Home / Metal News / Nickel / SMM Copper Market Morning Review (2013-2-8)
SMM Copper Market Morning Review (2013-2-8)
Feb 8,2013 09:30CST
price review forecast
LME copper prices will move between USD 8,200-8,270/mt during Friday's Asian trading session, and SHFE 1305 copper contract will hover in the RMB 59,400-59,900/mt range.

SHANGHAI, Feb. 8 (SMM) – The US economic figures came in softer than anticipated on Thursday, with the initial jobless claims increasing to 366,000 last week, compared with the expected 360,000. Besides, the result of the ECB policy meeting was also in line with market expectation as the central bank announced to keep the interest rate of 0.75% unchanged for a seventh straight month. The ECB President Mario Draghi said at the press conference following the meeting that the European economy should recover later this year, thanks to no inflation risk which enables the bank to maintain its exceptionally low interest rate. However, he pointed out that European economic recovery still faces risks while seeing signs of improving, and held the view that recent appreciation in the euro is one of the factors restricting inflation. Draghi added that the ECB will monitor the impact of a strengthening euro on the euro zone's economy. In this context, the euro tumbled by over 1% to the lowest level in recent two months, while US equity markets closed down across the board. LME copper prices tested a trough at USD 8,190/mt as a consequence, and finally settled USD 25/mt lower at USD 8,210/mt. Nevertheless, LME copper still exhibited more resilience than the euro, so investors should not be over bearish over copper prices in the short term. 

Draghi's comments are likely to depress movements of the euro over the short term, and can not give support to copper prices. But markets are generally upbeat about the upcoming Chinese CPI and PPI data releases. As such, LME copper prices will probably rally and move between USD 8,200-8,270/mt during Friday's Asian trading session. Chinese A-shares will likely rebound during the last trading day before the Chinese New Year holiday. SHFE copper prices will test support at the 10-day moving average after starting marginally down, and may easily experience large fluctuations if speculative activity appears. SHFE 1305 copper contract will hover in the RMB 59,400-59,900/mt range. Shanghai spot copper offers are estimated between discounts RMB 80/mt and premiums RMB 20/mt versus SHFE 1302 copper contract.


LME copper prices
SHFE copper prices
US economic data
US initial jobless claims
Mario Draghi comments
ECM interest rate meeting
Chinese A-shares

For queries, please contact Frank LIU at liuxiaolei@smm.cn

For more information on how to access our research reports, please email service.en@smm.cn

Related news