SMM Evening Comments (Feb 10): Shanghai Nonferrous Metals Closed Mostly with Losses on Mixed Macro Front

SHANGHAI, Feb 10 (SMM) – Shanghai nonferrous metals closed mixed in day trading. On the macro front, another Fed official sent hawkish signal, but the US dollar index dropped slightly overnight as inflation is believed to have peaked. In addition, China's January PPI fell and CPI rose.

SHFE copper edged down 0.09%, aluminium fell 1.66%, lead grew 0.98%, zinc lost 0.36%, tin dropped 0.63%, and nickel gained 3.86%.

Copper: The most-traded SHFE 2303 copper closed down 0.09% or 60 yuan/mt at 68,420 yuan/mt, with open interest down 2,604 lots to 152,323 lots.

The spot quotations rose from discounts to premiums today as downstream players restocked appropriately.

Aluminium: The most-traded SHFE 2303 aluminium closed down 1.66% or 315 yuan/mt at 18,630 yuan/mt, with open interest down 10,132 lots to 174,921 lots.

From the perspective of the supply side, smelters in Yunnan are subject to power rationing. Transactions in the spot market have become increasingly active as downstream purchases have begun to pick up, forming support for aluminium prices. However, the inventory of aluminium ingots is still in a state of accumulation, with no obvious sign of inflection point. Therefore, aluminium prices are expected to remain in a narrow range.

Lead: The most-traded SHFE 2303 lead closed up 0.98% or 150 yuan/mt at 15,395 yuan/mt, with open interest down 7,928 lots to 59,898 lots.

The cargo holders were active in making shipments, and the discounts expanded from yesterday. The downstream players still purchased on rigid demand, while a few players and traders favoured sources with large discounts. But the actual transactions were still limited.

Zinc: The most-traded SHFE 2303 zinc closed down 0.36% or 85 yuan/mt at 23,240 yuan/mt, with open interest down 2,007 lots to 82,346 lots.

SHFE zinc dropped today, which boosted market inquiries, but the downstream players were still not active in purchasing. Nonetheless, the overall market transactions picked up slightly.

Tin: The most-traded SHFE 2303 tin closed down 0.63% or 1,380 yuan/mt at 217,460 yuan/mt, with open interest up 13,919 lots to 50,156 lots.

In the spot market, some smelters quoted as usual, while some stood on the sidelines. But the spot transactions were relatively poor according to the traders.

Nickel: The most-traded SHFE 2303 nickel closed up 3.86% or 8,120 yuan/mt at 218,560 yuan/mt, with open interest up 11,690 lots to 74,862 lots.

In the spot market, Jinchuan nickel was in premiums of 6,500-7,000 yuan/mt, with an average of 6,750 yuan/mt, down 50 yuan/mt on a daily basis. NORNICKEL nickel was in premiums of 5,500-6,000 yuan/mt, with an average of 5,750 yuan/mt, down 200 yuan/mt from the previous trading day. SHFE nickel remained high in morning trade boosted by the news front, and market inquiries and transactions were both weak. For nickel briquette, the prices stood between 221,000-221,500 yuan/mt, up 6,750 yuan/mt from a day ago.

[Disclaimer: The above representation and data is based on market information SMM believes to be reliable at the time of acquiring as well as the comprehensive assessment by SMM research team, and any and all information provided in this article is for reference only. This article does not constitute a direct recommendation for investment or any decisions in any form and clients shall act on their own discreet and any decisions made by clients are not within the responsibility of SMM.]