SHANGHAI, Aug. 29 (SMM) – Lead for October delivery, the most active contract on the Shanghai Futures Exchange, climbed to RMB 14,615/mt after opening Wednesday’s night session at RMB 14,560/mt, and finished down RMB 5/mt at RMB 14,580/mt. During the night session, trading volumes for the SHFE 1410 lead contract totaled 4,362 lots, while positions added 62 lots to 27,378 lots.
On Thursday, SHFE lead initially sank to RMB 14,500/mt, breaking below the 5-day and 10-day moving average, and ended down RMB 80/mt, or 0.55%, at RMB 14,505/mt. Trading volumes for the SHFE 1410 lead contract lost 2,468 lots to 6,136 lots, and positions shed 600 mt to 26,716 mt. The most active contract has found support at the 40-day moving average, but a large number of bulls are heading for the exit, indicating a lack of market confidence. The price of the soft metal is expected to rise should US GDP report come in positive late on Thursday.
In the Shanghai physical lead market, goods from Chihong Zn & Ge and Chengyuan traded on Thursday at RMB 14,370/mt, a RMB 160-170/mt discount over the most active SHFE 1410 lead contract. Traded prices were RMB 14,350-14,380/mt for Nanfang brand, RMB 14,360/mt for Shuangyan brand, and RMB 14,340/mt for Hanjiang and Humon brands. Lead smelters were moving goods actively, while some traders ramped up purchases due to a big price gap between SHFE and spot lead. Downstream producers, however, remained disinclined to buy, due in large part to tight cash flows at the end of August.