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Stocks Never Lost After Industrial Metals Did This

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  Jason Goepfert
  
  
  Published: 2021-10-19 at 07:35:00 CDT

When consumers are optimistic about the economy, they buy stuff. That stuff needs to be manufactured by somebody, and those somebodies need materials to make it.
So, manufacturers get busy, inputs are in demand, and industrial materials tend to rise. There's no doubt that's the case now.
Dean has shown how some metals like zinc and copper have skyrocketed. That has helped to drive the S&P GSCI Industrial Metals Index to a new high. Just as impressively, the index has doubled from its pandemic-panic low.

After prices in this market doubled from a low, the metals have typically been about to cool off. High prices tend to generate higher production, leading to lower prices through the magic of market forces. Massive moves like this don't often happen, so the usual caveats about small sample sizes apply.
While it's iffy to automatically assume that potential good news about the economy necessarily equals good news for stocks, the S&P 500 never showed a loss a year after industrial metals doubled.