SMM Morning Comments (Sep 19)

Published: Sep 19, 2018 09:40

Save

SMM Morning Comments

SHANGHAI, Sep 19 (SMM) –

Copper: LME copper led the gains overnight and settled 2.36% higher at $6,091/mt when eased market worries buoyed most base metals. It broke resistance at the 40-day moving average as shorts exited, and may test pressure above at the 60-day moving average in the short run. The SHFE 1811 contract also closed higher at 49,610 yuan/mt after rising to a high of 49,730 yuan/mt. Spot premiums will remain firm at 250-310 yuan/mt today.

Aluminium: Prices of aluminium are expected to have little downward room as market worries over trade conflict between China and the US eased after official decisions on tariffs were made Tuesday. LME aluminium rose to a high of $2,056.5/mt and settled at $2,029/mt overnight. We forecasts it to trade at $2,020-2,050/mt today with the SHFE 1811 contract at 14,430-14,530 yuan/mt. Spot offers are seen at a discount of 20 yuan/mt to a premium of 20 yuan/mt.

Zinc: LME zinc climbed up overnight and settled at close to the 10-day moving average. It will continue to test pressure above today and hover at $2,340-2,390/mt. The SHFE 1811 contract may attempt to stand firm above the 60-day moving average today, and trade robustly at 20,800-21,300 yuan/mt with support from high demand from the infrastructure sector. Spot premiums for #0 common brand zinc are seen at 450-500 yuan/mt over the October contract.

Nickel: Both LME nickel and the SHFE 1811 contract closed slightly higher as investors reduced concerns over the China-US trade war. Fresh US tariffs imposed on Chinese goods are expected to cause limited impact on the downstream stainless steel sector as China barely exports such products to the US. We expect LME nickel to consolidate around $12,300/mt today with the 1811 contract trading at 101,500-103,000 yuan/mt. Spot prices are set at 101,500-108,000 yuan/mt today.

Lead: Limited upward room is expected for LME lead in the short run, given pressure at the 40-day moving average above, even though it registered the second consecutive trading day of increase overnight. The SHFE 1811 contract hovered at high levels with the highest overnight at 18,375 yuan/mt. Inflow of capitals should be closely watched today.

Tin: LME tin traded rangebound overnight and closed at $18,945/mt. The SHFE 1901 contract slid as the US dollar rebounded, and lost all the gains during Tuesday’s afternoon to close at 144,000 yuan/mt. It will continue to trade with pressure today with support at 143,000 yuan/mt.

Morning comments Futures movement

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.

For any inquiries or to learn more information, please contact: lemonzhao@smm.cn

For more information on how to access our research reports, please contact:service.en@smm.cn

Related News

7 hours ago

"Premier Li Qiang Leads State Council Meeting on Enhancing Effective Investment, Boosting Economic Growth"

Premier Li Qiang presided over an executive meeting of the State Council to study policy measures for promoting effective investment. The meeting noted that promoting effective investment plays an important role in stabilizing economic growth and strengthening momentum for development. It is necessary to innovate and improve policy measures, and intensify efforts to enhance the efficiency of utilizing funds such as central budget investments, ultra-long-term special treasury bonds, local government special bonds, and new-type policy-based financial instruments. In conjunction with formulating and implementing the 15th Five-Year Plan

7 hours ago

"Guided by Xi Jinping Thought, Implement 20th CPC Congress Spirit, Apply New Development Philosophy...

Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, we will thoroughly implement the spirit of the 20th National Congress of the Communist Party of China and the plenary sessions of the Party’s 20th Central Committee, fully and faithfully apply the new development philosophy, strengthen top-level design, build computing power interconnection nodes oriented toward national hub periods, major strategic regions, and key industries, establish a system of computing power interconnection nodes, improve the efficiency and service level of public computing power resources, and promote high-quality development of computing power.

7 hours ago

Indirect Iran-US Nuclear Talks in Muscat Show Progress, Omani FM Mediates Tense but Efficient Discussions

After intensive indirect consultations, the new round of nuclear talks between Iran and the US in Muscat, the capital of Oman, has achieved phased progress. It is reported that during this round of talks, the Iranian and US delegations did not meet directly. Instead, Omani Foreign Minister Badr acted as an intermediary, conveying a series of core proposals, strategic concerns, and policy positions to the other side. The atmosphere at the talks was tense yet efficient. According to preliminary on-site assessments, although both sides continue to negotiate over specific terms, they have reached a consensus on the key objective of "continuing dialogue."

7 hours ago