SHANGHAI, Aug. 26 (SMM) – SHFE 1510 copper contract opened lower at RMB 37,980/mt Monday night, but climbed soon after finding support at to RMB 37,870/mt, to finish the session at RMB 38,680/mt, up RMB 350/mt. Positions increased 350, and trading volumes were around 370,000 lots.

SHFE copper extended Monday night’s growing momentum and once soared to RMB 39,090/mt but later the red metal dived to RMB 38,430/mt as China’s stocks fell below 3,000. The contract ended the day at RMB 38,820/mt, rising RMB 490/mt or 1.28%. Positions jumped 20,584 to 195,670 while trading volumes stayed flat at 660,000 lots.

The slump in Chinese stock market fueled concerns over the world’s second largest economy. Expectation for more depreciation in Chinese yuan lured buyers to sell LME copper and buy SHFE copper. Positions of SHFE 1511 copper were only 6,000 less than SHFE 1510 copper. 

On Tuesday, spot copper settled between discounts of RMB 50/mt and premiums of RMB 10/mt in Shanghai market. Standard-quality copper quoted RMB 39,020-39,140/mt, versus RMB 39,060-39,200/mt for high-quality copper.

Cargo holders turned more willing to sell, leaving spot supply abundant in market. Those traders tended to hold prices firm in the morning. But later, spot premiums disappeared and copper was throwed into discounts again. As such, trading activity was active between traders. But downstream buyers watched from the sidelines.