SMM Evening Comments (Apr 29): Shanghai nonferrous metals closed mostly higher, lead fell 0.71%

SHANGHAI, Apr 29 (SMM) – SHFE nonferrous metals rose for the most part on Thursday April 29 as investors reacted to the US Federal Reserve's decision to keep its easy money policy in place.

Tin, the best performer, rose 3.26%, copper advanced 0.99%, nickel went up 2.8%, zinc climbed 0.63% and aluminium gained 2.33%, while lead fell 0.71%.

The ferrous complex closed mixed. Rebar advanced 1.94%, hot-rolled coil rose 1.83%, while iron ore fell 0.84%.

Copper: The most-traded SHFE 2106 copper contract finished the day 0.99% higher at 72,380 yuan/mt. Open interest fell 244 lots to 175,000 lots. The Federal Reserve's interest rate decision came to fruition, which was in line with market expectations. The Federal Reserve kept the interest rate and bond purchase rate unchanged, raised its economic assessment and signaled that the risk had dropped. Chairman Powell said that it was not yet time to discuss the contraction of asset purchase plan, and made it clear that he had no intention of closing the liquidity gate immediately, and the easing policy still supported the market. The decline of US dollar index and US debt to a certain extent led to the upward trend of copper price again. In addition, Biden proposed a 1.8 trillion support plan for American families, which also boosted market sentiment to a certain extent. The US trade deficit in goods set a new record in March, and the import volume reached a new high, which also indicated the strong recovery of consumption to a certain extent. US initial jobless claims, the speeches of the Fed directors and the guidelines of LME copper will be monitored tonight.

Aluminium: The most-liquid SHFE 2106 aluminium contract finished the day 2.33% higher at 18,865 yuan/mt. Open interest rose 4,294 lots to 287,359 lots. SMM data showed that stocks of 6063 aluminium billet across the five major consumption areas – Foshan, Wuxi, Huzhou, Changzhou and Nanchang – in China dropped 28,700 mt from the previous week to 134,000 mt as of April 29.

Zinc: The most-active SHFE 2106 zinc contract closed up 0.63% at 22,265 yuan/mt. Open interest rose 4,664 lots to 105,444 lots.

Nickel: The most-traded SHFE 2106 nickel contract ended the day 2.8% higher at 129,920 yuan/mt today. Open interest fell 2,941 lots to 151,532 lots.

Lead: The most-traded SHFE 2106 lead contract rose to an intraday high of 15,405 yuan/mt and ended the day 0.71% lower at 15,290 yuan/mt. Open interest rose 2,654 lots to 52,319 lots. The recovery of refined lead smelters was insufficient, and the capacity was slightly limited before May Day. Social stocks are not expected to increase. Downstream orders and social inventory changes should be monitored post-holiday, and the contract will test support from 10-day moving average tonight.

Tin: The most-liquid SHFE 2106 tin contract fell to a session low of 187,380 yuan/mt and finished the day 3.26% higher at 192,150 yuan/mt today. Open interest fell 1,524 lots to 17,097 lots.