SMM Morning Comments (Jan 2)

Published: Jan 2, 2018 09:41

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SHANGHAI, Jan 2 (SMM)－

Copper: LME copper is set to see a correction following 15 consecutive days of increase and bulls taking profits. While it is expected to trade at $7,180-7,320/mt today, the SHFE 1803 copper is expected to trade at 55,200-56,000 yuan/mt. Trading liquidity in the spot market is set to recover and we see discounts at 220-150 yuan/mt today.

Aluminium: LME aluminium set a new high before the New Year holiday with increased volatility. We expect the contract to trade at $2,260-2,295/mt today and the SHFE aluminium at 15,250-15,500 yuan/mt. Spot discounts are to move at 370-330 yuan/mt.

Zinc: While lower zinc inventory at LME has supported the prices, funds entered the market despite holiday risk sent the contract up to $3,326/mt. Today it is expected to trade at $3,290-3,335/mt and drive SHFE zinc to 25,500-26,000 yuan/mt today. However, we see limited increase for the domestic contract due to lacklustre fundamentals.

Nickel: LME nickel is expected to trade in a narrow range at high level today with the SHFE 1805 contract at 97,600-99,800 yuan/mt. Spot price is seen at 97,100-99,200 yuan/mt.

Tin: LME tin would test the support at $20,000/mt with upper pressure at $20,200/mt. SHFE tin, on the other hand, sees upper pressure at 146,000 yuan/mt and trading range at 144,000-146,000 yuan/mt. Spot prices are supported by futures both at home and abroad and set to trade at 140,000-142,500 yuan/mt today.

Lead: SHFE lead are in stalemate with rather balanced market forces from both sides. It will keep rangebound in the near term.

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Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM's internal database model. They are for reference only and do not constitute decision-making recommendations.

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