SMM Tin Market Morning Review (2013-2-1)

SHANGHAI, Jul. 1 (SMM) -- LME tin for delivery in three months opened at USD 24,964/mt and closed at USD 24,825/mt overnight, down by USD 76/mt from a day earlier, with the highest price at USD 25,115/mt and the lowest price at USD 24,747/mt. Daily trading volumes were 475 lots, down by 115 lots. Positions were 23,365 lots, up by 470 lots from a day earlier. LME tin inventories were 13,420 mt, up 185 mt from a day earlier.

LME tin prices largely fluctuated around USD 25,000/mt but fell to hit a low at USD 24,747/mt at the tail of the trading. Finally, LME tin prices closed at USD 24,825/mt, down USD 76/mt from a day earlier.

In the euro zone, the Germany’s seasonally-adjusted unemployment data unexpectedly fell to 16,000 in January, dragging down unemployment rate to 6.8%, below market expectation of an increase by 8,000, showing improvement in Germany’s employment condition. However, Germany’s retail sales for December fell to 4.7%, down 1.7% MoM, the largest decline since May 2011.

In the US, monthly rate of the US personal income for December rose to 2.6%, the highest since December 2004, suggesting that consumer spending will continue to support the US economy recovery. Moreover, the US Chicago PMI for January rose to 55.6, higher than 50.5 expected, and the highest since April 2012.The negative news is the rebound in initial jobless claim to 368,000, high than 350,000 expected.

In China, China’s central bank totally injected RMB 59 billion net liquidity into market through 7-day reverse purchase operation in order to ease cash flow pressure.

The US dollar index closed flat, while the European equity market slightly fell. Base metal prices largely fell overnight.

Market focus has shifted to PMI from major economies and the US nonfarm employment data to be released on Friday night.

SMM expects LME tin prices will meet resistance at USD 25,250/mt and Shanghai spot tin prices will slightly advance to RMB 159,000-161,000/mt due to reduced supply of low-priced goods.