SHANGHAI, Nov. 27 (SMM) – LME lead price overnight opened at USD 2,090/mt and consolidated narrowly below the opening mark in Asian trading hours, due to the lack of major news. Buoyed by a resurgent euro and encouraging US housing activity, LME lead edged up to close USD 7/mt or 0.34% higher at USD 2,095.5/mt in European and the US trading session. LME lead outperformed other base metals to end with gains, but failed to push through the USD 2,100/mt mark,on soft movements of other base metals. LME lead is expected to consolidate weakly on Wednesday, as capital is flowing out of the market ahead of the US Thanksgiving holiday.
The US October building permits surged to 1.034 million units on an annualized basis, the highest level since June 2008, while the S&P/Case-Shiller home price index rose at an annualized rate of 13.3% in September from a year earlier, above forecasts for an increase of 13% and August’s 12.8%. However, the US consumer confidence dropped to a seven-month low of 70.4 in November, showing that Americans are concerned over future job and earning prospects. As a result, these economic data weighed down on metals market.
Administrative approval procedures for QDII and QFII qualification and quota will be cancelled "when conditions are ripe," Zhou Xiaochuan, governor of the People's Bank of China (PBOC), said Tuesday. Reforms to accelerate convertibility of RMB under capital accounts and further liberalize interest rates, deposit rates in particular, are being considered, Zhou added. The PBOC is willing to buy more government bonds of the euro zone to help the region recover, said Zhou, strengthening the euro.
Minutes from the Central Bank of Japan’s October meeting showed that opinions were divided towards the introduction of the aggressive monetary stimulus policy. Three out of nine committee members disagreed with the bank’s bullish expectations of Japan’s economy and consumer prices.
European and the US stock markets were mixed with the US shares rising in a slower pace, while the Nasdaq Composite Index finished above 4,000 for the first time in 13 years. LME base metals, except LME lead, recorded some losses.
Metals markets will be subdued on Wednesday, dragged down by the downbeat US consumer confidence on Tuesday, while lead prices are expected to stage a strong performance. LME lead price is expected to fluctuate between USD 2,085-2,105/mt, while the most-traded SHFE lead price is forecast to move between RMB 13,900-14,000/mt. In China’s spot lead market, traded prices will hold flat at RMB 13,850-13,950/mt on Wednesday.