SMM Copper Market Morning Review (2015-10-19)

SHANGHAI, Oct. 19 (SMM) – LME copper touched a low of USD 5,232/mt during European and US trading hours last Friday due to firmer dollar, to end down USD 54/mt at USD 5,272/mt.

Commodity prices were depressed last Friday. The Eurozone HICP printed a negative number, boosting the case for ECB expand or extend its quantitative-easing program. This weighed down the RUR. The expectation for US Fed’s interest rate hike late this year drove up dollar last Friday, pushing down commodity prices. But dollar rally was curbed by mixed data from US released last Friday night, including industrial output, job openings and CCI.

SHFE 1512 copper opening at RMB 39,560/mt last Friday evening and then moved tightly, to end at RMB 39,720/mt, down RMB 130/mt or 0.33%. Trading volumes were around 160,000 lots and positions dropped 2,634.

US dollar extends rising momentum and Monday will see economic data from China, like GDP. LME copper should move in USD 5,230-5,290/mt during Asian trading hours. SHFE 1512 copper will range between RMB 39,400-39,900/mt on October 19. Spot supply grows in China with delivered goods flowing into market. Cargo holders will rush to sell late October. Spot discounts of RMB 0-50/mt are expected against SHFE 1511 copper.