SHANGHAI, Apr 17 (SMM) –
Copper: Three-month LME copper continued to hover around $6,490/mt in a range of $26/mt on Tuesday. It inched up 0.02% on the day and closed at $6,491.5/mt. The SHFE June contract fluctuated to end at 49,400 yuan/mt overnight. China will release its first quarter gross domestic product (GDP) data today, which is expected to bolster copper prices. Recovering consumption and smelter maintenance in China raised market concerns about tighter supply, and this also provided support to copper prices. LME copper is expected to trade at $6,470-6,520/mt today with SHFE copper at 49,350-49,800 yuan/mt. Spot premiums are seen at 20-150 yuan/mt as expectations of a supply deficit and limited supplies of good-quality materials prompt sellers to hold offers firm.
Aluminium: Pressured by the robust greenback, three-month LME aluminium fell 0.5% to close at $1,853.5/mt on Tuesday. It is expected to trade between $1,840-1,880/mt today as traders failed to find direction from fundamentals. The SHFE June contract climbed along the five-day moving average to a high of 13,950 yuan/mt in early trade overnight, and managed to hold onto much of those gains to end at 13,930 yuan/mt. Report that Shandong Weiqiao Group, one of the top aluminium producers in China, shut some capacity for a capacity swap improved market sentiment and helped SHFE aluminium buck the downtrend across nonferrous metals overnight. SHFE aluminium is expected to trade at 13,850-13,950 yuan/mt today, with spot discounts of up to 40 yuan/mt against the May contract.
Zinc: A considerable delivery into LME warehouses and a stronger US dollar lowered the three-month LME zinc below the 40-day moving average to a low of $2,804/mt on Tuesday. LME zinc lost over 3% on the day and ended at $2,809/mt. Two consecutive days of sharp gains in LME zinc inventories fanned expectations that a supply deficit will soon end. LME zinc is expected to trade between the 40- and 60-day moving averages today, with most transactions at $2,780-2,830/mt, as pessimistic sentiment cools. Weaker fundamentals for LME zinc prompted shorts in Shanghai to add position overnight. A buildup of shorts, of over 20,000 lots, weighed the most active SHFE June contract to a low of 21,715 yuan/mt before it ended 2.1% lower at 21,775 yuan/mt. SHFE zinc also lost its ground at the 40-day moving average. A higher SHFE/LME price ratio might trigger flows of zinc imports into China and weigh on SHFE zinc. SHFE zinc is expected to be weak and trade around the 40-day moving average today, between 21,550-22,000 yuan/mt.
Nickel: Three-month LME nickel rose above all moving averages to a high of $13,160/mt on Tuesday before it lost those gains to end 0.5% lower at $12,930/mt. The most active SHFE June contract lost much of its gains in daytime trade and ended 0.4% lower at 100,830 yuan/mt overnight. LME nickel is expected to trade rangebound between $12,850-13,050/mt today with SHFE nickel at 100,000-102,000 yuan/mt. Spot prices are seen at 101,000-103,000 yuan/mt.
Lead: As the US dollar rose, three-month LME lead fell to close at $1,927/mt on Tuesday, losing 1.2% on the day and reversing gains from Monday. The pullback on Tuesday suggested the unsustainability of the rally in LME lead, which is expected to trade rangebound today. The most active SHFE June contract fell along with other nonferrous metals overnight, to a low of 16,350 yuan/mt before longs helped its recover some losses to end 0.2% lower at 16,410 yuan/mt. SHFE lead fell less than its LME counterpart, and it started this morning with gains. This grew confidence about the rally in SHFE lead.
Tin: With a robust US dollar, three-month LME tin tumbled to $20,455/mt, its lowest in close to three months, before it closed 0.5% lower at $20,510/mt on Tuesday. Support is seen at $20,100/mt. The most active SHFE September contract rose to a high of 149,190 yuan/mt overnight before it pared those gains to end at 148,520 yuan/mt. Support is seen at 148,000 yuan/mt.
