SHANGHAI, Jan. 17 (SMM) -- LME tin for delivery in three months opened at USD 24,901/mt and closed at USD 24,995/mt overnight, up by USD 65/mt from a day earlier, with the highest price at USD 25,000/mt and the lowest price at USD 24,761/mt. Daily trading volumes were 203 lots, down 104 lots. Positions were 23,008 lots, up by 110 lots from a day earlier. LME tin inventories were 12,800 mt, up 50 mt from a day earlier.
LME tin prices initially fell to hit a low of USD 24,761/mt, but later pared early losses and closed USD 65/mt higher at USD 24,995/mt, the only base metal closing with gains overnight. It is expected market sentiment will remain cautiously before release of significant economic data from China.
The US industrial output for December rose 0.3%, flat with expectation and higher than 1.0% recorded a month earlier. The capacity utilization rate for December was 78.8%, higher than 78.5% expected and previous reading of 78.7%. The industrial output rose the highest since June 2008, suggesting that the US economy is expanding moderately. Affected by price decline of crude oil, the US CPI for December was flat from a on a monthly basis, but fell on a yearly basis. Previously, the Fed Reserve announced in December 2012 to try to keep interest rate at 6.5% and inflationary rate at 2.5%. The lower than expected CPI in December 2013 suggests that the US will continue to keep low interest rate unchanged. In addition, the US net capital inflow for November was USD 27.8 billion. The USD net government bond for November was USD 26.4, while the previous reading for October was revised into USD 12 billion. At present, China is still the largest purchaser of the US government bond. In the euro zone, the core CPI for December rose 0.5%, and the previous reading was down 0.2%, suggesting that the consumption in the euro zone recovered.
In China, the Ministry of Commerce announced on January 16th, number of newly-approved foreign companies was 24,925, down 10.1%. Utilized foreign capital was USD 111.72 billion, down 3.7% YoY. The foreign investors in China have some new features. First, proportion of service companies outnumbered manufacture companies. Second, foreign capital growth in central China is faster than that in regions.
On the earnings front, most base metals closed with losses. The US dollar rose by 0.17%. The S&P 500 index closed 0.29 points higher.
Concern over economic growth continues to weigh market, and market will remain cautious before economic data from China. SMM expects that LME tin prices will find support at 5-day moving average and will meet resistance at USD 25,000/mt.In spot market, Shanghai tin spot prices will move in the RMB 160,000-162,500/mt range on Thursday.