SMM Morning Comments (Apr 11)

Published: Apr 11, 2018 09:56

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SMM Morning Comments

SHANGHAI, Apr 11 (SMM) –

Copper: As crude oil soared overnight, LME copper climbed above the 40- and 60-day moving averages as investors added their longs. It stood above the 60-day moving average at opening today and is likely to trade at $6,930-6,990/mt. The SHFE 1805 contract mostly traded between the 20- and 40-day moving averages with strong momentum overnight. We expect it to trade at 51,000-51,500 yuan/mt with spot premiums at 20-70 yuan/mt today.

Aluminium: LME aluminium tested a high of $2,242/mt overnight as the US dollar weakened and as the US-Russia trade conflict intensified. SMM sees upward room for LME aluminium as the LME plans to restrict the trade of Russian-brand aluminium ingots from April 17. LME aluminium is likely to trade rangebound at $2,185-2,235 today. Driven by a strong LME aluminium, SHFE aluminium inched up overnight but with limited momentum. It is likely to face pressure in the mid term. We expect it to hover at 14,400-14,550 yuan/mt with spot discounts at 110-70 yuan/mt today.

Zinc: As the US imposed sanctions on Russia and as US-Sino trade tension eased, LME zinc traded rangebound and closed with a high of $3,249.5/mt. With resistance, LME zinc is expected to trade between $3,220-3,270/mt today. SHFE zinc gained 40 yuan/mt and edged up to 24,540 yuan/mt. It is likely to trade at 24,250-24,750 yuan/mt today.

Nickel: LME nickel saw a V-shaped recovery, gained $280/mt and closed at $13,730/mt. SHFE nickel edged down to close at 101,820 yuan/mt. Market participants should pay attention to China's inflation data and US CPI data today. We see LME extending its downward trend and the SHFE 1807 contract trading between 100,500-102,300 yuan/mt with spot prices at 100,000-101,800 yuan/mt today.

Tin: As trade pressure grew between the US and Russia, LME tin edged down overnight and is expected to trade rangebound with pressure at $21,300/mt and support at $20,600/mt today. SHFE tin edged down to the 10-day moving average with pressure overnight. It is likely to trade at 143,500-145,000 yuan/mt today.

Lead: LME lead hovered around $2,400/mt for five consecutive days and is seen continuing to trade rangebound at this level. Most base metals notched a strong performance and SHFE lead rose to a high of 18,560 yuan/mt overnight. It is likely to hover around 18,500 yuan/mt today.

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copper aluminium nickel zinc lead tin

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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