SHANGHAI, May 15 (SMM) –
Copper: LME copper and the most-traded SHFE July contract traded with support from the Bollinger lower band overnight, but a higher US dollar prevented them from rebounding considerably. While eased fear around the US-China trade pulled base metals, the SHFE July contract failed to rebound and dipped to a low of 47,390 yuan/mt, before ended at 47,500 yuan/mt. It is expected to trade at 47,300-47,800 yuan/mt with LME copper at $6,020-6,080/mt today. Spot premiums are expected to be firm at 50-150 yuan/mt, which may depress downstream purchases.
Aluminium: LME aluminium traded robustly overnight with a high of $1846.5/mt, ending 1.57% higher at $1,839/mt. Rising longs also bolstered the most-traded SHFE June contract to the highest since mid-October of 2018, at 14,310 yuan/mt. Lower alumina supply and peak-season demand are likely to keep the contract at 14,300-14,400 yuan/mt, with LME aluminium at $1,810-1,840/mt today. Spot offers are likely to stand flat to a premium of 20 yuan/mt today.
Zinc: LME zinc stemmed its decline and advanced 0.52% to close at $2,590.5/mt overnight as zinc inventories across LME warehouses ceased their increase. Premiums of spot zinc against LME three-month contract rose to a record high of $141/mt. The SHFE 1907 contract slid after rose to a high of 20,825 yuan/mt, with limited support from fundamentals. Ending at 20,775 yuan/mt overnight, it is likely to trade between 20,580-21,080 yuan/mt today, with its LME counterpart at $2,560-2,610/mt.
Nickel: A rebound in oil prices bolstered LME nickel but the pressure remained at the $12,000/mt level. It jumped to a high of $11,945/mt, ending 1.4% higher at $11,930/mt, with LME nickel inventories down 474 mt to 169,744 mt. The SHFE July contract regained support from the five- and 10- day moving averages, closing 0.43% higher at 96,590 yuan/mt. We see it trading at 95,500-97,500 yuan/mt with spot prices at 96,000-100,000 yuan/mt today. LME nickel is likely to trade at $11,800-12,000/m today.
Lead: Both LME lead and the most-traded SHFE June contract rebounded as shorts exited amid improved macroeconomic sentiment. LME lead found support from $1,800/mt and ended 1.23% higher at $1,812/mt. The SHFE 1906 contract closed 0.69% higher at 15,980 yuan/mt. There is further upside room in prices today.
Tin: LME tin traded around the five- and 10- day moving averages and tested the 20-day moving average after rose to a high of $19,820/mt. It may found resistance at the $20,000/mt level today. The most-liquid SHFE September contract rebounded after dipped to a low of 145,590 yuan/mt, settling 0.53% higher at 146,200 yuan/mt. Support is expected at 145,000 yuan/mt, with pressure from 147,000 yuan/mt.