SMM Morning Comments (Feb 9)

SHANGHAI, Feb 9 (SMM) –

Copper: Stock market slump, lower crude oil prices, and a surge in LME copper inventory gave shorts more confidence overnight. We expect LME copper to trade at $6,810-6,880/mt today and SHFE copper at 51,700-52,200 yuan/mt. Weak fundamentals may lead spot premiums lower to 30-40 yuan/mt today.

Aluminium: We expect LME aluminium to trade rangebound at $2,158-2,193/mt with support at the 60-day moving average. The SHFE 1804 aluminium contract is to trade at 14,260-14,460 yuan/mt while spot discounts are stable at 130-90 yuan/mt.

Nickel: While downstream consumption stayed weak ahead of the Chinese New Year holiday next week, decreasing LME inventory has supported nickel prices. We see the SHFE 1805 contract at 99,800-101,800 yuan/mt today with spot prices at 99,000-100,800 yuan/mt.  

Zinc: The 40-day moving average has provided firm support for LME zinc but lower oil prices and volatile US dollar led investors to be cautious. We see LME zinc at $3,390-3,440/mt today and SHFE zinc at 26,200-26,600 yuan/mt.  

Lead: We see both LME and SHFE lead to trade around the 60-day moving average with stable spot prices at 19,050-19,200 yuan/mt.

Tin: LME tin sees support at the $21,200/mt level while SHFE tin is set to trade at 148,000-149,500 yuan/mt. Spot prices are seen at 146,500-148,500 yuan/mt. 

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