SMM Morning Comment For SHFE Base Metals November 8

SHANGHAI, November 8(SMM) –
Copper
SMM copper morning comment
LME copper prices opened at $8168.5/mt and closed at $8195/mt in overnight trading, a drop of 0.63%, with the low-end of $8131/mt and the high-end of $8199/mt. Trading volume was 18,000 lots, and open interest stood at 264,000 lots. The most active SHFE 2312 copper contract prices opened at 67190 yuan/mt and finished at 67440 yuan/mt overnight, up 0.25%, with the low-end of 67100 yuan/mt and the high-end of 67470 yuan/mt. Trading volume was 29,000 lots and open interest stood at 145,000 lots. On the macro front, many senior Federal Reserve officials said that inflationary pressures still exist. Fed Governor Bowman believes that further interest rate increases are still expected. Dallas Fed President Logan also said that inflation is still too high, and the data looks to be heading towards 3% rather than 2%. In terms of fundamentals, spot premiums and discounts in East China continued to rise yesterday. Imported copper was limited, and spot resources were overall tight. Inventories in South China were still low. Although downstream purchasing enthusiasm was limited, sellers kept prices firm. In terms of consumption, in the face of high prices, more companies were mainly replenishing goods as required. Due to the fact that many officials from the Federal Reserve are still worried about inflation, the pressure on copper prices is still high.
Aluminum
SMM Aluminum Morning Comment
The most-traded SHFE 2312 aluminum contract opened at 19170 yuan/mt overnight, with the highest and lowest prices at 19210 yuan/mt and 19125 yuan/mt before closing at 19200 yuan/mt, up 21 yuan/mt. LME aluminum opened at $2286.0/mt on Tuesday, with its low and high at $2253.0/mt and $2286.0/mt respectively before closing at $2277.0/mt, down $9/mt or 0.39%.
There is still great uncertainty in overseas macroeconomics. U.S. economic data shows that the U.S. economy is resilient. The U.S. dollar index fluctuates at a high level, suppressing commodities. China will issue an additional one trillion yuan of local government bonds to boost the economic market Recovery. In terms of fundamentals, some aluminum billet factories have recently reduced production, and ingot casting volume has increased. Domestic aluminium supply will remain high in the short term. There has been inflows of imported goods due to import profit. Downstream consumption is weakening, and aluminum billet and ingot inventory faces pressure. The inventory is still at a high level in half a year. In the short term, aluminum prices may remain rangebound.
Lead
LME and SHFE lead prices diverged
SHANGHAI, Nov 8 (SMM) -
Overnight, LME lead prices opened at $2180.5/mt. LME lead inventories continued to grow. The contract finally closed at $2193/mt, an increase of 0.32%.
The most active SHFE 2312 lead contract prices opened at 16550 yuan/mt last evening and finally closed at 16480 yuan/mt, down 0.18%. Open interest decreased 629 lots to 65327 lots.
Zinc
SMM Zinc Morning Comment
Overnight, Minneapolis Fed President Kashkari said: The Fed will take more measures on interest rates if necessary, and the FOMC did not discuss interest rate cuts. Chicago Fed President Goolsby: If long-term Treasury yields remain at a high level, it is likely to be equivalent to tightening policy, and the first priority in changing the interest rate stance is the progress of inflation; Fed Governor Bowman: It is still expected that further interest rate increases will be needed. Dallas Fed President Logan: Inflation is still too high and the data looks to be heading towards 3% rather than 2%. Fed Governor Waller: The economy is booming in Q3, and the Fed is paying close attention to this situation. The surge in the 10-year U.S. Treasury yield is an "earthquake." Palestinian-Israeli Conflict - Defense Minister: Israeli troops have entered the core area of Gaza City; US media: Biden told Netanyahu that the three-day ceasefire pause may help to release some hostages; Prime Minister: There can be no time limit Maintain security control over Gaza. The IMF said at the press conference on China's economic assessment that due to higher-than-expected performance in the third quarter and a series of fiscal measures introduced by the Chinese government, China's GDP growth forecast this year has been raised from 5% to 5.4%, and the forecast for 2024 is 4.6%. China Customs： In dollar terms, China's total import and export value in July was $493.13 billion, a decrease of 2.5%. Exports fell by 6.4%; imports increased by 3%; the trade surplus was $56.53 billion, narrowing by 30.8%.
Tin
SMM Tin Morning Comment
The price of the most active SHFE 2312 tin contract rose fluctuated rangebound in overnight trading session, reaching a high of 212360 yuan/mt. The prices finally closed at 210100 yuan/mt last evening, up 0.63%.
During the early trading yesterday, spot quotes of various domestic tin ingot brands did not change much. Among them, the premiums of small brand tin ingots stood at a maximum of 300-600 yuan/mt, and the premiums of delivery brands ranged from 500 yuan/mt to 900 yuan/mt. Yunxi brand was quoted with premiums of 1000-1200 yuan/mt, and imported tin brand were quoted with discounts of 500-100 yuan/mt. Tin prices continued to rise yesterday, and downstream companies were less enthusiastic about buying goods. Most companies in the trading market reported that yesterday's shipments were scattered, and some trading companies still had no goods. Generally speaking, the spot market transactions were poor yesterday. The spot market showed a mixed situation yesterday afternoon, with some companies trading around 20 mt.
Nickel
SMM Nickel Morning Comment
On November 7, the most active SHFE nickel contract prices opened at 143110 yuan/mt and closed at 141450 yuan/mt, a decrease of 1390 yuan/mt from the closing price of the previous trading day. The trading volume increased by 16259 lots, and the open interest increased by 7752 lots. If prices drop overly significantly, bulls will enter the market. This, combined with the retreat of shorts, will push up nickel prices. On the macro front, after the unemployment rate data released by the Federal Reserve last Friday was lower than expected, the current weakness in the U.S. job market will provide some support for ending the process of the Federal Reserve's interest rate hike. However, yesterday's hawkish speech by Federal Reserve officials led to increased market expectations for a December Federal Reserve interest rate hike. From a fundamental perspective, the trend of pure nickel inventory accumulation remains unchanged, downstream demand has not yet improved, and spot market transactions were still weak. However, due to the positive macro sentiment, it is expected that nickel prices may rebound slightly in the future.