SMM Lead Market Morning Review (2015-1-6)-Shanghai Metals Market

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SMM Lead Market Morning Review (2015-1-6)

Price Review & Forecast 09:48:40AM Jan 06, 2015 Source:SMM

SHANGHAI, Jan. 6 (SMM) – LME lead started trended down on Monday after starting at USD 1,876/mt against a series of unfavorable macroeconomic news, and closed down USD 28.5/mt at USD 1,840/mt. Trading volumes for three-month lead on the London Metal Exchange gained 684 lots to 3,588 lots, while positions added 1,506 to 115,716. LME lead inventories remained unchanged at 221,975 mt.

Lead for March delivery on the Shanghai Futures Exchange, the most active contract, dipped as low as RMB 12,140/mt in Monday’s night session after opening at RMB 12,290/mt and finished down RMB 75/mt at RMB 12,325/mt. Trading volumes for the SHFE 1503 lead contract totaled 7,326 lots, while positions increased 672 to 19,630.

Expectations grew on Monday that Syriza, a party of the radical left, will win in Greece’s upcoming presidential election. Should the party win the election as expected, it will cancel the nation’s austerity measures and slash debts, presenting greater risks of Greece’s exit from the European Union. In addition, Mario Draghi, President of the European Central Bank (ECB), hinted last Friday that the ECB is approaching broad-based quantitative easing by purchasing government bonds. As a result, the euro fell again to a 9-year low on Monday.

The Organization of Petroleum Exporting Countries (OPEC) has decided to leave output unchanged as its members prefer oil prices based on market conditions. Moreover, large oil producers across the world witnessed their output surging to new highs in over a decade in December. US crude oil prices responded by falling below USD 50/mt, putting a dent in base metals prices.

Germany’s initial CPI for December rose 0.1% YoY, the smallest increase since 2009 and below the expected 0.2% rise. The index increased 0.5% YoY in November. The nation’s stocks tumbled nearly 3% on Monday.

The US dollar index closed Monday up 0.3% at 91.43, surging to a refreshed 8-year high at one stage, while the euro slipped 0.57%. Major world shares fell sharply, but the Shanghai Composite Index rose to a high not seen in over five years. LME nickel ended higher, but other base metals finished with losses.

As such, LME lead is set to hover at USD 1,825-1,855/mt, while the most active SHFE 1503 lead contract is expected to move at RMB 12,250-12,400/mt on Tuesday. Spot lead prices in China should range between RMB 12,500-12,600/mt.
 

SMM Lead Market Morning Review (2015-1-6)

Price Review & Forecast 09:48:40AM Jan 06, 2015 Source:SMM

SHANGHAI, Jan. 6 (SMM) – LME lead started trended down on Monday after starting at USD 1,876/mt against a series of unfavorable macroeconomic news, and closed down USD 28.5/mt at USD 1,840/mt. Trading volumes for three-month lead on the London Metal Exchange gained 684 lots to 3,588 lots, while positions added 1,506 to 115,716. LME lead inventories remained unchanged at 221,975 mt.

Lead for March delivery on the Shanghai Futures Exchange, the most active contract, dipped as low as RMB 12,140/mt in Monday’s night session after opening at RMB 12,290/mt and finished down RMB 75/mt at RMB 12,325/mt. Trading volumes for the SHFE 1503 lead contract totaled 7,326 lots, while positions increased 672 to 19,630.

Expectations grew on Monday that Syriza, a party of the radical left, will win in Greece’s upcoming presidential election. Should the party win the election as expected, it will cancel the nation’s austerity measures and slash debts, presenting greater risks of Greece’s exit from the European Union. In addition, Mario Draghi, President of the European Central Bank (ECB), hinted last Friday that the ECB is approaching broad-based quantitative easing by purchasing government bonds. As a result, the euro fell again to a 9-year low on Monday.

The Organization of Petroleum Exporting Countries (OPEC) has decided to leave output unchanged as its members prefer oil prices based on market conditions. Moreover, large oil producers across the world witnessed their output surging to new highs in over a decade in December. US crude oil prices responded by falling below USD 50/mt, putting a dent in base metals prices.

Germany’s initial CPI for December rose 0.1% YoY, the smallest increase since 2009 and below the expected 0.2% rise. The index increased 0.5% YoY in November. The nation’s stocks tumbled nearly 3% on Monday.

The US dollar index closed Monday up 0.3% at 91.43, surging to a refreshed 8-year high at one stage, while the euro slipped 0.57%. Major world shares fell sharply, but the Shanghai Composite Index rose to a high not seen in over five years. LME nickel ended higher, but other base metals finished with losses.

As such, LME lead is set to hover at USD 1,825-1,855/mt, while the most active SHFE 1503 lead contract is expected to move at RMB 12,250-12,400/mt on Tuesday. Spot lead prices in China should range between RMB 12,500-12,600/mt.