Metals Continue Fluctuation, Wait for Direction

SHANGHAI, Aug. 29 (SMM) – Metals were on continuous fluctuation today after the market was disappointed by Bernanke remarks which did not provide any signal for further stimulation.

According to Bernanke, president of US Fed, no economic stimulating measures were needed at the time. His remarks were met with quiet response by both exchange rates and stock markets, indicating market worries towards panic-generating moves were completely relieved. Whereas in China, after its central bank extended reserve requirements to margin deposits, another over RMB 900 billion will be frozen, thereby causing bearish sentiment for various sectors of China economy, including banks, stocks and commodities.

Though overseas market sentiment improved and domestic investor appetite relatively stabilized, the news to add margin to denominator of reserve ratio will pose certain pressure for domestic markets. Given highly cautious sentiment in base metals markets at the moment, SMM expects these metals to continue fluctuation this week.