Summary of SMM Lead Morning Meeting on July 17, 2023

Futures trading:

Last Friday, LME Lead was trading at $2122 per ton. Recently, the US dollar has weakened, and base metals have generally rebounded. LME Lead has shown a volatile upward trend overall in the day. Although the lead price dropped to $2103 per ton due to inventory accumulation during the period, the overall upward trend did not change and rose to $2131 per ton in the European session, breaking a new high in nearly a month, until the final close of the day at $2128.5 per ton, an increase of 0.52%, recording six consecutive positive days.

Last Friday, the main contract of SHFE Futures Lead 2308 was opened at 15790 yuan/ton. Under the pressure of accumulated inventory, bulls concentrated to withdraw, and Shanghai Lead opened high and closed low, with an initial low of 15655 yuan/ton. However, due to the reduction in production of delivery brands, the long short game intensified, and Shanghai Lead fluctuated between 15690 and 15730 yuan/ton for a long time, ultimately closing at 15675 yuan/ton, a decrease of 0.51%; Its position reached 87.131 million hands, a decrease of 3245 hands compared to the previous trading day.

Today's lead price forecast:

On the macro side, the US Consumer confidence announced last Friday rose more than expected, the US bond yield and the US dollar accelerated to recover in the session, and the two-year US bond yield rose more than 10 basis points, but fell sharply throughout the week; The U.S. Dollar Index, which hit a new low for more than a year, rose, still hitting its biggest weekly decline in eight months.

In terms of fundamentals, today is the delivery date of the SHFE Lead 2307 contract, and the explicit inventory of lead ingots is expected to increase. At the same time, some original lead delivery brands have completed maintenance, and the supply has gradually recovered, which will bring more circulating sources of goods or slow down the pace of lead price rise to some extent. In addition, lead consumption has relatively improved, and the market has expectations for the traditional peak season, focusing on the support of downstream delivery efforts on prices in the future.

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