SHANGHAI, Apr.1 (SMM) --
1. The dollar index fell back from recent highs and ended last week at 82, but should boost metal prices.
2. LME nickel prices are expected to find strong support between USD 16,500-16,600/mt and should not move lower unless additional negative news is announced.
1. Recent US jobless claims totaled 357,000, higher than market expectations of 340,000 and a new 4-month high. US 4Q GDP was low at 0.4% and below the expected 0.5%. Weaker-than-expected US economic data, combined with the bearish sentiment, will depress market confidence.
2. Chinese banking A-shares suffered a heavy blow on March 28th from new rules issued by China’s Banking Regulatory Commission (CBRC), which asked major commercial banks to closely monitor wealth management products.
3. Bearish news continues to dominate the euro zone, including the Cyprus’s bailout plan and political turmoil in Italy. Economic results in the region remain sluggish with German unemployment growing by 13,000 and in contrast to the expected drop of 2,000.
Generally speaking, the bearish sentiment is keeping LME nickel market prices weak. Strong support is found at the low end, which should limit near-term price declines.
Domestic stainless steel markets in China remain weak. Sluggish consumption in spot markets and weak LME nickel prices are dampening market confidence and cutting demand for stock replenishments, even at low-end prices. In addition, due to the upcoming Qingming Festival in China later in the coming week, domestic spot trading is expected to be thin.