SMM Morning Review – 2012/4/5 Lead Market

Shanghai, Apr. 5 (SMM) – LME lead market overnight opened at USD 2,065/mt, but later the US dollar index rallied strongly, along with the disappointing auction sales of Spain’s bonds, and the Federal Reserve’s meeting minutes, which again dented market expectations for QE3. As a result, LME lead market lost all gains made during the Qingming Festival holiday. Finally, LME lead prices finished at USD 1,992.8/mt, down USD 78.3/mt or 3.78%. Transactions were up 1,705 lots to 4,863 lots, while positions fell 838 lots to 125,000 lots. LME lead inventories were 374,300 mt, down by 2000 mt.

In neighboring markets, the US dollar surged to close at 79.72. COMEX silver futures for May delivery ended at USD 31/oz, a drop of cents 226 or 6.8%.

Market focus is now on the US non-farm employment data due on Friday. On Thursday, SHFE lead market will continue to be affected by movements in domestic stocks market, with prices expected to move between RMB 15,400-15,650/mt. Domestic spot lead prices are showing more resilience to declines, and will hover in the RMB 15,500-15,650/mt range.