Ample supply weighs on agriculturals

There were some sharp moves in metals prices this week, as investors took positions ahead of the weeklong holiday in China. Meanwhile, oil prices edged higher on speculation that OPEC will extend its output cuts beyond March 2018. However, higher US production should put a cap on prices. Looking forward, China’s official and unofficial manufacturing PMIs will be released on Saturday, ahead of the National Day holiday which will shut the Chinese market for the whole of next week. On Friday, we expect the US employment report to show that payrolls increased by only 100,000 in September, owing to the disruption caused by the hurricanes. That said, we doubt this will have any impact on Fed policy as the central bank is likely to ignore any hurricane-related weakness.