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SMM Copper Market Morning Review (2014-4-15)
Apr 15,2014 09:24CST
price review forecast
On Monday, the Ukraine crisis continued to escalate, with EU announcing to expand sanctions on Russia, fueling market concerns.

SHANGHAI, Apr. 15 (SMM) – On Monday, the Ukraine crisis continued to escalate, with EU announcing to expand sanctions on Russia, fueling market concerns. The US retail sales posted its biggest rise since September 2012 in March, driving up both the US dollar index and US stock prices. LME copper prices closed at USD 6,657/mt with no clear direction. Traded volumes for LME copper fell below 10,000 lots, but positions increased 8,208 lots, with total positions exceeding 310,000 lots.

SHFE 1407 started at RMB 46,790/mt during night trading of Monday, and moved in a narrow range. The prices met resistance at RMB 46,840/mt before closing the session at RMB 46,730/mt, up RMB 40/mt. Traded volumes for the most active contract during night session fell to about 160,000 lots, while positions increased by 2,050 lots.

Ukraine's acting president said Monday he was not opposed to a countrywide referendum on possibly granting regions greater autonomy. However, European countries and the US remained tough and agreed that the third round of sanction may possible be imposed on Russia. With the Ukraine crisis further intensified, market worried the sanctions imposed on Russia may affect its exports, which drove up prices for commodities, including wheat, natural gas, and nickel.

As for economic data, the US retail sales were reported up 1.1% on the month in March, its biggest gain since September 2012 and exceeding the 0.9% forecast, gaining steam primarily from the auto industry. Automobile and auto parts sales also staged the largest growth last seen in September 2012. The Citigroup reported its seasonally-adjusted earning per share at USD 1.3 during the first quarter, higher than the USD 1.14 expected, boosting stocks. The euro zone February factory output matched forecast by rising 0.2% MoM, with January’s data revised from a 0.2% decline to a 1.6% growth.

European and US shares increased across the board. On the London Metal Exchange, lead, zinc and nickel showed strong momentum.

On April 15, SHFE 1407 copper contract prices are expected to move between RMB 46,500-46,900/mt. Physical copper may be offered at premiums of RMB 20-120/mt against SHFE 1404 copper contract prices.

LME copper
SHFE night trading

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