Futures:
Overnight, the LME lead 3M contract moved lower before rising on August 27, opening at $1,907.0/mt and closing at $1,912.5/mt, up $7/mt from the previous trading day, a gain of 0.37%. It traded in a range of $1,898.0-1,917.5/mt, with a swing of $19.5/mt. During the Asian session, it moved sideways in the $1,901-1,909/mt range, then surged rapidly during the overlapping Europe-US session, hitting a high of $1,917.5/mt. Trading volume was 5,534 lots, open interest 174,366 lots, up 845 lots.
Overnight, the SHFE lead 2610 contract rose on increased open interest in the night session, opening at 16,150 yuan/mt. After the open, it quickly jumped to around 16,237 yuan/mt, then continued to consolidate at highs. After 23:00, it rose again to a high of 16,300 yuan/mt, and finally closed at 16,275 yuan/mt, up 165 yuan/mt from the previous trading day’s closing price, a gain of 1.02%. Night-session volume was 46,972 lots, open interest 71,668 lots, up 2,228 lots. The night session broke above the prior sideways range at the highs formed by three doji, but after the highest price (16,300 yuan/mt) touched the upper Bollinger Band it pulled back; the closing price (16,275 yuan/mt) was below the upper band, with clear pressure at the upper band.
Notably, the SHFE lead night-session rally was highly synchronized with the LME lead move. After 20:00 Beijing time, LME lead surged rapidly, rising from around 1,900 to 1,917.5; after the SHFE lead night session opened at 21:00, it immediately followed with a rally, breaking from 16,110 to 16,300. Resonance between SHFE and LME drove lead prices higher, and both came under pressure and pulled back near the upper Bollinger Band.
On the macro front:
US Fed officials collectively released hawkish signals; US economic data were mixed, with the revised Q2 GDP at 2.0% below the prior 3.0%, July durable goods orders MoM -0.1%, and existing home sales at 4.03 million units below expectations, while initial jobless claims at 203,000 were below expectations. The Middle East situation remained volatile: the Trump administration refused to return to the memorandum of understanding reached with Iran in June; Iran demanded conditions for opening the Strait of Hormuz; Kuwait and Qatar increased crude oil exports to 70% of pre-conflict levels. The US was considering new semiconductor tariffs, and tariff relief may be linked to investment in US chip manufacturing. The Jackson Hole global central bank annual meeting was set to be held today, with attention on monetary policy signals.
China side, the Ministry of Commerce responded to the US consideration of an additional 7.5% tariff on China; NBS data showed that profits of industrial enterprises above designated size nationwide rose 17.6% YoY in January-July; the central bank conducted overnight reverse repo operations for six consecutive days to maintain liquidity; Wang Yi met with the US ambassador to China, and China and the US maintained communication on leader-level interactions within the year; the three major A-share indices consolidated higher, and the nonferrous sector continued to strengthen.
Spot market:
Yesterday, the SMM #1 lead average price was flat, and SHFE lead consolidated at highs. For primary lead, domestic lead had limited available supply, with suppliers holding prices firm while selling; some primary lead enterprises entered maintenance, tightening regional supply, and quotations diverged notably across regions. More quotations were seen for imported lead, at a premium of 400-500 yuan/mt against the SHFE lead 2610 contract. For secondary lead, smelters sold in line with the market, with relatively firm quotations in north China; secondary refined lead was quoted ex-works at a discount of 100-0 yuan/mt against the SMM #1 lead average price. Downstream, after lead prices stabilized, enterprises’ risk-hedging sentiment eased and they maintained purchasing as needed. As SHFE lead prices pulled back, some enterprises became more proactive in inquiries, and trading activity in south China picked up somewhat.
Inventory: As of August 27, SMM’s total social inventory of lead ingots across five regions rose to 69,300 mt, down 6,400 mt from August 20 and down 5,400 mt from August 24. LME lead inventory stood at 408,500 mt, down 2,100 mt from the previous trading day; total SHFE lead ingot warrant inventory was 56,991 mt, unchanged from the previous trading day.
Today’s lead price forecast:
Lead prices are expected to hold up well today. With suppliers holding prices firm and downstream buyers wary of high prices, transactions may strengthen first and then weaken. Key focuses include the futures daytime session and downstream’s actual acceptance after spot prices follow gains.
![SHFE and LME Resonated, Open Interest Increased and Rose; SHFE Lead Night Session Surged 1.02%, Breaking Through Consolidation [SMM Lead Morning News]](https://imgqn.smm.cn/usercenter/xVgcv20251217171721.jpg)
