SMM Hot Rolled Coil Daily Review: Market sentiment bolstered, spot transactions remain decent

Hot-rolled coil futures fluctuated upward throughout the day, closing at 4114, with a 3.19% increase. In terms of spot market, mainstream city prices rose by 20-60 yuan/ton. Today, speculation and demand for futures and spot market have improved compared to the previous period, with end users still mainly purchasing on demand. This week, some steel mills in East China and North China conducted maintenance on their rolling equipment, leading to a decrease in hot-rolled coil production. On the raw material side, there are expectations of three rounds of coke delivery, coupled with limited supply at the ore end, making it unlikely for significant cost support to loosen in the short term. However, vigilance against the reappearance of high-level price regulation risk is needed. Overall, the supply and demand pattern of hot-rolled coils remains stable at present, with the manufacturing industry showing improvement, making it not difficult to continue the de-stocking pace in the short term. However, there is a risk that subsequent supply may continue to remain high, and vigilance is needed against the possibility of demand not being able to sustain. Currently, coil prices mainly revolve around changes in raw material prices, and it may continue to fluctuate in the short term until cost support collapses and macro expectations are realized.