Spot market transactions were sluggish before the National Day holiday, with only rigid demand; Further attention is needed on the transmission of favorable policies [SMM Lead Morning Comment]

Last Friday night, LME lead opened at $2,135.5/mt. During the Asian session, it rose slightly to a high of $2,142.5/mt and then consolidated. In the European session, it was pressured by the daily moving average, fluctuating downward to a low of $2,107.5/mt, and finally closed at $2,111.5/mt, down $25.5/mt, a decrease of 1.19%.

Last Friday night, the most-traded SHFE lead 2411 contract opened at 16,855 yuan/mt. After opening, it fluctuated upward to a high of 16,990 yuan/mt, then fell under pressure to a low of 16,815 yuan/mt, and finally closed at 16,795 yuan/mt, down 70 yuan/mt, a decrease of 0.41%.

Macro side, China's economic stimulus policies were intensively introduced, along with RRR cuts and interest rate cuts by the PBoC, leading to sustained positive sentiment. In the lead market, further attention is needed on the transmission of policies such as the trade-in of electric vehicles and actual market consumption changes. Due to the National Day holiday, there was only one trading day for SHFE lead this week, and downstream restocking has ended, with spot transactions likely limited to nearby purchases for rigid demand. According to the SMM survey, during the National Day holiday, many downstream enterprises plan to take a break, while lead smelters will mostly maintain normal production. The risk of inventory accumulation in the lead market is high after the holiday, with few pre-sales during the holiday. Post-holiday market changes are more closely watched. After the release of favorable macro sentiment, lead prices may return to fundamentals.