SMM Lead Market Morning Review (2015-10-29)

SHANGHAI, Oct. 29 (SMM) – LME lead started at USD 1,745.5/mt overnight and once shot up to USD 1,758/mt near session’s end responding to crude oil prices. But LME lead fell back later due to stronger dollar before ending at USD 1,739/mt, down USD 10/mt or 0.57%. Trading volumes grew 1,091 to 2,958 lots whilst positions declined 1,807 to 121,615.

SHFE 1512 lead opened lower at RMB 13,230/mt for night trading Wednesday and drifted higher to RMB 13,395/mt. Later, the contract met resistance at the 20-day moving average and closed at RMB 13,330/mt, up RMB 60/mt or 0.45%. Trading volumes fell 322 to 3,310 lots while positions increased 272 to 14,206.

Inventories of crude oil, gasoline and refined oil all fell short of forecast last week, supporting crude oil prices. US Fed left interest rate unchanged at 0-0.25% but will decide whether to raise interest rate on its December policy meeting. The Fed also expressed that economy growth is moderate but concerns over inflation still exist, which denies the saying that global situation will curb US economy growth, allowing US dollar to move at highs.

Amid mixed news, LME lead will move in USD 1,730-1,750/mt during Asian trading hours. SHFE 1512 lead finds support at the 40-day moving average and will fluctuate between RMB 13,200-13,350/mt on October 29. Spot supply stays stable in China and downstream consumption remains sluggish. Spot lead should move in RMB 13,300-13,400/mt.