SMM Daily Review - 2012/6/25 Nickel Market-Shanghai Metals Market

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SMM Daily Review - 2012/6/25 Nickel Market

SMM Insight 10:08:21AM Jun 26, 2012 Source:SMM

SHANGHAI, Jun. 26 (SMM) -- On Monday, mainstream prices of Jinchuan nickel were between RMB 122,500-122,800/mt, while mainstream Russian nickel prices were between RMB 119,800-122,700/mt. Transactions improved in the morning session due to the need to replenish stocks post the Dragon Boat Festival at lower prices, pushing up prices of Jinchuan nickel to RMB 128,000-130,000/mt. But as LME nickel prices continued to fall in the afternoon, spot quotes were lowered, with traders unwilling to sell goods. As a result, transactions were extremely quiet in the afternoon.

40% market players believe LME nickel prices will continue to fall this week. As hopes of QE3 implementation fade, the likelihood that the US Federal Reserve will release massive liquidity in the short term decreased, with risk aversion prevailing in the market. In this context, the US dollar index will not fall. LME nickel prices should meet resistance. As the seasonal high demand period for electricity and the seasonal low demand period for stainless steel near, many private stainless steel plants begin to conduct maintenance, causing downstream demand for nickel to fall.

40% of investors believe LME nickel prices should remain fluctuating and be subject to the result of the EU summit taking place on June 28th. The EU summit will further discuss issues including eurozone fiscal integration, European banking sector union and government bond purchasing. There might be good news reported to boost the market.

The remaining 20% believe LME nickel prices should rise. Italy and Spain will issue government bonds on Tuesday, and government bond yields of the two countries fell previously. As European leaders agreed to push EUR 130 billion of stimulus plan, government bonds yields of the two countries are expected to fall further, and resistance of LME nickel prices should ease.
 

SMM Daily Review - 2012/6/25 Nickel Market

SMM Insight 10:08:21AM Jun 26, 2012 Source:SMM

SHANGHAI, Jun. 26 (SMM) -- On Monday, mainstream prices of Jinchuan nickel were between RMB 122,500-122,800/mt, while mainstream Russian nickel prices were between RMB 119,800-122,700/mt. Transactions improved in the morning session due to the need to replenish stocks post the Dragon Boat Festival at lower prices, pushing up prices of Jinchuan nickel to RMB 128,000-130,000/mt. But as LME nickel prices continued to fall in the afternoon, spot quotes were lowered, with traders unwilling to sell goods. As a result, transactions were extremely quiet in the afternoon.

40% market players believe LME nickel prices will continue to fall this week. As hopes of QE3 implementation fade, the likelihood that the US Federal Reserve will release massive liquidity in the short term decreased, with risk aversion prevailing in the market. In this context, the US dollar index will not fall. LME nickel prices should meet resistance. As the seasonal high demand period for electricity and the seasonal low demand period for stainless steel near, many private stainless steel plants begin to conduct maintenance, causing downstream demand for nickel to fall.

40% of investors believe LME nickel prices should remain fluctuating and be subject to the result of the EU summit taking place on June 28th. The EU summit will further discuss issues including eurozone fiscal integration, European banking sector union and government bond purchasing. There might be good news reported to boost the market.

The remaining 20% believe LME nickel prices should rise. Italy and Spain will issue government bonds on Tuesday, and government bond yields of the two countries fell previously. As European leaders agreed to push EUR 130 billion of stimulus plan, government bonds yields of the two countries are expected to fall further, and resistance of LME nickel prices should ease.