demands reveal relative stability

Steel mills are grappling with profitability constraints, and the seasonal reduction in output is at a moderate paceWhile consumption demonstrates resilience, the potential for upward improvements is limitedAs the winter storage activity begins to manifest, suppliers exhibit enhanced confidence reflected in pricing strategiesFrom a supply perspective, seasonal reductions have started; however, the production of silicon manganese remains elevated, and stockpiles remain ample, maintaining an oversupply in the marketThis seasonal demand might induce upward price momentum in the short term, yet a well-supplied scenario suggests that significant price escalation could be constrainedThe risk of price declines looms large as the winter storage season culminates and macroeconomic factors fully unfold.

For coking coal and coke, the situation remains crucial as inventories of iron ore are now realizing a gradual replenishment

Recent data shows a sustained high volume of outputs, yet the dynamics surrounding the demand for coking coal and coke remain tepid, leading to an expanding price differentialThe future strength of coking coal will largely hinge on winter storage requirementsWhile consumption remains somewhat resilient, the potential for further enhancements appears stagnantDespite a slight decrease in pig iron outputs, profitability remains reasonable, and the seasonal curtailment trajectory is not steepWith supply levels being relatively adequate and coal inventories generally on the rise, any attempts to ignite prices during winter storage accumulation must be approached with caution.

Lastly, the liquefied gas market continues to respond to seasonal shifts, as colder temperatures sweep across broader regions of China, particularly in the East and SouthThis transitional climate marks the end of an extended warm spell and significantly boosts demand for heating fuels