SMM Morning Comment For Copper Market On August 30

SHANGHAI, Aug 30 (SMM) –

LME copper prices opened at $8,428/mt on Tuesday, and hit a low of $8,363/mt, but rebounded to a high of $8,458/mt towards the closing session, and finally closed up 1.15% at $8,455/mt. Trading volumes were 14,000 lots, and open interest stood at 281,000 lots. The most-traded SHFE 2310 copper contract opened at 69,100 yuan/mt, and closed up 0.56% at 69,480 yuan/mt. Trading volume was 37,000 lots and open interest stood at 155,000 lots.

On the macro front, the Job Openings and Labor Turnover Survey (JOLTS) report released by the U.S. Department of Labor on Tuesday showed that the number of job vacancies in July was 8.827 million, a decline for the third consecutive month, unveiling easing of pressure on the labor market. The market's bets on the Fed's suspension of interest rate hikes in September increased, and they also expected that interest rate hikes in November are unlikely to unfold. Therefore, the U.S. dollar index plunged. In terms of fundamentals, premiums and discounts in East China remained stable yesterday, and copper cathode futures prices stood high, blunting buying appetites of downstream buyers. However, at the end of the month, traders were more enthusiastic about purchasing goods at low premiums. Inventory in South China declined for 9 consecutive days. There was little change in shipments and arrivals of domestic coppers. As inventory fell to a low level, spot premiums and discounts fell yesterday, and some downstream buyers who had rigid demand were forced to accept high premiums. In terms of consumption, given high copper price, downstream buyers were in a wait-and-see mood. Therefore, copper market activity appeared lukewarm. In terms of price, tightening monetary policy in the United States may witness a turning point, and copper prices will run strongly.