SMM Nickel Market Morning Review (2013-6-21)-Shanghai Metals Market

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SMM Nickel Market Morning Review (2013-6-21)

Price Review & Forecast 09:48:45AM Jun 21, 2013 Source:SMM

SHANGHAI, Jun. 21 (SMM) – LME nickel prices overnight opened at USD 14,100/mt, with the high end of the price range USD 14,100/mt, and finding support at USD 13,700/mt. Finally, LME nickel prices closed at USD 13,703/mt, down USD 532/mt from the previous trading day. Trading volumes increased by 1,647 lots, to 4,245 lots, and total positions increased by 869 lots, to 118,217 lots. Inventories fell by 174 mt, to 185,514 mt.

LME nickel prices overnight opened at USD 14,100/mt. As the US Federal Reserve (Fed) confirmed it will scale back QE3, LME nickel prices plummeted. Besides, the disappointing HSBC's June PMI for China distressed the market, so LME nickel prices plunged throughout the day and finally closed at USD 13,703/mt, down USD 532/mt.

The Fed signaled that it may cut stimulus policy later this year, triggering market concerns. The market expects the Fed will likely cut USD 20 billion in monthly assets purchasing in September. The Dow Jones Industrial Average dropped by the most since 2012 US general election (November 6), and US Markit June PMI fell to 52.2, while the figure was expected to rise to 52.5, compared to the final of 52.3 in May. New export orders shrank for the second consecutive month, with overseas demand the weakest since October 2012; the number of US initial jobless claims for the week ending June 15 was 354,000, higher than both expectations and the previous month, weighing down base metals prices. But existing home sales rose 4.2% in May, much higher than the previous month and the forecast. US 10-year government bond yields rose by 11 basis points, to 2.425%, the highest since August 2011.

HSBC/Markit released June 20 that China's initial June PMI fell to 48.3, compared to the final of 49.2 in the previous month, with new order index hitting a record low in 10 months, down from 49.5 in the previous month, to 47.1. Meanwhile, output price index shrank for the first time in eight months, with job subitem index and new export order index below 50 for the third consecutive month, falling further from May. That shows the manufacturing lacked momentum to recovery due to sluggish domestic and overseas demand. The final China's June PMI from HSBC/Markit and official data will be released on July 1, which are pessimistic, and will continue to weigh on commodity prices. Coupled with surging overnight inter-bank offered rate, the Shanghai Composite Index closed at 2,084.02, down 59.43 or 2.77%; Shanghai base metals prices closed with declines, with copper falling the most by RMB 1,070/mt.

Euro zone June initial PMI rose to 48.7, a record high in one and a half years (since February 2012), while the figure was expected to rise to 48.6, and the final data in May was 48.3, a new high in 15 months; Germany's initial Markit/BME PMI in June fell to 48.7, below expectations of 49.8, and also lower than the minimum estimated of 49.0, with the final data of 49.4 in May. That reflected euro zone will not come out of recession in Q2.
LME base metals prices plummeted; the US dollar index rose by 0.6%; the Dow Jones Industrial Average plunged by 2.34%; Comex gold prices closed down 6.4%, at USD 1,286.20/oz, the lowest closing price in three years.

LME nickel prices will move between USD 13,500-14,000/mt today, and spot nickel prices in Shanghai are expected to fall to RMB 96,000-98,000/mt.
 

Key Words:  LME nickel prices 

SMM Nickel Market Morning Review (2013-6-21)

Price Review & Forecast 09:48:45AM Jun 21, 2013 Source:SMM

SHANGHAI, Jun. 21 (SMM) – LME nickel prices overnight opened at USD 14,100/mt, with the high end of the price range USD 14,100/mt, and finding support at USD 13,700/mt. Finally, LME nickel prices closed at USD 13,703/mt, down USD 532/mt from the previous trading day. Trading volumes increased by 1,647 lots, to 4,245 lots, and total positions increased by 869 lots, to 118,217 lots. Inventories fell by 174 mt, to 185,514 mt.

LME nickel prices overnight opened at USD 14,100/mt. As the US Federal Reserve (Fed) confirmed it will scale back QE3, LME nickel prices plummeted. Besides, the disappointing HSBC's June PMI for China distressed the market, so LME nickel prices plunged throughout the day and finally closed at USD 13,703/mt, down USD 532/mt.

The Fed signaled that it may cut stimulus policy later this year, triggering market concerns. The market expects the Fed will likely cut USD 20 billion in monthly assets purchasing in September. The Dow Jones Industrial Average dropped by the most since 2012 US general election (November 6), and US Markit June PMI fell to 52.2, while the figure was expected to rise to 52.5, compared to the final of 52.3 in May. New export orders shrank for the second consecutive month, with overseas demand the weakest since October 2012; the number of US initial jobless claims for the week ending June 15 was 354,000, higher than both expectations and the previous month, weighing down base metals prices. But existing home sales rose 4.2% in May, much higher than the previous month and the forecast. US 10-year government bond yields rose by 11 basis points, to 2.425%, the highest since August 2011.

HSBC/Markit released June 20 that China's initial June PMI fell to 48.3, compared to the final of 49.2 in the previous month, with new order index hitting a record low in 10 months, down from 49.5 in the previous month, to 47.1. Meanwhile, output price index shrank for the first time in eight months, with job subitem index and new export order index below 50 for the third consecutive month, falling further from May. That shows the manufacturing lacked momentum to recovery due to sluggish domestic and overseas demand. The final China's June PMI from HSBC/Markit and official data will be released on July 1, which are pessimistic, and will continue to weigh on commodity prices. Coupled with surging overnight inter-bank offered rate, the Shanghai Composite Index closed at 2,084.02, down 59.43 or 2.77%; Shanghai base metals prices closed with declines, with copper falling the most by RMB 1,070/mt.

Euro zone June initial PMI rose to 48.7, a record high in one and a half years (since February 2012), while the figure was expected to rise to 48.6, and the final data in May was 48.3, a new high in 15 months; Germany's initial Markit/BME PMI in June fell to 48.7, below expectations of 49.8, and also lower than the minimum estimated of 49.0, with the final data of 49.4 in May. That reflected euro zone will not come out of recession in Q2.
LME base metals prices plummeted; the US dollar index rose by 0.6%; the Dow Jones Industrial Average plunged by 2.34%; Comex gold prices closed down 6.4%, at USD 1,286.20/oz, the lowest closing price in three years.

LME nickel prices will move between USD 13,500-14,000/mt today, and spot nickel prices in Shanghai are expected to fall to RMB 96,000-98,000/mt.
 

Key Words:  LME nickel prices