SMM Morning Comments (Feb 7)

Published: Feb 7, 2018 09:30

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SMM Morning Comments

SHANGHAI, Feb 7 (SMM) –

Copper: The global stock market rout may have limited impact on commodities and we expect SHFE copper to gather enough momentum to go up in short term. We see the 1804 contract to trade at 52,700-53,300 yuan/mt today while LME copper is expected at $7,050-7,110/mt. Spot prices continued to be affected by the spread between the 1802 and 1803 contracts and spot copper is set to trade at a discount of 10 yuan/mt to a premium of 30 yuan/mt today.

Aluminium: The SHFE 1804 aluminium contract may halt its losing streak temporarily today and trade at 14,100-14,250 yuan/mt while LME aluminium is expected to trade at $2,150-2,185/mt. Spot discounts are stable at 130-90 yuan/mt.

Nickel: Lower LME inventory is providing support to nickel prices to a certain extent but fundamentals remained weak. We see SHFE nickel at 101,000-102,700 yuan/mt today and spot prices at 99,800-101,800 yuan/mt.

Zinc: With investors adding their short positions, we expect the SHFE 1804 contract to trade at 26,350-26,750 yuan/mt today and LME zinc at $3,450-3,500/mt. In the spot market, the 0# common brand would see discounts of 110-80 yuan/mt against the 1802 contract whereas the Shuangyan brand is set to trade at discounts of 90-70 yuan/mt.

Tin: LME tin is likely to stay rangebound at $21,300-22,000/mt with SHFE tin at 149,500-151,500 yuan/mt today. Spot prices are seen at 147,000-149,500 yuan/mt.

Lead: We expect spot lead prices to fall by 150 yuan/mt today to 19,300-19,450 yuan/mt due to sluggish physical trading and logistics constraints.

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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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