Overnight, bears increased positions, leading lead futures to close lower; macro sentiment remains one of the factors affecting lead prices [SMM Lead Morning Brief]

SMM July 22:

Overnight, LME lead opened at $1,880/mt, drifting higher during Asian trading hours. Entering the European session, it rose to a high of $1,890/mt before weakening due to increased bearish positions, giving up all gains to hit a low of $1,867/mt, and finally settled at $1,868/mt, down 0.48%.

Overnight, the most-traded SHFE lead 2609 contract opened lower with a gap at 15,820 yuan/mt. After briefly touching a high of 15,880 yuan/mt in early trading, it drifted lower. As bears added positions, SHFE lead hit a low of 15,700 yuan/mt and finally settled at 15,715 yuan/mt, down 1.07%.

Demand side, the off-season consumption in the lead-acid battery market persists. Downstream enterprises continue to purchase as needed. As some enterprises have expectations of holidays, the subsequent purchasing intensity for lead ingots will further decline. Supply side, secondary lead enterprises maintain low operating rates, with limited circulating supplies in the market, while primary lead supply is relatively ample. The spot market is expected to continue trading at a discount. Additionally, high uncertainty in the Middle East conflict has raised energy and shipping costs, becoming one of the factors affecting lead prices.