SMM Lead Market Morning Review (2015-6-11)

SHANGHAI, Jun. 11 (SMM) – LME lead started at USD 1,930.5/mt during Wednesday evening session and soared to USD 1,965/mt during European and US trading hours, to close at USD 1,924.5/mt, falling USD 4/mt on sell-offs. Totaling trading volumes were up 566 to 4,689 lots while positions dropped 1,114 to 142,139. LME lead inventories slipped 1,225 to 154,975 mt.

The most active SHFE 1508 lead opened Wednesday evening at RMB 13,260/mt and fell back after testing RMB 13,300/mt, to finish at RMB 13,205/mt, down RMB 15/mt, leaving SMM/LME lead price ratio at 6.87.

The JPY:USD surged on Bank of Japan president’s statement. Base metals prices were favored but diverged later on.

National Development & Reform Commission approved seven fundamental construction projects with total investment of over RMB 120 billion on Wednesday to stabilize China’s economy growth. But the PBOC revised forecast of 2015’s GDP rise down to 7% and CPI down to 1.4%, and the proportion of current account surplus in GDP up to 2.9%.

World Bank adjusted 2015’s GDP estimate up 0.4 percent points to 1.5% in euro zone and urged US Fed to hike interest rate next year. Goldman Sachs forecasts US Fed will raise interest rate in September.

US crude oil inventories tumbled unexpectedly, easing worries about oil oversupply. Crude oil prices thus hit a fresh high in 2015. New York gold prices ended up 0.8% at USD 1,186.6/Oz. US stocks closed at highs.

LME lead is expected to be in USD 1,910-1,950/mt today. SHFE 1508 lead should hover between RMB 13,150-13,300/mt and spot lead between RMB 13,550-13,650/mt.