SMM Morning Comments (Feb 23)

Published: Feb 23, 2018 09:48

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SMM Morning Comments

SHANGHAI, Feb 23 (SMM) –

Copper: We see copper continue to rebound after touching a low at 51,000 yuan/mt ahead of Chinese New Year. LME copper is expected to trade at $7,140-7,200/mt today with SHFE copper at 53,200-53,900 yuan/mt. In the physical market, spot discounts are seen smaller at 250-180 yuan/mt as downstream customers resume operations gradually.

Aluminium: LME aluminium is expected to trade at $2,172-2,200/mt today with support at the 10- and 60-day moving averages and resistance at the five- and 20-day moving averages. As investors added to their long bets, SHFE aluminium is set to test and hit the 10-day moving average today, trading at 14,200-14,380 yuan/mt. Spot discounts are seen at 280-240 yuan/mt.

Nickel: Higher crude oil prices have given confidence to the base metals complex and LME nickel is expected to stay firm today. We see the SHFE 1805 nickel contract at 103,000-105,500 yuan/mt with spot prices at 102,300-104,800 yuan/mt today.

Zinc: LME zinc is expected to stay firm with steadily lowering inventory and trade at $3,500-3,550/mt today, while SHFE zinc is expected to trade at 26,450-26,900 yuan/mt with higher social inventory post- Chinese New Year. Thin liquidity also added to the pressure.

Lead: As the physical market is set to see post-holiday restocking amid weak US dollar, we expect SHFE lead to hit the 20-day moving average level, trading at 19,250-19,450 yuan/mt today.

Tin: We expect SHFE tin to be rangebound today at 146,500-148,500 yuan/mt, while LME tin sees support at $21,000/mt and pressure at $22,000/mt.

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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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