SHANGHAI, Feb. 6 (SMM) – With LME copper giving up some of increases overnight, SHFE 1305 copper contract, the most active one, opened RMB 340/mt down at RMB 59,710/mt Tuesday. The contract hovered around the daily moving average of RMB 59,850/mt following the opening, with a fluctuating band of merely RMB 300/mt. In the afternoon, as Chinese stock markets increased, SHFE copper prices challenged resistance at RMB 60,000/mt, but then suffered pressure at RMB 60,030/mt after long investors took profit-taking. Testing a low at RMB 59,700/mt, SHFE 1305 copper contract finally settled RMB 300/mt or 0.5% lower at RMB 59,750/mt, with trading volumes down 30,998 lots but positions up 370 lots. Long and short investors were wary of copper price corrections now that the resistance level at RMB 60,000/mt still can not be neglected.
SHFE copper prices slipped slightly, but spot copper cargo-holders took the last chance to sell goods ahead of the Chinese New Year holiday, leading copper discounts to expand to negative RMB 140-280/mt in the morning business. Traded prices for standard-quality copper were between RMB 58,800-58,850/mt, and RMB 58,870-58,950/mt for high-quality copper. Cargo-holders of standard-quality copper became reluctant to insist on firm prices, so the price gap between standard and high-quality copper widened. Nevertheless, spot copper supply decreased after cargo-holders became less eager to move goods, which helped copper discounts shrink. More traders and downstream producers opted to exit from markets, turning market activity more lackluster in the morning. In the afternoon, as SHFE copper prices came under pressure with SHFE forward copper contracts seeing larger declines, spot copper cargo-holders expanded discounts to negative 200-300/mt. Traded prices were RMB 58,750-58,900/mt in the afternoon, but market transactions remained limited.