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SMM Morning Comments (Mar 12)

iconMar 12, 2018 09:38
SMM Morning Comments

SHANGHAI, Mar 12 (SMM) –

Copper: As the US dollar weakened and the US' February nonfarm payrolls performed well, nonferrous metals rebounded across the board and SHFE copper stood above 52,000 yuan/mt. But the pickup was limited by the anticipated trade war. We see it trading at 51,800-52,300 yuan/mt and LME copper trading at $6,950-7,000/mt today. In the physical market, spot discounts are seen smaller at 60-20 yuan/mt today as downstream production recovers slowly. 

Aluminium: LME aluminium stayed firm above $2,100/mt over the weekend due to strong data from US non-farm payrolls. We expect it to test the five-day moving average and trade at $2,110-2,135/mt today. SHFE aluminium will rebound as consumption is expected to recover in the short term. We expect it to trade at 14,130-14,340 yuan/mt today. Spot discounts are seen at 120-80 yuan/mt.

Zinc: LME zinc is expected to stay rangebound, with limited upward room, and trade at $3,270-3,320/mt today. With pressure from shorts, SHFE zinc is set to trade at 24,900-25,400 yuan/mt today. The 0# common brand will trade at a discount of 60-30 yuan/mt and Shuangyan brand will trade at a discount of 20 yuan/mt to a premium of 20 yuan/mt.

Nickel: Prices of nickel are likely to rise as investors turn bullish on new energy vehicles. LME nickel will trade rangebound today while the SHFE 1805 contract will trade at 103,500-105,500 yuan/mt. Spot prices are seen at 102,800-104,700 yuan/mt.

Tin: LME tin traded rangebound with support at $21,000/mt, while SHFE tin rose with resistance from moving averages as investors reduced their short bets. We expect it to trade at 145,500-147,500 yuan/mt today.

Lead: As LME lead rebounded with resistance at $2,400/mt, SHFE lead climbed up and closed at 18,540 yuan/mt. It will trade rangebound with strong resistance at the five-day moving average today.


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