SMM Tin Market Morning Review (2012-11-14)

SHANGHAI, Nov. 14 (SMM) -- LME tin for delivery in three months opened at USD 20,450/mt and closed at USD 20,400/mt overnight, up by USD 50/mt from a day earlier, with the highest price at USD 20,450/mt and the lowest price at USD 20,090/mt. Daily trading volumes were 173 lots, up by 43 lots. Positions were 20,232 lots, down by 325 lots from a day earlier. LME tin inventories were down by 195 mt to 11,485 mt.

LME tin prices initially fell but later advanced. During Tuesday’s Asian trading hours, LME tin prices fell to hit a low at USD 20,090/mt but pared certain losses and closed USD 50/mt higher during the European trading hours. Greek government’s successful auction of EUR 4.06 billion of short-term debt eased market concern, boosting the euro higher.

LME base metal prices rebounded overnight on the news that the EU may provide loans to Greece. According to German Finance Minister Wolfgang, the discussion over the plan to provide three batches of loans to Greece is underway. On Tuesday, Greece successfully sold around EUR 4.1 billion short-term bond, higher than EUR 3.5 billion expected, which eased market concern that Greece may report debt default when its EUR 5 billion debt is mature on November 16th.  In addition, market expected that Spain is close to receive financial aid, which supports financial market. Although Greece has to further adopt austerity plan if it asks for financial aid, the Eurozone financial markets rallied on rumor that Spain will ask for financial help. News from the US was also relieving. The Fed Reserve Vice President Janet Yellen was strongly support that monetary policy decision should consider inflation and employment rate. Market interpreted that the Fed Reserve’s loose monetary policy shall continue to extend. It is expected that the Fed shall continue to keep loose monetary policy.

SMM expected that LME tin prices will move between USD 20,000-20,500/mt and Shanghai spot tin prices will move between RMB 147,000-149,500/mt on Wednesday.