SMM Morning Comments (Apr 11)

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.

For editorial queries, please contact Daisy Tseng at daisy@smm.cn 
For more information on how to access our research reports, please email service.en@smm.cn