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SMM Copper Market Morning Review (2013-11-29)
Nov 29,2013 09:43CST
price review forecast
Three-month copper on the London Metal Exchange was range-bound due to thin trading during the Thanksgiving Day and closed at USD 7,029/mt.

SHANGHAI, Nov. 29 (SMM) – Three-month copper on the London Metal Exchange was range-bound due to thin trading during the Thanksgiving Day and closed at USD 7,029/mt. 

The euro rose on encouraging European economic figures. The euro zone’s economic sentiment index jumped to its highest level at -15.4 in November and business confidence index also hit its record high since September 2011 at 0.18. Germany’s Consumer Price Index (CPI) accelerated to 1.3% in November on an annual basis and its Harmonised Index of Consumer Prices (HICP) also rallied to 1.6%, both exceeding expectations. These data eased worries over deflation risks in the euro zone and bolstered the euro. However, lending to the private sector in the euro zone dropped 2.1% YoY in October, while M3 grew 1.4% YoY, both below forecasts and previous readings. This, combined with a contraction in the bloc’s GDP and falling inflation rate, may probably prompt the European Central Bank (ECB) to further loosen its monetary policy.  

In China, above-scale industrial enterprises posted RMB 4.63 trillion in profits throughout the first ten months of this year, up 13.7% YoY, with the growth rate up 0.2 percentage point from the January-September period. However, the year-on-year growth in October was down 3.3 percentage points from September to 15.1%. The People’s Bank of China (PBOC) launched 19 billion worth of 14-day reverse repurchase operation on Thursday, leaving a net injection of RMB 17 billion into the open market this week, markedly down from the RMB 59 billion recorded a week ago.  

US stock markets were closed for the Thanksgiving Day holiday. European stocks generally closed with gains. All base metals on the LME nudged up, except aluminum. 

Market caution will cause LME copper to move in a tight range of USD 7,000-7,060/mt during Friday’s Asian trading hours. The Shanghai Composite Index will edge higher. SHFE 1402 copper contract will fluctuate between RMB 50,300-50,800/mt. In spot markets, cargo holders will remain anxious to sell against tight cash on the last trading day of the month, with a discount of RMB 0-20/mt and a premium of RMB 0-60/mt expected over SHFE 1312 copper contracts.


LME copper
SHFE copper

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