SHANGHAI, Aug. 9 (SMM) -- LME tin for delivery in three months opened at USD 24,150/mt and closed at USD 22,750/mt overnight, down by USD 1,750/mt from a day earlier, with the highest price at USD 24,150/mt and the lowest price at USD 22,400/mt. Daily trading volumes were 620 lots, down by 255 lots. Positions were 20,270 lots, up by 214 lots from a day earlier. LME tin inventories were up by 125 mt to 22,600 mt.
Standard and Poor’s downgrade adjustment of the US credit rating as well as possibility that the rating agency may cut down US credit rating further triggered slumps in the US equity markets. In this context, LME tin prices continued to plunge. LME tin prices tumbled to hit a low of USD 22,400/mt after opening at USD 21,000/mt. Later, LME tin prices pared certain losses, but plummeted to close at USD 22,750/mt, down by 7.1% from a day earlier, due to slumps in US equity market overnight.
The US equity market tumbled on Monday, with three major equity indexes down by 5%. Panic sentiment triggers sell-offs of risk assets, with the euro falling sharply and the US dollar advancing slightly. Concern over global economic recovery continued to weigh down on oil prices, while gold price hit at historical high and stood above USD 1,700/ounce due to risk aversion sentiment.
In the short term, market shall continue to be haunted by concern over the US debt issue and global economy recovery, and risk aversion sentiment will dominate market. LME tin prices fell sharply to USD 22,100/mt after a low open at USD 22,490/mt on Tuesday. Panic sentiment does not dissipate, so LME tin prices will continue to be weighed on Tuesday. A technical correction is possible for LME tin prices after plunging for several days and decline in LME tin prices may slow down to certain extent, but LME tin prices will continue to extent downward momentum in the short term. In Shanghai tin spot market, tight supply of spot tin will restrict prices to fall further, and SMM expects spot tin prices will fall to around RMB 193,000/mt on Tuesday.