SMM Lead Market Morning Review (2015-4-24)

Published: Apr 24, 2015 13:22

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LME lead opened at USD 2,043/mt Thursday’s Asian trading hours and later dropped to USD 2,025/mt due to China’s poor April PMI.

SHANGHAI, Apr. 24 (SMM) – LME lead opened at USD 2,043/mt Thursday’s Asian trading hours and later dropped to USD 2,025/mt due to China’s poor April PMI. LME lead dipped a low of USD 2,013/mt due to downbeat economic indicators from euro zone, France, Germany and US. But later LME lead rebounded to end at USD 2,033/mt, down USD 13/mt, after touching the 10-day moving average. Trading volumes climbed 160 lots to 4,549 lots and positions increased 951 to 145,434. Inventories of LME lead dropped 4,500 mt to 187,875 mt.

The most active SHFE 1506 lead opened at RMB 13,490/mt Thursday’s night and dropped to RMB 13,355/mt due to short selling. But later the most active contract climbed due to tight spot lead supply and rising long positions, to close at RMB 13,500/mt, down RMB 95/mt. Trading volumes totaled 4,586 lots and positions jumped 272 to 17,252.

Economic indicators from China, Europe and US all were downbeat. China’s April PMI released Thursday was 49.2, a new low since April 2014, lower than March’s PMI and expectation. New order and output index decreased to 49.2, a 12-month low, and 50.4, a 3-month low, respectively, causing base metals to suffer selling pressure and decrease considerably. But investors expected China’s Q2 economy to rebound. Eyes will be on China’s official April PMI due out next week

1,600 billion local debts in Jiangsu due out Thursday were delayed to call for bid. So did many debts in lots of cities and provinces as trillions of government debts of low interest rate and low liquidity were not popular among investors.

Weak data weighed down US dollar, but US stocks all increased thanks to upbeat earnings reports. US March home sales dropped 11.4% QoQ to a seasonally adjusted annual rate of 481,000, dropping the most since July 2013 and ending 3-month rise. Markit’s US April PM fell to 54.2, the lowest since January 2015.

US stocks all increased while Asian and European stocks diverged. Meanwhile, LME base metals polarized. Copper and nickel jumped with positions falling but other base metals all dropped.

SHFE 1506 lead contract prices are expected at RMB 13,350-13,550/mt and spot lead prices may be RMB 13,450-13,550/mt.

lead SHFE lead prices

Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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