SHANGHAI, Jan. 4 (SMM) –LME tin for delivery in three months opened at USD 24,249/mt and closed at USD 23,975/mt, down USD 125/mt from a day earlier, with intraday high at USD 24,500/mt and the low at USD 23,975/mt.Daily trading volumes were 318 lots, down 354 lots. Positions were 21,905 lots, down 125 lots. LME tin inventories were 12,675 mt, down 125 mt from a day earlier.
The two parities in the US finally reached an agreement on fiscal cliff negotiation during the g LME New Year holiday, sending LME tin prices to hit a high at USD 24,510/mt. However, base metal prices later fell to close at USD 23,975/mt, down USD 125/mt from a day earlier as positive impact from fiscal cliff talk was absorbed by market.
House of Representatives and Senate finally reached an agreement and averted fiscal cliff. The agreement includes raising tax for the rich, extending unemployment benefit and postponing large-scale expenditure cutting by two months. The agreement fueled risk appetite, boosting stock, crude oil and fund prices to rise both at home and abroad. However, another negotiation on cutting government spending and raising upper limit of debt will begin, which will continue to affected international financial market.
On the macroeconomic data, the US ISM manufacturing PMI for December rose from 49.5% in November to 50.7% in December. ADP employment payrolls for December rose by 215,000, better than 140,000 expected. However, last week’s initial jobless claim totaled 372,000, higher than 360,000 expected, and the previous reading was adjusted from 350,000 to 362,000. The Eurozone manufacturing PMI for December totally 46.1, lower than previous reading. China’s manufacturing PMI for December was 50.6, flat from a month earlier and the third consecutive month above 50. Non-manufacturing activity index was 56.1%, up 0.5 percentage point, and the third consecutive month recording increase.
Market focus has shifted to the US non-farm employment data. As the ADP employment payrolls and ISM manufacturing index were both upbeat, market expects that non-farm employment data will be also positive. SMM expects that LME tin prices will move around USD 24,000/mt, and Shanghai tin spot prices will move between RMB 152,500-155,000/mt on Friday.