SMM Morning Comments (Feb 19)-Shanghai Metals Market

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SMM Morning Comments (Feb 19)

Price Review & Forecast 09:33:28AM Feb 19, 2019 Source:SMM

SHANGHAI, Feb 19 (SMM) –

Copper: As longs added their positions, LME copper climbed to close at $6,261/mt on Monday. The buildup of long positions bolstered the SHFE 1904 contract to a higher open overnight, which extended its gains to end at 49,380 yuan/mt. Reports that the Indian court refused to allow Vedanta to restart its copper plant, and consecutive gains in crude prices are likely to support copper prices in the near term. LME copper is expected to trade at $6,240-6,300/mt today with the SHFE 1904 contract at 49,100-49,600 yuan/mt. Despite brisk purchasing interest, higher prices of futures are set to widen spot discounts. Spot discounts are seen at 170-40 yuan/mt today.

Aluminium: Sharp gains in Chinese stocks boosted LME aluminium to a day-high of $1,868/mt in Asian trading hours. It later lost some gains to end Monday at $1,847/mt. A lack of confidence among longs lowered the SHFE 1903 contract overnight to end at 13,405 yuan/mt. It is expected to trade at 13,300-13,500 yuan/mt today with spot discounts at 50-10 yuan/mt against the March contract.

Zinc: LME zinc recovered some earlier losses to end Monday lower at $2,643.5/mt. Declines in LME zinc inventories and US-China trade optimism are likely to support LME zinc, which is expected to trade at $2,610-2,660/mt today. The SHFE 1904 contract came off from earlier highs overnight before it stablised to end at 21,435 yuan/mt. While social inventories extended gains, anticipated post-holiday consumption would keep shorts cautious. The contract is likely to trade at 21,200-21,650 yuan/mt today.

Nickel: LME nickel fell in early trade on Monday as the ferrous complex weakened. It later rebounded to end the trading day higher at $12,465/mt. The SHFE 1905 contract rose to a high of 99,680 yuan/mt in early trade overnight, and ended higher at 99,260 yuan/mt. LME nickel is expected to edge up today with most transactions occurring at $12,400-12,550/mt. The SHFE 1905 contract is expected to trade at 98,500-100,000 yuan/mt. Spot prices are seen at 98,500-100,000 yuan/mt.

Lead: LME lead dropped more than 2% at the start of the week as LME lead inventories expanded 2,500 mt, the largest gain in 11 months. The three-month contract fell past the five- and 10-day moving averages to finish Monday at $2,030/mt. Losses in LME lead dragged the SHFE 1903 contract to open lower overnight, which weakened to end at 16,860 yuan/mt. The contract faces the potential for further declines as shorts dominate.

Tin: LME tin rebounded from earlier lows to end Monday higher at $21,155/mt. LME tin inventories extended declines on Monday, which is expected to keep LME tin stable in the near term. The SHFE 1905 contract inched up in a tight range overnight, ending at 149,150 yuan/mt. It is expected to try to break through the 150,000 yuan/mt level.

Key Words:  Morning comments   Copper   Aluminium   Zinc   Lead   Nickel   Tin 

SMM Morning Comments (Feb 19)

Price Review & Forecast 09:33:28AM Feb 19, 2019 Source:SMM

SHANGHAI, Feb 19 (SMM) –

Copper: As longs added their positions, LME copper climbed to close at $6,261/mt on Monday. The buildup of long positions bolstered the SHFE 1904 contract to a higher open overnight, which extended its gains to end at 49,380 yuan/mt. Reports that the Indian court refused to allow Vedanta to restart its copper plant, and consecutive gains in crude prices are likely to support copper prices in the near term. LME copper is expected to trade at $6,240-6,300/mt today with the SHFE 1904 contract at 49,100-49,600 yuan/mt. Despite brisk purchasing interest, higher prices of futures are set to widen spot discounts. Spot discounts are seen at 170-40 yuan/mt today.

Aluminium: Sharp gains in Chinese stocks boosted LME aluminium to a day-high of $1,868/mt in Asian trading hours. It later lost some gains to end Monday at $1,847/mt. A lack of confidence among longs lowered the SHFE 1903 contract overnight to end at 13,405 yuan/mt. It is expected to trade at 13,300-13,500 yuan/mt today with spot discounts at 50-10 yuan/mt against the March contract.

Zinc: LME zinc recovered some earlier losses to end Monday lower at $2,643.5/mt. Declines in LME zinc inventories and US-China trade optimism are likely to support LME zinc, which is expected to trade at $2,610-2,660/mt today. The SHFE 1904 contract came off from earlier highs overnight before it stablised to end at 21,435 yuan/mt. While social inventories extended gains, anticipated post-holiday consumption would keep shorts cautious. The contract is likely to trade at 21,200-21,650 yuan/mt today.

Nickel: LME nickel fell in early trade on Monday as the ferrous complex weakened. It later rebounded to end the trading day higher at $12,465/mt. The SHFE 1905 contract rose to a high of 99,680 yuan/mt in early trade overnight, and ended higher at 99,260 yuan/mt. LME nickel is expected to edge up today with most transactions occurring at $12,400-12,550/mt. The SHFE 1905 contract is expected to trade at 98,500-100,000 yuan/mt. Spot prices are seen at 98,500-100,000 yuan/mt.

Lead: LME lead dropped more than 2% at the start of the week as LME lead inventories expanded 2,500 mt, the largest gain in 11 months. The three-month contract fell past the five- and 10-day moving averages to finish Monday at $2,030/mt. Losses in LME lead dragged the SHFE 1903 contract to open lower overnight, which weakened to end at 16,860 yuan/mt. The contract faces the potential for further declines as shorts dominate.

Tin: LME tin rebounded from earlier lows to end Monday higher at $21,155/mt. LME tin inventories extended declines on Monday, which is expected to keep LME tin stable in the near term. The SHFE 1905 contract inched up in a tight range overnight, ending at 149,150 yuan/mt. It is expected to try to break through the 150,000 yuan/mt level.

Key Words:  Morning comments   Copper   Aluminium   Zinc   Lead   Nickel   Tin