SHANGHAI, Oct. 24 (SMM) – Lead for three month delivery on the London Metal Exchange hovered overnight essentially between USD 2,025-2,030/mt after starting at USD 2,020/mt, and then surged to USD 2,040/mt in the Asian trading session. During European and US trading hours, the price of the soft metal fluctuated between USD 2,010-2,040/mt amid mixed macroeconomic news, and finished up USD 5.3/mt at USD 2,020.8/mt. Trading volumes shed 671 lots to 2,119 lots, and positions gained 676 lots to 117,545 lots. Meanwhile, LME lead inventories held flat at 224,675 mt.

Lead for December delivery on the Shanghai Futures Exchange, the most active contract, moved between RMB 13,635-13,675/mt during Thursday’s night session, and closed down RMB 5/mt at RMB 13,645/mt. Total trading volumes were 424 lots, and total positions gained 46 lots to 26,344 lots.

HSBC’s China initial manufacturing PMI was reported at 50.4 in October, above the expected 50.2 and its highest in three months. However, the production sub-index fell further to 50.7, while the sub-indices measuring input and output prices slid to 44.0 and 45.6, respectively, compounding deflation risks. This indicates that more adjustments are needed to prop up the Chinese economy given persistently sluggish demand.

In the euro zone, the preliminary composite PMI rose to 52.2 in October, higher than the expected 51.7 and September’s reading of 52.0. Meanwhile, the single currency area’s initial manufacturing PMI for October came in at 50.7, exceeding 50.3 in September and the estimated 49.9. Nevertheless, companies in the area cut prices for a 31st month in a row, stoking concerns over the euro zone’s economy and deflationary risks.

Economic performance in France and Germany, two largest economies in the euro zone, continued to diverge in October. France’s flash manufacturing PMI tumbled to a 2-month low of 47.3 in October, shy of expectations, while the index in Germany climbed to 51.8.

In the US, the initial jobless claims for the week ending October 18 remained low after adding 17,000 to 283,000, indicating a sustained recovery in the labor market. In addition, the Conference Board’s leading economic index advanced 0.8% to 104.4 in September in a sing of continuous momentum in the US economic recovery. US flash Markit PMI for October, however, declined to 56.2, lower than the expected 57.0 and the final reading of 57.5 in September. The sub-index tracking new orders dipped to the lowest since January.

Crude ended up 2% to 82.09, but gold dropped 1.3% to USD 1,229/oz. The US dollar index finished at 85.86. Boosted by encouraging earnings reports from major US companies, US stocks rose across the board, with the Dow, S&P 500, and Nasdaq up 1.32%, 1.23%, and 1.60%, respectively. European stocks were up 0.7%. LME copper and zinc edged up, but other base metals fell, with aluminum down 1.1%.

Base metals prices are expected to hover in narrow ranges on Friday despite positive economic indicators released by China, Europe, and the US on Thursday. LME lead is set to move between USD 2,010-2,030/mt, and the most active SHFE 1412 lead contract is projected to fluctuate between RMB 13,600-13,700/mt. Traded prices on China’s physical lead markets should range between RMB 13,600-13,750/mt on Friday.