SMM Evening Comments (Mar 24): Shanghai Nonferrous Metals Closed with Gains as US initial Jobless Claims Fell below Expectations

SHANGHAI, Mar 24 (SMM) - Shanghai nonferrous metals closed with gains in day trading. On the macro front, the Bank of England decided to hike interest rates by 25 bps to 4.25%, which was in line with market expectations. The US initial jobless claims in the week ended March 18 recorded 191,000, lower than the forecast of 197,000. The US dollar index slowed down in falling and fluctuated at 102.

SHFE copper added 1.84%, aluminium gained 1.21%, lead inched higher 0.03%, zinc advanced 2.09%, tin jumped 5.86%, and nickel surged 3.74%.

Copper: The most-traded SHFE 2305 copper closed up 1.84% or 1,260 yuan/mt at 69,760 yuan/mt, with open interest up 11,801 lots to 173,603 lots.

In the spot market, the spot premiums rose further as traders needed to deliver monthly long-term orders. The import loss of spot goods expanded as SHFE/LME copper price ratio slid to around 7.7. The supply of imported copper remain in shortage.

Aluminium: The most-traded SHFE 2305 aluminium closed up 1.21% or 220 yuan/mt at 18,470 yuan/mt, with open interest down 1,686 lots to 223,127 lots.

On the fundamentals, the resumption of production by aluminium smelters in Sichuan, Guizhou and other places has led to a slight recovery on the supply side. Downstream consumption continued to pick up, driving domestic aluminium ingot social inventory to fall rapidly. The short-term aluminium prices may rally slightly, driven by improving fundamentals and macro sentiment.  

Lead: The most-traded SHFE 2305 lead closed up 0.03% or 5 yuan/mt at 15,390 yuan/mt, with open interest down 1,059 lots to 55,755 lots.

SHFE lead prices continued to move sideways, and cargo holders quoted based on market dynamics. Spot prices did not change, while some secondary lead suppliers lowered their offers to promote sales. The downstream buyers mainly purchased as needed, and the transactions in the refined lead market were thin.

Zinc: The most-traded SHFE 2305 zinc closed up 2.09% or 465 yuan/mt at 22,680 yuan/mt, with open interest down 6,465 lots to 103,535 lots.

Zinc prices edged up today, which discouraged downstream purchases. Traders were active in making shipments and lowered their prices slightly. However, the transactions remained poor.

Tin: The most-traded SHFE 2304 tin closed up 5.86% or 11,050 yuan/mt at 199,600 yuan/mt, with open interest up 7,221 lots to 53,370 lots.

As tin futures prices soared, more smelters were willing to offer quotes in the morning session and were keen on making shipment. The spot transactions were slack amid poor inquiries.  

Nickel: The most-traded SHFE 2304 nickel closed up 3.74% or 6,540 yuan/mt at 181,410 yuan/mt, with open interest down 3,140 lots to 50,001 lots.

In the spot market, Jinchuan nickel was quoted in premiums of 7,600-7,800 yuan/mt, with an average of 7,700 yuan/mt, flat from the previous trading day. NORNICKEL nickel was in premiums of 2,800-2,900 yuan/mt, with an average of 2,850 yuan/mt, up 50 yuan/mt from the prior trading day. The spot premiums stayed firm with rising nickel prices, but transactions were lower than expected. For nickel briquette, the prices stood between 177,400-178,600 yuan/mt, up 2,550 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.]