SMM Evening Comments (Jan 16): Shanghai Nonferrous Metals Closed Mostly with Gains on Easing Inflationary Pressure

SHANGHAI, Jan 16 (SMM) – Shanghai nonferrous metals closed mostly with gains. On the macro front, last week's US economic readings implied cooling inflation, and the US dollar index fell to nearly 102, underpinning metals prices.

Shanghai copper dropped 0.29%, aluminium rose 0.52%, lead added 0.36%, zinc jumped 1.36%, tin grew 2.99%, and nickel fell 1.83%.

Copper: The most-traded SHFE 2303 copper closed down 0.29% or 200 yuan/mt at 68,640 yuan/mt, with open interest down 3,672 lots to 197,618 lots.

SMM copper cathode inventory across major markets in China stood at 154,200 mt, and accumulating inventory weighed on copper prices.

Aluminium: The most-traded SHFE 2302 aluminium closed up 0.52% or 95 yuan/mt at 18,485 yuan/mt, with open interest down 7,185 lots to 95,867 lots.

Overseas macro data was positive recently, and China released a series of favourable policies, boosting market confidence. However, due to poor downstream demand ahead of the upcoming CNY holiday and rapidly rising inventory, aluminium prices are pressured.

Lead: The most-traded SHFE 2303 lead closed up 0.36% or 55 yuan/mt at 15,340 yuan/mt, with open interest up 2,852 lots to 79,588 lots.

In the spot market, there were few quotes in the spot market, and market inquiries were also scarce with downstream lead-acid battery companies closing for Chinese New Year holiday. The halting logistics services in some regions further contained market activities.

Zinc: The most-traded SHFE 2303 zinc closed up 1.36% or 325 yuan/mt at 24,305 yuan/mt, with open interest up 9,858 lots to 75,933 lots.

The market weakened further today, featuring scarce quotes and inactive inquiries with downstream players and traders closing for holiday.

Tin: The most-traded SHFE 2302 tin closed up 2.99% or 6,560 yuan/mt at 225,730 yuan/mt, with open interest down 305 lots to 38,756 lots.

In the spot market, most traders and downstream players have been closed for holiday, and the transactions were lacklustre. SHFE warrants inventory added 196 mt to 6,448 mt.

Nickel: The most-traded SHFE 2302 nickel closed down 1.83% or 3,780 yuan/mt at 203,250 yuan/mt, with open interest down 1,029 lots to 36,222 lots.

In the spot market, Jinchuan nickel was in premiums of 10,500-14,000 yuan/mt, with an average of 12,250 yuan/mt, down 1,750 yuan/mt from the previous trading day. NORNICKEL nickel was in premiums of 6,800-7,500 yuan/mt, with an average of 7,150 yuan/mt, flat. SHFE nickel opened the week with a losing session. Currently, there were few quotations for Jinchuan nickel in the last trading week before the Chinese New Year. For nickel briquette, the prices stood at 209,100-209,900 yuan/mt, down 3,500 yuan/mt from the previous trading day.

[Disclaimer: The above representation and data is based on market information SMM believes to be reliable at the time of acquiring as well as the comprehensive assessment by SMM research team, and any and all information provided in this article is for reference only. This article does not constitute a direct recommendation for investment or any decisions in any form and clients shall act on their own discreet and any decisions made by clients are not within the responsibility of SMM.]